San Antonio Community Hosp. v. Southern California Dist. Council of Carpenters

• Decision Date: 08 September 1997
• Docket Number: No. 96-56124,96-56124
• Citation: 125 F.3d 1230
• Parties: 156 L.R.R.M. (BNA) 2364, 97 Cal. Daily Op. Serv. 7215, 97 Cal. Daily Op. Serv. 7408, 97 Daily Journal D.A.R. 11,982 SAN ANTONIO COMMUNITY HOSPITAL, Plaintiff-Appellee, v. SOUTHERN CALIFORNIA DISTRICT COUNCIL OF CARPENTERS, an unincorporated association; Carpenters Local 1506, an unincorporated association; Does 1 through 100, Defendants-Appellants.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1230

125 F.3d 1230

156 L.R.R.M. (BNA) 2364, 97 Cal. Daily Op.

Serv. 7215,

97 Cal. Daily Op. Serv. 7408,

97 Daily Journal D.A.R. 11,982

SAN ANTONIO COMMUNITY HOSPITAL, Plaintiff-Appellee, v. SOUTHERN CALIFORNIA DISTRICT COUNCIL OF CARPENTERS, an unincorporated association; Carpenters Local 1506, an unincorporated association Does 1 through 100 Defendants-Appellants.

No. 96-56124.

United States Court of Appeals Ninth Circuit.

Argued and Submitted March 3, 1997.

Decided Sept. 8, 1997.

Gerald V. Selvo and Daniel M. Shanley, DeCarlo, Connor & Selvo, Los Angeles, CA, for defendants-appellants.

Douglas R. Hart and Teresa F. Elconin, Sheppard, Mullin, Richter & Hampton, Los Angeles, CA, for plaintiff-appellee.

Appeal from the United States District Court for the Central District of California; Robert M. Takasugi, District Judge, Presiding. D.C. No. CV-96-04830-RMT.

Before: FARRIS, KOZINSKI and T.G. NELSON, Circuit Judges.

T.G. NELSON, Circuit Judge:

ORDER

The Opinion filed June 4, 1997, slip op. 6439, is hereby WITHDRAWN.

OPINION

Southern California District Council of Carpenters ("the Union") appeals the district court's issuance of a preliminary injunction restricting the manner in which the Union had displayed a banner purporting to publicize its labor dispute with Best Interiors, a subcontractor engaged in a construction project at San Antonio Community Hospital ("the Hospital"). The district court concluded that the Hospital had met the strict requirements for a preliminary injunction set forth in the Norris-LaGuardia Act ("NLA"), 28 U.S.C. §§ 101-115. We have jurisdiction under 28 U.S.C. § 1292(a). We affirm.

I. FACTS

The Union is currently engaged in an ongoing labor dispute with Best Interiors, a construction company, over Best Interiors' failure to pay its employees prevailing wages and benefits. Best Interiors is a subcontractor in an expansion project at the Hospital. There is no contract between Best Interiors and the Hospital. The Union concedes that it does not now have, and has never had, a labor dispute with the Hospital.

On June 21, 1996, the Union began displaying a banner near the Hospital's construction site and the entrance to the Hospital's maternity ward that was visible by passersby driving on San Bernardino Road in front of the Hospital and patients entering the maternity ward. The banner is displayed during the morning hours and is held by three retired members of the Union. In twelve-inch red capital letters on two lines, the banner reads: "THIS MEDICAL FACILITY IS FULL OF RATS." Below those lines, in five-inch red capital letters on two lines that appear just above the feet of the banner's holders, it reads: "CARPENTERS L.U. 1506 HAS A DISPUTE WITH [_______] FOR FAILING TO PAY PREVAILING WAGES TO ITS WORKERS." In the blank space, in two-inch black handwritten letters, the banner reads: "Best Int." ¹

On June 25, 1996, the Hospital filed unfair labor practice charges against the Union with the National Labor Relations Board ("NLRB"). During the NLRB investigation, there were several attempts to reach a negotiated agreement between the Union and the Hospital. After completing its investigation, the NLRB Regional Office determined that evidence could not support the Hospital's allegations, and the Hospital withdrew its charges.

On July 11, 1996, the Hospital filed this lawsuit in the district court, including various state tort claims and a federal claim for an unlawful secondary boycott under 29 U.S.C. § 187. On July 17, 1996, the Hospital filed a motion for a temporary restraining order which the district court denied on July 22, 1996, because the Hospital had failed to satisfy the requirements of the NLA.

On August 9, 1996, the district court held an evidentiary hearing on the Hospital's request for a preliminary injunction. After hearing the testimony of witnesses from both sides, the district court ruled that the Hospital had met the requirements for a preliminary injunction set forth in the NLA. The district court ordered that the Union's members "are hereby preliminarily enjoined from using the term, 'Rats,' as they currently have in their banner which they display in front of plaintiff San Antonio Community Hospital." This timely appeal followed.

