Clemens v. Central Railroad Company of New Jersey, 37346.

• Court: United States District Courts. 3th Circuit. United States District Court (Eastern District of Pennsylvania)
• Writing for the Court: HIGGINBOTHAM
• Citation: 264 F. Supp. 551
• Parties: Ira CLEMENS (Individually and on behalf of others adversely affected) v. CENTRAL RAILROAD COMPANY OF NEW JERSEY and Lehigh & New England Railroad Company.
• Docket Number: No. 37346.,37346.
• Decision Date: 13 February 1967

264 F. Supp. 551

Ira CLEMENS (Individually and on behalf of others adversely affected)
v.
CENTRAL RAILROAD COMPANY OF NEW JERSEY and
Lehigh & New England Railroad Company.

No. 37346.

United States District Court E. D. Pennsylvania.

February 13, 1967.

264 F. Supp. 552

COPYRIGHT MATERIAL OMITTED

264 F. Supp. 553

COPYRIGHT MATERIAL OMITTED

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Lawrence J. Richette, Philadelphia, Pa., for plaintiffs

Miles W. Kirkpatrick, Philadelphia, Pa., for defendants.

HIGGINBOTHAM, District Judge.

OPINION

The above action was brought by Ira Clemens on his behalf, and for others similarly situated, against the defendant railroads. The plaintiffs seek an order from this Court to compel the defendants to submit their dispute to arbitration. The defendants have filed motions to dismiss or in the alternative for summary judgment.

The plaintiffs contend that this dispute must be arbitrated in accordance with the Washington Job Protection Agreement of May, 1936, and its modifications as found in the New Orleans Union Passenger Terminal Case, 282 I.C.C. 271 (January 16, 1952). Defendants argue that the complaint should be dismissed on the ground that it fails to state a claim for which relief can be granted. Specifically, the defendants argue (1) this action is barred by the doctrine of res judicata; (2) this Court lacks jurisdiction over the subject matter of the litigation; (3) the plaintiffs have failed to plead a proper class action; (4) this action should be stayed until the costs in a previous action are

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paid; and (5) the plaintiffs have waived any right of arbitration which they might have had by bringing this suit. It is my conclusion that the parties must be required to submit this dispute to arbitration.

STATEMENT OF FACTS

In April of 1960, the defendant Lehigh and New England Railway acquired control of the Lehigh and New England Railroad. The Railway obtained the approval of the Interstate Commerce Commission for the abandonment of approximately 77% of the trackage of its acquisition. Approval of this request was granted by the Commission in 1961. Interstate Commerce Commission Finance Docket No. 21155. The Commission imposed, and the defendants accepted certain conditions for the protection of employees of the Railroad as part of its order authorizing the acquisition and abandonment. Essentially, the conditions imposed for the protection of adversely affected workers were derived from the Washington Job Protection Agreement of May, 1936. Briefly, that agreement called for the payment of compensation to railroad workers who have been displaced because of carrier mergers or consolidations.

In seeking permission the Railway informed the Commission that such abandonment would entail severing the employment of approximately one hundred and ten men. Railway, in early 1960, approached the three local lodges¹ with the proposal of revising their collective bargaining agreement so that when an employee reached age sixty-five he would be required to retire without severance pay. This proposal was rejected. Thereafter, in November of 1961, the Railway severed the employment relationship of thirty men who were at that time over sixty-six years of age and paid them severance pay in accordance with the Washington Job Protection Agreement.

In January of 1962, each of the three unions, after approval of their membership, entered into an agreement with Railway which provided for compulsory retirement of all workers when they reached the age of sixty-five. These agreements were ratified by the majority of the members of each of the unions involved. As a consequence of this agreement the plaintiff Clemens, and others, who had been employees of the Railway, were retired at the age of sixty-five without severance pay. Some of these adversely affected workers then brought suit against the Railway Company and the unions. See Roberts v. Lehigh and New England Railway Company, 211 F. Supp. 379 (E.D.Pa.1962), affirmed 323 F.2d 219 (3 Cir. 1963).

In Roberts, the plaintiffs' complaint was dismissed by Chief Judge Clary, and this dismissal was affirmed by the Court of Appeals. The complaint was dismissed on the ground that the dispute was one over which the National Railroad Adjustment Board had primary jurisdiction, and that the Courts were without jurisdiction to decide the matter. In Chief Judge Clary's judgment the subject of the dispute revolved around the interpretation of the various agreements and not their validity. The Court of Appeals affirmed.

