Danielson, for and on Behalf of N.L.R.B. v. International Organization of Masters, Mates and Pilots, AFL-CIO

• Decision Date: 30 May 1975
• Docket Number: AFL-CI,R,D,No. 842,842
• Citation: 521 F.2d 747
• Parties: 89 L.R.R.M. (BNA) 2564, 77 Lab.Cas. P 10,926 Sidney DANIELSON, Regional Director, Region 2 of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner-Appellee, v. INTERNATIONAL ORGANIZATION OF MASTERS, MATES AND PILOTS,espondent-Appellant. ocket 75-7062.
• Court: U.S. Court of Appeals — Second Circuit

Page 747

521 F.2d 747

89 L.R.R.M. (BNA) 2564, 77 Lab.Cas. P 10,926

Sidney DANIELSON, Regional Director, Region 2 of the National Labor Relations Board, for and on behalf of the National Labor Relations Board Petitioner-Appellee, v. INTERNATIONAL ORGANIZATION OF MASTERS, MATES AND PILOTS AFL-CIO, Respondent-Appellant.

No. 842, Docket 75-7062.

United States Court of Appeals Second Circuit.

Argued April 2, 1975.

Decided May 30, 1975.

Seymour M. Waldman, New York City (Waldman & Waldman, Marvin, Schwartz, New York City, of counsel), for respondent-appellant.

Joseph M. Sharnoff, Supervisory Atty., N.L.R.B., Washington, D. C. (Peter G. Nash, Gen. Counsel, John S. Irving, Deputy Gen. Counsel, Gerald Brissman, Associate Gen. Counsel, Frank H. Parlier, Asst. Gen. Counsel, Charles I. Cohen, Supervisory Atty., N.L.R.B., Washington, D. C., of counsel), for petitioner-appellee.

Martin C. Seham, New York City (Andrew E. Zelman, Fred C. Klein, Surrey, Karasik, Morse & Seham, New York City, of counsel), for amicus curiae Seatrain Lines, Inc.

Before ANDERSON, MANSFIELD and OAKES, Circuit Judges.

MANSFIELD, Circuit Judge:

The International Organization of Masters, Mates and Pilots ("MM&P" or "the Union") appeals from a preliminary injunction restraining it from seeking to arbitrate or otherwise enforce a provision in its collective bargaining agreement with Seatrain Lines, Inc. ("Seatrain"), obligating Seatrain, as condition precedent to sale or transfer of a vessel, to insure that the transferee will bind itself to MM&P's collective bargaining agreement. The injunction granted below was sought, pursuant to § 10(L ) of the National Labor Relations Act ("the Act"), 29 U.S.C. § 160(L ), ¹ by plaintiff Danielson, Regional Director of the National Labor Relations Board ("the Board") and was based on a charge filed with the Board by Seatrain on October 1, 1974, alleging that MM&P's attempt to enforce this provision constituted an unfair labor practice in violation of § 8(e) of the Act, 29 U.S.C. § 158(e), ² the so-called "hot cargo" provision. The Board, after investigation, concluded that there was reasonable cause to believe that MM&P was engaging in the unfair labor practice charged and accordingly sought relief under § 10(L ) pending final disposition of the charge by the Board. After a hearing on December 6 and 9, 1974, Judge Motley of the Southern District of New York found that the Regional Director had shown reasonable grounds to believe that the Union was engaged in the charged unfair labor practice and granted the injunctive relief. We affirm.

Seatrain, a Delaware corporation based in New York, is engaged through subsidiaries in operating, owning and constructing seagoing vessels. One of the wholly-owned subsidiaries is Seatrain Shipbuilding Corp. ("Shipbuilding"), a corporation engaged in the business of building and selling ships. Shipbuilding began operations in 1969 and has engaged in the construction of four vessels, at least one of which has been completed.

Shipbuilding's first vessel, the T/T Brooklyn, was constructed pursuant to a construction contract by Langfitt Shipping Corp., another Seatrain subsidiary. On December 31, 1973, the Brooklyn was sold to Wilmington Trust Company as agent for General Electric Credit Corporation ("GECC"). Wilmington concurrently bareboat-chartered (i.e., chartered without crew) the Brooklyn to East River Steamship Corp., which entered into a management agreement with Anndep Shipping Corp. Finally, Anndep entered into an agreement with Westchester Marine Shipping Co. ("Westchester"), a labor contractor, which undertook to supply the crew for the Brooklyn.

Shipbuilding's second vessel, the T/T Williamsburg, was constructed under a construction contract held by another Seatrain subsidiary, Tyler Tanker Corp. Seatrain has obtained from GECC a commitment letter to purchase this vessel and GECC intends to bareboat-charter the vessel to Kingsway Tankers, Inc. Kingsway also has a management agreement with Anndep Corp., and thus Westchester will also supply the crew of the Williamsburg.

