Eastern Air Lines, Inc. v. Air Line Pilots Ass'n, Intern.
| Decision Date | 27 December 1988 |
| Docket Number | No. 87-5978,87-5978 |
| Citation | 861 F.2d 1546 |
| Parties | 130 L.R.R.M. (BNA) 2284, 110 Lab.Cas. P 10,881 EASTERN AIR LINES, INC., Plaintiff-Appellant, v. AIR LINE PILOTS ASSOCIATION, INTERNATIONAL and Larry D. Schulte, Defendants- Appellees. |
| Court | U.S. Court of Appeals — Eleventh Circuit |
Michelle L. Gilbert, Michael J. Madigan, Richard L. Wyatt, Jr., Washington, D.C., for plaintiff-appellant.
James L. Linsey, Cohen, Weiss & Simon, Stephen Presser, New York City, Jonathan A. Cohen, Air Line Pilots Ass'n, Washington, D.C., for defendants-appellees.
Appeal from the United States District Court for the Southern District of Florida.
Before KRAVITCH and EDMONDSON, Circuit Judges, and HOFFMAN *, Senior District Judge.
This labor-contract dispute between an airline and its pilots' union came before the district court on cross-motions for summary judgment. The court granted the motion of defendants Air Line Pilots Association, International and Larry D. Schulte, the chairman of the governing body of the association's local (collectively, "ALPA"), and denied the motion of plaintiff Eastern Air Lines, Inc. (Eastern). Eastern Air Lines, Inc. v. Air Line Pilots Association, Int'l, 670 F.Supp. 947 (S.D.Fla.1987). We now affirm.
Eastern and its unions together faced a serious dilemma in the early weeks of 1986. Eastern's above-industry labor costs contributed substantially to its deteriorating financial condition, and the airline realized that if it could not reduce those costs by securing wage concessions from ALPA, the machinists' union, and the flight attendants' union, it would be compelled to opt either for bankruptcy or loss of its independence. Neither alternative appealed to Eastern or to its pilots, who were then engaged in rocky negotiations with the carrier over a new collective-bargaining agreement. While an agreement with ALPA alone would not prevent a sale or bankruptcy, the lack of a contract would probably cause one or the other, and would leave the pilots unprotected after such an event occurred. Reaching some sort of agreement was thus of critical importance to both parties.
Collective-bargaining negotiations between Eastern and ALPA, under the eye of the National Mediation Board (NMB), began in December of 1985. In late January 1986, after an impasse, the NMB declared a mandatory thirty-day "cooling off" period under the Railway Labor Act (RLA), after which both the pilots and the carrier could engage in "self-help." Self-help for the pilots entails striking the airline; the airline avails itself of self-help by unilaterally implementing the terms of its final offer. The cooling-off period was to end on February 26.
Intense negotiation continued during the cooling-off period. In the final days of the period, Eastern was approached by a potential suitor, the Texas Air Corporation. Eastern seriously considered accepting Texas Air's offer if it could not resuscitate itself by slashing its labor costs. The offer was due to expire at midnight on February 23, 1986, yet by the 23rd, Eastern and ALPA had not been able to agree to a new contract.
Compounding the external pressure to reach an agreement imposed by the potential of a sale or bankruptcy, the pilots voted on February 21 to strike the airline at the end of the cooling-off period. On February 23, then, the negotiating parties began to work feverishly in the face of the looming deadline, while Texas Air apparently agreed to extend its offer for a few more hours. Wide areas of disagreement still separated the parties.
Sometime in the evening of February 23, ALPA requested Eastern's final offer, and to the ALPA team Eastern offered "EAL No. 7," a handwritten four-page document peppered with "buzzwords" and loose phrases. The terms of EAL No. 7 summarized concepts that the negotiating parties had been discussing over the course of the talks. After some inconclusive haggling, ALPA negotiators submitted the document to the Eastern Air Lines Master Executive Committee (the "MEC"), ALPA's local governing body, without recommending that the draft be ratified. The MEC questioned its negotiators about various provisions of the document, and the negotiators, aware that they did not completely understand EAL No. 7, were not able to answer every question posed them. The MEC initially rejected EAL No. 7. Then, in the early hours of February 24, informed that it would have to ratify the document or steer Eastern toward bankruptcy or toward a sale, the MEC ratified. Following the ratification, Eastern tendered EAL No. 7 for the signature of the relevant ALPA officials, who then signed the document. Eastern's officials had already signed EAL No. 7. Eastern's vice president then substituted the word "AGREEMENT" for "PROPOSAL" as the title of the document. On February 25, Eastern and ALPA executed a signature page in blank.
