International Ass'n of Machinists & Aerospace Workers, AFL-CIO v. Eastern Airlines, Inc.

Decision Date21 June 1988
Docket NumberNo. 88-7079,AFL-CIO,88-7079
Citation849 F.2d 1481
CourtU.S. Court of Appeals — District of Columbia Circuit

Philip A. Lacovara, with whom Thomas D. Goldberg, John J. Gallagher, Charles L. Warren and T. Jay Thompson, Washington, D.C., were on the brief, for appellant.

Joseph Guerrieri, Jr., with whom John A. Edmond and Richard Ruda, Washington, D.C., were on the brief, for appellee. Edgar N. James, Washington, D.C., also entered an appearance for appellee.

Before EDWARDS and WILLIAMS, Circuit Judges, and OBERDORFER *, District Judge.

Opinion for the Court filed by Circuit Judge EDWARDS.

HARRY T. EDWARDS, Circuit Judge:

In July 1987, the District Court issued a preliminary injunction ("July injunction") prohibiting Eastern Air Lines, Inc. ("Eastern") from spinning off its fleet service employees into a wholly owned subsidiary, and ordering it to maintain the status quo until it exhausted the dispute resolution procedures of the Railway Labor Act ("RLA"), 45 U.S.C. Secs. 151-188 (1982). In March 1988, the court issued an order ("March order") adjudging Eastern in contempt of the July injunction after the carrier announced plans to spin off its East Coast air shuttle operations ("shuttle") into a majority-owned subsidiary of Texas Air Corporation ("Texas Air"), Eastern's corporate parent.

We decline to consider any claims raised by Eastern regarding the legality of the July injunction because Eastern voluntarily dismissed an earlier appeal from that injunction and agreed to abide by its terms. As for the March order, we first find that the July injunction did not prohibit the shuttle transaction, and that the District Court thus issued a new or modified injunction when it enjoined its consummation. Consequently, we have jurisdiction under 28 U.S.C. Sec. 1292(a)(1) (1982), which permits an immediate appeal from the issuance of a new or modified injunction. We next find that the March order must be vacated because the District Court did not make the factual findings or consider the relevant criteria necessary to support the issuance of a new or modified injunction. The March order shall remain in effect for 10 days after the issuance of this court's mandate, however, during which time the International Association of Machinists and Aerospace Workers ("IAM") may request injunctive relief covering the shuttle transaction.


IAM is the certified representative of 13,000 Eastern employees, approximately 6,000 of whom are fleet service workers who perform such tasks as baggage handling and aircraft cleaning and fueling. For the past 42 years, all of Eastern's IAM employees have been covered by a single collective bargaining agreement, the most recent of which was signed on May 16, 1985. Article 30 of this agreement contains a moratorium provision which reads in pertinent part: "This entire Agreement shall continue in full force and effect through December 31, 1987, and thereafter shall be subject to change as provided for in Section 6 ... of the Railway Labor Act, as amended." Joint Appendix ("J.A.") 25.

On June 23, 1987, Eastern advised IAM of its decision to transfer all of its fleet service employees to Airport Ground Services Corporation ("AGS"), a wholly owned subsidiary of Eastern. The next day, IAM sought declaratory and injunctive relief in the District Court, claiming that the involuntary transfer of IAM-represented employees amounted to an unlawful alteration of the status quo and undermined its ability to represent its members. Following a hearing on June 24, the District Court found that the proposed fleet service transaction created a "major" dispute under the RLA, 1 and it entered an order temporarily enjoining Eastern from changing the status quo and from interfering with IAM as the certified bargaining representative of its fleet service employees. IAM v. Eastern Air Lines, No. 87-1720 (D.D.C. June 24, 1987), reprinted in J.A. 31.

A hearing was held on IAM's motion for a preliminary injunction on July 2, 1987. At its conclusion, the District Court issued the July injunction, in which it ordered Eastern to maintain the status quo as of June 24, 1987, "by recognizing the validity and acting in accordance with all the terms and conditions" of the parties' collective bargaining agreement, "including its moratorium provision." IAM v. Eastern Air Lines, No. 87-1720 (D.D.C. July 2, 1987), reprinted in J.A. 159. The court further enjoined Eastern "from unilaterally changing or modifying the rates of pay, rules, and working conditions of its fleet service employees" until it "exhaust[ed] the procedures mandated by the Railway Labor Act for altering or amending collective bargaining agreements." Id., J.A. 160. Eastern immediately noticed an appeal of the July injunction. 2