This case arises because Westchester entered into a collective bargaining agreement with MM&P's rival union, Marine Engineers Beneficial Association, District 2, and through that organization it has hired some 28 licensed deck officers for the Brooklyn and has begun hiring to the Williamsburg. The MM&P had a collective bargaining agreement with Seatrain and its affiliates and subsidiaries, in effect from June 16, 1972 to June 15, 1975, which covered the licensed deck officers of all U.S.-flag vessels owned, operated, or bareboat chartered by Seatrain and contained the following provisions:

"Section V. VESSELS BOUND BY THE AGREEMENT

"2. Sales and Transfers

"a. With regard to any sale, charter (but not including a vessel which the Company may be operating under a bareboat charter and the charter is terminated) or any manner of transfer (except sales to foreign flag) of the Company's vessel:

"i. At least seventy-two (72) hours prior to the date of the effective transfer of the vessel, written notice must be given to the Organization by the Company.

"ii. The execution by the purchaser, charterer or transferee of the Organization's collective bargaining agreement shall be a condition precedent to any sale, charter or transfer.

"iii. If the Company violates subsection 2(a)(ii) above, the Arbitrator may include as part of his award, loss of wages and contributions to the various Organization Plans.

"iv. A violation of subsection 2(a)(ii) above shall also permit the Organization to cancel the no-strike provisions of this Agreement."

When it agreed to sell the Brooklyn and the Williamsburg, Seatrain did not require the transferees to execute MM&P's collective bargaining agreement as required by § 2(a)(ii).

On April 17, 1974, MM&P notified Seatrain that it was placing on the agenda for arbitration ³ a grievance arising from "the failure to man the SS. BROOKLYN with IOMM&P licensed deck officers employed under (the) agreement." On September 18, 1974, MM&P advised that it was placing on the arbitration agenda a grievance arising from the "failure to secure the manning of the T/T Williamsburg with IOMM&P Licensed Deck Officers" and specifically informed Seatrain that it was seeking relief consisting of: "1. The manning of the T/T Williamsburg by IOMM&P Licensed Deck Officers" and "2. The lost wages, including overtime, and the contributions to the various Organization Plans for the period of time that the T/T Williamsburg was, is and remains manned by licensed officers other than IOMM&P Licensed Deck Officers. . . ." On April 22, 1974, Seatrain brought an action in the Supreme Court of New York seeking to enjoin MM&P from pressing its arbitration claims. The action was removed to the Southern District where MM&P cross-applied for an order compelling arbitration. Both the motion to compel and the motion to stay arbitration were denied as moot after the district court granted the § 10(L ) injunction sought by the Board in the present proceeding.

In the court below, and again on appeal, the Union argues that subdivision 2 of Section V of the agreement does not violate § 8(e) of the Act because it is merely a "work preservation" provision, and that in any event the Union had an absolute right to seek arbitration of its grievances. Thus appellants urge that there was no reasonable cause to believe that an unfair labor practice charge will ultimately be sustained, and thus the § 10(L ) injunction should not have issued.

DISCUSSION

In determining whether an injunction under s10(L ) should issue, it is well settled that the district court need not decide that an unfair labor practice has actually occurred but merely must decide whether the Board has reasonable cause to believe there has been a violation of the Act. Douds v. Milk Drivers & Dairy Employees Union, 248 F.2d 534, 537-38 (2d Cir. 1957). The district court should defer to the statutory construction urged by the Board. See McLeod v. National Maritime Union, 457 F.2d 490, 494 (2d Cir. 1972). When there are disputed issues of fact, the Regional Director is entitled to assume facts and draw inferences in favor of the charging party, and, as long as his choice is rationally based and the court is not convinced that the Board's legal position is wrong, the court must sustain those findings and grant injunctive relief. Danielson v. Joint Board, 494 F.2d 1230, 1245 (2d Cir. 1974). Bearing these standards in mind, we have little difficulty concluding that the district court reached the correct result.

At the hearing below, appellants urged that subdivision 2 of Section V must be upheld as a means of preserving existing work in the bargaining unit, see National Woodwork Mfrs. Ass'n v. NLRB, 386 U.S. 612, 87 S.Ct. 1250, 18 L.Ed.2d 357 (1967); ⁴ Meat & Highway Drivers v. NLRB, 118 U.S.App.D.C. 287, 335 F.2d 709 (1964), its "thrust" being "toward the jobs of Seatrain's own licensed deck officers or at least jobs fairly claimable for them." The Union thus in effect contends that since Seatrain has agreed to have all its vessels manned by MM&P, the ships owned by Seatrain at any time represent the measure of the work which the Union is entitled to "preserve," and the Union can thus legally cause the job to "run with the ship" at least as long as direct pressure is exerted only against Seatrain.

As recognized by the district court, we rejected an almost identical argument only a year and a half ago in NLRB v. National Maritime Union (Commerce Tankers), 486 F.2d 907 (2d Cir. 1973), Cert. denied, 416 U.S. 970, 94 S.Ct. 1993, 40 L.Ed.2d 559 (1974). In that case the labor agreement also obligated the employer, upon selling a ship, to obtain from the transferee an agreement with the NMU to be bound by the union's collective bargaining agreement. Following sales by the employer of a vessel, the Union had obtained an arbitration award restraining the employer...