Samson Tug & Barge, Co. v. Int'l Longshore & Warehouse Union

Decision Date01 March 2021
Docket NumberCase No. 3:20-cv-00108-TMB,Case No. 3:20-cv-00248-TMB Consolidated
PartiesSAMSON TUG & BARGE, CO. INC., Plaintiff, v. INTERNATIONAL LONGSHORE & WAREHOUSE UNION, ALASKA LONGSHORE DIVISION, and, ILWU UNIT 222, Defendants.
CourtU.S. District Court — District of Alaska

ORDER ON PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION

I. INTRODUCTION

The matter comes before the Court on Plaintiff Samson Tug and Barge, Co., Inc.'s ("Samson") Motion for Preliminary Injunction (the "Motion").1 The Motion was fully briefed by the Parties,2 and the Court heard oral argument, witness testimony, and received evidence on the matter.3 For the reasons stated below, Samson's Motion is DENIED.

II. BACKGROUND

Samson is an Alaska corporation that provides marine tug and barge transportation services between Washington and Alaska and has operated at its Kodiak Womens Bay Terminal for decades under a series of leases with the Terminal's prior owner, LASH Corporation ("LASH").4 At Womens Bay, Samson employs Marine Engineers' Beneficial Association, AFL-CIO ("MEBA") members.5 MEBA is an unincorporated labor organization representing employees at ports and on oceangoing vessels, which includes Samson employees through IBU-MEBA.6 MEBA is party to a collective bargaining agreement ("CBA") with Samson.7 Samson has historically utilized individuals represented by MEBA to unload and load cargo at its Womens Bay operation.8 According to MEBA, Samson presently employs approximately 10 MEBA-represented individuals at Womens Bay Terminal.9

Defendants International Longshore and Warehouse Union and ILWU Unit 222 (collectively, "ILWU") is an unincorporated labor organization with offices nationwide, including in Alaska.10 Matson Navigation Company of Alaska ("Matson") purchased the terminal in Womens Bay from LASH in 2016 or 2017.11 Besides acting as landlord, Matson is also an employer and a party to a multi-employer CBA called the All Alaska Longshore Agreement ("AALA")12 with ILWU, American President Lines LTD ("APL"), and others.13 Samson and MEBA are not parties to the AALA.14 After Matson purchased Womens Bay Terminal from LASH, it continued leasing the property to Samson under an amended lease.15 The amended lease modified the lease term to month-to month.16

A. Underlying Arbitration Decision at Issue

Samson states that until 2018, Samson shipped cargo for APL through the Womens Bay Terminal.17 Because APL was a signatory to AALA, Samson subleased a portion of Samson's leased Womens Bay Terminal to APL for the limited purpose of establishing a restricted area, informally called the "DMZ," where Samson could receive APL outbound cargo and deliver APL inbound cargo.18 In furtherance of its claim to all the work at Womens Bay, ILWU filed a grievance against Matson under the AALA, demanding that all cargo handling at the Womens Bay Terminal be performed by ILWU labor because the terminal was now under Matson's control.19 The Alaska Arbitrator20 ruled that because there was no evidence that Matson was using Samson as a subterfuge to move cargo on Matson's behalf, and because there was no claim that Matson or any other AALA member had a financial interest in Samson, ILWU was not entitled to the cargo handling work; ILWU appealed the decision to the Coast Arbitrator.21

On February 13, 2020, Coast Arbitrator John Kagel issued his Opinion & Decision (the "Decision") vacating Item 5 in the underlying Alaska Arbitration Decision.22 This Decision stated that Matson was now required to assign all cargo handling work at Womens Bay to ILWU.23 The Coast Arbitrator found that the Decision was enforceable because "Matson had substantial leverage over Samson, including by terms of its lease[.]"24 ILWU also states that in March 2020, Matson and ILWU came to an agreement that: "(1) Matson will comply with the Coast Arbitrator Kagel's award, and (2) ILWU will accept time in lieu (i.e. unpaid wages and benefits) from Matson until Matson negotiated a terminal service agreement with Samson and obtained necessary cargo handling equipment to perform the work."25 As a result, ILWU submitted "time in lieu" cards to Matson consistent with the minimum manning both Matson and ILWU agreed was appropriate.26 Matson did not appeal the Coast Arbitrator's Decision, and neither ILWU nor Matson sought judicial confirmation of the Decision.