Eastern's appeal from the July injunction had been briefed by both sides and was scheduled for oral argument before this court when, on February 4, 1988, Eastern moved for voluntary dismissal, claiming that its appeal was moot because it had decided to abandon the AGS transaction. The next day, Eastern announced that it had entered into an agreement to sell the shuttle's assets to Air Shuttle Holdings ("ASH"), a business entity whose majority owner would be Texas Air, in exchange for $225 million. Eastern indicated that, under the purchase agreement between it and Texas Air, the 865 or so Eastern employees working on the shuttle--including approximately 260 represented by IAM--would not be transferred involuntarily to ASH. Instead, according to Eastern, positions at ASH would be offered to Eastern's shuttle employees in seniority order. 3 With regard to those shuttle employees wishing to remain at Eastern, Eastern and Texas Air declared their "intent" that the transaction produce "no loss of employment" and that it have a "minimum impact on the employees of [Eastern]." J.A. 230.

The announcement of the shuttle transaction prompted IAM to take two actions. First, it opposed Eastern's motion for voluntary dismissal by "strenuously disput[ing] appellants' characterization of [the] appeal as moot." J.A. 335. This court agreed. In an order issued on February 16, 1988, Eastern's appeal was dismissed solely "because the company ... abandoned its claim and ... asserted that it [would] comply with the judgment of the District Court." IAM v. Eastern Air Lines, No. 87-7123 (D.C.Cir. Feb. 16, 1988), reprinted in J.A. 487. Second, IAM asked the District Court to hold Eastern in contempt of the July injunction or, in the alternative, to issue a new preliminary injunction enjoining Eastern from spinning off the shuttle.

A hearing limited to IAM's contempt motion was held by the District Court on February 12, 1988. Nearly a month later, the court issued the March order, in which it adjudged Eastern in civil contempt for violating the July injunction. IAM v. Eastern Air Lines, No. 87-1720 (D.D.C. Mar. 10, 1988), reprinted in J.A. 491. It "further enjoined and restrained [Eastern] from taking any steps to separate" the shuttle "by sale or other means pending exhaustion of the mandatory dispute resolution procedures of the Railway Labor Act." Id., J.A. 492. In a memorandum opinion released on the same day, the court explained that the July injunction "was directed not only to the proposed transfer to AGS but to any substantially similar proposal." IAM v. Eastern Air Lines, No. 87-1720 (D.D.C. Mar. 10, 1988), reprinted in J.A. 503. In its view, the shuttle deal was "not fundamentally different" from the fleet service transaction. Id., J.A. 503. This appeal followed. 4

A. Jurisdiction
1. 28 U.S.C. Sec. 1291

IAM contends that this court lacks jurisdiction to entertain Eastern's appeal because civil contempt orders are not final orders that are immediately appealable under 28 U.S.C. Sec. 1291. 5 IAM grounds its argument on a long line of cases stretching back to Doyle v. London Guar. & Accident Co., 204 U.S. 599, 603, 27 S.Ct. 313, 314, 51 L.Ed. 641 (1907), where the Supreme Court held that "an order punishing for contempt made in the progress of the case, when not in the nature of an order in a criminal proceeding, is regarded as interlocutory and to be reviewed only upon appeal from a final decree in the case." See also SEC v. Elmas Trading Corp., 824 F.2d 732, 732 (9th Cir.1987); Duell v. Duell, 178 F.2d 683, 687 (D.C.Cir.1949). Although Eastern correctly notes that "[e]xceptions to the rule are plentiful," Drummond Co. v. District 20, UMWA, 598 F.2d 381, 383 (5th Cir.1979), none is applicable here.

Specifically, this is not a case where an immediate appeal should be permitted because, based "on a pragmatic assessment, it appears that nothing further remains to be done [in the District Court], notwithstanding the lack of formal termination." 15 C. WRIGHT, A. MILLER & E. COOPER, FEDERAL PRACTICE AND PROCEDURE Sec. 3917, at 627 (1976); see, e.g., Peabody Coal Co. v. Local Union Nos. 1734, 1508 & 1548, UMWA, 484 F.2d 78, 84-85 (6th Cir.1973). To the contrary, IAM filed an amended complaint after the July injunction was issued in which it renewed its earlier request for permanent injunctive relief and a declaratory judgment. IAM also sought to begin discovery. We thus "presume the underlying litigation is still pending in district court, not having been informed otherwise by the parties." Union of Professional Airmen v. Alaska Aeronautical Indus., 625 F.2d 881, 883 n. 2 (9th Cir.1980). 6

2. 28 U.S.C. Sec. 1292(a)(1)

Although no appeal may be taken here pursuant to 28 U.S.C. Sec. 1291, Eastern correctly notes that 28 U.S.C. Sec. 1292(a)(1) permits an immediate appeal from an interlocutory order that grants or modifies an injunction. 7 Because it believes that the shuttle transaction...

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