Kraemer Hosiery Co. v. American Federation of Full Fashioned Hosiery Workers

• Citation: 305 Pa. 206,157 A. 588
• Decision Date: 09 October 1931
• Docket Number: 49
• Parties: Kraemer Hosiery Co. et al. v. American Federation of Full Fashioned Hosiery Workers et al.; Appeal of Lewis Francis Budenz
• Court: United States State Supreme Court of Pennsylvania

157 A. 588

305 Pa. 206

Kraemer Hosiery Co. et al. v. American Federation of Full Fashioned Hosiery Workers et al.;

Appeal of Lewis Francis Budenz

No. 49

Supreme Court of Pennsylvania

October 9, 1931

Argued February 2, 1931

Appeal, No. 49, Jan. T., 1931, by Lewis Francis Budenz, from decree of C.P. Northampton Co., in equity to No. 6, Nov. T 1929, awarding injunction, in case of Kraemer Hosiery Company and A.G. Schmidt, president of the company, v. American Federation of Full Fashioned Hosiery Workers et al. Decree modified and affirmed.

Bill for injunction. Before STEWART, P.J. See 22 Northampton Co Rep. 223.

The opinion of the Supreme Court states the facts.

Injunction awarded. Lewis Francis Budenz appealed.

Error assigned, inter alia, was final decree which was as follows quoting it:

"And now, March 31, 1930, this cause came on to be heard at this term by the court in banc, and, upon consideration thereof, it is ordered, adjudged, and decreed that all the exceptions filed be dismissed, and that the injunction heretofore granted, as modified in the decree nisi, entered January 13, 1930, be made permanent, and that a perpetual injunction be issued to the American Federation of Full Fashioned Hosiery Workers, Reading Branch, Local No. 10, and its members, Earl White, individually and as secretary of Local No. 10, and Lewis Francis Budenz, defendants, commanding and restraining them, and every of them, their agents, servants, employees, and every of them, from in any way interfering with the business of the Kraemer Hosiery Company, especially from inducing, by any means whatsoever, the employees of the Kraemer Hosiery Company, to break the individual contracts which they have entered into with the Kraemer Hosiery Company, and from annoying, molesting, threatening, intimidating the employees of the Kraemer Hosiery Company, or sending libelous and scandalous pamphlets or newspapers to them or any of them, with the intention and purpose of inducing them to violate the individual contracts between the Kraemer Hosiery Company and its said employees. It is further ordered and decreed that the defendants shall pay the costs of this proceeding."

As thus modified the decree of the court below is affirmed and the appeal is dismissed at appellant's costs.

Orrin E. Boyle, for appellant. -- An injunction will not be sustained where the offenses alleged are not proven to have been committed or threatened: Bussier v. Weekey, 11 Pa.Super. 463.

Equity should not restrain a labor union and its representatives from peacefully persuading employees to join their union, where such employees were induced, without receiving legal consideration, to sign individual promises not to join that union and to leave their employment if they did, by being threatened by their employers with loss of their jobs if they would not sign, and by other overreaching conduct and smart bargaining: Reynolds v. Boland, 202 Pa. 642, 648; Weegham v. Killefer, 215 F. 168; Deweese v. Reinhard, 165 U.S. 386.

The contract relied upon by the plaintiff, whatever its status at law, fails in equity because of the over-reaching conduct and smart bargaining of plaintiffs in obtaining it: Pope Mfg. Co. v. Gormully, 144 U.S. 224; Friend v. Lamb, 152 Pa. 529.

Where, as here, a contract is rooted in a disparity in the bargaining power of the parties, and the contract is harsh, unfair and inequitable, courts will supervise and alter that contract in order to work justice, even though the contract is founded on sufficient consideration and is otherwise valid.

The plaintiffs' privilege to refuse to hire or to discharge men for membership in the defendant union does not include the power to procure an enforceable promise that they shall not join a union.

The defendant's conduct is fully justified in that it is wholly privileged: American Steel Foundries v. Tri-City C.T. Council, 257 U.S. 212; Jefferson & Indiana Coal Co. v. Marks, 287 Pa. 171.

An injunction should not issue against any inducement of a breach of an invalid contract.

An injunction cannot be issued against the defendants on the ground that they are seeking to accomplish an unlawful purpose: Jefferson & Indiana Coal Co. v. Marks, 287 Pa. 171; Rutland Marble Co. v. Ripley, 77 U.S. 339; Gavieres v. U.S., 220 U.S. 338; Iron City Laundry Co. v. Leyton, 55 Pa.Super. 93; Central I. & S. Co. v. Harrisburg, 271 Pa. 340; Hutchinson B. Co. v. Marvel, 270 Pa. 378.

