Leber v. Universal Music and Video Distribution

• Decision Date: 24 September 2002
• Docket Number: No. 99-CV-4279-JPG.,99-CV-4279-JPG.
• Citation: 225 F.Supp.2d 928
• Parties: Alison LEBER, et al., Plaintiffs, v. UNIVERSAL MUSIC AND VIDEO DISTRIBUTION, INC., et al., Defendants.
• Court: U.S. District Court — Southern District of Illinois

Page 928

225 F.Supp.2d 928

Alison LEBER, et al., Plaintiffs, v. UNIVERSAL MUSIC AND VIDEO DISTRIBUTION, INC., et al., Defendants.

No. 99-CV-4279-JPG.

United States District Court, S.D. Illinois.

September 24, 2002.

COPYRIGHT MATERIAL OMITTED

Scott A. Huber, Cutright & Cutright, Toledo, IL, Mervin Lee Wolfe, Attorney at Law, Toledo, IL, for Plaintiff.

Rebecca R. Jackson, Gregg M. Lemley, Bryan Cave, St. Louis, MO, for Universal Music and Video Distribution Inc.

Joseph S. Turner, Joshua L. Ditelberg, Seyfarth, Shaw, Chicago, IL, Rebecca A. Whittington, Attorney at Law, Carbondale, IL, for Panasonic Disc Services Corp.

MEMORANDUM AND ORDER

GILBERT, District Judge.

This matter comes before the Court on the motions for summary judgment filed by defendants Matsushita Universal Media Services ("MUMS") (Doc. 62), Panasonic Disc Services Corporation ("Panasonic") (Doc. 70), and the International Leather Goods, Plastics, Novelty and Service Workers Union ("the International") (Doc. 82). The plaintiffs, International Leather Goods, Plastics, Novelty and Service Workers Union, Local 352 ("Local 352"), a member organization of the International, and 75 of Local 352's individual members or former members ("individual plaintiffs"), have responded to the motions (Docs. 65 & 66), and the defendants have filed their respective replies (Docs. 67, 73 & 76). The Court also considers the plaintiffs' response (Doc. 113) to the Court's order to show cause why their claims against Universal Music & Video Distribution, Inc. ("Universal") should not be dismissed pursuant to Federal Rule of Civil Procedure 4(m) for failure to effect service within 120 days after the filing of the complaint.

The plaintiffs bring this suit against Universal, MUMS and Panasonic pursuant to § 301 of the Labor Management Relations Act, 29 U.S.C. § 185, for breach of a collective bargaining agreement. They have sued the International pursuant to § 9(a) of the National Labor Relations Act, 29 U.S.C. § 159(a), for breach of the duty of fair representation based on a violation of § 101(a)(1) of the Labor Management Reporting and Disclosure Act, 29 U.S.C. § 411(a)(1).

I. Summary Judgment Standard

Summary judgment is appropriate where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c); see Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Spath v. Hayes Wheels Int'l-Ind., Inc., 211 F.3d 392, 396 (7th Cir.2000). The reviewing court must construe the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in favor of that party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Spath, 211 F.3d at 396. Where the moving party fails to meet its strict burden of proof, a court cannot enter summary judgment for the moving party even if the opposing party fails to present relevant evidence in response to the motion. Cooper v. Lane, 969 F.2d 368, 371 (7th Cir.1992).

In responding to a summary judgment motion, the nonmoving party may not simply rest upon the allegations contained in the pleadings but must present specific facts to show that a genuine issue of material fact exists. Fed.R.Civ.P. 56(e); Celotex, 477 U.S. at 322-26, 106 S.Ct. 2548; Johnson v. City of Fort Wayne, 91 F.3d 922, 931 (7th Cir.1996). A genuine issue of material fact is not demonstrated by the mere existence of "some alleged factual dispute between the parties," Anderson, 477 U.S. at 247, 106 S.Ct. 2505, or by "some metaphysical doubt as to the material facts," Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Michas v. Health Cost Controls of Ill., Inc., 209 F.3d 687, 692 (7th Cir.2000). Rather, a genuine issue of material fact exists only if "a fair-minded jury could return a verdict for the [nonmoving party] on the evidence presented." Anderson, 477 U.S. at 252, 106 S.Ct. 2505; accord Michas, 209 F.3d at 692.