II. DISCUSSION

Generally, the grant or denial of a preliminary injunction will be reversed only where the district court abused its discretion or based its decision on an erroneous legal standard or on clearly erroneous findings of fact. Does 1-5 v. Chandler, 83 F.3d 1150, 1152 (9th Cir.1996). See also Donnelly Garment Co. v. Dubinsky, 154 F.2d 38, 45 (8th Cir.1946) ("Since we conclude that the trial courts' findings against the appellants in this case on issues necessary to its power and jurisdiction to enjoin the appellees [under the NLA] are not clearly erroneous, the decree appealed from is affirmed."); International Ass'n of Bridge, Structural & Ornamental Iron Workers v. Pauly Jail Bldg. Co., 118 F.2d 615 (8th Cir.1941). However, when a case involves free expression, "[w]e must make an independent examination of the whole record so as to assure ourselves that the judgment does not constitute a forbidden intrusion on the field of free expression." Old Dominion Branch No. 496, Nat'l Ass'n of Letter Carriers v. Austin, 418 U.S. 264, 282, 94 S.Ct. 2770, 2780, 41 L.Ed.2d 745 (1974) (citations omitted). "While this duty has been most often recognized in the context of claims that the expression involved was entitled to First Amendment protection, the same obligation exists in cases involving speech claimed to be protected under federal labor laws." Id. We review issues of law underlying the district court's grant of a preliminary injunction de novo. Chandler, 83 F.3d at 1152.

A. Injunctions and the Norris-LaGuardia Act

Under traditional legal standards, a moving party may become eligible to obtain a preliminary injunction by demonstrating "a combination of probable success on the merits and the possibility of irreparable injury." United States v. Odessa Union Warehouse Co-op, 833 F.2d 172, 174 (9th Cir.1987). At the very least, "it must be shown as an irreducible minimum that there is a fair chance of success on the merits." Stanley v. University of S. Cal., 13 F.3d 1313, 1319 (9th Cir.1994).

The NLA is an anti-injunction statute that prevents district courts from issuing "any restraining order or temporary or permanent injunction in a case involving or growing out of a labor dispute, except in a strict conformity with the provisions of this Act." 29 U.S.C. § 101. The NLA denies jurisdiction to district courts to issue preliminary injunctions that would prevent union members from "[g]iving publicity to the existence of, or the facts involved in, any labor dispute, whether by advertising, speaking, patrolling, or by any other method not involving fraud or violence." 29 U.S.C. § 104(e) (emphasis added).

Therefore, in addition to satisfying the traditional requirements for a preliminary injunction and providing evidence of fraud or violence, the Hospital, as proponent of the preliminary injunction, was required to prove the following additional elements:

1) That unlawful acts have been threatened and will be committed unless restrained (29 U.S.C. § 107(a));

2) That substantial and irreparable injury to the Hospital's property will follow (29 U.S.C. § 107(b)); ²

3) That greater injury will be inflicted upon the Hospital by the denial of relief than will be inflicted upon the Union by the granting of relief (29 U.S.C. § 107(c));

4) That the Hospital has no adequate remedy at law (29 U.S.C. § 107(d));

5) That the public officers charged with the duty to protect the Hospital's property are unable or unwilling to furnish adequate protection (29 U.S.C. § 107(e)); and

6) That the Hospital has made every reasonable effort to settle the dispute (29 U.S.C. § 108).

Because the Union challenges the district court's conclusions with regard to all of these elements, we will address each element in turn. ³

1. Fraud and Unlawful Acts

In addition to satisfying the strict requirements of the NLA, the Hospital must demonstrate "a fair chance of success on the merits." On the merits of what? Of one of the Hospital's substantive claims. The Hospital's complaint contained six damages claims: libel, trade libel, intentional interference with prospective economic advantage, negligent interference with prospective economic advantage, interference with contractual rights, and secondary boycott under section 303 of the Labor Management Relations Act ("LMRA") (29 U.S.C. § 187). Four of the six claims cannot form the basis for injunctive relief. The interference with prospective economic advantage and contractual rights claims are preempted by section 303 of the LMRA. Local 20, Teamsters v. Morton, 377 U.S. 252, 260-61, 84 S.Ct. 1253, 1258-59, 12 L.Ed.2d 280 (1964). And an employer cannot seek injunctive relief from a secondary boycott under section 303; only damages are available. Burlington Northern R.R. v. Brotherhood of Maintenance of Way Employes, 481 U.S. 429, 448, 107 S.Ct. 1841, 1852-53, 95 L.Ed.2d 381 (1987) (because the NLRB has exclusive authority to seek injunctions under the National Labor Relations Act, "employers are not permitted to obtain injunctions of secondary activity."); California Ass'n of Employers v. Building and Constr. Trades Council of Reno, 178 F.2d 175, 178 (9th Cir.1949) ("The [LMRA] did not give private litigants the right to obtain injunctive relief even in those situations where a suit for damages was allowed."). That leaves the Hospital's defamation claims as the only possible basis for the preliminary injunction.

Because the injunction must be predicated on the Hospital's defamation claims, the Supreme Court's decisions in Linn v. United Plant Guard Workers of Am., 383 U.S. 53, 86 S.Ct. 657, 15 L.Ed.2d 582 (1966), and Old Dominion Branch No. 496, Nat'l Ass'n of Letter Carriers v. Austin, 418 U.S....