Leach v. Pan American World Airways

• Decision Date: 12 April 1988
• Docket Number: No. 769,D,No. 87-5323,769,87-5323
• Citation: 842 F.2d 285
• Parties: 128 L.R.R.M. (BNA) 2126, 56 USLW 2609, 108 Lab.Cas. P 10,485 Alice LEACH and Carmen Irons, Plaintiffs-Appellees, v. PAN AMERICAN WORLD AIRWAYS, et al., Defendants, Teamsters Local Unionefendant-Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 285

842 F.2d 285

128 L.R.R.M. (BNA) 2126, 56 USLW 2609,

108 Lab.Cas. P 10,485

Alice LEACH and Carmen Irons, Plaintiffs-Appellees, v. PAN AMERICAN WORLD AIRWAYS, et al., Defendants Teamsters Local Union No. 769, Defendant-Appellant.

No. 87-5323.

United States Court of Appeals Eleventh Circuit.

April 12, 1988.

Robert A. Sugarman, Miami, Fla., for defendant-appellant.

Richard Schoolman, Pan Am Legal Dept., New York City, Joseph Z. Fleming, Fleming and Klink, Miami, Fla., for Pan American.

Alan E. Dubow, Dubow & Hoffman, J. Bruce Hoffman, Coral Gables, Fla., for Leach & Irons.

Gerry M. Miller, Previant, Goldberg, Uelmen, Gratz, Miller & Brueggeman, S.C., Milwaukee, Wis., for Georgia-Florida Conference.

Appeal from the United States District Court for the Southern District of Florida.

Before HILL, Circuit Judge, HENDERSON ^*, Senior Circuit Judge, and MURPHY ^**,District Judge.

HILL, Circuit Judge:

FACTS

Plaintiffs Alice Leach and Carmen Irons are employees of Pan American World Airways, Inc.; defendant Teamsters Local 769 represents them before their employer. The two claim that the Department of Labor has declared them to be handicapped as a result of their extreme physical reactions to smoke in the workplace. Pursuant to the Railway Labor Act, Local 769 presented the employees' claims to the System Board of Adjustment: both plaintiffs insist this representation was flawed because the union did not present the grievances in the manner they requested of it, and because the union did not allow them to choose whether they would rather represent themselves.

After the System Board deadlocked over the claims of Leach and Irons, the union presented Irons' claim to a neutral arbitrator. Leach asserts that she signed an agreement with Pan American and Local 769 to allow her grievance to be presented at the same hearing; at the hearing, however, Local 769 withdrew Leach's claim when Pan American objected to its introduction. Leach contends she should have been notified before Local 769 breached the agreement.

Irons lost her claim at arbitration. Leach never received a definitive answer as to her grievance. Both women filed charges against Local 769 according to the Teamsters' internal procedures. An internal board exonerated Local 769, and the plaintiffs brought their claims to federal court, seeking to overturn the arbitration award and to recover damages for Local 769's breach of its duty of fair representation. The complaint named Pan American, Local 769, the International Brotherhood of Teamsters, and the Georgia-Florida Conference of Teamsters as defendants.

The present appeal poses the single and deceptively simple question of whether Leach and Irons are entitled to a jury trial of their claim that the union breached its duty to represent them fairly. The district court, 651 F.Supp. 713, found that a controlling precedent in the former Fifth Circuit bound it to conclude that plaintiffs were to receive a jury trial. See Cox v. C.H. Masland & Sons, Inc., 607 F.2d 138 (5th Cir.1979). Suggesting that the Cox rationale had been undercut, if not destroyed, the district court certified the question for interlocutory appeal. We agree with the district court that recent Supreme Court cases have undermined Cox, and, accordingly, we reverse.

THE DESTRUCTION OF COX

Cox expressly concluded that a discharged employee could obtain a jury trial for his claim that the union failed to represent him fairly. Cox, 607 F.2d at 143. Because the Cox decision was issued by the Fifth Circuit prior to September of 1981, normally we would accept its precedential value in this circuit, absent an Eleventh Circuit en banc decision to the contrary. Bonner v. City of Prichard, 661 F.2d 1206, 1209 (5th Cir. Unit B Aug. 1981). At the same time, however, according to both Eleventh and Fifth Circuit precedent this panel may not overlook decisions by the Supreme Court which implicitly overrule a binding circuit decision, or undercut its rationale. See Gresham Park Community Organization v. Howell, 652 F.2d 1227, 1234-35 (5th Cir. Unit B Aug. 1981); United States v. Kirk, 528 F.2d 1057, 1063 (5th Cir.1976) (dictum). See also LeVick v. Skaggs Companies, Inc., 701 F.2d 777, 778 (9th Cir.1983).

