Souza v. Trustees of Western Conference of Teamsters Pension Trust

• Decision Date: 14 December 1981
• Docket Number: No. 79-4454,79-4454
• Citation: 663 F.2d 942
• Parties: 109 L.R.R.M. (BNA) 2199, 92 Lab.Cas. P 13,159, 2 Employee Benefits Ca 2322 Frank J. SOUZA, et al., Plaintiffs-Appellants, v. The TRUSTEES OF the WESTERN CONFERENCE OF TEAMSTERS PENSION TRUST, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 942

663 F.2d 942

109 L.R.R.M. (BNA) 2199, 92 Lab.Cas. P 13,159,

2 Employee Benefits Ca 2322

Frank J. SOUZA, et al., Plaintiffs-Appellants, v. The TRUSTEES OF the WESTERN CONFERENCE OF TEAMSTERS PENSION TRUST, Defendants-Appellees.

No. 79-4454.

United States Court of Appeals Ninth Circuit.

Argued and Submitted June 10, 1981.

Decided Dec. 14, 1981.

R. J. Wolf, San Rafael, Cal., John A. Cochrane, Cochrane & Bresnahan, St. Paul, Minn., for plaintiffs-appellants.

Noble K. Gregory, Pillsbury, Madison & Sutro, San Francisco, Cal., for defendants-appellees.

Appeal from the United States District Court for the Northern District of California.

Before ANDERSON and POOLE, Circuit Judges, and ENRIGHT, ^* District Judge.

ENRIGHT, District Judge:

I. History of Case

This class action was filed in 1973 (certified in 1974) to obtain declaratory and injunctive relief against enforcement of an "age requirement" for the vesting of pension benefits under the Western Conference of Teamsters pension plan. The "plan" was an employee benefit trust fund jointly administered by employer and employee trustees, governed by section 302(c)(5) of the Labor Management Relations Act of 1947 (the "Act"). (29 U.S.C. § 186(c)(5)). The Teamsters plan provided that an employee's retirement benefit was vested if he had attained at least 15 years of unbroken service, 3,000 covered hours ¹ with a covered employer and a minimum age. (The minimum age was 52 through 1968 and was reduced to 45 by the trustees thereafter). ² This minimum age requirement was challenged as allegedly violative of Section 302(c)(5) of the Act. (29 U.S.C. § 186(c)(5)). The statute provides in part that the assets of such trust funds must be held for the "sole and exclusive benefit of the employees...." Section 302(e) authorizes district courts "to restrain violations of this section." (29 U.S.C. § 186(e)).

The trial court denied defendants' motion for summary judgment in a thorough 1978 opinion, which also framed the issues for trial. Souza v. Trustees of Western Conference of Teamsters Pension Trust, 460 F.Supp. 843 (N.D.Cal.1978). The trial court then determined the case should be tried before the court rather than a jury. Trial was held and the court ruled for defendants, finding there was reasonable justification for the "age requirement" provision. We now invoke jurisdiction to review under 28 U.S.C. § 1291.

II. Issues on Appeal

Appellants first contend that legal issues predominate in this action and therefore they should have been entitled to a jury trial. Second, they charge the findings of fact were contrary to the evidence and clearly erroneous.

III. Appellants' Right to a Jury Trial

Appellants argue the trial court erred in denying them a jury trial. They list numerous questions of fact which were issues in this suit, such as whether or not there was reasonable justification for the exclusion of benefits, and describe them as legal issues. Appellants cite Curtis v. Loether, 415 U.S. 189, 194, 94 S.Ct. 1005, 1008, 39 L.Ed.2d 260 (1974), for the proposition that where legal, statutory rights, as opposed to equitable rights alone, are in issue, a jury trial must be available. They also point to cases holding that when an action involves both legal and equitable claims, the right to jury trial remains. Dairy Queen, Inc. v. Wood, 369 U.S. 469, 82 S.Ct. 894, 8 L.Ed.2d 44 (1962); Beacon Theatres, Inc. v. Westover, 359 U.S. 500, 79 S.Ct. 948, 3 L.Ed.2d 988 (1959).

The Supreme Court's analysis in Curtis v. Loether, supra, is quite instructive on the jury issue. Curtis considered whether there was a jury right in cases brought under the 1968 Civil Rights Act's Title VIII fair housing provisions. The Supreme Court held that "when Congress provides for enforcement of statutory rights in an ordinary civil action in the district courts ... a jury trial must be available if the action involves rights and remedies of the sort typically enforced in an action at law." Curtis, supra at 195, 94 S.Ct. at 1009 (emphasis added). The Court goes on to stress that awards of actual and punitive damages, made specifically available by Title VIII (42 U.S.C. § 3612), are the traditional forms of relief offered in courts of law. It specifically contrasts Title VII of the Civil Rights Act, which includes the language "the court may enjoin the respondent from engaging in such unlawful employment practice...." (42 U.S.C. § 2000e-5(g)). The Title VII section also authorizes monetary awards of back pay as a form of relief. (Similarly, an injunction in the present case would result in monetary relief to those who have been excluded under the age provision of the pension plan). However, the Supreme Court in Curtis notes that in Title VII actions the courts of appeal have characterized these awards as integral parts of an equitable remedy. Id. at 198, 94 S.Ct. at 1010. The Court states that the statutory language of Title VII "contrasts sharply with (Title VIII's) simple authorization of an action for actual and punitive damages." Id. at 198, 94 S.Ct. at 1010.