II. Facts

Viewed in the light most favorable to the plaintiffs, the admissible evidence establishes the following facts.¹

A. The Pinckneyville Plant

Prior to May 1999, Universal owned and operated a compact disc ("CD") manufacturing plant in Pinckneyville, Illinois. The workforce at the plant was composed of members of Local 352, and the International was their exclusive bargaining representative. The plant included manufacturing operations and a department to handle CDs and digital versatile discs ("DVDs") returned from customers ("returns department"). The individual plaintiffs worked in Universal's returns department. Their employment was governed by a 1996 collective bargaining agreement between Universal and the International ("1996 Universal CBA"). There were no other signatories to the 1996 Universal CBA. By its terms, the 1996 Universal CBA was effective from June 9, 1996, to June 9, 2001, and possibly longer.

As a result of a corporate reorganization following Universal's parent company's merger with PolyGram, Universal announced in January 1999 that it would be closing the Pinckneyville returns department.

B. The Joint Venture

In late 1998, Universal and Panasonic began discussing the possibility of a joint venture to manufacture CDs and DVDs. Universal and Panasonic did not share any corporate parentage and were completely separate corporations. Panasonic wanted to establish a manufacturing operation closer to its customers and its warehouses in the eastern and midwestern United States than its manufacturing operations in California, which were operating at peak capacity at the time. Panasonic was also interested in a joint venture with Universal because it believed that the venture could spawn a long-term contract to supply DVDs or CDs to Universal, one of Panasonic's largest customers, and could give Panasonic access to lower cost raw materials. On the other side, Universal wanted to find additional uses for the Pinckneyville facility, which it believes would become underutilized after Universal's parent company's merger with PolyGram and the subsequent reorganization.

On April 15, 1999, Universal notified Local 352 and Rosemary Behrman ("Behrman"), general president of the International and the International's Midwest Joint Board and member of the International's General Executive Board, that, with the exception of the returns department, it would be selling its Pinckneyville operations. In a meeting held May 7, 1999, Local 352's Executive Board was told that the new owner refused to be bound by the 1996 Universal CBA but that it would accept the economic terms of the 1996 Universal CBA if some changes were allowed to the non-economic terms of the agreement. Otherwise, the new owner would "go non-union." Behrman did not inform the Local Executive Board of the specific changes the new owner wanted because she did not know what they were. The Local Executive Board authorized Behrman to accept a "language change" to the non-economic terms of 1996 Universal CBA in a new agreement with the new employer.

On May 13, 1999, in a letter agreement, Behrman agreed with Panasonic on behalf of the joint venture company, MUMS,² that MUMS would offer jobs to all of the employees working in Universal's manufacturing plant under modified terms and conditions. They also agreed that if a majority of the MUMS workforce had been represented by the International when they were employed at Universal, MUMS would recognize the International as the exclusive bargaining representative of its workforce as well. In return, the International agreed to enter into a new collective bargaining agreement with MUMS under non-economic terms that differed slightly from the 1996 Universal CBA. The agreement was clear that the returns department employees would not be offered MUMS employment, would not become employees of MUMS and would not be able to bump less senior Universal manufacturing department employees from their jobs at MUMS.

C. MUMS Goes On Line

The joint venture became a reality on May 22, 1999, when Universal and Panasonic officially formed MUMS, a limited liability corporation. The joint venture documents signed by Universal and Panasonic contained the following provisions:

3.1 Closing The transfer of assets contemplated by this UMVD Contribution Agreement shall occur simultaneously with, and as part of, the Closing of the JV Agreement. At Closing, with respect to the [Universal] Contributed Assets:

* * * * * *

(b) [Universal] and [MUMS] shall enter into an assignment of the amended Union Contract....

* * * * * *

5.4 Employees. [MUMS] shall offer employment following Closing to each Employee at the Pinckneyville Facility who is employed in the CD replication and packaging business of the Pinckneyville Facility at the Closing on substantially equivalent salary, wages and benefits ... taken as a whole, as provided to such Employees by [Universal] prior to Closing. Employees involved in the distribution and returns business at the Pinckneyville Facility will not be employed by [MUMS] following Closing, and [MUMS] will have no liability or obligations with respect to such employees. ...

5.5 Union.

* * * * * *

5.5.3 [Universal] will bargain in good faith with the Union concerning the "effects" of the assignment of the contract to [MUMS].

UMVD Contribution Agreement Among Matsushita Universal Media Services LLC of America and Universal Music and Video Distribution, Inc., Dated as of May 22, 1999.

The day after MUMS was formed, MUMS recognized the International as the exclusive bargaining representative of its workforce and, on behalf of the International, Behrman signed a collective bargaining agreement with MUMS ("1999 MUMS CBA"). She represented that she had the authority to sign the...