Conn. Ironworkers Emp'rs Ass'n, Inc. v. New Eng. Reg'l Council of Carpenters, No. 16-485-cv

CourtU.S. Court of Appeals — Second Circuit
Writing for the CourtJOSÉ A. CABRANES, Circuit Judge
Citation869 F.3d 92
Parties CONNECTICUT IRONWORKERS EMPLOYERS ASSOCIATION, INC., MRS Enterprises, Inc., Barrett, Inc., Ernest Peterson, Inc., Berlin Steel Construction Co., Iron Workers Local No. 15, International Association of Bridge, Structural, Ornamental & Reinforcing, Iron Workers Local 37, International Association of Bridge, Structural, Ornamental & Reinforcing, Iron Workers Local 424, International Association of Bridge, Structural, Ornamental & Reinforcing, Sheet Metal Workers Local 38 Craft Training Fund, Sheet Metal Workers Local No. 40, International Union of Painters & Allied Trades District Council 11, AFLCIO, CLC, International Union of Painters, Allied Trades Local Unions, Glaziers Local Union Nos. 1333 & 1274, Glaziers Union, No. 1333, Glaziers Union, Local No. 1274, Plaintiffs-Appellants, v. NEW ENGLAND REGIONAL COUNCIL OF CARPENTERS, Defendant-Appellee.
Docket NumberNo. 16-485-cv,August Term 2016
Decision Date23 August 2017

869 F.3d 92

CONNECTICUT IRONWORKERS EMPLOYERS ASSOCIATION, INC., MRS Enterprises, Inc., Barrett, Inc., Ernest Peterson, Inc., Berlin Steel Construction Co., Iron Workers Local No. 15, International Association of Bridge, Structural, Ornamental & Reinforcing, Iron Workers Local 37, International Association of Bridge, Structural, Ornamental & Reinforcing, Iron Workers Local 424, International Association of Bridge, Structural, Ornamental & Reinforcing, Sheet Metal Workers Local 38 Craft Training Fund, Sheet Metal Workers Local No. 40, International Union of Painters & Allied Trades District Council 11, AFLCIO, CLC, International Union of Painters, Allied Trades Local Unions, Glaziers Local Union Nos. 1333 & 1274, Glaziers Union, No. 1333, Glaziers Union, Local No. 1274, Plaintiffs-Appellants,
v.
NEW ENGLAND REGIONAL COUNCIL OF CARPENTERS, Defendant-Appellee.
*

No. 16-485-cv
August Term 2016

United States Court of Appeals, Second Circuit.

Argued: December 13, 2016
Decided: August 23, 2017


Paul C. Hetterman , Hartnett Gladney Hetterman, LLC, St. Louis, MO (Ronald C. Gladney, Hartnett Gladney Hetterman, LLC, St. Louis, MO; Thomas W. Meiklejohn, Livingston, Adler, Pulda, Meiklejohn & Kelly, Hartford, CT; on the brief), for Plaintiffs-Appellants.

Keith P. Carroll , Mintz Levin Cohn Ferris Glovsky and Popeo, PC, Boston, MA (Christopher N. Souris, Krakow & Souris LLC, Boston, MA; Kevin McGinty, Mintz Levin Cohn Ferris Glovsky and Popeo, PC, Boston, MA; Bruce D. Sokler, Mintz Levin Cohn Ferris Glovsky and Popeo, PC, Washington, DC; on the brief), for Defendant-Appellee.

Before: Jacobs, Cabranes, and Parker, Circuit Judges.

JOSÉ A. CABRANES, Circuit Judge:

Much of the practice of American antitrust law consists of deciding whether particular conduct is, or is not, "exempt" from the application of the antitrust statutes by virtue of immunities conferred by later legislation or judicial interpretation. The celebrated fourteen-volume treatise of Professor Philip E. Areeda devotes fully two volumes to these numerous immunities.1 The history of these immunities is "rich and fascinating ... com[ing] in waves. Each particular wave has involved a distinct approach and rested on its own economic justification."2

We consider here the latest chapter in the unfolding story of one of those immunities—those that exempt certain labor union activities. Professor Ralph K. Winter (as he then was) characterized this topic as "one of the most disputed legal issues of this century."3 We address only a piece of this storied immunity: the exemption for certain union activities within the construction industry.

