Sheet M 27, Afl-Cio v. E.P. Donnelly, Inc., Nos. 10–2201

• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
• Writing for the Court: VANASKIE
• Citation: 737 F.3d 879
• Parties: SHEET METAL WORKERS INTERNATIONAL ASSOCIATION LOCAL UNION NO. 27, AFL–CIO, Appellant in No. 10–2202 v. E.P. DONNELLY, INC.; Sambe Construction Co., Inc. E.P. Donnelly, Inc, Appellant in No. 10–2201 Sambe Construction Co., Inc, Appellant in No. 10–2325. Sheet Metal Workers International Association Local Union No. 27, AFL–CIO, Petitioner v. National Labor Relations Board; United Brotherhood of Carpenters and Joiners of America, Local Union No. 623; E.P. Donnelly, Respondents. National Labor Relations Board, Petitioner v. Sheet Metal Workers' International Association, Local Union No. 27, AFL–CIO; United Brotherhood of Carpenters and Joiners of America, Local Union No. 623, Respondents.
• Decision Date: 13 December 2013
• Docket Number: Nos. 10–2201,10–2202,10–2325,12–1047.,11–4480

737 F.3d 879

SHEET METAL WORKERS INTERNATIONAL ASSOCIATION LOCAL UNION NO. 27, AFL–CIO, Appellant in No. 10–2202
v.
E.P. DONNELLY, INC.; Sambe Construction Co., Inc.
E.P. Donnelly, Inc, Appellant in No. 10–2201
Sambe Construction Co., Inc, Appellant in No. 10–2325.
Sheet Metal Workers International Association Local Union No. 27, AFL–CIO, Petitioner
v.
National Labor Relations Board; United Brotherhood of Carpenters and Joiners of America, Local Union No. 623; E.P. Donnelly, Respondents.
National Labor Relations Board, Petitioner
v.
Sheet Metal Workers' International Association, Local Union No. 27, AFL–CIO; United Brotherhood of Carpenters and Joiners of America, Local Union No. 623, Respondents.

Nos. 10–2201, 10–2202, 10–2325, 11–4480, 12–1047.

United States Court of Appeals,
Third Circuit.

Argued Feb. 13, 2013.
Filed: Dec. 13, 2013.

[737 F.3d 883]

Louis Rosner, Esq. (argued), Philadelphia, PA, for E.P. Donnelly Inc.

Mark E. Belland, Esq. (argued), Steven J. Bushinsky, Esq., O'Brien, Belland & Bushinsky, Cherry Hill, NJ, for Sheet Metal Workers International Association AFL–CIO Local Union No. 27.

Marc Furman, Esq., Jonathan Landesman, Esq. (argued), Cohen, Seglias, Pallas, Greenhall & Furman, Philadelphia, PA, for Sambe Construction Co. Inc.

Heather S. Beard, Esq. (argued), Julie B. Broido, Esq., Linda Dreeben, Esq., National Labor Relations Board, Washington, D.C., for the National Labor Relations Board.

Raymond G. Heineman, Esq., Kroll Heineman, Iselin, NJ, for United Brotherhood of Carpenters and Joiners of America Local Union No. 623.

Before: McKEE, Chief Judge, HARDIMAN, and VANASKIE, Circuit Judges.

OPINION
VANASKIE, Circuit Judge.

These consolidated appeals arise out of a construction trades jurisdictional dispute concerning whether certain work on a public building should be conducted by sheet metal workers or by carpenters. Sheet Metal Workers' International Association, Local 27, AFL–CIO (“Sheet Metal”) petitions this Court for review of the decision and order of the National Labor Relations Board (“the Board” or “NLRB”) of December 8, 2011, finding that Sheet Metal violated the National Labor Relations Act by maintaining a section 301 suit against E.P. Donnelly, Inc. (“Donnelly”) and Sambe Construction Company, Inc. (“Sambe”) following the Board's decision in a section 10(k) proceeding to assign the disputed work to the New Jersey Regional Council of Carpenters and the United States Brotherhood of Carpenters and Joiners of America, Local 623 (“Carpenters”). The Board cross-petitions for enforcement of its order. Also before this Court are three appeals from orders of the District Court entered in connection with the jurisdictional labor dispute. Donnelly appeals from an order of the District Court granting summary judgment in favor of Sheet Metal on its breach of contract claim and awarding Sheet Metal $365,349.75 in compensatory damages. Sheet Metal appeals the District Court's award of nominal damages of $1.00 against Sambe, and Sambe cross-appeals against Sheet Metal on the matters of contract liability and damages. For the reasons that follow, we will deny Sheet Metal's petition for review; grant the Board's petition for enforcement of its December 8, 2011 decision and order; vacate the judgment of the District Court in favor of Sheet Metal on the breach of contract claims against Donnelly and Sambe; and remand the case to the District Court with directions to enter judgment in favor of Donnelly and to conduct further proceedings with respect to Sheet Metal's contract claim asserted against Sambe.

I. FACTS AND PROCEDURAL HISTORY

In 2006, Egg Harbor Township, located in Atlantic County, New Jersey, authorized the construction of the Egg Harbor Township Community Center (“the Project”). In accordance with New Jersey

[737 F.3d 884]

law governing public works projects, the Township adopted a project labor agreement (“the PLA” or “Agreement”), which governed the terms and conditions of the Project's construction.¹ All contractors working on the Project were required to become signatories to the PLA. The PLA also contained a “supremacy provision,” which provided that the PLA “together with the local Collective Bargaining Agreements appended hereto as Schedule A represent[ ] the complete understanding of all signatories and supersede[ ] any national agreement, local agreement or other collective bargaining agreement of any type which would otherwise apply to this Project(s), in whole or in part” (“the Supremacy Clause”). (Board Appeals Joint Appendix [“B. J.A.”] 100.)

