McLaughlin v. Penn Central Transportation Co.

Decision Date29 October 1974
Docket NumberNo. 72 Civ. 5282.,72 Civ. 5282.
Citation384 F. Supp. 179
PartiesTerence P. McLAUGHLIN, Plaintiff, v. PENN CENTRAL TRANSPORTATION COMPANY et al., Defendants.
CourtU.S. District Court — Southern District of New York

McGowan & McGowan, New York City, for plaintiff; William J. McGowan, New York City, of counsel.

Robert M. Peet, New York City, for defendant Penn Cent. Transp. Co., Debtor in Reorganization; James L. More, New York City, of counsel.

Mulholland, Hickey & Lyman, Washington, D. C., Reilly, Fleming & Reilly, New York City, for defendants System Council #7, International Brotherhood of Electrical Workers and its General Chairman Russell Homiak; Edward J. Hickey, Jr., William J. Hickey, William E. Fredenberger, Jr., David J. Fleming, New York City, of counsel.

OPINION

EDWARD WEINFELD, District Judge.

This is the second action commenced by plaintiff against the defendant Penn Central Transportation Corporation and its trustees in reorganization (Penn Central), by whom he is and has been employed as an electrician at its Grand Central Terminal. Plaintiff claims that since May 1971 he has suffered a worsening of his working conditions by reason of discontinuances of passenger trains pursuant to the Rail Passenger Service Act of 1970,1 and that he is therefore entitled to employees' benefits mandated by that Act and by section 5(2)(f) of the Interstate Commerce Act.2 In this second action plaintiff has also named as defendants System Council #7, International Brotherhood of Electrical Workers and its General Chairman, Russell Homiak (the Union). The complaint in the instant suit was filed two days after Judge Lasker granted summary judgment in favor of Penn Central, dismissing plaintiff's first action on the ground that "the record established beyond dispute that McLaughlin's compensation rate had not been adversely affected," and that it failed to establish that he had been put "into a worse position with respect to the rules governing his working position."3

The defendants now move to dismiss the complaint under Rule 12 of the Federal Rules of Civil Procedure upon various grounds, including res judicata, failure to state a claim upon which relief may be granted, and lack of subject matter jurisdiction; and for summary judgment under Rule 56 upon the ground that there is no genuine issue of fact — that, in fact, plaintiff's condition of employment was not worsened. The plaintiff cross-moves to maintain the suit as a class action to include the other car department electricians at Grand Central Terminal, and to require the Union to negotiate with Penn Central the terms of employment for employees affected by the discontinuance of trains.

The Rail Passenger Service Act of 1970 created a quasi-public agency, the National Railroad Passenger Corporation (Amtrak), the essential purpose of which was to establish a modern and efficient nationwide rail passenger service through a basic and unified system for intercity rail passenger service and the discontinuance of lines not required for that purpose.4 Amtrak was authorized to enter into contracts with railroads to relieve them of the responsibility for the operation of lines to be included in the basic system,5 provided, among other matters, that adequate protective arrangements for affected employees were incorporated into the agreements, referred to as service agreements, under which the railroads were to provide Amtrak with the servicing and operating of passenger trains; and further, provided that the Secretary of Labor certified that such protective arrangements afforded affected employees fair and equitable protection.6

On April 16, 1971, Penn Central and Amtrak entered into a service contract effective on and after May 1, 1971, and the contract's labor protection provisions, section 7.3 and Appendices C-1 and C-2, were certified by the Secretary of Labor as affording fair and equitable protection of employees. The plaintiff does not challenge the Secretary of Labor's determination that those provisions are fair and equitable and meet the requirements of the Act.7

Appendix C-1, among other matters, mandates payments to a displaced employee, defined as one "who, as a result of a transaction a discontinuance of intercity rail passenger service is placed in a worse position with respect to his compensation and rules governing his working conditions."8 Plaintiff's claim, however phrased, is that he was placed in a "worse" position based on two "transactions" or discontinuances, one on May 1, 1971, and the other on April 30, 1972. In essence, he alleges that as a result of those "transactions" he was "disturbed" from his original position as an electrician at Grand Central Station servicing principally intercity passenger trains, and that he thereafter was assigned to work principally on commuter and suburban trains, with consequent loss of earnings and a worsening in the conditions of his employment. Plaintiff's claim against the Union is that it failed, upon notification by Penn Central of the proposed discontinuances, to request that the railroad enter into an "implementing agreement"9 regarding the assignment of employees pursuant to Article I, section 4 of the Appendix, and sections 4 and 5 of the Washington Agreement.10

We pass for the moment Penn Central's plea that this action is barred under the doctrine of res judicata or collateral estoppel by reason of the judgment dismissing the first action, and consider the motions made by both defendants to dismiss for lack of subject matter jurisdiction, failure to state a claim upon which relief may be granted and failure to exhaust contractual remedies.

