Dillon Companies v. Teamsters Union Local No. 795

• Citation: 3 F.Supp.2d 1193
• Decision Date: 02 April 1998
• Docket Number: No. 98-1072-JTM.,98-1072-JTM.
• Parties: DILLON COMPANIES, INC., Plaintiff, v. TEAMSTERS UNION LOCAL NO. 795, AFFILIATED WITH the INTERNATIONAL BROTHERHOOD OF TEAMSTERS WAREHOUSEMAN AND HELPERS OF AMERICA, et al., Defendants.
• Court: U.S. District Court — District of Kansas

3 F.Supp.2d 1193

DILLON COMPANIES, INC., Plaintiff, v. TEAMSTERS UNION LOCAL NO. 795, AFFILIATED WITH the INTERNATIONAL BROTHERHOOD OF TEAMSTERS WAREHOUSEMAN AND HELPERS OF AMERICA, et al., Defendants.

No. 98-1072-JTM.

United States District Court, D. Kansas.

April 2, 1998.

William G. Haynes, Frieden, Haynes & Forbes, Topeka, KS, James R. Gilliland, Gilliland & Hayes, P.A., Hutchinson, KS, for Plaintiff.

James B. Zongker, Hammond, Zongker & Farris, L.L.C., Wichita, KS, for Defendants.

MEMORANDUM ORDER

MARTEN, District Judge.

Plaintiff Dillon Companies, Inc. brought the present action to enjoin defendant union from engaging in actions which had the effect of encouraging customers to boycott its grocery stores. The action was first brought in the District Court of Reno County, Kansas, which granted Dillon a temporary restraining order on February 20, 1998. On February 27, 1998, the union removed the matter to this court. In their brief in support of the motion to remand, Dillon explicitly states: "The sole question involved in this case is whether the Defendants have violated the provisions of a collective bargaining agreement between Plaintiff and Defendants." (Plf. Br. at 4).

The Supreme Court addressed the ability of federal courts to grant injunctive relief in labor disputes arising out of collective bargaining agreements in Sinclair Ref'ng. Co. v. Atkinson, 370 U.S. 195, 82 S.Ct. 1328, 8 L.Ed.2d 440 (1962). In that case the Court held that the Norris-LaGuardia Act, 29 U.S.C. § 104 prohibited a federal court from enjoining a strike in violation of a no-strike obligation under a collective bargaining agreement, even if the agreement would otherwise be enforceable under Section 301(a) of the Labor Management Relations Act of 1947, 29 U.S.C. § 185(a).

Several years later, the Court held that § 301(a) actions can be removed from state courts pursuant to 28 U.S.C. § 1441. Avco Corp. v. Aero Lodge No. 735, Intern. Ass'n of Machinists and Aerospace Workers, 390 U.S. 557, 88 S.Ct. 1235, 20 L.Ed.2d 126 (1968). The Avco Court recognized that federal courts did not have the power to grant injunctive relief, but stated:

The nature of the relief available after jurisdiction attaches is, of course, different from the question whether there is jurisdiction to adjudicate the controversy. The relief in § 301 cases varies-from specific performance of the promise to arbitrate, to enforcement or annulment of an arbitration award, to an award of compensatory damages, and the like. But the breadth or narrowness of the relief which may be granted under federal law in § 301 cases is a distinct question from whether the court has jurisdiction over the parties and the subject matter.

390 U.S. at 561, 88 S.Ct. 1235 (citations omitted).

The competing goals of the Norris-LaGuardia Act and the Taft-Hartley Act have been balanced in Boys Markets, Inc. v. Retail Clerks Union, 398 U.S. 235, 90 S.Ct. 1583, 26 L.Ed.2d 199 (1970). In Boys Markets the Supreme Court overruled Sinclair and held that where a union has agreed to arbitrate disputes instead of striking, federal courts can enjoin the union from striking pending arbitration of the dispute underlying the strike. Such an injunction, the Court found, is proper as it is issued in furtherance of arbitration. In reaching this conclusion, the Court observed that "there has never been a serious contention that Congress intended that the removal mechanism be utilized to foreclose completely remedies otherwise available in the state courts." Id., at 246, 90 S.Ct. 1583.

In its decision, the Court in Boys Markets defined a specific, narrow instance in which federal courts were empowered to enjoin strikes by Unions. The Court stated:

Our holding in the present case is a narrow one. We do not undermine the vitality of the Norris-LaGuardia Act. We deal only with the situation in which a collective-bargaining contract contains a mandatory grievance adjustment or arbitration procedure. Nor does it follow from what we have said that injunctive relief is appropriate as a matter of course in every case of a strike over an arbitrable grievance. The dissenting opinion in Sinclair suggested the following principles for the guidance of the district courts in determining whether to grant injunctive relief — principles that we now adopt:

`A District Court entertaining an action under Section 301 may not grant injunctive relief against concerted activity unless and until it decides that the case is one in which an injunction would be appropriate despite the Norris-LaGuardia Act. When a strike is sought to be enjoined because it is over a grievance which both parties are contractually bound to arbitrate, the District Court may issue no injunctive order until it first holds that the contract does have that effect; and the employer should be ordered to arbitrate, as a condition of his obtaining an injunction against the strike. Beyond this, the District Court must, of course, consider whether issuance of an injunction would be warranted under ordinary principles of equity — whether breaches are occurring and will continue, or have been threatened and will be committed; whether they have caused or will cause irreparable injury to the employer; and whether the employer will suffer more from the denial of an injunction than will the union from its issuance.'

