Mobile Mechanical Contractors Ass'n, Inc. v. Carlough, 79-2054

Citation664 F.2d 481
Decision Date21 December 1981
Docket NumberNo. 79-2054,79-2054
Parties109 L.R.R.M. (BNA) 2647, 92 Lab.Cas. P 13,184 MOBILE MECHANICAL CONTRACTORS ASSOCIATION, INC., Plaintiff-Appellee, v. Edward J. CARLOUGH, Individually, and as the representative of all members of the Sheet Metal Workers' International Association, et al., Defendants-Appellants. . Unit B *
CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)

Donald W. Fisher, Toledo, Ohio, Roderick P. Stout, Mobile, Ala., for defendants-appellants.

Willis C. Darby, Jr., James Forrest Hinton, Jr., Mobile, Ala., for plaintiff-appellee.

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

Before GODBOLD, Chief Judge, TUTTLE and HILL, Circuit Judges.

GODBOLD, Chief Judge:

This case concerns a lengthy dispute between the Mobile Mechanical Contractors, ("the association") an association representing several employers for collective bargaining purposes, and Sheet Metal Workers' International Association ("the union"), its president Edward J. Carlough, and its Mobile local ("the union local"). The dispute arose over two union demands that triggered a peaceful economic strike by the local from July 16 to October 16, 1974.

The union local had demanded that the association contribute to SASMI, a nationwide employee trust fund for sheet metal workers founded by the union and Carlough. The association has consistently maintained that the trust fund, as it was then structured, violated § 302 of the Labor Management Relations Act of 1947, 29 U.S.C. § 186. 1 The union local also demanded that the association agree to the union's "Standard Form of Union Agreement." Article X, § 8 of this agreement provided that if the association and the union local reach a bargaining impasse they must submit their dispute to the National Joint Adjustment Board, composed of union representatives and representatives of the Sheet Metal and Air Conditioning Contractors' National Association, an employer organization to which the Mobile Contractors' Association members do not belong. The adjustment board is empowered to formulate new contract terms through unanimous decision. Otherwise the dispute would be returned to the association and the local for resolution through traditional economic warfare. 2

The association turned to both the National Labor Relations Board and the courts for relief from the strike. On August 23, 1974 the association filed unfair labor practice charges against the union local, and two months later filed similar charges against the union and Carlough. The Board consolidated these charges and set a hearing. The parties settled, however, and on December 3, 1976 the NLRB entered a consent order restraining the union local from making similar future demands for the trust fund or the arbitration clause. The Board's order was enforced by this court, NLRB v. Sheet Metal Workers International Assn. Local No. 441, No. 77-3080 (5th Cir. Nov. 2, 1974) (unpublished).

The association also sued the defendants in federal district court seeking to enjoin the strike under § 302(e) of the Labor Management Relations Act, 29 U.S.C. § 186(e). The district court held that the trust fund violated § 302(c) of the Act, 29 U.S.C. § 186(c), and granted a preliminary injunction restraining the union local from continuing the strike or demanding that the association contribute to the trust fund. Mobile Mechanical Contractors Assn. v. Carlough, 382 F.Supp. 1134 (S.D.Ala.1974). On appeal this court concluded that the injunction issue was moot because, inter alia, during the pendency of the appeal the parties had agreed to a contract without the trust fund. Mobile Mechanical Contractors Association v. Carlough, 566 F.2d 1213 (5th Cir. 1977). The parties also omitted from the contract Article X, § 8, of the Standard Form of Union Agreement.

After this court remanded the case to the district court, the association sought damages for the strike from the union and Carlough on a variety of theories. It alleged an implied cause of action in favor of employers under § 302(c) based upon the union local's demand for the trust fund, a diversity claim under Alabama law for tortious interference with a lawful business, and a claim under § 303, 29 U.S.C. § 187, grounded on the theory that the strike for Article X was an unfair labor practice under § 8(b)(4)(A) of the National Labor Relations Act, 29 U.S.C. § 158(b)(4)(A). In addition, the association sought punitive damages on the first two claims.

The district court denied defendants' motion for summary judgment and granted summary judgment as to liability in favor of the association on all of these claims, Mobile Mechanical Contractors Assn. v. Carlough, 456 F.Supp. 310 (S.D.Ala.1978). A trial was held to determine damages. The jury awarded $17,000 in general damages against the union and Carlough and $10,000 in punitive damages against Carlough. The defendants do not question the amount of damages awarded but contend that the district court erred in failing to grant their motion for summary judgment as to liability on all of the claims.

