Drivers, Chauffeurs, Warehousemen and Helpers Teamsters Local Union No. 71 v. Akers Motor Lines, Inc.

• Decision Date: 19 September 1978
• Docket Number: Nos. 78-1254,78-1286,s. 78-1254
• Citation: 582 F.2d 1336
• Parties: 99 L.R.R.M. (BNA) 2601, 84 Lab.Cas. P 10,846 DRIVERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS TEAMSTERS LOCAL UNION NO. 71, a/w International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Appellee, v. AKERS MOTOR LINES, INC. and Akers-Central Motor Lines, Inc., Appellants. DRIVERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS TEAMSTERS LOCAL UNION 71, a/w International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Appellants, v. AKERS MOTOR LINES, INC. and Akers-Central Motor Lines, Inc., Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 1336

582 F.2d 1336

99 L.R.R.M. (BNA) 2601, 84 Lab.Cas. P 10,846

DRIVERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS TEAMSTERS

LOCAL UNION NO. 71, a/w International Brotherhood

of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Appellee, v. AKERS MOTOR LINES, INC. and Akers-Central Motor Lines, Inc.,

Appellants.

DRIVERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS TEAMSTERS

LOCAL UNION 71, a/w International Brotherhood of

Teamsters, Chauffeurs, Warehousemen and Helpers of America, Appellants, v. AKERS MOTOR LINES, INC. and Akers-Central Motor Lines, Inc.,

Appellees.

Nos. 78-1254, 78-1286.

United States Court of Appeals Fourth Circuit.

Argued July 20, 1978.

Decided Sept. 19, 1978.

Hugh J. Beins, Washington, D. C. (Jonathan G. Axelrod, Bethesda, Md., Francis M. Fletcher, Jr., Charlotte, N. C., on brief), for appellant.

J. W. Alexander, Jr., Charlotte, N. C. (Blakeney, Alexander & Machen, Kennedy, Covington, Lobdell & Hickman, Charlotte, N. C., on brief), for appellees.

Before WINTER and HALL, Circuit Judges, and FIELD, Senior Circuit Judge.

K. K. HALL, Circuit Judge:

The issue presented in this appeal is whether a federal court may enjoin an employer, who is in the process of partially liquidating his business, from further encumbering capital assets pending resolution of ongoing arbitration of grievances filed by the union. The district court held that, on the facts of this case, injunctive relief was proper to maintain the Status quo. We affirm.

Akers Motor Lines, Inc. and Akers-Central Motor Lines, Inc. (hereinafter "Akers-Central") are a joint employer signatory to some six labor contracts ¹ with Drivers, Chauffeurs, Warehousemen and Helpers Teamsters Local Union No. 71 (hereinafter "Local 71"). The collective bargaining agreements contain no-strike and no-lockout provisions, and call for mandatory grievance and arbitration procedures. ²

Akers-Central is engaged in the business of interstate haulage of various commodities. Before 1975, most of these commodities (hereinafter "general commodities") were hauled by Local 71 employees in tractors and trailers owned by Akers-Central, and handled by Local 71 employees in terminals owned by Akers-Central. The employer, however, could not profitably haul "special commodities," notably steel, using union employees, so a "Steel Rider" to the Over-The-Road Supplemental Agreement specifically exempted these items from the collective bargaining agreement negotiated by the union. In 1975 Akers-Central began an expanded special commodities operation, and Local 71 negotiated a "Special Commodity Rider" which limited the definition of special commodities to include only steel and refrigerated commodities which could be hauled on flatbed trailers or refrigeration vans.

Subsequently, Akers-Central's chief negotiator was fired and Victor DeMaras, president of the company, repudiated the Special Commodity Rider; no supplanting agreement has ever been negotiated, but DeMaras did give Local 71 his commitment that no van-type trailers would be used in the special commodities operation.

From 1975 to 1977 Akers-Central continued to expand the special commodities operation while simultaneously cutting back on the general commodities operation. In October, 1977, Akers-Central began to liquidate the general commodities division. It sold most of its tractors and trailers, then leased them for use in the special commodities operation, sold or leased most of its terminals, and sold (subject only to final approval from the Interstate Commerce Local 71 had already initiated its first grievance on September 29, 1977, requesting that Akers-Central be ordered to cease and desist the special commodities operation and to compensate all Local 71 employees already laid off for lost earnings. This grievance was prompted by the discovery that a special commodities trailer was hauling general commodities, namely rugs. On February 20, 1978, the union filed another grievance requesting the same relief, when another special commodities tractor was found to contain general commodities. Finally, on March 1, 1978, Local 71 filed five additional grievances, alleging that Akers-Central had violated the Master Agreement by failing to pay earned vacation monies to road drivers, city employees, maintenance employees, office employees, and janitorial employees.