The promise in a work contract not to join a union is not within the category of promises the inducement of the breach of which equity will enjoin: Hitchman C. & C. Co. v. Mitchell, 245 U.S. 229; Flaccus v. Smith, 199 Pa. 128.

The conduct of plaintiffs and others after the time alleged in the bill cannot justify a restraint of defendants in equity.

A promise not to join a labor union is opposed to public policy, and therefore void: Pope Mfg. Co. v. Gormully, 144 U.S. 224.

C. F. Smith, of Smith & Paff, for appellee. -- Plaintiff company, in the contracts of employment, at all times gave the employee the right to withdraw from the employment, and even if the employee joined the union or wished to join a union and wished to solicit members for the union, these rights were not taken away from him by the contract of employment, but he could not belong to a union and solicit members for a union and remain in the employment of the Kraemer Hosiery Company. This is a right, which has been recognized by the courts, that the employer has. This right has been recognized not only by the laws of the State of Pennsylvania and the laws of the United States, but by the laws of our sister states: Flaccus v. Smith, 199 Pa. 128; Hitchman C. & C. Co. v. Mitchell, 245 U.S. 260; Eagle G. & Mfg. Co. v. Rowe, 245 U.S. 275; Montgomery v. Ry., 293 F. 681; Am. Steel Foundries v. Tri-City Central Trades Council, 257 U.S. 184.

Before FRAZER, C.J., WALLING, SIMPSON, KEPHART, SADLER, SCHAFFER and MAXEY, JJ. Affirmed.

OPINION

MR. CHIEF JUSTICE FRAZER:

Plaintiff company, owner and operator of a hosiery mill at Nazareth, Northampton County, filed its bill in this case to restrain the American Federation of Full Fashioned Hosiery Workers, a national organization, one of its local branches and its officers and other designated persons (among them, appellant), acting for the local union or for the superior body of which it is a part, from interfering with plaintiff's employees. The bill alleged attempts by defendants to induce plaintiff's workers to join defendant union, though knowing that by so doing the workers would violate the terms of the written "individual contract" under which they were respectively employed by plaintiff. A preliminary injunction was issued, which after answer and hearing was made permanent. Budenz, who was not an employee of plaintiff, nor a member of either the national or local organizations, alone has appealed.

After consideration of the voluminous record, we are convinced that it would serve no useful purpose to discuss at length the legal points argued, as the chancellor's findings of fact are controlling, and the law as applied to them is clear. Briefly stated, the controlling findings are: Plaintiff company does not recognize any labor union, and employs approximately 700 persons, of which number, 241 men and women are workers in its hosiery mill. On June 20, 1929, plaintiff requested each of its employees to sign what the pleadings refer to as an "individual contract." The terms of this contract were: that the signer was not a member of the American Federation of Full Fashioned Hosiery Workers, or affiliated with it or similar organizations, that if the signer concluded to join an organization of the character of the bodies referred to, he would withdraw from plaintiff company's employ and not before that time make efforts to unionize the other employees, and that he understood plaintiff company was to "run non-union, and agrees with me that it will run non-union while I am in its employ." The court found that the hosiery company practiced no fraud or duress in inducing its employees to sign the agreement, and that each signer was afforded full opportunity to read and understand the contract before adopting its terms.

The court found that Budenz, an attorney-at-law residing in the City of Rahway, New Jersey, and White, the secretary of the Reading Branch, Local No. 10, as representatives of the American Federation of Hosiery Workers, of which defendant union is a branch, visited Nazareth and by addresses, both spoken and written, at meetings attended by plaintiff's employees, induced a number of the company's employees to violate their agreement with plaintiff and enroll in defendant union, and that they, Budenz and White, published and distributed pamphlets among plaintiff's employees, which the court found were for the purpose of unionizing such persons, inducing them to violate their contracts and exciting the minds of Nazareth citizens against plaintiff company.

Seven employees having affiliated themselves with the union in violation of their contracts, were dismissed from plaintiff's employ, which action upon the part of plaintiff resulted in a sympathetic strike by a portion of the remaining employees, and, as the court found, those not striking have been interfered with and annoyed by threats, statements of intimidation, and picketing, brought about by the printed matter issued by defendants. Appellant himself was one of the pickets and his claim that defendant's actions were legal and peaceably persuasive was not sustained by the chancellor.

The court's findings also state that, previous to defendants' interference, the relations between plaintiff company and its employees were satisfactory and peaceable and no...