Kitty Hawk Aircargo, Inc. v. Chao

• Decision Date: 20 July 2005
• Docket Number: No. 04-10860.,04-10860.
• Citation: 418 F.3d 453
• Parties: KITTY HAWK AIRCARGO, INC., Plaintiff-Appellee, v. Elaine CHAO, Etc., Defendant, Air Line Pilots Association; Hal Winters, Intervenor Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

418 F.3d 453

KITTY HAWK AIRCARGO, INC., Plaintiff-Appellee, v. Elaine CHAO, Etc., Defendant, Air Line Pilots Association; Hal Winters, Intervenor Defendants-Appellants.

No. 04-10860.

United States Court of Appeals, Fifth Circuit.

July 20, 2005.

Karen S. Precella, Haynes & Boone, Fort Worth, TX, Gerard F. Doyle (argued), Scott W. Woehr, Doyle & Bachman, Arlington, VA, for Plaintiff-Appellee.

Robert Russell Bailey (argued), Airline Pilots Ass'n Intern., Washington, DC, Marta Wagner, Air Line Pilots Ass'n, Herndon, VA, for Air Line Pilots Ass'n.

Steven K. Hoffman (argued), Sean B. Bajkowski, James & Hoffman, Washington, DC, for Winters.

Appeals from the United States District Court for the Northern District of Texas.

Before DAVIS, STEWART and DENNIS, Circuit Judges.

DENNIS, Circuit Judge:

Intervenors Airline Pilots Association (ALPA) and Hal Winters appeal the district court's granting of summary judgment to the plaintiff, Kitty Hawk Aircargo, Inc. The district court enjoined the defendant, the Secretary of the United States Department of Labor (the Secretary), from implementing, against Kitty Hawk, a ruling of the Department of Labor's Administrative Review Board (ARB) concluding that pilots are "service employees" subject to the prevailing wage requirements of the McNamara-O'Hara Service Contract Act (SCA). We conclude that Kitty Hawk lacked standing to challenge the ARB's ruling in the district court. We therefore reverse the judgment of the district court and remand with instruction to dismiss the complaint.

I

The United States Postal Service contracts with air cargo carriers for the transportation of the nation's mail. There are three major types of Postal Service air cargo contracts: ANET, WNET and CNET contracts. ANET and WNET contracts are year-round contracts; CNET contracts are short-term peak Christmas season contracts. In addition to the three major types of contracts, the Postal Service enters into some air transport contracts between certain pairs of cities during peak periods (point-to-point contracts) and for mail delivery on direct and indirect flights on the carrier's transportation system between certain dates (ASYS contracts). The SCA applies to WNET, ANET, and CNET contracts and, apparently, to point-to-point contracts. There are exemptions, however, for certain ASYS contracts based upon the proportion of the carrier's revenue attributable to Postal Service business. The plaintiff, Kitty Hawk Air Cargo Inc., formerly held certain contracts subject to the SCA.

Every contract subject to the SCA must include, among other things, a "provision specifying the minimum monetary wages to be paid the various classes of service employees in the performance of the contract or any subcontract thereunder, as determined by the Secretary, or his authorized representative, in accordance with prevailing rates for such employees in the locality. . . ."¹ The Secretary has delegated the task of making prevailing wage determinations to the Wage and Hour division (WHD).² In 1996, the WHD issued wage determination No. 95-0229 (Rev.1) which significantly increased the prevailing wage determination for captains and first officers (pilots) transporting mail.

The Postal Service, which is required by regulation to increase contract prices to defray the additional costs of a changed wage determination,³ challenged the wage determination. Numerous other interested parties also challenged the new wage rate. The parties argued that the WHD used an improper methodology to calculate the new wage rate and also argued that pilots are exempt from the prevailing wage provisions of the SCA because they are "professionals" rather than "service employees" under the SCA. On December 13, 1996, the WHD issued a letter ruling reducing the pilot wage rate for ANET and WNET pilots. The letter ruling also explicitly exempted pilots on CNET and other short-term contracts from that wage rate and instead issued a separate, significantly lower, rate for those pilots. The WHD, however, failed to address whether pilots are professionals and therefore not subject to the prevailing wage provisions of the SCA.

Kitty Hawk and the Postal Service, among others, appealed the WHD's decision to the ARB. The ARB remanded the matter to the WHD to make an initial determination regarding the applicability of the SCA's prevailing wage requirements to pilots. On remand, the WHD determined that pilots are not professionals exempt from the wage provisions of the SCA. Kitty Hawk, the Postal Service and others again appealed to the ARB. The ARB affirmed the WHD's determination that pilots are not exempt from the prevailing wage provisions of the SCA but found that the WHD's method of calculating the wage rates for ANET and WNET pilots was contrary to the statute. Thus, the ARB remanded the matter to the WHD for a recalculation of the prevailing wage for air cargo pilots working on ANET and WNET Postal Service contracts.