One year after Curtis was decided this court ruled that parties were not entitled to jury trials in Title VII actions. Slack v. Havens, 522 F.2d 1091 (9th Cir. 1975). Relying on Curtis, we held that "not all awards of monetary relief should necessarily be characterized as legal relief for purposes of the jury trial requirement." Slack, supra at 1094. We also had the opportunity to consider and reject the argument that Beacon Theatres and Dairy Queen require a jury trial:

These cases involved a joinder of several claims, some legal, some equitable, and not a situation like the one presently before us in which a single cause of action must be characterized as itself legal or equitable.

Id. at 1094, fn. 4.

The present case, like Slack, involves only a single cause of action which must be characterized as legal or equitable.

In characterizing this cause of action, it seems the rationale of Curtis and Slack would clearly support the finding of the lower court. The statutory language of Section 302 is much more directly analogous to that of Title VII. Section 302(e) authorizes district courts to "restrain violations of this section." (29 U.S.C. § 186(e)) (emphasis added). Appellants contend the legislative history shows the above quoted language was intended to remove bars to injunctive relief that had existed under the Clayton and Norris-LaGuardia Acts. This may be so, but nowhere is it shown that the section intended to provide anything more than injunctive relief. There is no mention of ordinary actions in the courts or awards of actual and/or punitive damages.

Appellants point out that actions brought under Sections 301 and 303 of the Act have been deemed to be entitled to be tried before juries. However, these are entirely different statutes with different jurisdictional provisions. Both are much more general and provide for ordinary suits in the courts. For example, both sections provide there shall be no "amount in controversy" requirement for suits brought under the respective sections. Section 303(b) (29 U.S.C. § 187(b)) specifically authorizes the recovery of damages. Section 301(b) (29 U.S.C. § 185(b)) speaks of money judgments. By way of contrast, Section 302 only mentions the district court's power "to restrain violations."

Other circuits interpreting Section 302(e) have consistently found its function as limiting jurisdiction to the grant of injunctive relief. See, e. g., Snider v. All State Administrators, Inc., 481 F.2d 387 (5th Cir. 1973), cert. denied, 415 U.S. 957, 94 S.Ct. 1484, 39 L.Ed.2d 571 (1974).

Finally, the lower court in this case ruled that the class action should be certified under F.R.Civ.P. 23(b)(2), adopting appellants' own argument that the action primarily sought injunctive relief.

Thus, while there is no case directly on point, the language of the statute and the weight of authority in similar cases clearly indicate the district court was correct in striking plaintiffs' jury demand.

IV. Findings and Judgment of the District Court

Section 302(c)(5) governs the establishment of employee pension funds. It provides that the pension fund must be "for the sole and exclusive benefit of the employees..." (29 U.S.C. § 186(c)(5)). This language has been interpreted to give federal courts jurisdiction to determine whether challenged provisions of a given pension fund constitute a "structural defect" in violation of this section.

This court has stated that alleged violations of the provisions of Section 302(c)(5) of the Act shall be judged by the following test: "A structural defect is present when a pension plan excludes a sizeable number of union members with no reasonable purpose behind their exclusion...." Burroughs v. Board of Trustees of Pension Trust, Etc., 542 F.2d 1128, 1131 (9th Cir. 1976), cert. denied, 429 U.S. 1096, 97 S.Ct. 1113, 51 L.Ed.2d 543 (1977). We have also repeatedly held trustees' decisions may not be overturned on the ground that they constitute a "structural defect" which violates Section 302 unless it can be demonstrated the provisions are clearly "arbitrary and capricious." Ponce v. Const. Laborers Pension Trust, 628 F.2d 537, 542 (9th Cir. 1980); Tomlin v. Board of Trustees of Construction Laborers, 586 F.2d 148, 149 (9th Cir. 1978); Wilson v. Board of Trustees, Etc., 564 F.2d 1299, 1302 (9th Cir. 1977); Toensing v. Brown, 528 F.2d 69, 72 (9th Cir. 1975). Under this limited standard of review, "(c)ourts are extremely reluctant to substitute their judgments for the judgments of the trustees, and will do so only if the actions of the trustees are not grounded on any reasonable basis." Ponce, supra at 542. It is in this light which the court should determine whether, as appellants contend, the trial court's findings are contrary to the evidence and clearly erroneous.

Appellants challenge the court's Finding of Fact 7, which reads:

7. From 1968 to 1973, approximately...