Japan Air Lines Co., Ltd. v. International Ass'n of Machinists and Aerospace Workers, AFL-CIO ('IAM'), AFL-CIO

• Court: U.S. Court of Appeals — Second Circuit
• Writing for the Court: Before LUMBARD, WATERMAN and MESKILL; LUMBARD
• Citation: 538 F.2d 46
• Parties: 92 L.R.R.M. (BNA) 3383, 79 Lab.Cas. P 11,518 JAPAN AIR LINES COMPANY, LTD., Plaintiff-Appellee, v. INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE WORKERS,("IAM"), et al., Defendants-Appellants. ockets 75-7060 and 75-7641.
• Docket Number: Nos. 993,AFL-CIO,1122,D
• Decision Date: 14 July 1976

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538 F.2d 46 92 L.R.R.M. (BNA) 3383, 79 Lab.Cas. P 11,518 JAPAN AIR LINES COMPANY, LTD., Plaintiff-Appellee,
v.
INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE
WORKERS, AFL-CIO("IAM"), et al., Defendants-Appellants. Nos. 993, 1122, Dockets 75-7060 and 75-7641. United States Court of Appeals,
Second Circuit. Argued April 29, 1976.
Decided July 14, 1976.

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Murray Gartner, New York City (Poletti Freidin, Prashker Feldman & Gartner, and Edward Brill, New York City, on the brief), for plaintiff-appellee.

Sheldon Engelhard, New York City (Vladeck, Elias, Vladeck & Lewis, Deborah A. Watarz, and Robert Jauvtis, New York City, on the brief), for defendants-appellants.

Before LUMBARD, WATERMAN and MESKILL, Circuit Judges.

LUMBARD, Circuit Judge:

In this consolidated appeal, the International Association of Mechanics and Aerospace Workers (the Union) seeks review of two orders entered in the Southern District. The first, a temporary restraining order issued by Judge Ward on January 22, 1975 and subsequently extended, prohibited the Union from striking over its demand that Japan Air Lines (JAL) gradually phase out its long standing practice of subcontracting maintenance and ground service work at various of its stations in the United States. The second, a declaratory judgment filed on October 15, 1975, concluded inter alia that the Union's above described "scope" proposal did not constitute a mandatory subject about which the parties were required to bargain under the Railway Labor Act (RLA), 45 U.S.C. § 151 et seq. Since the TRO has long since expired, we hold that the appeal therefrom is now moot. Insofar as the Union has appealed from the declaratory judgment, it is affirmed on the merits.

JAL began service to the United States in 1954 with regularly scheduled flights from Tokyo, Honolulu and San Francisco. Although initially it relied on United Air Lines personnel to perform the necessary maintenance and ground service at both locations, within a year JAL had modified this decision and hired the nucleus of its own crew in Honolulu. The development of this core group, grown to fifteen by the time the Union and JAL signed their first agreement effective March 1959, established a precedent which was later repeated as JAL's operations expanded to Anchorage and Los Angeles in 1959 and to New York City in 1966. In each instance, JAL first arranged to have other companies provide its maintenance and ground service; only later, and from time to time, did it replace these independent contractors with its own employees. At present, the Union estimates that it represents approximately 112 JAL employees. JAL places the total at more than 200.

However many employees may be represented by the Union, it is undisputed that since 1958 the Union has been the sole collective bargaining agent for all JAL employees "who comprise the craft or class of Airline Mechanics, including Ground Service and Ramp employees." In that capacity it has negotiated a series of successive agreements with the Company, each of which has contained in substantially similar form the following paragraph:

If, during the life of this Agreement, the Company should establish its own maintenance, ground service or stores facilities at any other base within the United States, its territories and/or possessions, the Company and the Union will meet and negotiate wage rates and other conditions to govern the employees at the new base only prior to, or as near as

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possible after, the opening of the new facility.