The panel in Cox analyzed the question of whether to grant a jury trial by applying the three-pronged test supplied by the Supreme Court in Ross v. Bernhard, 396 U.S. 531, 90 S.Ct. 733, 24 L.Ed.2d 729 (1970). ¹ In Ross the Supreme Court explained that a jury trial would be constitutionally mandatory under the Seventh Amendment when the particular case was "legal" in nature; the nature of the claim "is determined by considering, first, the pre-merger [of law and equity] custom with reference to such questions; second, the remedy sought; and, third, the practical abilities and limitations of juries." Ross, 396 U.S. at 538 n. 10, 90 S.Ct. at 738 n. 10. The Cox panel explained that suits alleging a breach of the duty of fair representation resembled a common law tort, an action triable to a jury prior to the merger of law and equity. Furthermore, the panel determined that the action was one to enforce a "statutory liability involving legal rights and remedies." Cox, 607 F.2d at 143. Such actions have been accorded the right to a jury trial. Curtis v. Loether, 415 U.S. 189, 193-94, 94 S.Ct. 1005, 1007-08, 39 L.Ed.2d 260 (1974).

The Cox court summarily addressed the second two prongs of Ross, explaining that the plaintiffs sought the traditional legal remedy of compensatory and punitive damages, and that juries "could adequately" adjudge the merits of disputes over the duty of fair representation. Cox, 607 F.2d at 143.

Since the panel decided Cox, two Supreme Court cases have eroded the rationale on which the panel constructed its decision. ² In United Parcel Serv., Inc. v. Mitchell, 451 U.S. 56, 101 S.Ct. 1559, 67 L.Ed.2d 732 (1981), the Supreme Court explained:

Respondent suggests Hines actions might also be characterized as actions upon a statute, personal injury actions, or malpractice actions, all governed by a 3-year limitations period in New York.... All of these characterizations suffer from the same flaw as the effort to characterize the action as one for breach of contract: they overlook the fact that an arbitration award stands between the employee and any relief which may be awarded against the company.

Mitchell, 451 U.S. at 62 n. 4, 101 S.Ct. 1564 n. 4. ³

A second Supreme Court decision toppled what remained of the Cox analysis. In DelCostello v. International Broth. of Teamsters, 462 U.S. 151, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983), the Court explained that the hybrid action at issue here "has no close analogy in ordinary state law." DelCostello, 462 U.S. at 165, 103 S.Ct. at 2291. ⁴

Mitchell and DelCostello also have undermined the reasoning the Cox panel used to assert that cases such as this one meet the second factor set forth in Ross. Cox stated that in cases such as the one at issue here plaintiffs seek only the traditional legal remedy of compensatory and punitive damages from the defendant union. DelCostello explained, however, that the claim against the union is "inextricably interdependent," DelCostello, 462 U.S. at 164-65, 103 S.Ct. at 2290-91 (quoting Mitchell, 451 U.S. at 66-67, 101 S.Ct. at 1565-1566 (Stewart, J., concurring in the judgment)), with the claim against the employer: " '[t]o prevail against either the company or the Union, ... [employees-plaintiffs] must not only show that their discharge was contrary to the contract but must also carry the burden of demonstrating breach of duty by the Union.' " Mitchell, 451 U.S. at 66-67, 101 S.Ct. 1565-1566 (Stewart, J., concurring in the judgment) (quoting Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 570-71, 96 S.Ct. 1048, 1059, 47 L.Ed.2d 231 (1976)). The Hines language is also quoted in DelCostello, 462 U.S. at 165, 103 S.Ct. at 2291.

Leach's and Irons' claim against the employer seeks vacation of the arbitration award, ⁵ a de novo hearing of the merits of plaintiffs' claims, and "fair and adequate" equitable relief for the plaintiffs. ⁶ None of the remedies sought by plaintiffs constitutionally merits a jury trial. Now that the Supreme Court has established that the remedies for that portion of plaintiffs' suit directed at the employer are clearly equitable, and that the two parts of the claim are "inextricably intertwined," we can no longer rely on Cox's conclusion that the remedies sought by the plaintiffs against the union are legal ones.

Furthermore, the Supreme Court has limited the scope of damages awarded to employees victorious in fair representation cases. Stressing that the purpose of relief in these cases is "to make the injured employee whole," International Bro. of Electrical Wkrs. v. Foust, 442 U.S. 42, 49, 99 S.Ct. 2121, 2126, 60 L.Ed.2d 698 (1979), is "essentially remedial," id. at 52, 99 S.Ct. at 2127, and is governed by the "compensation principle," id. at 49, 99 S.Ct. at 2126, the Court has refused to allow punitive damages against a union. Id. at 50-52, 99 S.Ct. at 2126-2128. While Leach and Irons sought punitive damages in their original complaint, the district court correctly struck the request; the remedies remaining to plaintiffs, then, are equitable, "make whole" ones.

As to Cox's determination that juries would be able to adequately deal with the issues at stake in breach of duty of fair representation cases, we note that at least two courts, including this one, have questioned whether the third tenet of Ross retains any vitality in light of the fact that the Supreme Court has several times considered the right to a jury trial without analyzing or even mentioning the third factor. Phillips v. Kaplus, 764 F.2d 807, 814 n. 6 (11th Cir.1985), cert. denied, 474 U.S. 1059, 106 S.Ct. 802, 88 L.Ed.2d 778 (1986), In re U.S. Financial Securities Litigation, 609 F.2d 411, 425-26 (9th Cir.1979), cert. denied sub nom. Gant v. Union Bank, ...