Cool Wind Ventil. v. Sheet Metal Workers
| Decision Date | 16 April 2001 |
| Docket Number | No. CV 00-3678.,CV 00-3678. |
| Parties | COOL WIND VENTILATION CORP., Plaintiffs, v. SHEET METAL WORKERS INTERNATIONAL ASSOCIATION, Local Union No. 28; John Harrington, President and Business Manager of Local 28, Sheet Metal Industry Labor Management Committee, by its administrator Thomas Doherty; Sheet Metal and Air Conditioning Contractors Association of New York City, Inc., Sheet Metal and Air Conditioning Contractors Association of Long Island, Inc.; Nelson Air Device Corp. and Karo Sheet Metal, Inc., Defendants. |
| Court | U.S. District Court — Eastern District of New York |
White & Kretzing, P.C., By Laurel R. Kretzing, Westbury, NY, for Plaintiff.
William H. Englander, P.C., By William H. Englander, Westbury, NY, for Plaintiff.
Smetana & Avakian, By Gerard C. Smetana, Chicago, IL, for Plaintiff.
Roy Barnes, P.C., By Wendell Shepherd, Elmsford, NY, for Defendants Sheet Metal Workers International Association, Local Union 28 and John Harrington.
Paul, Weiss, Rifkind, Wharton & Garrison, By Sidney S. Rosdeitcher, Esq., John F. Baughman, New York City, for Defendant Sheet Metal Industry Labor Management Committee, by its Administrator Thomas Doherty.
Law Offices of Howard E. Gilbert, By Howard E. Gilbert, Melville, NY, for Defendant Sheet Metal and Air Conditioning Contractors Association of Long Island, Inc.
Rubin Baum, LLP, By Martin R. Gold, Esq., Martin J. Schwartz, New York City, for Defendant Sheet Metal and Air Conditioning Contractors Association of New York City, Inc.
Proskauer Rose LLP, By Jerold D. Jacobson, Daniel R. Halem, New York City, for Defendant Karo Sheet Metal, Inc.
Ettelman & Hochheiser, P.C., By Gary Ettelman, Garden City, NY, for Defendant Nelson Air Device Corp.
This is an case commenced by Plaintiff Cool Wind Ventilation Corp. ("Cool Wind" or "Plaintiff") alleging, primarily, antitrust violations. The named defendants include a labor union, its president and business manager, two multi-employer collective bargaining entities and two individual companies (collectively "Defendants"). Plaintiff's complaint alleges that defendants have entered into a conspiracy to restrain trade and monopolize the market in the sheet metal and duct work industry in the City of New York and Nassau and Suffolk Counties. Also alleged are violations of the National Labor Relations Act (the "Labor Act") and state law claims for tortious interference with contract.
Presently before the court are the motions of all Defendants, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, to dismiss the complaint for failure to state a claim upon which relief can be granted. For the reasons set forth below, the motion to dismiss the Labor Act claims against all defendants other than the Union is granted. The motions are, in all other respects, denied.
1. Factual Background
The facts forming the basis of Plaintiff's claims are set forth in the complaint. Taking those allegations in the light most favorable to the non-moving party (Plaintiff), as required in the context of this motion directed to the pleadings, the facts are as follows.
Cool Wind is a company that is engaged in the business of designing, manufacturing and installing sheet metal duct work used in heating, ventilating and air conditioning ("HVAC") systems. Cool Wind is a union shop; it has a collective bargaining agreement pursuant to which it employs members of the International Brotherhood of Teamsters, Local Union 1205 (the "Teamsters").
Named as defendants here are: (1) the Sheet Metal Workers International Association, Local Union No. 28 ("Local 28" or the "Union") and its president and business manager, John Harrington ("Harrington"); (2) the Sheet Metal Industry Labor Management Committee by its Administrator, Thomas Doherty (the "Labor-Management Committee"); (3) the Sheet Metal and Air Conditioning Contractors Association of New York City, Inc., a multi-employer bargaining entity responsible for negotiation of collective bargaining agreements between employers in New York City and Local 28 ("SMACNA-NY"); (4) SMACNA-NY's Long Island counterpart, Sheet Metal and Air Conditioning Contractors Association of Long Island, Inc. ("SMACNA-LI")(New York and Long Island entities referred to collectively herein as "SMACNA"); (5) Nelson Air Device Corp., a mechanical contractor ("Nelson") and (6) Karo Sheet Metal Corporation, a contractor engaged in the same business as Cool Wind ("Karo").