I. Section 303 claim

Section 303(b) of the Labor Management Relations Act, 29 U.S.C. § 187(b), provides a cause of action for damages in favor of any person sustaining injury to his property or business from any union unfair labor practice set forth in § 8(b)(4) of the National Labor Relations Act, 29 U.S.C. § 158(b)(4). 3 The association's § 303 claim is premised on the argument that the strike to obtain Article X violated § 8(b)(4)(A), which proscribes strikes to force an employer to join an employer organization. 4

Relying on Frito-Lay, Inc. v. Teamsters, 401 F.Supp. 370 (N.D.Cal.1975), affirmed, 623 F.2d 1354 (9th Cir. 1980), the district court held that § 8(b)(4) (A) prohibits not only efforts to force an employer to join an employer organization but also efforts to force an employer to act as if it belonged to an employer organization. It then reasoned that, by forcing the association to submit contract disputes to the adjustment board, Article X, § 8, forced the association to cede some of its collective bargaining authority to the national employers organization to which neither the association nor its members belong. The district court then concluded that this requirement was tantamount to forcing the association to act as if it belonged to the national employers association.

The defendants first argue that the decisions of the district court and the Ninth Circuit in Frito-Lay are based upon an erroneous interpretation of the legislative history of § 8(b)(4)(A). To say the least, the legislative history of § 8(b)(4)(A) is cryptic. The Conference Committee Report states only that

Section 8(b)(4) of the conference agreement has been expanded to cover a matter which was covered by section 12 of the House bill, namely, concerted activity by a union or its agents to compel an employer or self-employed person to become a member.

House Conference Report No. 510, 80th Cong., 1st Sess. 44-45; (1947) U.S.Code Cong. & Ad.News, pp. 1135, 1150. Moreover, the conference agreement also explicitly omitted the provisions of the House bill "treating 'monopolistic strikes' as unlawful concerted activities" and "the matter of industry-wide bargaining." Id. at 1165.

Defendants contend that the Frito-Lay district court (and presumably the Ninth Circuit since it affirmed) overlooked these passages from the conference report and that these passages, as the last words of Congress on the subject, are controlling. We disagree. The opinions in Frito-Lay reflect a probing and comprehensive analysis of a legislative history that is far more complex than the defendants suggest.

Section 8(b)(4)(A) was the product of a compromise solution between two warring factions in Congress, those that opposed industry-wide bargaining and those that favored it. Compare H.R.Rep.No.245, 80th Cong., 1st Sess. 5-6, 24, 35 (1947) with id. at 86 and with S. 1126, 80th Cong., 1st Sess. §§ 2(2), 9 (1947). The conference committee undertook to reconcile a House bill that banned all multi-employer bargaining, H.R. 3020, 80th Cong., 1st Sess. §§ 2(16), 9(f)(1), 12(a)(3) (1947) and a Senate bill that banned only involuntary multi-employer bargaining, S. 1126, 80th Cong., 1st Sess. §§ 2(2), 9 (1947). Contrary to defendants' assertion, the opinions in Frito-Lay did not overlook the conference report but interpreted it as rejecting the total ban on multi-employer bargaining contained in the House bill in favor of the more limited ban on involuntary multi-employer bargaining contained in the Senate bill. See 623 F.2d at 1358-59; 401 F.Supp. at 373-76. Moreover, this interpretation is supported by decisions of courts and the NLRB that uniformly have construed § 8(b)(4)(A) to proscribe the involuntary multi-employer bargaining that results when a union attempts to compel an employer to join an employer organization for collective bargaining purposes. See Amax Coal Co. v. NLRB, 614 F.2d 872, 878-81 (3d Cir. 1980), rev'd on other grounds, --- U.S. ----, 101 S.Ct. 2789, 69 L.Ed.2d 672 (1981); Union de Tronquistas de Puerto Rico v. Arlook, 586 F.2d 872, 876 (1st Cir. 1978); United Mine Workers, Local 1854 (Amax Coal Co.), 238 NLRB 1583 (1978), enforcement denied on other grounds, 614 F.2d 872 (3d Cir. 1980), rev'd on other grounds, --- U.S. ----, 101 S.Ct. 2789, 69 L.Ed.2d 672 (1981); Glass Workers Local 1892 (Frank J. Rooney, Inc.), 141 NLRB 106 (1963); I.L.W.U. Local 8 (General Ore, Inc.), 126 NLRB 172 (1960); United Construction Workers (Kanawha Coal Operators Assn.), 94 NLRB 1731 (1951).

Frito-Lay holds that § 8(b)(4)(A) prohibits union efforts to compel an employer to join an employer organization. We conclude that this section also prohibits union efforts to compel an employer to act as if it were a member of an employer organization. A contrary conclusion would mean that Congress intended to allow unions to accomplish indirectly the forbidden...

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