B. Petition to Vacate Arbitration Decision and Complaint for Damages

On May 12, 2020, Samson and MEBA filed a Petition to Vacate the Coast Arbitrator's Decision under Section 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185 and § 10 of the Federal Arbitration Act, 9 U.S.C. § 10 in this case.27 On October 5, 2020, Samson also filed a Complaint for Damages under Section 303 of the LMRA, 29 U.S.C. § 187 in the companion Case No. 3:20-cv-248-TMB. The Petition to Vacate involves the arbitration decision which is the basis for the damages incurred in Case No. 3:20-cv-00248-TMB. Because the present case and the companion case are both based on the same underlying facts, and each action challenges the legality of imposing the burdens of an arbitration decision on Samson, an entity that was not party to the arbitration, the Parties' request to consolidate the cases was granted.28

In June 2020, Samson and Matson entered into a Terminal Service Agreement ("TSA") which provides that if Samson pays "time in lieu" wages for ILWU claimed work, Samson may continue its cargo operations at Womens Bay with its own MEBA employees.29 The term of the TSA is June 16, 2020 through June 30, 2022, or until Samson's lease with Matson is terminated.30 ILWU claims that it was unaware of the TSA until December of 2020.31

In relevant part, Article VII of the TSA provides:

Carrier [Samson] and Contractor [Matson] agree that on Carrier's request Carrier's own labor may be used for terminal services performed at the Terminal as an alternative to Contractor providing terminal services under this Agreement. If the ILWU submits "time in lieu" claims to Contractor for such services performed at the Terminal by Carrier's own labor, Contractor will invoice Carrier for such "time in lieu" claims in accordance with Article VI. Despite the effective date of this Agreement, Carrier expressly agrees to pay such "time in lieu" claims dating back to February 13, 2020. In the event that a Court or Arbitrator determines that any such ILWU "time in lieu" claims were improper, Carrier's recourse shall be from ILWU and not Contractor. Carrier may only use its own labor for terminal services with Contractor's advance written permission.32

Samson and Matson agreed to a scheduled billing rate for ILWU labor, noting that the billing rates were subject to change after July 1, 2020, based on negotiations between Matson and ILWU.33 Samson states it has been invoiced for ILWU "time in lieu" charges for the time period from March through December 2020 in the sum of $648,866.90 but that Samson's actual labor cost for its MEBA employees for the Womens Bay cargo handling during that period was $250,431.21.34

On July 22, 2020, ILWU moved to dismiss Samson and MEBA's Petition to Vacate Arbitration Decision pursuant to Federal Rules of Civil Procedure 12(b)(1) and (6).35 Samson and MEBA both filed oppositions to ILWU's Motion to Dismiss the Petition to Vacate and requested oral argument.36 ILWU also filed a second Motion to Dismiss Samson's Complaint for Damages under Section 303 and Motion to Strike Confidential Settlement Communications pursuant to Federal Rules of Civil Procedure 12(b)(6) and 12(f).37 Samson filed an opposition to the Motion to Dismiss and Motion to Strike and requested oral argument.38 ILWU then filed a consolidated reply in support of its two Motions to Dismiss.39

C. Preliminary Injunction

On February 3, 2021, Samson moved for a preliminary injunction.40 Samson seeks equitable relief including an order: (1) prohibiting ILWU from collecting further "time in lieu of wages" charges for Womens Bay operations, and (2) requiring ILWU to deposit all such previously collected charges in an account to be distributed with future orders of this Court.41

Although Samson does not cite to Rule 65, it does argue that the Court should grant Samson a preliminary injunction because: (1) it is likely to succeed on the merits because ILWU's actions are a clear violation of 29 U.S.C. § 158(b)(4) as ILWU is using an arbitration in which Samson was not a party to coerce Samson to hire ILWU members;42 (2) it will suffer irreparable harm in the form of financial ruin by making the "time in lieu" of wage payments to ILWU, or vacating the premises with no alternative space to operate, or terminating its employees and replacing them with ILWU employees; (3) the equities tip in favor of Samson because no party will be harmed if the injunction is granted, but if the arbitration Decision is enforced and Matson uses it substantial leverage to force Samson to replace its entire workforce or be evicted, great harm will result; (4) public interest favors injunction because there is a strong public policy against the unfair labor practices in which ILWU is currently engaged.43 Tangentially, as part of its argument that it will succeed on the merits, Samson also argues that ILWU should have sought a Section 10(k) determination, 29 U.S.C. § 160(k), because the dispute in reality is a jurisdictional fight between rival unions: MEBA and ILWU.44 Samson points out that had ILWU pursued this avenue, Samson would have a right to be involved in such a proceeding.45

More specifically, Samson argues it will be harmed if the Court does not intervene because ILWU is currently before the Coast Arbitrator seeking to force Samson to use ILWU represented workers immediately.46 Samson states it is not a party to this arbitration and can only protect its rights by challenging the Arbitrator's Decision in this Court. In support of this assertion, Samson attaches a declaration by its owner, George Baggen...

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