West v. Butler
| Decision Date | 15 May 1980 |
| Docket Number | No. 78-1081,78-1081 |
| Parties | 88 Lab.Cas. P 12,050, 2 Employee Benefits Ca 1985 Harold WEST et al., Trustees of the Southern Labor Union Welfare Fund and Pension Fund, Plaintiffs-Appellants, v. James BUTLER et al., Defendants-Appellees. |
| Court | U.S. Court of Appeals — Sixth Circuit |
Thomas Phillips, Phillips & Phillips, Oneida, Tenn., William Murphy Howard, Harlan, Ky., for plaintiffs-appellants.
E. H. Rayson, John B. Rayson, Knoxville, Tenn., Eugene Goss, Goss, Forester & Stephenson, Harlan, Ky., for defendants-appellees.
Before EDWARDS, Chief Judge, LIVELY, Circuit Judge, and PHILLIPS, Senior Circuit Judge.
The issue before the court on this appeal is whether the Employee Retirement Income Security Act of 1974 1 (hereinafter cited as ERISA) allows pension fund trustees to file civil actions to enjoin secondary picketing. We hold it does not and affirm the district court's order dismissing the suit.
The plaintiffs-appellants are trustees of the Southern Labor Union (the union or SLU) Welfare and Pension funds. The funds were created pursuant to § 302(c) of the Taft-Hartley Act, 29 U.S.C. § 186(c), to receive contractually required pension and welfare contributions from employers with whom the union has collective bargaining agreements. Those employers are coal companies located in the Appalachian region of the United States.
Under the terms of the SLU's collective bargaining agreements, an employer's contributions to the welfare and pension funds are tied directly to its monthly coal production. For each ton of coal it produces, handles or processes, an employer must contribute 60cents to the welfare fund and 20cents to the pension fund. The contracts also provide that the per-employee monthly contributions cannot fall below $65 to the welfare fund and $30 to the pension fund. However, the appellants argue these minimums do not apply unless some coal is produced.
On December 6, 1977, the defendants-appellees, among others, allegedly began picketing some of the coal mines with which the SLU has collective bargaining agreements. 2 Most SLU miners refused to cross the picket lines. As a result, many of the mines cut back production drastically or ceased operations entirely during December, 1977.
Since fund contributions are tied to coal production, employer payments to the welfare and pension funds decreased dramatically during the picketing. Appellants estimate total contributions for the period were about $250,000 below normal.
On December 28, 1977, the appellants, as trustees of the SLU funds, filed this suit in the United States District Court for the Eastern District of Tennessee. Their complaint characterized the defendants' picketing as an illegal effort to interfere with SLU miners' right to protect their pension and welfare rights by working, a right appellants say is guaranteed by ERISA. They asked the court to enjoin the picketing and to require the defendants to reimburse the funds for $34,987.58 in lost contributions from the eight employers listed in the complaint.
On January 5, 1978, District Judge Robert L. Taylor dismissed the complaint for failure to state a cause of action under ERISA. Judge Taylor held:
The defendants could not interfere with any rights under this plan by preventing coal mining because, as plaintiffs admit, all rights under this plan are contingent upon work performed and assessments thereupon. . . . If no coal mining is performed, no rights under this plan are created. The fact that no contributions are due to the fund from employers for some period of time does not, in and of itself, violate rights under the plan, or under the Act. The plaintiffs have pointed to no authority nor legislative history indicating that Congress intended through the Act to prohibit the type of activity allegedly engaged in by the defendants.
The plaintiffs-trustees appeal.
The trustees have based their suit on sections 511 and 502(a)(3) of ERISA, 29 U.S.C. § 1141 and § 1132(a)(3) respectively.
Section 511 makes it a criminal offense to interfere coercively with the exercise of rights protected by ERISA:
§ 511 Coercive interference
It shall be unlawful for any person through the use of fraud, force, violence, or threat of the use of force or violence, to restrain, coerce, intimidate, or attempt to restrain, coerce, or intimidate any participant or beneficiary for the purpose of interfering with or preventing the exercise of any right to which he is or may become entitled under the plan, this title, section 3001 (29 USC § 1201), or the Welfare and Pension Plans Disclosure Act (29 USC §§ 301-309). Any person who willfully violates this section shall be fined $10,000 or imprisoned for not more than one year, or both.
(Sept. 2, 1974, P.L. 93-406, Title I, Subtitle B, Part 5, § 511, 88 Stat. 895.)
The trustees argue the appellees violated § 511 by engaging in violent secondary picketing for the purpose of 3 interfering with SLU miners' ERISA-protected rights. Specifically, the trustees contend, ERISA protects the miners' contractual right to mine coal in order to obtain vested pension and welfare rights and in order to protect the financial integrity of the union's trust funds. Pointing out that ERISA contains other sections that deal with abuses by employers and fiduciaries, the trustees argue § 511 was enacted specifically to prevent coercive third-party interference with employees' rights. Thus, the trustees conclude, the appellees' coercive secondary picketing violated the clear language and intended spirit of § 511.
