Similarly Situated Nw. Airlines Inc. Quality Serv. Assistants v. Int'l Ass'n Of Machinists

• Citation: 613 F.3d 609
• Decision Date: 22 July 2010
• Docket Number: No. 09-1563.,09-1563.
• Parties: Patricia M. MERRITT; Faye Hadley; Carmen Pinckney; Mary Filice, and similarly situated Northwest Airlines, Inc. Quality Service Assistants, Plaintiffs-Appellants, v. INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE WORKERS; Air Transport District 143 International Association of Machinists and Aerospace Workers; Robert B. DePace, in his capacity as President and Directing General Chair of District 143, International Association of Machinists and Aerospace Workers; Sandra K. Weber, in her capacity as General Chair and Lead Negotiator for Clerical, Office, Fleet and Passenger Service Employees of District 143, International Association of Machinists and Aerospace Workers, Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (6th Circuit)

613 F.3d 609

Patricia M. MERRITT; Faye Hadley; Carmen Pinckney; Mary Filice, and similarly situated Northwest Airlines, Inc. Quality Service Assistants, Plaintiffs-Appellants,

v.INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE WORKERS; Air Transport District 143 International Association of Machinists and Aerospace Workers; Robert B. DePace, in his capacity as President and Directing General Chair of District 143, International Association of Machinists and Aerospace Workers; Sandra K. Weber, in her capacity as General Chair and Lead Negotiator for Clerical, Office, Fleet and Passenger Service Employees of District 143, International Association of Machinists and Aerospace Workers, Defendants-Appellees.

No. 09-1563.

United States Court of Appeals,Sixth Circuit.

Argued: Jan. 14, 2010.

Decided and Filed: July 22, 2010.

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ARGUED: Dennis M. Devaney, Devaney, Jacob, Wilson PLLC, Troy, Michigan, for Appellants. Carmen R. Parcelli, Guerrieri, Clayman, Bartos & Parcelli, P.C., Washington, D.C., for Appellees. ON BRIEF: Dennis M. Devaney, Devaney, Jacob, Wilson PLLC, Troy, Michigan, for Appellants. Carmen R. Parcelli, Joseph Guerrieri, Jr., Guerrieri, Clayman, Bartos & Parcelli, P.C., Washington, D.C., for Appellees.

Before: BOGGS and GILMAN, Circuit Judges; McCALLA, Chief District Judge. ^*

OPINION

JON P. McCALLA, Chief District Judge.

Northwest Airlines (“Northwest”) Quality Service Agents (“QSAs” or “Plaintiffs”) sued the International Association of Machinists and Aerospace Workers; Air Transport District Lodge 143; Robert B. DePace, President and Directing General Chair of District 143; and Sandra K. Weber, General Chair and Lead Negotiator for Clerical, Office, Fleet and Passenger Service Employees of District 143 (“Defendants”). Plaintiffs allege that between 2000 and 2006 Defendants breached their duty of fair representation relating to the negotiation and administration of contracts on behalf of QSA employees (“Count I”) and in handling QSA employees' dues-objector status requests (“Count II”). The district court granted summary judgment in favor of Defendants on Counts I and II and issued Rule 11 sanctions against Plaintiffs' counsel for failing to adequately investigate the law and facts before filing their complaint. For the reasons set forth below, we AFFIRM the district court's grant of summary judgment on Counts I and II and the grant of Rule 11 sanctions.

I. BACKGROUND

Plaintiffs are current and former Northwest QSAs. Northwest created the QSA position in 1984 to perform a variety of passenger-service functions such as escorting unaccompanied minors through airports and acting as “meeters and greeters” at Northwest terminals. Prior to 2000, QSAs were non-unionized, at-will employees. During this time, Northwest set pay levels for QSAs that varied based on employment location and specialized skills such as language abilities. Raises were awarded on a merit-based system rather than a seniority-based pay scale. QSAs also enjoyed various employment benefits, including F-3 travel pass privileges, which allowed them to travel ahead of most other non-management Northwest employees.

Defendants include the International Association of Machinists and Aerospace Workers (“IAM”); Air Transport District 143 (“District 143”); Robert B. DePace in his capacity as President and Directing General Chair of District Lodge 143; and Sandra K. Weber in her capacity as General Chair and Lead Negotiator for Clerical, Office, Fleet and Passenger Service Employees (“COFPS”) of District 143. The IAM is an international labor organization that represents, among many other individuals, Northwest QSAs. District 143 is an intermediate level body within the IAM. Under the Railway Labor Act (“RLA”), which governs labor relations in the airline industry, District 143 has exclusive collective bargaining responsibility for various crafts or classes of employees at Northwest, including QSAs.