Subsequent to the dismissal of the complaint in Roberts, two new complaints were filed, and it is the second of these complaints that the defendants now seek to have dismissed. The unions who were joined as defendants in Roberts are not now before this Court. In addition Lehigh and New England Railway Company and its parent, the Central Railroad Company of New Jersey, who were not joined in Roberts have now been joined as defendants.

I.

The defendants argue that the plaintiffs are barred from prosecuting this complaint by reason of the doctrine of

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res judicata. Specifically, they contend that the decision in Roberts, supra, resolved, as against the plaintiffs, all the issues presented by the complaint in the instant case. The essential distinction between this case and Roberts is that here the plaintiffs seek to have this Court order the defendants to arbitrate the dispute in accordance with an order of the Interstate Commerce Commission

At the threshold, we are faced with the question of whether this Court can order arbitration in view of the Roberts case. If we are to determine the validity of the defendants' contentions it must first be made clear what was actually decided in that case. When the Roberts case was decided in this Court by Chief Judge Clary, the decision turned on the assumption that the only statute applicable to the cause was the Railway Labor Act, 45 U.S.C. § 151 et seq. See 211 F. Supp. 379, 381-382. Chief Judge Clary held that the contentions raised by the plaintiffs constituted a "dispute between employees and carriers as to the interpretation of a collective bargaining agreements" within the Railway Labor Act. 211 F.Supp. 379, at p. 381. The resolution of this dispute, Chief Judge Clary held, was within the exclusive primary jurisdiction of the National Railroad Adjustment Board. The Court of Appeals upheld Chief Judge Clary's decision dismissing the plaintiffs' complaint for failure to state a claim for which relief can be granted. Thus it would appear that no decision on the merits was rendered. The defendants, however, point to certain language of the Court of Appeals' opinion which they claim precludes this action.

In the earlier suit the plaintiffs had attacked the retirement agreements because they discriminated against the older workers in favor of the younger ones. In response to this argument the Court made the following observations:

However, the allegations in the complaint do not set forth any facts from which hostile discrimination on the part of defendants would be a permissible inference. There is no assertion that the provision was agreed upon by the Railway for the purpose of weakening one lodge in preference to another, or that it was accepted by the three lodges by reason of fraud or coercion or in `bad faith and ill will'. Each lodge consented to the inclusion of the provision in the agreement only after a majority of its members voted in favor of it. The fact that the provision may favor younger workers who outnumber older ones with greater seniority rights is not a basis for a claim of hostile discrimination. See Ford Motor Co. v. Huffman, 345 U.S. 330, 338, 73 S.Ct. 681, 97 L.Ed. 1048 (1953) and Steele v. Louisville & N.R. Co., 323 U.S. 192, 203, 65 S.Ct. 226, 89 L.Ed. 173 (1944). (323 F.2d 219 (1963) at p. 223.)

In addition, Roberts correctly pointed out that a bargaining representative, within the limits of its constitution, may agree to a change in the terms of a collective bargaining agreement provided such change does not violate the Railway Labor Act. It appears to me that the arguments and opinions in Roberts proceeded on the assumption that the terms of the Washington Job Protection Agreement were merely terms privately agreed upon by the unions and railroads. A careful study of the complaint, answers, and the briefs filed in Roberts reveals that at no time did the plaintiffs assert that the provisions of the Washington Job Protection Agreement represented not merely a private collective bargaining agreement between the parties, but conditions imposed by the Interstate Commerce Commission for the protection of workers affected by a consolidation—as it is empowered to do by 49 U.S.C. § 5(2) (f).

Thus, considering the facts which were then before it, the following language of the Court of Appeals is perfectly understandable:

The second reason given by plaintiffs is that the memorandum agreements circumvented certain provisions of the Washington Job Protection Agreement. This claimed reason is, of course, based on plaintiffs' interpretation

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of the agreements in question. Even if we assume that they are right in their interpretation, the Act does not make the memorandum agreements invalid for that reason. The bargaining representative, within the limits of its constitution and by-laws, may agree to a change in the terms of a collective bargaining agreement provided such change does not violate the Act. McMullans v. Kansas, Oklahoma and Gulf Ry., supra, 229 F.2d at p. 56. (at p. 223, emphasis added.)

It is clear, therefore, that the Roberts case proceeded on two assumptions: (1) That the agreements involved were all private agreements—which was not the case; and (2) that the applicable statute was the Railway Labor Act—which also was not entirely the case. Assuming, as did the plaintiffs in Roberts, that the Railway Labor Act was applicable, the Court of...