Johnston Dev. Group v. CARPENTERS LOCAL UNION 1578, Civ. A. No. 89-566 (SSB).

• Decision Date: 10 May 1989
• Docket Number: Civ. A. No. 89-566 (SSB).
• Citation: 712 F. Supp. 1174
• Parties: JOHNSTON DEVELOPMENT GROUP, INC., et al., Plaintiffs, v. CARPENTERS LOCAL UNION NO. 1578, et al., Defendants.
• Court: U.S. District Court — District of New Jersey

712 F. Supp. 1174

JOHNSTON DEVELOPMENT GROUP, INC., et al., Plaintiffs, v. CARPENTERS LOCAL UNION NO. 1578, et al., Defendants.

Civ. A. No. 89-566 (SSB).

United States District Court, D. New Jersey.

May 10, 1989.

Blank, Rome, Comisky & McCauley by Jerald R. Cureton, Howard R. Flaxman, Cherry Hill, N.J., for plaintiffs.

Williams & Connolly by Aubrey M. Daniel, III, Kevin J. Hasson, Peter W. Chatfield, Washington, D.C. and Moss, Powers & Kugler by Robert B. Kugler, Moorestown, N.J., for defendants.

OPINION

BROTMAN, District Judge.

Presently before the court is the application of plaintiffs, Johnston Development Group, Inc. and Glassboro Development Co., Inc., for a temporary restraining order enjoining the defendants, Carpenters Local Union No. 1578, Frank Spencer, Ronald Jurnegan and "others acting in concert with them," ("Carpenters" or "the Union") from representing to prospective customers of plaintiffs that buying a home at plaintiffs' Hidden Creek development constitutes a health risk as a result of its close proximity to the Lipari Landfill.

FACTS AND PROCEDURE

Johnston Development Group, Inc., in a joint venture with Glassboro Development Co., Inc. d/b/a Plank Run Developers Partnership, L.P., is developing a residential subdivision known as "Hidden Creek." The subdivision is located in Glassboro, New Jersey, and is less than one mile from the Lipari Landfill, which is currently ranked number one on the United States Environmental Protection Agency's Superfund cleanup list. While plaintiffs do not directly employ any carpenters—union or non-union—or other trades persons in their development, they do subcontract all construction work to other companies and those companies apparently do not employ union carpenters.

In the fall of 1988, Carpenters Local 1578 began picketing the Hidden Creek development.¹ In response to the picketing, plaintiffs filed an "unfair labor practice" charge with the National Labor Relations Board (NLRB or "Board"), alleging that the Union's actions violated sections 8(b)(4)(i) and (ii)(B) of the National Labor Relations Act, 29 U.S.C. § 158(b)(4)(i) and (ii)(B), as amended.²

After an investigation, the NLRB filed an injunction action with this court, pursuant to 29 U.S.C. § 160(l),³ to enjoin what the Board had determined to be an unfair labor practice. The parties (the NLRB and the Union) settled the dispute by entering into a Stipulation on October 28, 1988, whereby the Union agreed to stop picketing the Hidden Creek site. See Stipulation and Order, attached to plaintiff's Memorandum of Law as Exhibit F.

Subsequently, on February 8, 1989, plaintiffs filed the complaint in this action, alleging, inter alia, violations of the Racketeer Influenced and Corrupt Organizations law, antitrust law, and 29 U.S.C. § 158(b)(4)(ii)(B)⁴, as well as various state tort claims. Besides its prayer for monetary relief, the complaint requests that the court preliminarily and permanently enjoin the defendants' unlawful conduct (which, the complaint alleges, goes far beyond simple picketing to include extortion, violence and threats of violence), pursuant to section 7 of the Norris-LaGuardia Act, 29 U.S.C. § 107.

Thereafter, beginning on or about February 18, 1988, and continuing on February 19 and every weekend until April 14, 1989, between two and five members of the union, dressed in white decontamination suits and wearing gas masks, have stood at or near the entrance to Hidden Creek and distributed handbills identical to those attached to plaintiff's Memorandum of Law as Exhibits A and B. Basically, the pamphlets, with the aid of somewhat hyperbolic —but not clearly false—language, photos and drawings, warned prospective home buyers of the potential dangers of living so close to the Lipari Landfill. Except for some very small print stating that they were paid for by Carpenters Local 1578, the pamphlets contain no indication of the underlying labor dispute.