370 U.S. at 228, 82 S.Ct. at 1346. (Emphasis in original.)

398 U.S. at 253-54, 90 S.Ct. 1583.

In 1976 the Supreme Court narrowed the Boys Markets exception in Buffalo Forge Co. v. United Steelworkers, 428 U.S. 397, 96 S.Ct. 3141, 49 L.Ed.2d 1022 (1976). In Buffalo Forge, the court ruled that when the arbitrable issue is the permissibility of the strike itself, rather than some underlying issue, then an injunction should not issue. In such a case the strike does not constitute an evasion of an agreement to arbitrate disputes.

"Under Boys Markets, an injunction may not issue merely because it is the only practical means of enforcing a collective bargaining agreement — an injunction is proper only to enforce an agreement to submit labor disputes to binding arbitration." American Tel. & Tel. Co. v. Communication Workers of America, 985 F.2d 855, 860 (6th Cir.1993). Thus, under Boys Markets and Buffalo Forge, the Norris-LaGuardia Act does not prohibit a federal court from enjoining a strike arising out of a labor dispute, but this power may be exercised only where (1) the union's work action is in breach of the collective bargaining agreement; (2) the parties are contractually bound to arbitrate the grievance; and (3) the injunction is otherwise warranted under principles of equity jurisprudence. A federal court does not have the power to enjoin actions beyond that recognized in Boys Markets. International Union of Op'ng Eng'rs, Local 675 v. Trumbull Corp., 93 LRRM (BNA) 2337, 1976 WL 1544 (S.D.Fla. Aug.19, 1976). For labor disputes which have been found to meet the Boys Markets criteria, see 611 A.L.R.Fed. 11 (1984) (collecting cases).

The Supreme Court in Avco explicitly refrained from deciding whether the federal court, once the action was removed, was required to dissolve the previously granted state injunction. Avco, 390 U .S. at 561 n. 4, 88 S.Ct. 1235. See also Boys Markets, 398 U.S. at 244, 90 S.Ct. 1583 (noting open question). Subsequent decisions by other courts have concluded prior state injunctive relief must be dissolved. See General Electric Co. v. Local Union 191, 413 F.2d 964 (5th Cir. 1969), vacated on other gds., 398 U.S. 436, 90 S.Ct. 1883, 26 L.Ed.2d 384 (1970) (court required to dissolve injunction); Progressive Steelworkers Union v. International Harvester, 70 F.R.D. 691, 693 (N.D.Ill.1976) (because federal court lacked jurisdiction to grant injunction under Norris-LaGuardia, prior state temporary restraining order was vacated).

In the present action, Dillon concedes no injunctive relief can be awarded by this court since the case does not fall within the narrow exception created by Boys Markets. Although the collective bargaining agreement includes a provision for arbitration of interpretation and application of the agreement, it does not grant Dillon the ability to grieve or arbitrate the alleged boycott of the defendants. The issue before the court, therefore, is whether the absence of a federal remedy supports or justifies remand of the action.

There is limited authority for the relief sought by Dillon. In Ralphs Grocery Co. v. Meat Cutters Union Local No. 421, 360 F.Supp. 548 (C.D.Cal.1973), the court concluded the effect of the decision in Boys Markets was to establish

that both the State courts and the Federal Courts have jurisdiction for injunctive relief in labor cases, depending on whether a Federal question is raised in the complaint. If not, the cause must be remanded to the State court. If is, it is properly removable and should stay in the Federal Court.

360 F.Supp. at 551. After quoting the Supreme Court's observation in Boys Markets that Congress would not have intended to "foreclose completely remedies otherwise available in the state courts," 398 U.S. at 246, 90 S.Ct. 1583, the court concluded that it had "no alternative but to abstain," and remanded the action to state court. 360 F.Supp. at 551 n. 2.

In contrast, there is authority from the Tenth Circuit directly suggesting the absence of injunctive relief may not be used as a grounds for remand. See Sheet Metal Workers Internat'l Ass'n v. Seay, 693 F.2d 1000 (10th Cir.1982), aff'd on petition for reh'ng, 696 F.2d 780 (10th Cir.1983) In that case, the employer initially sought both damages and injunctive relief in Oklahoma state court. The union removed the action to federal court, but the case was remanded to the state court. In reaching this conclusion the federal district court observed that the employer was seeking "injunctive remedies which it may be foreclosed from pursuing in federal court, whereas a state is not so limited," and that,...