Province v. Cleveland Press Pub. Co.

• Decision Date: 01 September 1983
• Docket Number: Civ. A. No. C 83-847.
• Citation: 571 F. Supp. 855
• Parties: James R. PROVINCE, et al., Plaintiffs, v. CLEVELAND PRESS PUBLISHING COMPANY, et al., Defendants.
• Court: U.S. District Court — Northern District of Ohio

571 F. Supp. 855

James R. PROVINCE, et al., Plaintiffs, v. CLEVELAND PRESS PUBLISHING COMPANY, et al., Defendants.

Civ. A. No. C 83-847.

United States District Court, N.D. Ohio, E.D.

September 1, 1983.

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Robert M. Phillips, Cleveland, Ohio, for plaintiffs.

Robert A. Goodman, Craig M. Brown, James P. Garner, Cleveland, Ohio, William E. Willis, Sullivan & Cromwell, Tobias J. Bermant, Sabin, Bermant & Blau, New York City, for defendants.

MEMORANDUM AND ORDER

ANN ALDRICH, District Judge.

Plaintiffs seek the enforcement of various collective bargaining agreements, and damages for the violation of various antitrust laws. Four of the five defendants move to dismiss counts of the complaint pursuant to Fed.R.Civ.P. 12(b)(6). Three of the four move in the alternative for summary judgment on various counts pursuant to Fed.R.Civ.P. 56. For the reasons set forth below, each motion is denied.

This Court's jurisdiction rests on 28 U.S.C. §§ 1331 and 1337, 29 U.S.C. § 185, and 15 U.S.C. § 15.

Plaintiffs ("the employees") are 89 former employees of the now defunct Cleveland Press ("the Press"), a daily newspaper which ceased publication on June 18, 1982. The terms and conditions of their employment with the Press were governed by collective bargaining agreements negotiated with the newspaper by their union, Cleveland Typographical Union No. 53 ("the Union").

Defendant H.W. Scripps & Co. ("Scripps") owned and operated the Press until October of 1980, when it sold the paper to Cleveland Press Publishing Co., Inc. ("Press Publishing"). Defendant Joseph Cole is the principal owner and president of Press Publishing and a general partner and majority owner of defendant Lakeside Associates, a limited partnership. Defendant Plain Dealer Publishing Company ("The Plain Dealer"), formerly Forest City Publishing Company, publishes The Plain Dealer, now the sole daily and Sunday newspaper in the Greater Cleveland area.

Prior to 1972, Scripps and The Plain Dealer were separate parties, on a multi-employer basis, to a collective bargaining agreement with the Union. On January 17, 1972, Scripps and The Plain Dealer entered into a supplemental job security agreement with the Union, under which each publisher guaranteed its eligible workers lifetime employment. The agreement was to terminate if a publisher went out of business, but would continue in the event of a merger.¹ Its language was incorporated by reference into subsequent multi-employer collective bargaining agreements. The last such agreement became effective on January 1, 1978, and was to expire on December 31, 1983.

On October 15, 1980, prior to the sale of the Press, Press Publishing and a Union official executed a letter agreement under which Press Publishing assumed, on a single employer basis, the contract between the Union and the paper² and promised to negotiate a full collective bargaining agreement at a later time. Only "proposals" for an agreement appear in the record before us. On October 29, 1980, Press Publishing and the Union official executed another letter agreement providing for a collective bargaining agreement that would become effective on the closing date of the sale of the Press and that would supercede any of Scripps' obligations under the 1978 agreement.³ Plaintiff employees contend that neither letter agreement was properly ratified by the Union membership, nor by the International President, and are therefore void. The sale of the Press was closed on October 30, 1980.

On June 18, 1982, Press Publishing ceased publication of the Press and fired the paper's employees. The Plain Dealer hired some of these employees, acquired an advertising insert, comics, and editorial columnists, and purchased the Press's subscription lists for $6,000,000. Employees who were not hired demanded that Scripps, The Plain Dealer and Press Publishing provide them with jobs as required by the job security agreement and with other benefits provided for in the collective bargaining agreement. When the defendants refused to do so, the employees filed this lawsuit.

In Count I of the complaint, plaintiff employees allege that defendants Scripps and The Plain Dealer unlawfully breached the job security agreement by refusing to provide jobs and vacation pay to the terminated Press employees.

In Count II, they repeat this allegation and allege that Press Publishing, by acquiring the Press from Scripps, is liable along with Scripps and The Plain Dealer for the breaches alleged in Count I.

Count III alleges that Press Publishing and The Plain Dealer breached the collective bargaining agreement by failing to provide adequate severance pay to the employees.

