Szabo v. U.S. Marine Corp., 86-2003

• Decision Date: 04 May 1987
• Docket Number: No. 86-2003,86-2003
• Citation: 819 F.2d 714
• Parties: 125 L.R.R.M. (BNA) 2572, 125 L.R.R.M. (BNA) 3136, 106 Lab.Cas. P 12,368 Joseph A. SZABO, Regional Director of the National Labor Relations Board, Petitioner-Appellee, v. U.S. MARINE CORPORATION, Respondent-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 714

819 F.2d 714

125 L.R.R.M. (BNA) 2572, 125 L.R.R.M. (BNA) 3136,

106 Lab.Cas. P 12,368

Joseph A. SZABO, Regional Director of the National Labor Relations Board, Petitioner-Appellee, v. U.S. MARINE CORPORATION, Respondent-Appellant.

No. 86-2003.

United States Court of Appeals, Seventh Circuit.

Argued Nov. 5, 1986.

Decided May 4, 1987.

Fred G. Groiss, Quarles & Brady, Milwaukee, Wis., for respondent-appellant.

Joseph F. Frankl, argued, with whom Rosemary M. Collyer, Gen. Counsel, John E. Higgins, Jr., Deputy Gen. Counsel, Harold J. Datz, Assoc. Gen. Counsel, Jospeh E. Mayer, Asst. Gen. Counsel, John W. Hornbeck, Deputy Asst. Gen. Counsel, Washington, D.C., on the brief, for petitioner-appellee.

Before POSNER, COFFEY and EASTERBROOK, Circuit Judges.

POSNER, Circuit Judge.

In 1984 U.S. Marine Corporation bought an engine plant in Wisconsin from Chrysler. The production and maintenance workers at the plant had been represented by a local of the Allied Industrial Workers. Pursuant to the terms of the sale Chrysler terminated these workers. U.S. Marine promptly rehired most of them. Contending that in these circumstances U.S. Marine was Chrysler's successor and was therefore obliged to bargain with the union, see, e.g., NLRB v. World Evangelism, Inc., 656 F.2d 1349, 1354-55 (9th Cir.1981), yet refused to do so, the Board in 1984 brought suit against U.S. Marine in a federal district court in Wisconsin under section 10(j) of the National Labor Relations Act, as amended, 29 U.S.C. Sec. 160(j). This statute authorizes the district court to grant an injunction that will preserve the status quo until the completion of unfair labor practice proceedings before the Board; the Board had instituted such proceedings against U.S. Marine. In May 1984 the district court granted the injunction, from which U.S. Marine did not appeal, enjoining U.S. Marine from "refusing to bargain collectively in good faith concerning wages, hours and other terms and conditions of employment with [the union] as exclusive bargaining representative of its employees."

In 1986 the Board's regional director sought and obtained from the district court a finding that U.S. Marine was in civil contempt of the injunction, and, by way of remedy, an order directing the company (1) to mail a notice of the finding to each employee, (2) to file a statement of compliance, (3) to permit discovery concerning compliance matters, (4) to cease holding "Safety & Progress Committee meetings" (U.S. Marine may meet with its employees to provide them with information but "it may not solicit questions or grievances from employees, nor may it make remarks reflecting an anti-union animus"), and (5) to pay the Labor Board the attorney's fees and other expenses reasonably incurred by the Board in the contempt proceeding, in an amount to be determined by the parties or, failing that, by the court.

U.S. Marine has appealed from the contempt order. When we denied a stay of the order pending appeal, U.S. Marine complied with its five paragraphs. Ordinarily compliance with an order of civil contempt makes the order moot, Marshall v. Whittaker Corp., 610 F.2d 1141, 1145 (3d Cir.1979), because reversing the order would not benefit the party held in contempt. But this case is different. First, the order imposes a continuing obligation; if we reverse it, U.S. Marine will resume meetings of the Safety & Progress Committee. Second, the one-time obligations that the order imposes can be undone. If we reverse, U.S. Marine will, through a new mailing, retract its notification to the employees that it has been adjudged in contempt. It will also seek to recover the attorney's fees and other expenses that it has paid the Board in compliance with paragraph (5).

After the contempt order was issued, an administrative law judge found that U.S. Marine had indeed committed an unfair labor practice in refusing to bargain with the union. His decision is currently pending on appeal to the Board. But until the decision is affirmed, and becomes final after judicial review (if sought), U.S. Marine will benefit from a reversal of the district judge's order of civil contempt. That reversal will enable it to do things it wants to do until the unfair labor practice proceeding ends in a final order adverse to it.