The genesis of the instant dispute lies in the Union's desire to obtain JAL's affirmative commitment to cease its subcontracting. On September 28, 1973, one month prior to the expiration of the then current agreement, the Union notified JAL of approximately 75 suggested contractual changes, as required by R.L.A. § 6, 45 U.S.C. 156. Most of these dealt with pay scale and working conditions. However, of particular concern here, the Union also proposed that, during the course of the new agreement, JAL assign all its maintenance and ground service work at all its American stations to its own employees. ¹

When negotiations commenced in November 1973, this so-called scope proposal became one of the focal points of discussion. The district court found that despite periodic meetings between labor and management through the next year JAL never wavered from its original position that it would not bargain on the issue of subcontracting. ² Although the Union raised its scope proposal at each bargaining session, the Company never made any counterproposal.

On January 25, 1974, after three months of fruitless negotiating, JAL requested the assistance of the National Mediation Board in resolving the deadlock between itself and the Union. 45 U.S.C. § 155. The Board accepted jurisdiction of the dispute, which at that point involved matters relating to wages, pension and a no lay-off clause as well as the proposal regarding scope, and it appointed a mediator. Suffice to say that his obviously diligent efforts, extending over a period of nearly four months, proved unavailing. Indeed, with the passage of time, the parties stiffened in their respective postures. Thus, in September 1974 when JAL indicated its willingness to accede to the contract terms which United Air Lines and the Union had already agreed upon, Robert Quick responded on behalf of the Union that the bargaining committee could not recommend ratification unless JAL made some concession on scope. On September 10, the rank and file endorsed Quick's position, rejecting the Company's offer by an overwhelming majority.

Furthermore, on several later occasions throughout the autumn, Quick repeated his insistence that he "had to have something on scope" to satisfy the membership. JAL, however, remained equally adamant and, on November 26, 1974, it addressed a letter to all its workers represented by the Union informing them that it had "told the Union Committee that we will not bargain on 'Scope' or other issues not related to rates of pay or working conditions for our own employees."

On December 17, 1974 the National Mediation Board suggested that the dispute be submitted to arbitration. JAL agreed to arbitrate all issues except scope; the Union rejected the proffer of arbitration in its entirety. As contemplated by the RLA, the Board thereupon informed both the Union and JAL that it was terminating its services as of December 23, 1974 and that following a statutory cooling off period of 30 days, 45 U.S.C. § 155, the parties would be free to resort to self-help. ³

Anxious to avoid the crippling impact of a strike, JAL petitioned the district court on January 13, 1975 for a permanent injunction barring the Union from continuing to bargain about or engaging in a work stoppage over its scope proposal. In addition, JAL brought on a motion for a preliminary

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injunction by an order to show cause, served on the Union on January 14 and returnable two days later.

On January 16, the Union promptly requested that the entire action be transferred to California, pursuant to 28 U.S.C. § 1404, on the ground that the latest round of negotiations had taken place there. After this was denied by the district court, the Union sought a continuance of the scheduled hearing on the preliminary injunction to allow it sufficient time to bring witnesses from the west coast. In an effort to accommodate the Union's logistical difficulties while at the same time protecting JAL's legitimate interests, Judge Ward offered to postpone the hearing if the Union consented to the entry of a TRO until January 31, thus extending in effect the cooling off period which would otherwise end on January 23.

When the Union rejected this compromise plan, the court indicated that it had no choice but to proceed with the evidentiary hearing. Two witnesses then testified for JAL and were cross-examined by counsel for the Union. The Union did not present any witnesses itself but asked leave to submit affidavits in opposition to the preliminary injunction. Judge Ward agreed, setting January 20 as the deadline for all affidavits and any memoranda which the parties might wish to submit.

At 4:30 p. m. on January 22, 1975, pending determination of its motion for a preliminary injunction, JAL returned to the district court, on notice to the Union, and applied for a TRO against the strike threatened to begin that midnight. After yet another unsuccessful attempt to obtain the Union's voluntary agreement to postpone the strike for a period of ten days, Judge Ward issued the requested TRO which enjoined the Union...