Cool Wind manufactures sheet metal duct work through which heated or air conditioned air flows and is ventilated throughout buildings. Cool Wind is sometimes employed directly by general contractors but is more typically employed as a subcontractor to HVAC mechanical contractors working on construction projects.
According to the allegations of the complaint the various Defendants have conspired with each other to restrain trade and monopolize the market for sheet metal duct work in large construction projects in the New York, Nassau and Suffolk areas.
The specific relevant market identified in the complaint is defined as:
the design, manufacture and installation of sheet metal duct work for heating, ventilation and air conditioning applications in commercial buildings in the geographical area of the City of New York and the counties of Nassau and Suffolk, each such job costing more than $150,000.
Jobs in the relevant market are alleged to have a total yearly cost of more than 700 million dollars, such figure representing the sum of the cost of approximately 3,500 individual jobs. The geographic basis for the relevant market lies in the alleged fact that the region referred to is the area over which Local 28 has established a stranglehold over jobs and destroyed the possibility of competition. The monetary limit placed on the market definition is based upon the allegation that while Local 28 has attempted to monopolize the entire industry, it has been successful only in monopolizing larger, more lucrative jobs. Local 28 is alleged to have quelled all competition for such contracts and excluded Cool Wind and other "non-Local 28" employers from obtaining the contracts described.
The factual allegations supporting Plaintiff's claims are contained in a forty-eight page complaint and are highly detailed. The court will not reiterate all facts alleged but will only refer to those necessary to draw a brief description of the conspiracy alleged.
As noted, Cool Wind has a collective bargaining agreement with the Teamsters. It has no agreement with Local 28. Local 28 is alleged to be the only sheet metal contractor that is associated with the Building Trades Council of New York City (the "Council"). According to Plaintiff, Local 28 takes the position that its membership in the Council renders it the only union that may perform sheet metal work in the City of New York. Because of its membership in the Council, Local 28 is alleged to be able to garner the support of other unions and employers to bar Plaintiff's employees from working on construction projects and to have Plaintiff's workers removed from such projects. Plaintiff supports these allegations with, inter alia, a description of a project at the United Nations Plaza in New York City from which its employees were ousted.
In addition to alleging the existence of agreements between Local 28 and other Council member unions, Plaintiff alleges agreements between direct competitors employing Local 28 workers (such as Defendant Karo) and Local 28, to exclude Cool Wind and other non-Local 28 sheet metal contractors from the relevant market. Plaintiff alleges a factual situation in which a Karo principal is said to have threatened to remove his Local 28 workers from various jobs being performed for a particular mechanical contractor unless that contractor removed Cool Wind from the sole job it was performing for the contractor.
The complaint contains additional factual allegations. For example, defendant SMACNY is asserted to be engaged in the business of inducing employees of non-Local 28 contractors to leave their jobs in favor of Local 28 contractors. Plaintiff also alleges the use of "target" funds, intended to combat non-union competition, to quell competition with Plaintiff. There are several other factual scenarios discussed in the complaint which the court will not here discuss. Suffice it to say that Plaintiff has tied defendants together, in one way or another, to support the allegations of a conspiracy to exclude Cool Wind, and all sheet metal contractors not employing Local 28 labor, from the relevant market.
Defendants move individually and as a group to dismiss Plaintiff's complaint for failure to state a claim. The majority of the defense arguments have been presented to the court in the form of a joint motion submitted by all Defendants (the "Joint Motion"). Grounds raised in the Joint Motion include the failure to plead a per se violation of the antitrust laws and the failure to allege a proper relevant market or injury to competition. Dismissal of monopolization claims are sought on the ground that Plaintiff has alleged neither a proper monopoly nor the requisite intent to monopolize. The Joint Motion also seeks dismissal of state law claims on preemption grounds. Finally dismissal of all Labor Act claims is sought as against all non-union defendants.
The Labor Management Committee, Karo, Nelson and SMACNA have each submitted individual motions to dismiss on the ground that the complaint fails to allege sufficient factual allegations to state a claim against these defendants. Finally, Local 28 and Harrington have submitted a motion seeking dismissal of Plaintiff's state law claims.
In response to the motions, Plaintiff argues that it has alleged facts in...
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