                Commission) some of its interstate operating rights.  By February, 1978, it had laid off all but two of its approximately twelve hundred Local 71 employees, while hiring one hundred sixty-six non-union road drivers.  3  In the spring of 1978, the special commodities operation had grossed $1,000,000 in one four-week period.  Local 71 alleges that this is a calculated scheme on Akers-Central's part to freeze out the union; it alleges that the special commodities operation is simply the general commodities operation in disguise.  Akers-Central counters by terming its layoff of all but two Local 71 employees "tragic," but says that liquidation of the general commodities division was a legitimate response to adverse business conditions
                

On March 10, 1978, Local 71 filed a Complaint and Motion for Preliminary Injunction against Akers-Central. A three-day trial was held, with Local 71 presenting nine witnesses and some seventy exhibits, and Akers-Central presenting two witnesses and ten exhibits. The district court issued a preliminary injunction and, after a subsequent hearing, finalized the injunction. The district court found, Inter alia, that the grievances were arbitrable, that Local 71 and the employees it represented would suffer more from denial of injunctive relief than Akers-Central would from its grant, and that preservation of the Status quo was necessary to prevent irreparable harm to Local 71. See Lever Brothers Co. v. International Chemical Workers Union, Local 217, 554 F.2d 115, 119 and n.6 (4th Cir. 1976). The court also found substantial likelihood of recovery by Local 71 on the grievances. The court, however, refused to issue an order for expedited arbitration, finding that the grievances were already before the arbitrator and any delays were inherent in the system which the parties had negotiated for and agreed upon. Finally, included in the district court's order was a provision which allowed the evidence developed through discovery at the court hearing to be used by the arbitrator. Akers-Central's request for a modification of this portion of the order was denied.

Local 71 filed an appeal, challenging the district court's refusal to order expedited arbitration, and its maintenance of the Status quo at the time the injunction issued, rather than restoration of the Status quo ante at the time the first grievance was filed. Akers-Central cross-appealed, contending that the injunction was improper because it violated the rule of Buffalo Forge Co. v. United Steelworkers of America, AFL-CIO, 428 U.S. 397, 96 S.Ct. 3141, 49 L.Ed.2d 1022 (1976), and because it encroached upon the exclusive statutory jurisdiction of the Interstate Commerce Commission.

I.

THE INJUNCTION

Three cases cast a long shadow over our consideration of whether injunctive relief was appropriate to "freeze" further encumbrance of an employer's capital assets pending resolution of grievance arbitration: Boys Markets, Inc. v. Retail Clerk's Union Local 770, 398 U.S. 235, 90 S.Ct. 1583, 26 L.Ed.2d 199 (1970); Buffalo Forge Co. v. United Steelworkers of America, AFL-CIO, supra ; and Lever Brothers Co. v. International Chemical Workers Union, Local 217, supra. An analysis of these decisions their holdings, their rationales, and their interrelationship is necessary to our determination that this injunction is not violative of the Norris-LaGuardia Act, § 4, 29 U.S.C.A. § 104.

In Boys Markets, the Supreme Court analyzed the history of federal labor contract law and concluded that, given the increased importance of arbitration as an instrument of federal policy for resolving labor-management disputes, 398 U.S. at 242-43, 90 S.Ct. 1583, Norris-LaGuardia did not prohibit the issuance of an injunction against a strike called in response to grievances which were subject to mandatory arbitration. The Court characterized its holding as a "narrow" one, Id. at 253, 90 S.Ct. 1583, and suggested guidelines adopted from Sinclair Refining Co. v. Atkinson, 370 U.S. 195, 228, 82 S.Ct. 1328, 1346, 8 L.Ed.2d 440 (1962) (Brennan, J., dissenting).

"A District Court entertaining an action under § 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."

Id., 398 U.S. at 254, 90 S.Ct. at 1594 (emphasis in original).

A proposed extension of Boys Markets was considered and rejected in Buffalo Forge Co. v. United Steelworkers of America, AFL-CIO, supra. There, the activity sought to be enjoined was a sympathy strike; the employer contended that Boys Markets was controlling. The Supreme Court disagreed.

"Boys Markets plainly does not control this case. The District Court found, and it is not now disputed, that the strike was not Over any dispute between the Union and the employer...