Despite the apparent success in reaching an agreement with ALPA, Eastern was unable to reach an agreement with its machinists' union. Eastern was therefore sold to Texas Air on February 24.
The negotiating committees disbanded and the NMB mediator left, later stating that the "dispute has been settled by an agreement reached through mediation." ALPA called off its plans to strike the airline. Eastern subsequently announced to the media, to Texas Air, to its employees, and to federal regulatory agencies that a fully binding collective-bargaining agreement had been reached with ALPA and that a pilot strike had been averted. On March 2, 1986, the airline began to implement the concessionary terms of EAL No. 7, including a twenty per cent pay cut.
From the end of February, the parties attempted to flesh out the terse phrases contained in EAL No. 7. As early as February 25, if not sooner, the parties realized that certain important terms were unclear. While they never were able to agree on precise definitions for six key terms, 1 other parts of the agreement were not in dispute, and over the first few months of 1986 Eastern and the union processed some fifty grievances under non-contested portions of EAL No. 7.
ALPA later learned that Eastern planned to grant pay increases to certain non-contract employees. Believing that such increases violated the pay-parity term of EAL No. 7, ALPA filed a grievance on May 27, 1986, with the Eastern Air Lines Pilots System Board of Adjustment (SBA), the arbitral panel responsible under the RLA for adjudicating disputes arising out of the labor contracts between Eastern and its pilots. 45 U.S.C. Sec. 153, Second. The specific content of the pay-parity term--which states, "Parity--with IAM, TWU, non-contract for general across-the-board salary increases only"--has never been defined by the parties.
Eastern filed this action in federal district court in June of 1986 praying that ALPA be enjoined from "attempting to alter or otherwise change the rates of pay as presently contained in an existing Collective Bargaining Agreement between [the] parties ... and to further restrain and enjoin [ALPA] from attempting to invoke the services of the Eastern Air Lines Pilots System Board of Adjustment...." Eastern appended a wage scale to its complaint, but made no reference to the pay-parity term of EAL No. 7.
In July, prior to ALPA's first responsive pleading, Eastern amended its complaint. The amendment alleged that in the event the court should "conclude that the wage rates [appended to the complaint] do not represent the actual wage rates agreed to between [the] parties during the course of the collective bargaining process," then the court should conclude that no "meeting of the minds" occurred in February, and hold that no collective-bargaining agreement exists. Eastern also alleged in its first amendment that the February negotiations
were based upon the premise and precondition that to be binding upon the parties such negotiations would lead to an integrated and all inclusive new agreement covering all aspects of wages, rules and working conditions that would govern the employment of pilots in the service of Eastern. If the parties could not reach such an integrated and all inclusive arrangement, then no valid or enforceable collective bargaining agreement could result from the negotiations.
In August, ALPA attempted to invoke adjustment-board procedures to resolve three more disputes under EAL No. 7, concerning the "labor protective" term, medical and dental benefits, and "pseudo" contributions to the pilots' retirement plan. In September, Eastern again amended its complaint, and alleged that
Contrary to the assertions of [ALPA], no agreement presently exists between ALPA and Eastern with respect to any of the matters referred to above. On the contrary, these and other matters have been the subject of ongoing, but to date unsuccessful collective bargaining negotiations upon which no agreement has been reached between these parties.
Eastern asked the court for "a judgment declaring that no agreement presently exists between [Eastern] and [ALPA] with respect to those matters over which defendants now seek to invoke grievance and arbitration proceedings...."
Initially we must determine whether the district court correctly concluded on summary judgment that the parties entered a collective-bargaining agreement on February 24, 1986. If the parties did form a collective-bargaining agreement, we must consider whether the RLA mandates arbitration or negotiation of their current differences. Review is plenary, guided by the same legal criteria employed by the district court, set out in Rule 56 of the Federal Rules of Civil Procedure and the relevant cases. See Federal Savings and Loan Insurance Corp. v. Haralson, 813 F.2d 370, 374 (11th Cir.1987). Summary judgment is appropriate only if, viewing the facts and inferences drawn from the facts in the light most favorable to Eastern, there is no genuine issue as to any material fact and ALPA is entitled to a judgment as a matter of...
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