Gable v. Vonnegut Machinery Co.

• Decision Date: 19 July 1921
• Docket Number: 3450.
• Citation: 274 F. 66
• Parties: GABLE et al. v. VONNEGUT MACHINERY CO. et al.
• Court: U.S. Court of Appeals — Sixth Circuit

274 F. 66

GABLE et al. v. VONNEGUT MACHINERY CO. et al.

No. 3450.

United States Court of Appeals, Sixth Circuit.

July 19, 1921

Rob V Phillips, of Toledo, Ohio, for appellants.

Richard D. Logan, of Toledo, Ohio, for appellee Vonnegut Machinery Co.

Harold W. Fraser, of Toledo, Ohio (Marshall & Fraser, of Toledo Ohio, on the brief), for appellee Toledo Machine & Tool Co.

Before KNAPPEN, DENISON, and DONAHUE, Circuit Judges.

PER CURIAM.

Appeal from a temporary injunction in a strike suit. The strike here involved is a sequel of the strike at the Overland plant, at Toledo, Ohio, involved in Quinlivan v. Dail-Overland Co., 274 F. 56, No. 3434 in this court, this day decided. The Toledo Machine & Tool Company, which is an Ohio corporation, was operating at Toledo, Ohio, a plant for the manufacture of machinery and tools. On August 13, 1919, a considerable force of its employees walked out, thus inaugurating a strike.

On the 16th day of January, 1920, the Vonnegut Machinery Company which is an Indiana corporation, doing business in that state, claiming to have contracts with the Tool Company for the manufacture and sale of a large amount of machinery whose manufacture and delivery were interfered with by the Tool Company's strike, filed its bill in equity in the court below. The original bill is not in the record. An amended bill was filed January 21, 1920. The defendants therein were the Tool Company, two labor unions, and a number of individuals alleged to be either officers or representatives of one or the other of the unions, or concerned as pickets or otherwise with the strike; the defendants other than the Tool Company being alleged to be citizens and residents of the Western division of the Northern district of Ohio. It is alleged that the individual defendants, conspiring with each other and with others unknown, had assembled at the plant of the Tool Company and had obstructed and interfered with the performance of said contracts and with the shipment of said materials in interstate commerce, and unless restrained and enjoined would continue to do so; that to facilitate such practices they had erected a shanty on the property of the Tool Company, wherein they congregated to keep warm; that they gathered at or near the entrance to the Tool Company's plant at the times when its employees were entering and leaving, and called them vile and offensive names, and heckled and nagged at such employees, and so annoyed and frightened them that they had threatened to quit their employment unless such abuses were stopped; that by similar actions the individual defendants were by threats and intimidation attempting to prevent other persons from seeking employment with the Tool Company.

It further alleged that the Tool Company operated its factory on the 'open shop' plan, refusing to, and being bound by contract not to, discriminate between so-called union labor and non-union labor, but to operate an 'open shop'; that defendants other than the Tool Company, by the strike activities referred to and otherwise, were interfering with, hindering, and obstructing the performance of the contract between the Tool Company and its employees, were seeking through such unlawful conduct and through oppression, fear, and intimidation to induce either the Tool Company or its employees to break the same, and by such unlawful conduct have interfered with the Tool Company in the performance of its obligations to the plaintiff, and have been and were then unlawfully obstructing the Tool Company in the delivery of the machinery, etc., to plaintiff and the shipment of the same in interstate commerce.

The prayer of the amended bill, as to the Tool Company, is that it be restrained from interrupting the manufacture, delivery, and shipment of the machinery and tools for whose manufacture, etc., the Tool Company was alleged to be under contract, and that the Tool Company be directed to employ such force of workmen as should be necessary to enable such production and to complete and carry out its alleged contract with plaintiff for such manufacture and delivery.

As to the labor unions and individual defendants, the prayer, speaking generally, was for restraint against interference with and obstruction of the Tool Company's business of manufacturing the machinery in question, from congregating about the Tool Company's plant and about the homes of its employees, from abusing, annoying, threatening, and intimidating that company's employees, or those desiring to become such, from attempting to induce employees to violate their contracts of employment, and from maintaining the shanty referred to.