In 1999, the IAM attempted to unionize the QSAs and led a campaign to collect authorization cards for a National Mediation Board (“NMB”) election. The NMB is the federal agency charged with determining representation disputes arising under the RLA. 45 U.S.C. § 152, Ninth. On February 7, 2000, the IAM decided to seek accretion of the QSAs into the existing COFPS craft or class rather than proceed with an NMB-run election. Northwest opposed this accretion proposal. On April 4, 2000, the NMB issued a final decision that Northwest's QSAs should be accreted into the COFPS craft or class because QSAs and COFPS employees “share a community of interests” in that their “duties are exclusively passenger service.” The NMB noted that the COFPS craft or class was comprised of approximately 18,700 employees, compared to 361 QSAs. In an effort “to avoid fragmentation and instability,” the NMB found that “an election [was] unwarranted.”

Following the April 4, 2000, NMB decision, DePace, the President and Directing General Chair of District Lodge 143, requested that Northwest meet to negotiate an interim collective bargaining agreement (“CBA”) for the newly accreted QSAs. The COFPS CBA in effect at the time did not expire until February 25, 2003. According to DePace, Northwest was not legally obligated to open this agreement prior to its expiration and was unwilling to do so because extending its benefits to QSAs would be costly. On July 8, 2000, various QSAs sent a letter to DePace, expressing their discontent with the outcome of the accretion decision. District 143 sent representatives to meet with QSAs and established a toll-free number for QSAs to contact the union with questions and concerns relating to the upcoming negotiations for an interim agreement. On August 11, 2000, DePace issued a bulletin informing QSAs that the interim agreement would not be voted upon, but was merely intended to cover the QSAs until the expiration of the COFPS CBA on February 25, 2003.

On October 24, 2000, District 143 and Northwest entered into a letter of agreement pertaining to the QSAs, commonly referred to as the “Accretion Agreement.” Following the execution of the Accretion Agreement, QSAs were required to pay union dues even though they had not voted for a contract. Although District 143 was unable to incorporate QSAs into the existing COFPS CBA, the Accretion Agreement did secure several benefits. Most importantly, QSAs were able to maintain their F-3 manager-level passes until February 25, 2003. The agreement also established, among other things, a pay increase schedule, the accrual of vacation time, just-cause protection against discipline, a separate seniority district for QSAs, and seniority-based bidding on schedules. The Accretion Agreement, however, did not define QSA seniority in terms of pay rates-a factor that would become relevant during the 2006 bankruptcy negotiations.

Following the negotiation and execution of the Accretion Agreement in late 2000, QSAs allege that DePace and the IAM leadership became openly hostile to QSAs and their complaints. In particular, QSAs claim that DePace referred to them as “whiners” and wished he could “give them back [to Northwest].” QSAs also allege that complaints made to IAM leadership about the union's poor representation were ignored.

Shortly after the execution of the Accretion Agreement, the airline industry suffered a period of tremendous upheaval and substantial losses. From 2001 through 2004, major American air carriers lost $28 billion. Northwest, in particular, lost $3.8 billion between 2001 and the third quarter of 2005. During this period, the COFPS CBA expired and became open for negotiation on February 25, 2003. Sandra Weber was elected as the COFPS craft or class representative, and Thomas Roth, a labor economist, acted as the IAM financial consultant during the negotiations. Although a QSA employee failed to be elected as a COFPS negotiation representative, the IAM permitted two QSAs to serve as negotiation liaisons.

After nearly two years of negotiations, no agreement was reached. On August 18, 2005, the IAM and Northwest signed a tentative agreement that extended most of the COFPS CBA provisions to QSAs. The agreement, however, specified that QSA pay rates were still to be negotiated and seniority dates were still to be assigned. On September 14, 2005, less than one month after signing the tentative agreement, Northwest filed for Chapter 11 bankruptcy. Northwest proceeded to invoke Section 1113 of the Bankruptcy Code, permitting an employer to reject a CBA if rejection is found necessary for a successful reorganization. 11 U.S.C. § 1113(c). While Northwest's Section 1113 motion was pending, the bankruptcy court approved an emergency 19% pay cut for all IAM-represented employees. By September 25, 2005, Northwest made it clear to the IAM that its bankruptcy-restructuring goal was to cut labor costs by $873 million per year, including $190 million in labor savings from IAM-represented employees. Although Northwest proposed a 12.5% pay cut for most IAM-represented employees, including QSAs, it ultimately granted the IAM flexibility to determine how the labor savings should be achieved.

From January 9, 2006 to January 13, 2006, IAM and Northwest negotiators engaged in meetings in New York. If the negotiators failed to reach an agreement, Northwest would be free to alter wages, work rules, and benefits at will. The two QSA liaisons were permitted to attend the January meetings but were asked to leave the room when the elected negotiators discussed QSA salaries. Northwest's chief negotiator, Julie Hagen Showers, stated after the negotiations that the fairest solution was to impose an 11.5% across-the-board pay cut for all IAM members.

Once the percentage pay cut was set, Patrick Clay, Northwest's finance representative, and Thomas Roth, the IAM's financial consultant, worked together...