Assuming a violation of § 511, the trustees argue, § 502(a)(3) gives them a right to bring a civil action in the district courts to obtain equitable relief. Section 502(a)(3) provides:
§ 502. Civil enforcement
(a) A civil action may be brought
(3) by a participant, beneficiary, or fiduciary (A) to enjoin any act or practice which violates any provision of this title or the terms of the plan, or (B) to obtain other appropriate equitable relief (i) to redress such violations or (ii) to enforce any provisions of this title or the terms of the plan;
As pension fund trustees, the appellants are fiduciaries. See 29 U.S.C. § 1002(21). Furthermore, § 511 was enacted as part of Title I of ERISA and therefore is a provision "of this title". Consequently, the trustees urge that § 502(a)(3) gives them a right to sue to enjoin appellees' picketing and to obtain "restitution" of the $34,987.50 in lost employer contributions.
A preliminary question for decision is whether § 502(a)(3) authorizes private civil actions to enforce § 511, which is, on its face, purely a criminal provision. We hold the trustees have no right to enforce § 511.
Section 511 is one of two provisions in ERISA which prohibit interference with protected rights. The other is § 510. Unlike § 511, which provides criminal penalties for violators, § 510 is a civil prohibition. We are cited to no court decision construing either section.
The statute's legislative history reveals that § 510 and § 511 are companion provisions. Section 510 prohibits interference with protected rights; § 511 provides criminal penalties where that interference is coercive:
Interference with rights. Under the bill as passed by both the House and the Senate, it is unlawful to interfere with the attainment of any rights to which a participant or beneficiary may become entitled or to coercively interfere through the use of fraud, force, or violence with any participant or beneficiary for the purpose of preventing him from exercising any right to which he is or may become entitled to under the plan or title I. The penalties and degrees of proof for violations of the provisions are somewhat different. Under the conference agreement, the participant or beneficiary may bring a civil action against any person who interferes with his rights which are protected under the Act. In addition, any person who willfully uses fraud, force, violence or threats to restrain, coerce or intimidate any participant or beneficiary for purposes of interfering with the participant's or beneficiary's rights under the plan or title I of the Act is to be fined $10,000 or imprisoned for not more than 1 year, or both.
H.R.Conf.Rep.No.93-1280, 93d Cong., 2d Sess., reprinted in (1974) U.S.Code Cong. & Admin.News, pp. 5038, 5110.
That Congress intended § 511 coercive interference to be a subcategory of § 510 interference with protected rights was made clear by Senator Javits, speaking on behalf of the bill as reported out of the Senate Committee on Labor and Public Welfare:
Every employee is to have the right, enforceable by the Secretary of Labor, to be free from interference with his pension benefits. This means that he cannot be discharged, fined, suspended, expelled or otherwise interfered with in order to prevent him from receiving pension benefits or attaining eligibility for pension benefits. There are stiff criminal penalties if this type of interference takes the form of force, fraud or violence or threats of this nature.
120 Cong.Rec. 29935, reprinted in Subcomm. on Labor, the Senate Comm. on Labor and Public Welfare, Legislative History of the Employee Retirement Income Security Act of 1974, Pub.L.No.93-406 (Comm.Print 1976) (hereinafter cited as Legislative History) at 4753 (emphasis supplied).
The interrelationship between § 510 and § 511 is carried over into their respective enforcement mechanisms. Section 510 provides:
§ 510. Interference with rights protected under Act
It shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising any right to which he is entitled under the provisions of an employee benefit plan, this title, section 3001 (29 USC § 1201), or the Welfare and Pension Plans Disclosure Act (29 USC §§ 301-309), or for the purpose of interfering with the...
To continue reading
Request your trial
-
Schobert v. CSX Transp. Inc.
...from discharging or harassing their employees in order to keep them from obtaining vested [ERISA plan] rights." West v. Butler , 621 F.2d 240, 245 (6th Cir. 1980). Courts in this Circuit recognize two types of § 510 claims: "(1) an ‘exercise’ or ‘retaliation’ claim, ... where adverse action......
-
Cowden v. Montgomery Cty. Soc. for Cancer Control
...(redress for discriminatory conduct proscribed in 29 U.S.C. § 1140 brought pursuant to 29 U.S.C. § 1132(a)(3)); see also, West v. Butler, 621 F.2d 240 (6th Cir.1980) (assuming without deciding that 29 U.S.C. § 1140 enforceable under 29 U.S.C. § The Court finds that the above clarification o......
-
Gavalik v. Continental Can Co.
...employers from discharging or harassing their employees in order to keep them from obtaining vested pension rights." 31 West v. Butler, 621 F.2d 240, 245 (6th Cir.1980); see also Zipf v. American Telephone & Telegraph Co., 799 F.2d at 889, 891 (1986) (citing Butler ); Donahue v. Custom Mana......
-
Mattei v. Mattei
...498 U.S. at 143, 111 S.Ct. at 485. Presaging the Court's identification of the § 510 prototype, this court observed in West v. Butler, 621 F.2d 240, 245 (6th Cir.1980), that "[t]he legislative history [of § 1140] reveals that the prohibitions were aimed primarily at preventing unscrupulous ......