Farmland Dairies v. Milk Drivers & Dairy Employees

• Decision Date: 11 February 1997
• Docket Number: Civ. No. 95-1735 (WHW).
• Court: U.S. District Court — District of New Jersey
• Parties: FARMLAND DAIRIES, INC., Plaintiff, v. MILK DRIVERS & DAIRY EMPLOYEES UNION LOCAL 680, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, AFL-CIO; Len Meyers, individually and as President of Local 680, Ed Tracy, individually and as Secretary-Treasurer of Local 680; John Doe and Mary Roe, said names being fictitious, their true names being unknown to plaintiff, Defendants.

956 F.Supp. 1190

FARMLAND DAIRIES, INC., Plaintiff, v. MILK DRIVERS & DAIRY EMPLOYEES UNION LOCAL 680, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, AFL-CIO; Len Meyers, individually and as President of Local 680, Ed Tracy, individually and as Secretary-Treasurer of Local 680; John Doe and Mary Roe, said names being fictitious, their true names being unknown to plaintiff, Defendants.

Civ. No. 95-1735 (WHW).

United States District Court, D. New Jersey.

February 11, 1997.

COPYRIGHT MATERIAL OMITTED

Jed L. Marcus, Patricia L. Hardaway, Grotta, Glassman & Hoffman, Roseland, NJ, for Plaintiff.

Mark C. Rushfield, Guazzo, Perelson, Rushfield & Guazzo, Maplewood, NJ, for Defendants.

AMENDED OPINION

WALLS, District Judge.

This matter arises on the motion of defendants Milk Drivers & Dairy Employees Union Local 680, International Brotherhood of Teamsters, AFL-CIO ("Local 680"); Len Meyers, individually and as President of Local 680 ("Meyers"); and Ed Tracy, individually and as Secretary-Treasurer of Local 680 ("Tracy") (collectively, "the defendants") to dismiss the complaint of the plaintiff, Farmland Dairies ("Farmland") and direct arbitration of the dispute, or in the alternative, to stay the claims pending arbitration. Farmland cross-moves for leave to amend its complaint to add new claims. Pursuant to Rule 78 of the Federal Rules of Civil Procedure, the Court will decide this matter on the basis of the parties' written submissions.

For the following reasons, the Court grants the defendants' motion and denies the plaintiff's cross-motion.

I. Background and Procedural History

Farmland operated a "blow-mold" facility to manufacture plastic bottles for packaging its dairy products. This facility employed workers represented by Local 680. In early 1995, Farmland decided to discontinue the blow-mold operation and instead purchase bottles from Bercon Industries ("Bercon"), a bottle manufacturer. Bercon agreed to lease space from the plaintiff in a building adjacent to Farmland's plant and planned to supply bottles to other businesses, including Tuscan Dairy ("Tuscan").

After Farmland announced the discontinuation of the blow-mold facility, the defendant labor union and its officers sought to pressure Farmland, allegedly through threats to shut down its business, to continue its blowmold operation, reverse its agreement with Bercon, refrain from doing business with Tuscan or convince Bercon to recognize Local 680. On April 10, 1995, the defendants organized a picket of Farmland using Tuscan and Clinton Milk Company ("Clinton") employees, who were also represented by Local 680. The picketing at times turned violent. Farmland alleges that the union, through its officers Meyers and Tracy, encouraged Farmland's employees to engage in a work stoppage by assuring them that they could not be disciplined for refusing to cross the picket lines.

On April 12, 1995, Farmland filed a complaint pursuant to § 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C.A. § 185 (West 1978), for the defendants' alleged violation of their collective bargaining agreement with Farmland. Specifically, Farmland alleged that the defendants caused or encouraged picketing and/or work stoppages at Farmland's facilities to protest its termination of the blow-mold operation. Such actions, charged Farmland, violated the no-strike/no-lockout and grievance and arbitration provisions in the collective bargaining agreement entered into by Local 680 and Farmland.

Article I, Section 1.25 of the collective bargaining agreement provides, in pertinent part:

(a) Any and all grievances, disputes and controversies arising under or in connection with the terms or provisions of this agreement, or in connection with or relating to the application or interpretation of any of the terms of provisions hereof, or in respect to anything not herein expressly provided but germane to the subject matter of this Agreement and affecting an employee, an Employer, or the Union, which the representatives of the Union and the Employer have been unable to adjust, shall be submitted for arbitration, upon the request of either party to this Agreement to an Arbitrator....

Certification of Mark C. Rushfield at ¶ 5.

Article I, Section 1.26 provides

(a) No strikes, lockouts, walkouts or slowdowns shall be ordered, sanctioned or enforced by either party hereto against the other during the life of this Agreement.

(b) The Union shall not call, sanction or enforce any sympathetic strike of its members, and the Employer shall not aid other companies in any fight that may be waged against the Union.

