Gainey v. BROTHERHOOD OF RAILWAY & STEAM. CLERKS, ETC.

• Decision Date: 31 August 1959
• Docket Number: Civ. A. No. 26133.
• Citation: 177 F. Supp. 421
• Parties: James A. GAINEY and J. L. Young, Individually and on behalf of others similarly affected v. BROTHERHOOD OF RAILWAY AND STEAMSHIP CLERKS, FREIGHT HANDLERS, EXPRESS AND STATION EMPLOYEES and The Pennsylvania Railroad Company.
• Court: U.S. District Court — Eastern District of Pennsylvania

177 F. Supp. 421

James A. GAINEY and J. L. Young, Individually and on behalf of others similarly affected v. BROTHERHOOD OF RAILWAY AND STEAMSHIP CLERKS, FREIGHT HANDLERS, EXPRESS AND STATION EMPLOYEES and The Pennsylvania Railroad Company.

Civ. A. No. 26133.

United States District Court E. D. Pennsylvania.

August 31, 1959.

COPYRIGHT MATERIAL OMITTED

Laurence J. Richette, Philadelphia, Pa. (Meehan, Neil & Richette, Philadelphia, Pa., on the brief), for plaintiffs.

Walter Biddle Saul, Philadelphia, Pa. (Saul, Ewing, Remick & Saul, Philadelphia, Pa., on the brief), for defendant Brotherhood.

Robert M. Landis, Philadelphia, Pa. (Owen B. Rhoads, Richard N. Clattenburg, Ronald P. Wertheim, and Barnes, Dechert, Price, Myers & Rhoads, Philadelphia, Pa., on the brief), for defendant Pennsylvania Railroad Company.

LORD, District Judge.

The two named plaintiffs are employees of the Pennsylvania Railroad who assert wage claims against the carrier, and claims for damages and refund of dues against the union. The named defendant union will hereafter be called The Brotherhood; the defendant carrier will be spoken of as The Railroad; and references to The Act will signify the Railway Labor Act, 45 U.S.C.A. § 151 et seq.

Each defendant has moved to dismiss, raising a variety of defenses and objections to be discussed herein.

The complaint, consisting of 20 paragraphs, an exhibit, and an amendment, was filed by plaintiffs in the form of a class bill on behalf of themselves and other persons similarly situated to recover about $1,750,000 back wages from the Railroad, a like amount as penalty against the Brotherhood, and an indeterminate sum for refund of dues paid to the latter.

The bill alleges that the Brotherhood is the duly authorized bargaining agent of the clerical employees (including plaintiffs as "tallymen") of the Railroad, so certified under the Act. A bargaining agreement between the Brotherhood, representing the employees, and the Railroad was executed in 1942, covering the entire Pennsylvania Railroad System.

Under the terms of this agreement, tallymen at freight stations in the Central Region of the Railroad were paid on a straight hourly basis, whereas tallymen in the Eastern Region were paid on a tonnage rate, depending on the amount of freight handled. As a result, the Eastern Region tallymen (plaintiffs) received less take home pay per month than the Central Region men.

In paragraphs I through VII, in which the foregoing facts appear, there are the following recitals, among others. The named plaintiffs are residents, respectively, of Camden, New Jersey and Philadelphia, Pennsylvania. The Brotherhood does business in Pennsylvania, maintains an office in Philadelphia, and is there represented by an authorized agent.

In paragraph I this cause is said to be

"a civil action arising under the Constitution and laws of the United States brought under the Railway Labor Act, 45 U.S.Code 151 et seq."

In paragraph V plaintiff says:

"The jurisdiction and venue of this Court are established by precedents of the United States Supreme Court which hold that the (Federal) right not to be discriminated against is implied in the Railway Labor Act. (45 U.S.Code 152 et seq.)"

The alleged class on whose behalf the suit is brought is those who are or were since August 1, 1950, the employees classified as Group I workers, i. e. clerks —more specifically known as "tallymen" in the Eastern Region of the Pennsylvania Railroad system. In that area (Altoona east to New York, Philadelphia, and Washington, D. C.) the asserted monthly wage disadvantage, by comparison to the Central Region employees, was approximately $25 per month (and later, due to general wage increases, $30 per month). In addition, the Central employees received sick leave benefits not available to the Eastern group.

The crucial paragraph VIII reads:

"This arbitrary differential, based on geography alone, was the subject of a dispute between the plaintiffs and the defendant railroad company and finally, S.V.W. Loehr, General Chairman of the Pennsylvania Railroad System Board of Adjustment of the defendant Brotherhood proceeded to negotiate a settlement of the dispute—in accordance with the grievance processing machinery of the Railway Labor Act—and on August 1, 1951 an agreement was consummated by Mr. Loehr on behalf of the plaintiffs and Mr. Stewart, Superintendent of Stations & Transfer on behalf of the Pennsylvania Railroad Company. In substance the defendant railroad company agreed to pay `tallymen' on the Eastern Region the same monthly rate of pay then prevailing on the Central Region. Fringe benefits were likewise equalized between the two regions. This understanding between the Brotherhood and the carrier was reduced to writing as was the custom in like matters by a letter from Mr. Loehr to the Pennsylvania Railroad Company confirming the change in rate of pay. This letter is attached hereto and marked Exhibit `A.'"

