Gabauer v. Woodcock
| Decision Date | 27 March 1979 |
| Docket Number | No. 77-1094,77-1094 |
| Citation | 594 F.2d 662 |
| Parties | 100 L.R.R.M. (BNA) 2808, 85 Lab.Cas. P 11,147 Ernest GABAUER, Joe DeLos Santos, Jr., Coleman G. Lewis, Jr., C. L. Greenfield, Elbert Hill and Claude J. Huskey, Appellants, v. Leonard WOODCOCK, Emil Mazey, Kenneth Worley, C. E. Mattix, Edward Lavin, John T. Webster, Roy Hartzell and Donald Young, Appellees. |
| Court | U.S. Court of Appeals — Eighth Circuit |
Donald W. Jones of Prewitt, Jones & Karchmer, Springfield, Mo., for appellants.
John A. Fillion, UAW, Detroit, Mich., for appellees.
Before GIBSON, Chief Judge, and LAY, HEANEY, BRIGHT, ROSS, STEPHENSON and HENLEY, Circuit Judges, en banc.
This case is before the Court en banc on the appellees petition for rehearing. The appellants are members of the United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) and its Local 25 in St. Louis, Missouri. The appellees are, or were at the time this litigation commenced, officers of the UAW International Union, Local 25, or affiliated Community Action Program Councils (CAP Councils). The complaint contains two counts. In the first count, the appellants invoke §§ 201(c) and 301(a) and (b) of the Labor-Management Reporting and Disclosure Act (LMRDA), 29 U.S.C. §§ 431(c) and 461(a) and (b), to gain an opportunity to inspect various union books and records. In the second count, the appellants allege a cause of action based on § 501 of the LMRDA, 29 U.S.C. § 501, for the appellees' involvement in the disbursement of union funds to various political, social and civic organizations. The District Court dismissed the first count in part for improper venue and in part for a pleading deficiency. The court also dismissed the second count in its entirety for failure to state a claim upon which relief could be granted. When the matter was first before us, we affirmed in part and reversed in part as to the first count, and
affirmed the dismissal of the second count. We adhere to our earlier opinion. 1
The appellants filed their complaint in the Eastern District of Missouri. In Count I, they requested an order requiring the appellees to make available to them certain union records. Section 201(b) requires that every labor organization file with the Secretary of Labor an annual report, signed by the president and treasurer of the organization which describes, among other things, the disbursements made by it during the preceding fiscal year. In addition, § 201(c) provides:
Every labor organization required to submit a report under this title shall make available the information required to be contained in such report to all of its members, and every such labor organization and its officers shall be under a duty enforceable at the suit of any member of such organization in * * * the district court of the United States for the district in which such labor organization maintains its principal office, to permit such member for just cause to examine any books, records, and accounts necessary to verify such report.
29 U.S.C. § 431(c).
Section 301(a) subjects labor organizations which establish and administer trusteeships over subordinate bodies to certain additional reporting requirements. Every such labor organization must file with the Secretary of Labor semiannual reports signed by the president, treasurer, and trustees which include the reasons for the establishment or continuation of the trusteeship and the financial condition of the subordinate organization. In addition, the labor organization must file the annual § 201(b) financial report on behalf of the local unit. Finally, § 301(b) makes the private inspection provisions of § 201(c) applicable to all § 301(a) reports.
The appellees filed a motion to dismiss the complaint, stating, with respect to Count I, that venue was improper; that the appellants failed to meet the just cause and specificity requirements of § 201(c); and that the action was barred in part by the statute of limitations. The District Court granted the appellees' motion to dismiss in part for improper venue and in part for a pleading deficiency.
Venue is governed by § 201(c). This section keys venue to the principal office of the labor organization required to file the report in question. The appellants seek to verify four annual financial reports for Local 25. Three of these were prepared and signed by the president and treasurer of the local, but one was apparently filed by the UAW International and its trustees on behalf of Local 25. In addition, the appellants seek certain reports and records from the local CAP councils and other records from the UAW which has its principal offices in Detroit. The appellees conceded to the trial court that venue was proper as to the records necessary to substantiate the reports filed by local officials. Conversely, there can be little dispute that venue was improper with respect to the reports filed by the International officials pertaining to files and records kept in Detroit.