Plaintiffs responded to this latest union tactic in two ways. First, they amended their complaint in the underlying lawsuit to include the incidents of handbilling as examples of the defendants' alleged unlawful activity. Second, plaintiffs filed another unfair labor practice charge with the National Labor Relations Board alleging, once again, a violation of § 158(b)(4)(i) and (ii)(B).⁵ This time, however, after an investigation of plaintiffs' allegations, the Regional Director of the Board refused to issue a complaint, stating: "The handbilling engaged in by the Union did not constitute picketing." See Letter of Regional Director of NLRB, attached to plaintiff's Memorandum of Law as Exhibit H. The Regional Director went on to state that, even if the handbilling had a secondary object within the meaning of § 158(b)(4)(i) and (ii)(B), it was not necessarily unlawful. Id. The Director relied on the recent Supreme Court decision in Edward J. DeBartolo Corp. v. Fla. Gulf Coast Bldg. & Const. Trades Council and NLRB, 485 U.S. 568, 108 S.Ct. 1392, 99 L.Ed.2d 645 (1988), in which the Court stated that there is no "clear indication in the relevant legislative history that Congress intended § 8(b)(4)(ii) to proscribe peaceful handbilling, unaccompanied by picketing, urging a consumer boycott of a neutral employer." Id. 108 S.Ct. at 1402. Plaintiffs appealed the Regional Director's decision to the General Counsel of the NLRB and on May 4, 1989, the General Counsel affirmed the Regional Director's refusal to issue an unfair labor practice complaint.⁶

Because of—or in spite of—the NLRB's refusal to issue a complaint against the defendants' most recent activity, plaintiffs first sought a temporary restraining order in the Chancery Division of New Jersey Superior Court. Before their claim could be heard, however, plaintiffs voluntarily dismissed their state case and brought this virtually identical application before this court seeking to enjoin the Carpenters from distributing the handbills at the Hidden Creek development.

Oral argument and fact-finding hearings were held by this court on April 14, 21 and 27, 1989, and the parties have also conducted settlement negotiations. It was during one of these negotiating sessions on April 14, 1989, that the Union agreed to limit the number of handbillers present at Hidden Creek at any one time to two, to cease wearing the decontamination suits and gas masks, and to revise its handbills to contain less inflammatory language.⁷ Plaintiffs, however, are not satisfied with these remedial measures and still seek injunctive relief on the grounds that the Union's actions constitute malicious libel and tortious interference with prospective contractual relations.

DISCUSSION

Before the court may address the merits of plaintiffs' claim, it must determine whether it may hear the matter at all, as there is a serious question as to whether federal labor law divests this court of jurisdiction over this dispute.⁸

The basic question that must be answered by this court in determining its jurisdiction over the instant action is whether a federal district court has the power to enjoin "secondary" labor activity. Put simply, secondary activity, in the form of strikes, boycotts, picketing and appeals to consumers, is action taken by a union or other group not against the employer with whom they have a labor dispute, but against those who do business with the employer. The main purpose of such secondary activity is to force the employer to succumb to the union's demands by isolating it from the business community by cutting off its suppliers, customers and other economic partners.

The twentieth century has seen Congress continually refine and curtail the jurisdiction of the federal courts over both primary and secondary labor activity.⁹ In the early 1900's, when labor unrest was at its peak, employers found a strong ally in the federal courts which were active in enjoining concerted labor activities, mainly through the application of the Sherman Antitrust Act of 1890, 15 U.S.C. § 1 et seq.¹⁰ While passage of the Sherman Act was originally intended to combat the abusive practice of manufacturers combining to monopolize avenues of production and distribution, thus controlling prices and markets, the anti-labor courts of the era used it to frustrate the objectives of labor unions. In fact, in 1908 in Loewe v. Lawlor, 208 U.S. 274, 28 S.Ct. 301, 52 L.Ed. 488, the Supreme Court held a secondary boycott by members of a striking hatters' union to be illegal under the Sherman Law and sustained a private judgment for treble damages against individual employee defendants.

A. The Clayton Act

In response to this judicial trend, Congress passed the Clayton Act of 1914 the purpose of which was "to equalize before the law the position of workingmen and employer as industrial combatants." Duplex Printing Press Co. v. Deering, 254 U.S. 443, 484, 41 S.Ct. 172, 182-83, 65 L.Ed. 349 (1921). In particular, Section 20 of the Clayton Act, 29 U.S.C. § 52, was intended to "withdraw from the general interdict of the Sherman Law specifically enumerated practices of labor unions by prohibiting injunctions against them." United States v. Hutcheson, 312 U.S. 219, 229-30, 61 S.Ct. 463, 465, 85 L.Ed. 788 (1941).¹¹ While the language of § 20 was clearly broad enough to protect all peaceful strike activity, whether primary or secondary, Burlington Northern Railroad Co. v. Brotherhood of Maintenance of Way Employees, 481 U.S. 429, 438, 107 S.Ct. 1841, 1847, 95 L.Ed.2d 381 (1987) (9-0 decision), the early courts did not read it that way. In Duplex Printing Press Co. v. Deering, 254 U.S. 443, 41 S.Ct. 172, 65 L.Ed. 349 (1921) (overruled by the Norris-LaGuardia Act of 1932, 29 U.S.C. §§ 101-115, see discussion infra), the Supreme Court held that § 20 did not prevent courts from enjoining peaceful secondary strike activity. In reaching its conclusion, the Court apparently relied on some remarks made during the legislative debates on the bill and...