Hyatt Chalet Motels, Inc. v. Salem Bldg. & Const. Tr. Coun.

• Decision Date: 22 October 1968
• Docket Number: Civ. No. 65-573,65-574.
• Citation: 298 F. Supp. 699
• Parties: HYATT CHALET MOTELS, INC., a California corporation, Robert W. Winter, Jr. and Katherina Winter, Plaintiffs, v. SALEM BUILDING & CONSTRUCTION TRADES COUNCIL, Defendant. REIMANN CONSTRUCTION CO., an Oregon corporation, Plaintiff, v. SALEM BUILDING & CONSTRUCTION TRADES COUNCIL, Defendant.
• Court: U.S. District Court — District of Oregon

298 F. Supp. 699

HYATT CHALET MOTELS, INC., a California corporation, Robert W. Winter, Jr. and Katherina Winter, Plaintiffs, v. SALEM BUILDING & CONSTRUCTION TRADES COUNCIL, Defendant.

REIMANN CONSTRUCTION CO., an Oregon corporation, Plaintiff, v. SALEM BUILDING & CONSTRUCTION TRADES COUNCIL, Defendant.

Civ. Nos. 65-573, 65-574.

United States District Court D. Oregon.

October 22, 1968.

COPYRIGHT MATERIAL OMITTED

Lewis K. Scott, McColloch, Dezendorf & Spears, Portland, Or., for plaintiffs.

Donald S. Richardson, Green, Richardson, Griswold & Murphy, Portland, Or., for defendant.

OPINION

KILKENNY, District Judge:

STATEMENT

Plaintiffs Hyatt Chalet Motels, Inc. and Robert and Katherina Winter entered a joint venture agreement October 12, 1964, to build, own and operate a Hyatt Lodge Motel in Salem, Oregon. It was Hyatt's practice to act as its own general contractor on motels of which it was to be the sole owner. This was open to some modification in the case of joint venture arrangements. In early 1965, Hyatt entered into a contract with Reimann Construction Co. under which Reimann would construct the contemplated Salem Hyatt Motor Lodge. The fact that Reimann had an interest in the land upon which the Salem motel was to be built, was a factor in the award of the contract. Work was begun on the motel in May, 1965, and completed on October 12, 1965. Reimann's employees on that and its other jobs were not members of the defendant or affiliated Unions. After the job was finished, Reimann's employees were not present at the motel site.

The motel opened for business October 16, 1965. On October 28, 1965, members of the defendant Union began picketing the Salem motel with signs to the effect that the building had been built by Reimann's employees under substandard wages and conditions. Handbills were also distributed in the name of the defendant Union.

In December, 1965, the Regional Director of the NLRB, pursuant to Section 10(l) of the NLRA, petitioned this court for a temporary injunction against the picketing pending a final decision by the Board. Before that injunction issued, the Union, on December 20th, stipulated with the Board that it would cease its secondary boycott activities. At that time the picketing ceased.

On February 20, 1967, the National Labor Relations Board found that the defendant, in these cases, was in violation of Section 8(b) (4) (ii) (B) of the National Labor Relations Act (secondary boycott activities), 29 U.S.C. § 158(b) (4) (ii) (B). On January 22, 1968, the Ninth Circuit approved of the Board's decision in enforcing the Board's Order. NLRB v. Salem Building Trades Council, 388 F.2d 987 (9th Cir. 1968). On December 2, 1965, Hyatt and Reimann filed these claims, under 29 U.S.C. § 187, for damages alleged to have resulted from the defendant Union's secondary boycott activities.

LIABILITY

There is no rule that an NLRB determination of an 8(b) (4) violation cannot establish the Union's liability in a subsequent damage suit under § 303.

Each of the cases defendant cites (except Purvis v. Great Falls Bldg. & Constr. Trades Council, 266 F.Supp. 661 (D.Mont.1967)), is decided in a factual background significantly different from our own. Old Dutch Farms, Inc. v. Milk Drivers & Dairy Employees Local Union, 359 F.2d 598 (2d Cir. 1966) held that a plaintiff need not have pursued arbitration via an arbitration clause as a prerequisite to bringing a § 303 suit. Int'l. Longshoremen's & Warehousemen's Union v. Juneau Spruce, 342 U.S. 237, 72 S.Ct. 235, 96 L.Ed. 275 (1952) held that the two remedies are independent and that a § 303 suit may be entertained even though the Board has not yet decided whether the defendant's conduct amounted to a violation of § 8(b) (4). The other cases cited were to the effect that the NLRB General Counsel's failure to issue a complaint is not such an adjudication on the merits of the matter in question as to be res judicata barring a plaintiff's subsequent § 303 damage suit. No one of these cases addressed itself to the precise question of whether an NLRB determination can determine liability in a § 303 suit.