Kitty Hawk filed a complaint in the district court on July 16, 2001 seeking judicial review of the ARB's decision. On January 10, 2001, however, the Postal Service had entered into a seven-year renewable contract with FedEx for the year-round, nationwide transportation of mail.⁴ Accordingly, by August 21, 2001, the Postal Service had terminated, for its own convenience, all of Kitty Hawk's major year-round contracts. On January 29, 2002, Kitty Hawk entered into a settlement agreement with the Postal Service concerning the termination of Kitty Hawk's largest contract, WNET 99-01. As part of the settlement, Kitty Hawk agreed to indemnify the Postal Service for any liability to the pilots who had worked on that and other contracts "for [SCA] issues related to the disputed pilot wage determinations." Kitty Hawk received more than $30 million in the settlement.

ALPA and Captain Hal Winters, a pilot employed by another air cargo company, intervened in the district court, with Kitty Hawk's consent, on the side of the Secretary. On May 30, 2002, ALPA and Winters filed a motion for summary judgment arguing, among other things, that Kitty Hawk lacked standing to challenge the ARB's decision. The district court denied the motion without opinion. The Secretary and Kitty Hawk subsequently filed cross-motions for summary judgment. The district court granted Kitty Hawk's motion for summary judgment and denied that of the Secretary.

The district court's initial judgment set aside the ARB's ruling and enjoined the Secretary from implementing the decision. The Secretary filed a motion to amend the judgment arguing that, because Kitty Hawk was the only party to the ARB's action that sought judicial review, the judgment should be limited to Kitty Hawk. The district court agreed and issued an amended judgment which did not set aside the ARB ruling but merely enjoined the Secretary from taking action against Kitty Hawk in accordance with the ruling or from taking any action against Kitty Hawk that would be inconsistent with the district court's finding that Kitty Hawk pilots are not service employees subject to the prevailing wage requirements of the SCA. Intervenors ALPA and Winters appeal from the amended judgment; the Secretary did not appeal.

II

As an initial matter we address Kitty Hawk's motion to dismiss the appeal for lack of jurisdiction. According to Kitty Hawk, the appellants lack standing to appeal because neither was a party at the district court and neither can individually satisfy the Article III requirement of injury resulting from the judgment. We conclude that ALPA satisfies Article III and, therefore, this court has jurisdiction over the appeal, regardless of Winters' ability to independently satisfy Article III.

ALPA and Winters intervened in the district court on the side of the Secretary with the consent of Kitty Hawk. Generally, a party's status as an intervenor below does not confer standing to appeal if the party on whose side intervention was permitted chooses not to appeal.⁵ "Rather, intervenors who wish to prosecute an appeal on their own must separately fulfill the injury, causation, and redressability requirements of Article III."⁶

"Where standing to appeal is at issue, appellants must demonstrate some injury from the judgment below."⁷ The judgment below applies only to the Secretary and Kitty Hawk. Thus, Kitty Hawk argues that because there is nothing in the record to demonstrate that ALPA has any relationship to the Kitty Hawk pilots, neither ALPA nor the pilots it represents are injured by the judgment. Furthermore, Kitty Hawk argues that Winters, a pilot who does not work for Kitty Hawk, is not injured by the district court's decision.

ALPA is the certified collective bargaining representative of the Kitty Hawk pilots. Kitty Hawk does not dispute that ALPA represents the pilots nor does it seriously dispute that, as the collective bargaining representative of the pilots whose wages are at issue, ALPA has standing to appeal the district court's judgment. Rather, Kitty Hawk contends that ALPA cannot point to any proof in the record of its representation of the Kitty Hawk pilots and, therefore, this court lacks jurisdiction over the appeal.

Kitty Hawk is correct that there is no evidence in the record proving that ALPA is the collective bargaining representative of the Kitty Hawk pilots. At the time that ALPA intervened in the district court action, it did not represent the Kitty Hawk pilots. Therefore, it did not allege that it represented those pilots and did not submit evidence to that effect. In 2003, however, ALPA merged with the Kitty Hawk pilots' prior certified collective bargaining representative, the Kitty Hawk Pilots Association (KPA). On January 5, 2004, the National Mediation Board (NMB) approved the transfer of KPA's certification to ALPA. This approval is published in the official administrative agency reporter, is available on the agency's website and on Lexis and Westlaw.⁸ Thus, ALPA's...