Counts IV and V allege that prior to the closing of the Press, a conspiracy was entered into between The Plain Dealer, Press Publishing, and Joseph Cole, the President of Press Publishing. Under the alleged conspiracy, Press Publishing and Cole agreed not to sell the Press to any competitor of The Plain Dealer; in return, The Plain Dealer agreed to purchase certain Press assets—such as subscription lists—for amounts far in excess of their actual value. It is further alleged that the dual purposes of this conspiracy were to eliminate all major competition to The Plain Dealer's business and to terminate the job security agreement. Counts IV and V assert that this conduct violated Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1, 2, and seek treble damages under Section 4 of the Clayton Act, 15 U.S.C. § 15.

Count VI alleges that Press Publishing fraudulently conveyed real property and other assets to Lakeside Associates for the express purpose of evading Press Publishing's debts and obligations. Lakeside has filed an answer but has not joined in any of the presently pending motions. The charges levelled in this Count need not be addressed at this time.

I. THE SECTION 301 ALLEGATIONS

A. Liability of Scripps and The Plain Dealer Under the Union—Press Publishing Contract.

Section 301(a) of the Labor Management Relations Act, 29 U.S.C. § 185(a), grants federal courts jurisdiction to examine alleged violations of collective bargaining agreements:

Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.

29 U.S.C. § 185(a). A § 301 claim must (1) allege violations of (2) a contract (3) between an employer and a labor organization, e.g., Carpenters Local Union No. 1846 v. Pratt-Farnsworth, 690 F.2d 489, 500 (5th Cir.1982), reh'g denied, 696 F.2d 996 (1983), petition for cert. filed, 51 U.S.L.W. 3974 (U.S. Feb. 22, 1983) (No. 82-1414).

Section 301 permits suits both by unions and by individual union members "seeking to vindicate `uniquely personal' rights of employees such as wages, hours, overtime pay, and wrongful discharge." Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 562, 96 S.Ct. 1048, 1055, 47 L.Ed.2d 231 (1976), quoting Smith v. Evening News Assn., 371 U.S. 195, 198-200, 83 S.Ct. 267, 269-270, 9 L.Ed.2d 246 (1962). Such rights must arise out of the collective bargaining agreement. Ruzicka v. General Motors Corporation, 528 F.2d 912 (6th Cir.1975); Broniman v. Great Atlantic & Pacific Tea Co., 353 F.2d 559, 561 (6th Cir.1965), cert. denied, 384 U.S. 907, 86 S.Ct. 1343, 16 L.Ed.2d 360 (1966).

Most courts agree that a § 301 suit may only be brought against a party to the agreement, holding that an action against a non-party is not a "suit for violation of contracts between an employer and a labor organization." Carpenters Local Union No. 1846 v. Pratt-Farnsworth, supra, at 500; Loss v. Blankenship, 673 F.2d 942, 947-48 (7th Cir.1982); Aacon Contracting Co. v. Association of Catholic Trade Unionists, 276 F.2d 958 (2d Cir.1960); Cate v. Blue Cross & Blue Shield, 434 F.Supp. 1187, 1189 (E.D. Tenn.1977). However, the Third and Ninth Circuits, acting on the Supreme Court's suggestion that employees with vested retirement rights have a § 301 action for breach of contract if their benefits are unilaterally altered, have permitted suits against non-party trustees of pension funds established by collective bargaining agreements. Nedd v. United Mine Workers, 556 F.2d 190 (3d Cir.1977), cert. denied, 434 U.S. 1013, 98 S.Ct. 727, 54 L.Ed.2d 757 (1978); Rehmar v. Smith, 555 F.2d 1362 (9th Cir. 1976); Alvares v. Erickson, 514 F.2d 156 (9th Cir.), cert. denied, 423 U.S. 874, 96 S.Ct. 143, 46 L.Ed.2d 106. See, Chemical Workers v. Pittsburgh Glass, 404 U.S. 157, 181 n. 20, 92 S.Ct. 383, 398 n. 20, 30 L.Ed.2d 341 (1971).

Scripps and The Plain Dealer jointly contend that the October 15, 1980 single-employer agreement between the Union and Press Publishing completely superceded the 1978 multi-employer agreement. Scripps cites in addition the October 29, 1980 letter explicitly terminating its liability; The Plain Dealer argues that even if the 1978 agreement did survive the 1980 transactions, publishers of another paper could not be held liable for breaches committed by owners of the Press.

The employees argue that the 1978 agreement was never terminated, and hence is still valid. They claim 1) that in 1980, the Union and Press Publishing never completed a full collective bargaining agreement; 2) that local Union officials never obtained the approval of the membership or of the International President for the October 15, 1980 agreement with Press Publishing; and 3) that the membership never ratified the October 29, 1980 letter releasing Scripps from liability.

Alternatively, the employees argue that the agreements between the Union and Press Publishing, even if properly effectuated, did not revoke the 1978 agreement, but rather constituted a...