The asserted grounds of federal jurisdiction are diversity of citizenship and the existence of a conspiracy to restrain interstate commerce, On the filing of the amended bill, the court below overruled a motion by the defendants other than the Tool Company to dismiss the suit for lack of either jurisdiction, cause of action, or good faith, and, upon the bill of complaint and testimony both oral and by affidavit, granted a restraining order against the defendants other than the Tool Company substantially as prayed.

The Tool Company filed an answer and cross-bill, admitting (with one exception not presently important) all the allegations of plaintiff's bill, specially averring its open shop policy, its contract with its employees to maintain the same, and the attempts of the labor and union defendants, by the strike complained of, to break up the 'open shop' and to unionize the plant, substantially as set forth in the bill-- asking substantially the same relief as did the original bill. The other defendants filed answer denying all unlawful conduct charged against them, asserting the continued existence of a strike and a dispute concerning terms and conditions of employment, and collusion between the Tool Company and the Vonnegut Company in bringing the suit for the sole purpose of obtaining jurisdiction on the part of the federal court, in preference to that of a state court. They joined issue on the cross-bill, after renewing motion to dismiss the original bill, and moving to dismiss the Tool Company's answer and cross-bill, for reasons including collusion and lack of jurisdiction.

Upon oral and other testimony taken January 26 and 27, a temporary injunction was ordered on February 7, 1920, against the defendants (except the Tool Company, one labor defendant, and one union defendant), conforming substantially to the prayer of the cross-bill and the terms of the restraining order. This appeal is from that order of injunction. ^[1]

On March 21, 1921, the Tool Company filed in this court a motion to dismiss the appeal, on the ground that the questions raised thereby had become moot by reason of the asserted fact (of which the movant offers to make proof) that each of the appellants has long since entered into contracts of employment elsewhere, and is now neither in the employ of nor seeking employment with the Tool Company. The appellants have not formally replied to this motion. We think the question of the jurisdiction of the District Court should be disposed of.

In our opinion jurisdiction was lacking so far as it depended upon diversity of citizenship, for we think that upon this record the Tool Company must be aligned as a party plaintiff, thereby destroying the alleged diversity. The bill alleges that plaintiff 'for many years has been and is now the agent of the defendant Tool Company in that part of the state of Indiana above described, and it has built up and now has and enjoys a large and extensive business in buying, selling, and dealing in machines and machinery, and particularly a large and profitable business in buying, selling, and dealing in presses, tools and equipment manufactured by the Tool Company. ' The Tool Company's secretary and treasurer testified thus:

'Q. The Vonnegut people are your sales agents, are they not? A. They are. Q. On commission basis? A. They are.'

The vice president and sales manager testified that the Vonnegut Company--

'have the right to sell goods in certain territory. They get a price from us and sell at that time (price?) and when they pay their bills they deduct 7 1/2% commission;' that the Tool Company has 'but one price, and when we quote them the price they are supposed to quote that price and sell our machines at that price. * * * Of course, when we quote the Vonnegut, it is necessary that they are to quote that price, or there would be a confliction of price from one place to the other. Q. So as a matter of fact you do fix the price, don't you? A. Yes, sir. Q. And all the Vonnegut Machine Company get out of your business is 7 1/2 per cent. commission for transacting this business for you, don't they? A. So far as I know; yes, sir. ' (It is not suggested that any one had better means of knowledge than this sales manager.)

True the Tool Company in its answer to the bill does not admit that the plaintiff has been or is its agent, but says that for many years plaintiff has purchased and sold tools and equipment manufactured by this defendant, and has built up and now enjoys a large and extensive business in such tools and equipment; that it never has had and now has no power and authority to bind the plaintiff-- doubtless meaning the Tool Company. But the case was not heard on pleadings alone, and the testimony of the Tool Company's two officers, as already given, is opposed to the answer. It is also true that in a portion of the bill of complaint, later than that from which we have quoted, plaintiff alleges that it has from time to time during the past six months ordered, contracted, and purchased from the Tool Company, and the latter has contracted to manufacture and deliver a large number of...