So the case is not moot; but there is another jurisdictional issue. The general rule is that an order of civil contempt is not appealable unless directed against a nonparty to the litigation. Doyle v. London Guarantee & Accident Co., 204 U.S. 599, 607-08, 27 S.Ct. 313, 315-16, 51 L.Ed. 641 (1907); In re Witness Before Special October 1981 Grand Jury, 722 F.2d 349, 351 (7th Cir.1983); 15 Wright, Miller & Cooper, Federal Practice and Procedure Sec. 3917 (1976); id., 1986 Supp. So stated, the rule is subject to powerful criticism. See, e.g., 15 Wright, Miller & Cooper, supra, at pp. 622-26. The fault, however, lies in the statement of the rule rather than the practice of the courts. A blanket rule against appealing orders of civil contempt would make no sense. Such an order may, for example, be final. This is particularly likely where the order is issued in a post-judgment proceeding, see, e.g., Vincent v. Local 294, Int'l Brotherhood of Teamsters, 424 F.2d 124, 128 (2d Cir.1970), or--a closely related category--where the contempt proceeding is the only pending proceeding, see, e.g., Shuffler v. Heritage Bank, 720 F.2d 1141, 1145 (9th Cir.1983). When not final in the strict sense of winding up the whole litigation in the trial court, an order of civil contempt may still be final enough to permit appeal under the collateral-order doctrine, as in Motorola, Inc. v. Computer Displays Int'l, Inc., 739 F.2d 1149, 1154 (7th Cir.1984); this is the rationale for allowing nonparties to appeal orders of contempt against them right away. Even when not final in any sense recognized by 28 U.S.C. Sec. 1291 (the "final judgment" rule), an order of civil contempt may still be appealable under another statute, such as 28 U.S.C. Sec. 1292(a)(1) (immediate appeal of preliminary injunctions), as in this case. Rather than talk about a rule against the appealability of civil contempt orders that is riddled with exceptions, see, e.g., Drummond Co. v. District 20, United Mine Workers of America, 598 F.2d 381, 383-84 (5th Cir.1979); Combs v. Ryan's Coal Co., 785 F.2d 970, 976 (11th Cir.1986), it would promote clarity to say that an order of civil contempt is appealable if and only if it is either final for purposes of section 1291 or appealable under a statute allowing the appeal of interlocutory orders.

If the contempt order that U.S. Marine seeks to appeal had wound up the proceedings in the district court, its appealability would be unquestionable under the simple test just proposed. The order is not, however, a final order in this sense. The reason is not, as might appear, that the Board's section 10(j) proceeding will remain alive in the district court until the injunction that the court found U.S. Marine to have violated expires--that is, until the company has been authoritatively determined to have committed an unfair labor practice by refusing to bargain with the union. Whenever an injunction is issued, the court that issued it retains jurisdiction, explicitly or implicitly, to enforce, modify, or dissolve it. Thus, so long as an injunction remains in force, the proceeding in which it was entered is not really final; hence an order in that proceeding, such as this order of civil contempt, is not really final. But the possibility of supplementary proceedings does not deprive an injunction of finality within the meaning of 28 U.S.C. Sec. 1291. University Life Ins. Co. v. Unimarc Ltd., 699 F.2d 846, 849 (7th Cir.1983). The post-judgment phase of an injunctive proceeding is treated just like the collection phase in a suit for damages; a judgment for damages is, of course, a final and appealable order, even though supplementary proceedings, whether in the same or a different court, may prove necessary to collect the damages. U.S. Marine is not appealing from the injunction but from a subsequent order; but so long as no further proceedings other than enforcement are contemplated in the district court, that order is itself a final order.

There is, however, a second reason for questioning the finality of the contempt order: the court did not determine the amount of attorney's fees to award the Board, but left that for later determination. Ordinarily, of course, the fact that attorney's fees have not been awarded does not prevent the underlying judgment from becoming final; the attorney's fee proceeding is regarded as collateral. See Exchange Nat'l Bank of Chicago v. Daniels, 763 F.2d 286, 292-94, on rehearing, 768 F.2d 140 (7th Cir.1985). Here, however, the judgment sought to be appealed includes an order to pay attorney's fees but no specification of the amount of fees to be paid, suggesting an analogy to the case where liability is determined but the quantification of damages is left for later determination--a classic example of a nonfinal order. See Liberty Mutual Ins. Co. v. Wetzel, 424 U.S. 737, 744, 96 S.Ct. 1202, 1206, 47 L.Ed.2d 435 (1976). It is true that the amount of attorney's fees was later determined and in fact paid, but if there was no final order when U.S. Marine filed its notice of appeal, the notice was premature, and did not confer appellate jurisdiction. United States v. Hansen, 795 F.2d 35 (7th Cir.1986). U.S. Marine would have had to file a later, timely notice when the fees were quantified--which it didn't do.

Clearly, if the only order sought to be appealed was an order to pay attorney's fees in a not yet determined amount, Wetzel would require the dismissal of the appeal for lack of finality. However, when such an order is ancillary to an appealable order, we have allowed it to be appealed too on "the principle that 'a court of appeals may, in the interest of orderly judicial...