Recitals add that the Railroad later refused to effectuate the agreement, and that the Brotherhood failed to enforce it, or follow up the negotiations. An amendment states that the Railroad, moreover, in 1951 eliminated tonnage payments to the tallymen, in contravention of the Act as well as the 1942 collective bargaining agreement.

After reciting the enforcement machinery which was at the disposal of the Brotherhood under the Act, the fact that the Brotherhood at all times enjoyed the benefit of competent counsel is pointed out. The next allegation, XIII, must speak for itself:

"The only reason for failure of the Brotherhood to compel the Pennsylvania Railroad Company to abide by its agreement is that the Pennsylvania Railroad Company could control union officers at will. For all of the officers of the Pennsylvania Railroad System Board of Adjustment, Brotherhood of Railway and Steamship Clerks, Freight Handlers, Express and Station Employees were former officers of the Pennsylvania Railroad Company union which was disbanded by the carrier in 1937 when the Brotherhood obtained the collective bargaining rights for this craft on the Pennsylvania Railroad."

Paragraphs XIV and XV state that plaintiffs have no specific remedy under the Act, and

"* * * no remedy within the Brotherhood since this complaint against the Pennsylvania Railroad Company has gone unheeded by all echelons of the Brotherhood since 1951."

After reciting the resultant economic hardship to plaintiffs, XVII says:

"Though the carrier has a constitutional right to discriminate against employees when it agrees to remove that discrimination as a part of a collective bargain it cannot then attempt to abrogate that agreement and renew the discrimination to the pecuniary detriment of employees."

Paragraph XVIII alleges the wrongful discrimination, asserts third party beneficiary rights of the plaintiffs in the alleged agreement; and claims the right of plaintiffs to enforce the agreement against the Railroad and "to sue the Brotherhood for breach of trust." Paragraph XIX specifies actions which the Brotherhood might have taken by way of enforcement of the alleged agreement and concludes with the recital that the Brotherhood continues to ignore its duty.

Damages are asserted, as result of defendants' wrongful acts, on behalf of "a minimum of 600 persons on the Eastern Region" comprising the class, at $30 per month since 1950—amounting to $1,734,000 exclusive of interest. In addition to general equitable relief, they demand:

"1. Mandatory injunction compelling defendant Pennsylvania Railroad Company to equalize the pay scale as described;

"2. Damages against the Pennsylvania Railroad for losses in earnings for a minimum of $1,734,000.

"3. Interest against the Pennsylvania Railroad Company at 6 per cent from August 1, 1951 to the date of judgment.

"4. Punitive damages on item (2) supra against the defendant Brotherhood equal to the judgment assessed against the Pennsylvania Railroad Company for wanton breach of trust and violation of the duty owed to the plaintiffs as agents, and for violating their statutory duty.

"5. An order compelling the defendant Brotherhood to return dues collected from plaintiffs for the period in question since defendant gave plaintiffs no quid pro quo for these union dues."

1. Jurisdiction over the Person; Insufficiency of Service of Process

The Brotherhood protests that it is not doing business within the District of the United States District Court for the Eastern District of Pennsylvania, and is therefore not subject to the jurisdiction of the court.

It also asserts insufficiency of service of process for the reason that service (at the Board of Adjustment office at 15th and Locust Streets in Philadelphia) was not made at an office at which the Brotherhood regularly conducts business or upon a representative authorized by the Brotherhood to accept service on its behalf. Defendant insists that the Brotherhood conducts no regular business from the office mentioned, that the Pennsylvania Railroad System Board of Adjustment, of which J. C. McGuigan is an officer, is autonomous and independent of the Brotherhood, and that the Brotherhood has therefore not been served. Farnsworth & Chambers Co., Inc. v. Sheet Metal Workers, D.C.N.Mex. 1954, 125 F.Supp. 830; Isbrandtsen Co., Inc. v. National Marine Engineers' Beneficial Ass'n, D.C.S.D.N.Y.1949, 9 F.R.D. 541.

The affidavits in the present motion present virtually the same facts that were before Judge Sporkin in 1957. McGovern v. Brotherhood of Railway Clerks, Court of Common Pleas No. 2, Philadelphia County, September Term 1956, No. 3908 in Equity. After full consideration it was held that

"* * * Service upon the local lodge was sufficient service upon the Brotherhood, Spica v. I.L.G.W.U., 1957, 388 Pa. 382, 130 A.2d 468; Tunstall v. Brotherhood of Locomotive F. and E., 4 Cir., 1956, 148 F.2d 403; Operative Plasterers' and Cement Finishers' International Association of U. S. and Canada v. Case

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