This case arises out of a dispute over subcontracting clauses in collective bargaining agreements ("CBAs") between the defendant New England Regional Council of Carpenters (the "Carpenters Union" or "Carpenters") and various construction companies and construction managers. These clauses effectively bar subcontracting of construction work with non-Carpenter affiliates. The plaintiffs, consisting of several other unions, employers, trade associations,

869 F.3d 96

and union pensions funds (jointly, the "Ironworkers"), allege that the Carpenters have used these subcontracting clauses to expand the scope of work assigned to the Carpenters Union to include work traditionally assigned to the Ironworkers. The Ironworkers bring two claims against the Carpenters: first, that the Carpenters' conduct constitute anticompetitive behavior in violation of Sections 1 and 2 of the Sherman Antitrust Act4 and second, that the Carpenters' conduct constitutes unfair labor practices in violation of Sections 8(b)(4) and 8(e) of the National Labor Relations Act ("NLRA").5 The Carpenters counter that their subcontracting practices are shielded from both antitrust liability and claims of unfair labor practices.

To determine if the disputed subcontracting practices6 are protected from antitrust liability, we must assess whether both the "construction industry proviso" of Section 8(e) of the NLRA7 and the judicially-created "non-statutory exemption"8 to antitrust liability apply.9 To defeat the unfair labor practices claim, the Carpenters need only show that their conduct falls within the statutory construction industry proviso.

In the United States District Court for the District of Connecticut (Stefan R. Underhill, Judge ), the Carpenters moved for summary judgment based on the affirmative defenses just described and the Court granted their motion. Specifically, the District Court held that the disputed subcontracting practices were immune from both antitrust and unfair labor practices liability because they qualified for protection under the construction industry proviso and the non-statutory exemption.

We agree that the Carpenters have met the requirements of the construction industry proviso, but we conclude that, on this record, there are factual disputes that preclude a decision on whether the conduct falls within the non-statutory exemption. To demonstrate that the disputed subcontracting practices are sheltered by the

869 F.3d 97

non-statutory exemption (and thus to defeat the Ironworkers' antitrust claim completely), the Carpenters must show that these practices furthered legitimate aims of collective bargaining, in a way that is not unduly restrictive of market competition. Absent additional fact-finding by the District Court as to whether the Carpenters' subcontracting practices further legitimate labor goals, it cannot undertake the analysis required by our precedents.10 Establishing that these subcontracting agreements arose from a lawful CBA is not, in and of itself, sufficient to gain the protection of the non-statutory exemption.

Accordingly, we VACATE the judgment of the District Court as to the Sherman Act claim, AFFIRM the judgment as to the unfair labor practices claim, and REMAND the cause to the District Court for further proceedings consistent with this opinion, including for such additional discovery as will permit the District Court to be informed of the relevant history and permit the parties to move for summary judgment or, if necessary, to proceed to trial.

BACKGROUND

This case concerns what some might call a "turf battle" between the Ironworkers and the Carpenters Union. The plaintiff Ironworkers are a group of construction organizations including: a district council, seven locals affiliated with construction trade unions, four construction contractors, and two trade groups.11 The defendant Carpenters Union is a labor organization that operates throughout New England.

The Ironworkers challenge the enforcement of restrictive subcontracting clauses in the Carpenters' CBAs. These clauses, colloquially called "hot cargo" clauses, bar signatories from subcontracting work to any employer that is not also a signatory to a Carpenters' CBA.12 The Ironworkers argue that the Carpenters use these subcontracting clauses to act in concert with various non-party general contractors and construction managers to prevent the Ironworkers from performing the relevant work.13 In other words, they allege that

869 F.3d 98

the Carpenters designed and enforced the disputed clauses not to further legitimate goals of collective bargaining, such as protecting wages, but rather, to secure work in the New England area that allegedly belonged to the Ironworkers. Accordingly, they claim that these subcontracting practices violate the antitrust laws and constitute unfair labor practices.

The Carpenters counter that these subcontracting practices are commonplace in the construction industry, and point to similar provisions in CBAs to which the Ironworkers are signatories. They assert, as affirmative defenses, that these practices are immune from antitrust liability and unfair labor practices claims because they fall within the construction industry proviso of Section 8(e) of the NLRA and the judicially-devised non-statutory exemption to antitrust liability.

The Ironworkers do not dispute that these subcontracting clauses have long existed, but they argue nonetheless that enforcement of the subcontracting provisions—namely, acting in concert with various non-party general managers—only started between 2005 and 2006.14 They assert that such enforcement impinges on work traditionally performed by Ironworkers and conflicts with historical industry practice. The primary purpose of these subcontracting practices, they argue, is to force parties to enter into CBAs with the Carpenters as opposed to other labor organizations.