The controversy involves the records necessary to verify the trustees reports filed pursuant to § 301(a). The lower court ruled that venue was improper as to these reports:
As this Court reads 201(c), since the UAW was the organization required to file a report by 301, a suit for the records necessary to verify this report could only have been brought against the UAW or its officers and could not have been brought against Local 25 or its officers, even though the report concerned the financial Gabauer v. Woodcock, 425 F.Supp. 1, 4 (E.D.Mo.1976).
condition of Local 25. A suit under 201(c) cannot be brought against the UAW in this Court since venue would be improper.
The appellants insist that the existence of a trusteeship should not change the place of venue for reports filed on behalf of the local unit.
Although the venue provisions of §§ 301(b) and 201(c) could be construed in the manner adopted by the District Court, we think the better view would permit suit for the verification of § 201(b) reports signed by trustees on behalf of a subordinate labor organization to be brought at the location where the records necessary to verify those reports are most likely to be. The trusteeship had been discontinued by the time the suit was commenced, so we cannot imagine that the UAW would have kept the records at issue in its Detroit office during any relevant period of time. Taking that fact into account, we hold that venue was appropriate insofar as the appellants sought records actually under the control of Local 25 officials, even though those records are relevant only to reports filed by the UAW and its trustees. For the records actually under the control of International officials, however, venue may be found only in the district of the principal International office.
Although the District Court understood that venue was appropriate for some of the records sought, it dismissed Count I in its entirety. The court explained: "(U)ntil amended pleadings are filed for that part of Count I over which this Court has venue, the question of the statute of limitations cannot be resolved." Id. To remedy this, the court dismissed Count I, giving the appellants twenty days within which to file an amended petition. We are aware of no authority which suggests that a complaint is subject to dismissal if it fails to plead in such a way that the statute of limitations question can be resolved on a motion to dismiss. In general, the limitations question is an affirmative defense to be pleaded and proved by the appellees. We note that Federal Rule of Civil Procedure 12(e) provides:
If a pleading to which a responsive pleading is permitted is so vague or ambiguous that a party cannot reasonably be required to frame a responsive pleading, he may move for a more definite statement before interposing his responsive pleading. The motion shall point out the defects complained of and the details desired.
The record in this case reflects no such motion, and we can perceive no need for a Sua sponte dismissal of the complaint on this ground in this case. 2
Since venue was proper with respect to the bulk of the records sought, we reinstate the complaint and remand this case to the District Court for further proceedings. In view of the continuing disputes as to whether just cause has been shown for the examination of the books and the nature and scope of the examination if such cause has been shown, we deem it important to lay down guidelines for the assistance of the District Court.
First, the party seeking to examine the union records has the burden of showing just cause.
Second, the just cause requirement must be read in a narrow sense when invoked to resist an examination. It is sufficient if a reasonable union member would be put to further inquiry. Fruit and Vegetable Packers & Ware. Local 760 v. Morley, 378 F.2d 738 (9th Cir. 1967); Allen v. Local 92, Iron Workers, 47 L.R.R.M. 2214 (N.D.Ala.1960).
Third, a principal purpose of the reporting provision is to provide union members with the vital information necessary for them to take effective action in regulating affairs of their organization. Individual members of a union are fully competent to regulate union affairs if they have minimum democratic safeguards and detailed essential information about the union. S.Rep. No. 187, 86th Cong., 1st Sess. 8 Fourth, the right to examine includes the right to make such copies as are reasonably necessary for the conduct of the examination, subject to the right of the union to protect itself against harassment and copying of protected materials, Conley v. United Steelworkers of America, etc., 549 F.2d 1122 (7th Cir. 1977), and the right to be assisted by experts in making the examination, Antal v. District 5, United Mine Workers of America, 451 F.2d 1187 (3rd Cir. 1971).
(1959), Reprinted in I NLRB, Legislative History of...
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