Plaintiff contends that the complaint states a claim under the Interstate Commerce Act, the Railway Labor Act and the Rail Passenger Service Act of 1970. The contention that the complaint states a claim under section 5(2)(f) of the Interstate Commerce Act11 and that the court has jurisdiction under that Act12 is without substance, since the case does not involve an order of the Interstate Commerce Commission approving a merger or consolidation of railroads or their acquisition or control.13 So, too, the contention that Penn Central violated a collective bargaining agreement, referred to as the Washington Agreement of 1936, is without substance, because that agreement is expressly limited to employees adversely affected by consolidations or so-called "coordinations."14 Obviously this case does not involve a coordination.15 Moreover, even if plaintiff's claim were within the purview of the Washington Agreement pertaining to coordinations, the court would not have jurisdiction of the dispute, because plaintiff has failed to exhaust the procedures set forth in section 13 of that agreement, which requires that a dispute or controversy be referred for determination to a committee and, if the committee is unable to agree, to a neutral referee whose determination shall be final and conclusive.16

Plaintiff's further contention that the complaint states a claim under the Railway Labor Act17 because a violation of the Amtrak agreement is within the purview of that Act is without merit, since the Amtrak agreement is not a collective bargaining agreement, but a private contract between two corporations.18 But even if plaintiff's position that the Railway Labor Act grounds his claim were accepted, the court would not have jurisdiction of this dispute because plaintiff has failed to present his claim in accordance with the mandatory procedures of that Act.19

Thus, we reach plaintiff's contention that the complaint states a claim under section 405 of the Rail Passenger Service Act of 197020 with jurisdiction based upon section 307(a) of that Act,21 which provides:

"If the Corporation or any railroad engages in or adheres to any action, practice, or policy inconsistent with the policies and purposes of this Act, obstructs or interferes with any activities authorized by this Act, refuses, fails, or neglects to discharge its duties and responsibilities under this Act, or threatens any such violation, obstruction, interference, refusal, failure, or neglect, the district court of the United States for any district in which the Corporation or other person resides or may be found shall have jurisdiction, except as otherwise prohibited by law, upon petition of the Attorney General of the United States or, in a case involving a labor agreement, upon petition of any employee affected thereby, including duly authorized employee representatives, to grant such equitable relief as may be necessary or appropriate to prevent or terminate any violation, conduct, or threat."

Plaintiff contends in essence that this action is maintainable under the foregoing section, since it is for a declaratory judgment to enforce the protections and benefits mandated by section 405 of the Act and implemented by the terms of Appendix C-1. The Supreme Court, however, has held that section 307(a) created a public cause of action maintainable by the Attorney General to enforce the duties and responsibilities imposed by the Act, and that the only private cause of action created thereunder is limited to a "case involving a labor agreement."22 Is this a case involving a labor agreement? Clearly it is not. Appendix C-1, certified by the Secretary of Labor to implement adequate protection of Penn Central employees affected by discontinuances, is part of the private operating agreement between Penn Central and Amtrak. The Union is not a party to that agreement. The agreement is therefore not a labor agreement, and the case is not maintainable by plaintiff as a private action.23

Moreover, even if this case did involve a labor agreement, it would fail for plaintiff's failure to exhaust the procedures available to him under the terms of Appendix C-1. When plaintiff first advanced his contention that his position was worsened, he sought a determination from the Secretary of Labor, apparently relying upon Article IV of the...

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3 cases
  • Local Division 519 v. LaCrosse Municipal Trans.
    • United States
    • U.S. District Court — Western District of Wisconsin
    • March 8, 1978
    ...issuing a temporary injunction to preserve the status quo pending an ICC determination; McLaughlin v. Penn Central Transportation Co., 384 F.Supp. 179, 182-183 (S.D.N.Y. 1974), holding that an employee's complaint failed to state a claim for violation of § 5(2)(f) because it did not involve......
  • Chesapeake and Ohio Ry. Co. v. Ford
    • United States
    • U.S. Court of Appeals — Fourth Circuit
    • January 10, 1979
    ...Parsons v. Norfolk & W. Ry., 442 F.2d 1075 (4th Cir. 1971), Aff'g, 310 F.Supp. 1197 (S.D.W.Va.1970). In McLaughlin v. Penn Central Transportation Co., 384 F.Supp. 179, 185 (S.D.N.Y.1974), Judge Weinfeld held in an opinion we find totally persuasive that the grievance procedure in Appendix C......
  • The Honorable Jack Danforth
    • United States
    • Comptroller General of the United States
    • March 18, 1985
    ... ... DANFORTH: CHAIRMAN, COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION UNITED STATES SENATE No. B-217662 Comptroller General of the United ... 352 F.Supp. 8, 11 (N.D.Ill. 1972). See also mclaughlin v ... Penn central transportation co., 384 F.Supp. 179, 183 ... ...

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