Sambe was selected as the general contractor on the Project and, as required, became a signatory to the PLA. In early 2007, Sambe subcontracted the Project roofing work to Donnelly. In accordance with the PLA's requirement that general contractors obtain signed letters of assent from all subcontractors hired to work on the Project, on March 30, 2007, Donnelly executed a letter of assent in which it consented to be bound by the terms and conditions of the PLA, and further agreed that any party it selected to perform the roofing work would also be required to become a signatory to the PLA.

A dispute arose when Donnelly selected Carpenters to perform the roofing work, even though Carpenters was not a signatory to the PLA. Donnelly apparently hired Carpenters because the two were parties to a collective bargaining agreement (“CBA”).² Sheet Metal, which was a signatory to the PLA, protested the work assignment and informed Donnelly that Carpenters could not complete the Project because it had not executed the PLA. Carpenters, in turn, threatened to picket if Donnelly reassigned the roofing work to Sheet Metal. Although Donnelly created conflicting contractual obligations by assenting to both the Carpenters' CBA and the PLA, it refused to reassign the work to Sheet Metal.

In an attempt to settle the work dispute, Sheet Metal initiated an arbitration proceeding pursuant to Article 10 of the PLA.³ An arbitration hearing was held before

[737 F.3d 885]

arbitrator Stanley Aiges. Donnelly, Sambe, and Sheet Metal participated in the hearing; Carpenters, although made aware of the hearing, did not appear at the proceeding.⁴ On June 15, 2007, Arbitrator Aiges issued a short form arbitration decision awarding the disputed work to Sheet Metal (“the Aiges arbitration award”).⁵

Carpenters nonetheless persisted in its assertion that it would picket the Project if the work were assigned to Sheet Metal. Donnelly subsequently filed an unfair labor practice charge with the Board pursuant to section 10(k) of the National Labor Relations Act (“NLRA” or “the Act”), 29 U.S.C. § 160(k), alleging that Carpenters violated section 8(b)(4)(ii)(D) of the NLRA, 29 U.S.C. § 158(b)(4)(ii)(D), “by engaging in proscribed activity [threatening to picket] with an object of forcing [Donnelly] to continue to assign certain work to employees it represents rather than to employees represented by [Sheet Metal].” ⁶United Bhd. of Carpenters & Joiners of Am., Local Union No. 623, 351 NLRB 1417, 1417 (2007) (“ Local Union No. 623 ”). The regional director for the NLRB ordered a section 10(k) hearing to determine the work jurisdiction dispute.⁷

While Donnelly's unfair labor practice charge against Carpenters was pending, Sheet Metal filed a grievance against Sambe and Donnelly with the Local Joint Adjustment Board (“the LJAB”) pursuant to its own CBA, seeking to confirm the Aiges arbitration award because Donnelly had not yet assigned the disputed work to Sheet Metal.⁸ Donnelly and Sambe were invited to participate in the LJAB proceeding, but both declined. Donnelly objected to the LJAB's jurisdiction. One month later, on July 25, 2007, the LJAB issued its decision, finding that Sambe and Donnelly violated the PLA and Sheet Metal's CBA by assigning the roofing work to Carpenters and failing to comply with the Aiges

[737 F.3d 886]

award. The LJAB further held that if the work was not reassigned to Sheet Metal, Sambe and Donnelly would be jointly liable to Sheet Metal for $428,319.26 in lost wages and benefits.

In the meantime, on June 29, 2007, Sheet Metal filed suit against Donnelly and Carpenters in the United States District Court for the District of New Jersey pursuant to section 301 of the Labor Management Relations Act of 1974 (“LMRA”), 29 U.S.C. § 185,⁹ seeking declaratory and monetary relief, as well as a preliminary injunction to enforce the Aiges arbitration award. ¹⁰ Sheet Metal filed an amended complaint in August, 2007, adding a claim against Donnelly for failure to abide by the LJAB arbitration award and joining Sambe as a defendant.

On December 31, 2007, the Board issued a decision and order resolving Donnelly's unfair labor practice charge against Carpenters. See Local Union No. 623,351 NLRB at 1417. Finding that it had jurisdiction pursuant to section 10(k) of the Act, the Board awarded the disputed roofing work to Carpenters, “relying on the factors of employer preference, current assignment and past practice, and economy and efficiency of operations.” Id. at 1422. Notwithstanding this award, Sheet Metal continued to pursue its section 301 lawsuit against Donnelly in the District Court. On January 11, 2008, Donnelly filed a second unfair labor practice charge with the Board, this time against Sheet Metal and asserting that Sheet Metal's continued pursuit of the section 301 action after the Board issued the section 10(k) order constituted an unfair labor practice in violation of section 8(b)(4)(ii)(D) because it sought reassignment of work in contravention of a section 10(k) order of the Board.

On March 27, 2008, the District Court denied Sambe and Donnelly's motions to vacate the Aiges arbitration award, finding that it could not evaluate the motions because a decision on the validity of the PLA was “premature at [that] time.” (D.C. J.A. 20.) The District Court did, however, “touch upon the ... [parties'] dispute regarding the preclusive effect of the 10(k) decision rendered by...