Id. at ¶ 6.

On April 12, 1995, this Court executed a Order to Show Cause which specifically stated, "Both parties are obligated to arbitrate any and all disputes arising out of the collective bargaining agreement." The order further provided that "all disputes between Defendant Local 680 and Plaintiff be resolved through the parties' grievance procedure, up to and including final and binding arbitration" pursuant to the collective bargaining agreement.

All parties consented to the "form and entry" of an order by the Court dated April 21, 1995 for a preliminary injunction. In pertinent part, this order required that:

... Defendants and all persons associated with or acting in concert or combination with them, shall:

1. Advise Farmland employees represented by Defendants to remain at work, and to cease the unlawful work stoppages which Defendants have threatened and encouraged, and may engage in, condone, or encourage in the future over the termination of its blow-mold operation and/or its contracting of such functions with Bercon Packaging and/or its purchase of plastic bottles from Bercon Packaging and/or the matters described in Exhibit C to the April 12, 1996 Affidavit of Frank Polizzi filed in the within matter.

2. Advise Farmland employees represented by Defendants to cease and refrain from engaging in any of the conduct prohibited above.

Following Farmland's request to depose Tracy and Meyers with regard to this litigation, the defendants moved to dismiss the complaint or in the alternative to stay any claims pending arbitration of the dispute. Farmland responds with its contentions that there are no more issues to arbitrate, that the defendants' signature on the Consent Order constituted a stipulation of their liability and therefore, the Court has the power to ascertain damages.

Farmland now moves for leave to amend its complaint to add claims against the defendants under § 303 of the LMRA, 29 U.S.C.A. § 187 (West 1978), the Civil Rights Acts, 42 U.S.C.A. § 1985 (West 1981), and federal common law, as well as a state law claim for tortious interference with contractual relations.

II. Analysis

A. Whether the Complaint Should Be Dismissed or the Action Stayed Pending Arbitration.

Farmland brought suit against the labor union and its officials pursuant to § 301 of the LMRA.¹ The plaintiff now claims that the defendants have been ordered by this Court to arbitrate the bottling grievance and that they, the defendants, have effectively conceded liability under the no-strike clause of the collective bargaining agreement by signing the consent order. Consequently, argues Farmland, the only issue left to consider is that of damages. And the issue of damages being one for this Court to decide, there is nothing to arbitrate.

As a preliminary matter, it is beyond argument that federal law leans strongly in favor of arbitration of labor relations disputes where the parties have so provided. See, e.g., United Steelworkers of America v. Warrior & Gulf Nav. Co., 363 U.S. 574, 582-83, 80 S.Ct. 1347, 1352-53, 4 L.Ed.2d 1409 (1960); AT & T Technologies, Inc. v. Communications Workers of America, 475 U.S. 643, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986). It is for the Court to decide whether a party is bound by an arbitration clause in a collective bargaining agreement. AT & T, 475 U.S. at 649, 106 S.Ct. at 1418-19; Laborers' Int'l Union v. Foster Wheeler Corp., 868 F.2d 573, 576 (3d Cir.1989).

Federal courts have long recognized the well-established "presumption of arbitrability which should be dispelled only when the agreement explicitly exempts certain conduct from arbitration or when the terms of the agreement, read as a whole, clearly envision non-arbitrability." Controlled Sanitation Corp. v. District 128, 524 F.2d 1324, 1328 (3d Cir.1975), cert. denied, 424 U.S. 915, 96 S.Ct. 1114, 47 L.Ed.2d 319 (1976); see also Warrior & Gulf, 363 U.S. at 583, 80 S.Ct. at 1353 (stating that "[d]oubts should be resolved in favor of [arbitration].") The Third Circuit has noted, "It is not arbitration per se that federal policy favors, but rather final adjustment of differences by a means selected by the parties." United Steelworkers of America v. Lukens Steel Co., 969 F.2d 1468, 1474 (3d Cir.1992) (citation omitted).

Article I of the collective bargaining agreement between the parties contains a very broad arbitration clause which covers "any and all grievances, disputes, and controversies arising under or in connection to the terms or provisions of [the] agreement." It also sweeps within its scope "anything not herein expressly provided but germane to the subject matter of [the] Agreement and affecting an employee, an employer, or the Union." The Court cannot envision a broader range of an agreement to arbitrate.

It is uncontroverted that this agreement is valid. Farmland, however, sets forth several arguments in opposition to the defendants' request to have all issues submitted to an arbitrator pursuant to the Consent Order or have the complaint dismissed.

First, the defendants consented to the entry of the Consent Order for the Preliminary Injunction, and in particular the provision stating that they would advise Farmland employees to "cease the unlawful work stoppages which Defendants have threatened and encouraged." This statement, argues Farmland, is an admission of fault by the...