Specifically, the Ironworkers identify seven examples of general contractors or construction managers who executed an agreement with the Carpenters to assign relevant work to Carpenters' signatories, in accordance with the Carpenters' CBAs: (1) Suffolk Construction Company, 360 State Street Project, New Haven, Connecticut; (2) Dimeo Construction, New Rowe Residences, New Haven, Connecticut; (3) Turner Construction, St. Francis Hospital, Hartford, Connecticut; (4) Bond Brothers, Bryant University Project, Smithfield, Rhode Island; (5) E. Turgeon, Immaculate Conception Catholic Regional School, Cranston, Rhode Island; (6) Berry & Sons, Bay State Medical Center Hospital Project, Springfield, Massachusetts; and (7) Fusco, Inc.,...

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31 practice notes
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    ...all facts in the light most favorable to the non-moving party. Conn. Ironworkers Emp'rs Ass'n v. New England Reg'l Council of Carpenters , 869 F.3d 92, 98-99 (2d Cir. 2017), cert. denied , ––– U.S. ––––, 138 S. Ct. 1547, 200 L.Ed.2d 740 (2018) (citing Eastman Kodak Co. v. Image Tech. Servs.......
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    ...all facts in the light most favorable to the non-moving party. Conn. Ironworkers Emp'rs Ass'n v. New England Reg'l Council of Carpenters , 869 F.3d 92, 98–99 (2d Cir. 2017), cert. denied , ––– U.S. ––––, 138 S. Ct. 1547, 200 L.Ed.2d 740 (2018) (citing Eastman Kodak Co. v. Image Tech. Servs.......
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    ...all facts in the light most favorable to the non-moving party. Conn. Ironworkers Emp'rs Ass'n v. New England Reg'l Council of Carpenters , 869 F.3d 92, 98-99 (2d Cir. 2017), cert. denied , ––– U.S. ––––, 138 S. Ct. 1547, 200 L.Ed.2d 740 (2018) (citing Eastman Kodak Co. v. Image Tech. Servs.......
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    • 28 Octubre 2020
    ...all facts in the light most favorable to the non-moving party. Conn. Ironworkers Emp'rs Ass'n v. New England Reg'l Council of Carpenters , 869 F.3d 92, 98-99 (2d Cir. 2017), cert. denied , ––– U.S. ––––, 138 S. Ct. 1547, 200 L.Ed.2d 740 (2018) (citing Eastman Kodak Co. v. Image Tech. Servs.......
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31 cases
  • Options Unlimited, Inc. v. McCann (In re McCann), CASE NO. 18-51319 (JAM)
    • United States
    • United States Bankruptcy Courts. Second Circuit. U.S. Bankruptcy Court — District of Connecticut
    • 31 Agosto 2021
    ...all facts in the light most favorable to the non-moving party. Conn. Ironworkers Emp'rs Ass'n v. New England Reg'l Council of Carpenters , 869 F.3d 92, 98-99 (2d Cir. 2017), cert. denied , ––– U.S. ––––, 138 S. Ct. 1547, 200 L.Ed.2d 740 (2018) (citing Eastman Kodak Co. v. Image Tech. Servs.......
  • Norton v. Town of S. Windsor (In re Norton), CASE NO. 16-20790 (JJT)
    • United States
    • United States Bankruptcy Courts. Second Circuit
    • 30 Septiembre 2020
    ...all facts in the light most favorable to the non-moving party. Conn. Ironworkers Emp'rs Ass'n v. New England Reg'l Council of Carpenters , 869 F.3d 92, 98–99 (2d Cir. 2017), cert. denied , ––– U.S. ––––, 138 S. Ct. 1547, 200 L.Ed.2d 740 (2018) (citing Eastman Kodak Co. v. Image Tech. Servs.......
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    • United States
    • United States Bankruptcy Courts. Second Circuit. U.S. Bankruptcy Court — District of Connecticut
    • 27 Marzo 2020
    ...all facts in the light most favorable to the non-moving party. Conn. Ironworkers Emp'rs Ass'n v. New England Reg'l Council of Carpenters , 869 F.3d 92, 98-99 (2d Cir. 2017), cert. denied , ––– U.S. ––––, 138 S. Ct. 1547, 200 L.Ed.2d 740 (2018) (citing Eastman Kodak Co. v. Image Tech. Servs.......
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    • United States
    • United States Bankruptcy Courts. Second Circuit. U.S. Bankruptcy Court — District of Connecticut
    • 28 Octubre 2020
    ...all facts in the light most favorable to the non-moving party. Conn. Ironworkers Emp'rs Ass'n v. New England Reg'l Council of Carpenters , 869 F.3d 92, 98-99 (2d Cir. 2017), cert. denied , ––– U.S. ––––, 138 S. Ct. 1547, 200 L.Ed.2d 740 (2018) (citing Eastman Kodak Co. v. Image Tech. Servs.......
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