Dieringer v. CHICAGO, MILWAUKEE, ST. PAUL AND PACIFIC R. CO., 63-C-91.

• Decision Date: 15 January 1968
• Docket Number: No. 63-C-91.,63-C-91.
• Parties: John E. DIERINGER, Plaintiff, v. CHICAGO, MILWAUKEE, ST. PAUL AND PACIFIC RAILROAD COMPANY, a Wisconsin corporation, Defendant.
• Court: U.S. District Court — Eastern District of Wisconsin

278 F. Supp. 211

John E. DIERINGER, Plaintiff, v. CHICAGO, MILWAUKEE, ST. PAUL AND PACIFIC RAILROAD COMPANY, a Wisconsin corporation, Defendant.

No. 63-C-91.

United States District Court E. D. Wisconsin.

January 15, 1968.

William S. Porter, Milwaukee, Wis., for plaintiff.

Rodger S. Trump, Milwaukee, Wis., for defendant.

OPINION

REYNOLDS, Judge:

I. Issues

Before this court are the two issues remaining in this case that could not be resolved by agreement. They are:

1. Whether the plaintiff, a railroad employee, should receive interest on the back pay he has been awarded (and, if so, how that interest should be computed); and

2. What is the "reasonable attorney's fee" that under 45 U.S.C. § 153, First (p), must be "taxed and collected as a part of the costs of the suit" if, as here, the "petitioner plaintiff shall finally prevail" in a suit to enforce an order of the Railroad Adjustment Board.

II. Facts

The plaintiff in this case, John E. Dieringer, was discharged from employment by the Railroad. Disputing the propriety of his discharge, he brought an action before the Railroad Adjustment Board pursuant to the provisions of 45 U.S.C. § 153. The Board found that plaintiff was improperly discharged, that he should be reinstated, and that he was entitled to be paid his wages for the period he would have worked between discharge and reinstatement. The Board's order to this effect became final on May 1, 1961, but plaintiff received no back pay from the company until April 15, 1963, when he received a portion of the amount due him.

On April 16, 1963, he brought an action before this court to enforce the Board's order. It has been agreed that plaintiff must be paid an amount in excess of $12,000 for lost wages, $477 for lost overtime pay, and interest from May 1, 1961, on the $477. The remaining questions are the amount of interest, if any, plaintiff should receive on the amount owing to him as lost regular-time pay, and the amount of attorney's fees that should be taxed to defendant as costs. These two questions will be dealt with in turn.

III. Question of Interest

Neither the Act nor the order of the Board in this case expressly authorizes payment of interest. However, since 1962 the National Labor Relations Board has granted prejudgment interest at the rate of 6 per cent on back pay awards, and its authority to do so has been upheld. E. g. Philip Carey Mfg. Co., Miami Cabinet Div. v. N.L.R.B., 331 F.2d 720 (6th Cir. 1964), cert. denied International Union, United Auto, Aerospace and Agr. Implement Workers of America, etc., v. Philip Carey Mfg. Co., etc., 379 U.S. 888, 85 S.Ct. 159, 13 L.Ed.2d 92. The N.L.R.B. policy would seem to be sound, and the same considerations would seem to apply to a back pay award by the Railroad Board. In Raabe v. Florida East Coast Railway Co., 259 F.Supp. 351 (M.D.Fla.1966), the court commented on Court of Appeals' decisions sanctioning the N.L. R.B.'s practice of awarding interest on back pay:

"* * * the reasoning is based on the proposition that the granting of such interest in this type of case is in conformity with general principles of law—that back pay awarded is not a fine or penalty but wages lost by the employee because of the employer's wrong; that back pay is thus in the nature of a debt and, moreover, indebtedness that arises out of a statutory obligation owed the employee by the employer. Clearly the interest is needed in order to make the employee whole. Absent any expressed policy in the R.L.A. to the contrary, and this court finds none, this reasoning applies equally to compensation awarded employees reinstated by the National Railroad Adjustment Board." Id. at 356.

In that case the court granted interest to a railroad employee on the back pay to which he was held entitled.

This case in our view is precisely in point. As in the Raabe case, the Board here held the plaintiff was entitled to a sum of money for back pay. It does not seem just to this court to deny to the plaintiff, and grant to the defendant, the use of what, after May 1, 1961, was plaintiff's money. Thus, following the Raabe case, and being directed to no case to the contrary, this court holds that plaintiff is entitled to interest on back pay from May 1, 1961, to such times as he did receive or will receive the money owed or owing to him.

If the purpose of awarding interest is "to make the employee whole," as the Raabe court said, i. e. to compensate him for loss resulting from his inability to use or invest sums owed to him during the period in which the debt was not paid, the period of nonpayment ought to be measured as accurately as possible. The N.L.R.B. computes the period of nonpayment on a quarterly basis, but the Raabe case used a less precise but more convenient annual basis. In this case, plaintiff suggests a quarterly computation, and defendant does not object. Being convinced that computation on a quarterly basis will be both reasonably accurate and not unreasonably difficult, this court is of the opinion that the interest to be awarded to the plaintiff in this case on the back pay owing to him ought to be computed on a quarterly basis. Plaintiff's attorney is requested to make the necessary computations, draft an appropriate order, secure the approval as to form of defendant's attorney, and submit the document to this court for signature.

IV. Question of Attorney's Fees

In suits like this one to enforce orders of the Railroad Board, a reasonable attorney's fee must be "taxed and collected as a part of the costs of the suit" when the plaintiff is successful. 45 U.S.C. § 153, First (p). In this case, there is no dispute about this basic proposition. However, defendant contends that plaintiff's attorney in this case is not entitled to any fees or, in any event, to no more than nominal fees because the Railroad had agreed to pay plaintiff his back pay and, in fact, had paid him most of that back pay before plaintiff's attorney filed a complaint in this court.^* Defendant suggests that the efforts of plaintiff's attorneys had nothing to do with plaintiff's recovery and asks this court, in effect, to read a kind of "proximate cause" requirement into the provisions of the Railway Labor Act dealing with attorney's fees. To this contention there are several replies.

In the first place, it is at best highly doubtful that defendant's factual contention would stand. Neither plaintiff nor plaintiff's attorneys received any indication of defendant's...