In Purvis, supra, District Judge Smith granted a defense motion to strike the portions of a § 303 complaint dealing with earlier findings of an unfair labor practice by the NLRB. In that case, however, the findings were based on a stipulation of the parties. It was on that basis—that the earlier judgment was in the nature of a consent decree— that the court granted the motion. In dicta, Judge Smith added: "A tower of words can be constructed which would support the conclusion that a cease and desist order of the National Labor Relations Board enforced by a Court of Appeals is res judicata and in some cases it may very well be. An order of the National Labor Relations Board based on a full hearing and merged in a court decree is required to be treated as a decree of the court." Purvis, supra, 266 F.Supp. at 663. (Emphasis supplied.)

The above cited cases establish that § 303 provides a remedy independent of NLRB proceedings, and that the one may be pursued without first exhausting the other. None of that authority addressed itself to a situation where full findings on the merits were made by the Board, and the Board's order was enforced by the Court of Appeals. In this situation, as Judge Smith opines, the NLRB order is merged in the Court of Appeals judgment. Since the same facts supporting a finding of an unfair labor practice under § 8(b) (4) will also support an award of damages under § 303, Haughton v. Int'l. Woodworkers, etc., 168 F.Supp. 273 (D.Or. 1958), aff'd. Haughton v. Columbia River District Council No. 5 etc., 294 F.2d 766 (9th Cir. 1961), the previous unfair labor practice finding and enforcement order should be regarded as determinative of the question of liability in this case.

Aside from the finding of the Board and the decision of the Ninth Circuit, I have no difficulty in making an independent finding that defendant, in these cases, was in violation of the Act and that its secondary boycott activities resulted in damage which support a claim under § 303. 29 U.S.C. § 187.

On the issues of fact outlined in the pre-trial order, I find that defendant's conduct did threaten, coerce and restrain persons engaged in commerce while an object of defendant's conduct was to force persons to cease doing business with plaintiff Reimann Construction Company.

I do not believe that NLRB v. Fruit & Vegetable Packers & Warehousemen, 377 U.S. 58, 84 S.Ct. 1063, 12 L.Ed.2d 129 (1964), is of value in the decision of this case.

STATUTE OF LIMITATIONS

Plaintiffs Robert and Katherina Winter were added by amendment February 8, 1968. At the same time, plaintiff's motion to add Carpenters' Local 1065 and Laborers Local 441, as defendants, was denied. The Union contends that the Oregon two-year statute of limitations¹ is applicable and had run at the time of the amendment. The Winters were added after they had taken an assignment of Hyatt's entire interest under the joint venture agreement. Plaintiffs contend that ORS 12.080(1) and (2) is applicable.² Int'l. Union of Operating Engineers v. Fischback & Moore, Inc., 350 F.2d 936 (9th Cir. 1965), cert. denied sub nom; Draucker, Inc. v. Int'l. Union of Operating Engineers, 384 U.S. 904, 86 S.Ct. 1336, 16 L. Ed.2d 358, 19 A.L.R.3d 1026 (1966) makes the state statutes of limitation applicable to § 303 actions. Boycott activities in this case ceased December 20, 1965. The Winters were not added as plaintiffs until February 8, 1968 (26 months later). The Union now contends their addition by amendment was not proper because their claim was barred.

The test of whether a right is "created by statute", under ORS 12.080(2), is whether such right so changed the liability imposed by common law as to create an entirely new and distinct liability. Shelton v. Paris, 199 Or. 365, 367, 261 P.2d 856 (1953); Hoffman v. Wair, 193 F.Supp. 727 (D.Or.1961). Under normal circumstances, the two year statute of limitations would be applicable to actions under § 303.

Here, however, we are not faced with a new action. Here, the complaint was filed within the statutory period and the Winters were added, as parties plaintiff, after the expiration of the two year period. Rule 15(c), F.R.Civ.P., with reference to the relation back of amendments was obviously enacted to meet this type of a problem. The Advisory Committee's note makes it clear that the 1966 Amendment to this Rule was intended to cover the situation here presented.³

At the time of the boycott, the Winters and Hyatt were joint venturers. Subsequent to the commencement of the action, Winters took an assignment from Hyatt of all of its interest in the venture. The adding of the Winters as parties plaintiff, did not inject a new cause of action. Additionally, the appearance of the Winters as parties plaintiff did not, in any way, prejudice the Union's defenses. The Winters were properly added as parties plaintiffs. 3 Moore, Federal Practice, ¶15.15 4.-2; Id. at ¶ 15.15 4.-1 at pp. 1046-1048.

Martz v. Miller Bros. Co., 244 F.Supp. 246 (D.Del.1965) on which defendant Union relies, was decided prior to the 1966 Amendment of Rule 15(c). Moreover, Moore criticizes the decision even under the language of the former rule. 3 Moore, Federal Practice ¶ 15.15 4.-1 at p. 1048.

REAL PARTY IN INTEREST

Union urges that Hyatt Chalet Motels is not a real party in interest as required by Rule 17(a), F.R.Civ.P. The record shows that in November, 1965, Hyatt was reorganized and became "Northridge Industries, Inc.". Nonetheless, one month later, Hyatt commenced this suit. In September, 1966, Hyatt assigned all of its right, title and interest in the motel venture to the Winters, including the cause of action out of which this claim arose. The record before me justifies a finding that the reorganization amounted to little more than a formal change of name, without a substantial change in...