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Aetna Freight Lines, Inc. v. Clayton

December 13, 1955


Author: Clark

Before CLARK, Chief Judge, LUMBARD and WATERMAN, Circuit Judges.

CLARK, Ch. J.:

This is an appeal from a preliminary injunction restraining defendant representatives of a local union from carrying on certain picketing activities directed at the plaintiff. Plaintiff is an Ohio corporation doing business as an interstate common carrier of iron and steel products. Its principal place of business is in Warren Ohio; but it maintains a terminal and dispatching point at Buffalo, New York. In order to carry on its business, plaintiff enters into lease agreements with approximately 300 individuals who own and operate motor transportation equipment. These operators receive a stated percentage of the gross revenue which plaintiff has obtained for the transportation of the materials carried. The operators are free to accept or refuse designated shipments; they must bear the cost of operation of their equipment, including gasoline, oil, equipment maintenance, taxes, licenses, insurance (except liability insurance), and other incidental expenses. The lease agreements further provide that, if the ownerdriver is absent, substitute drivers are to be paid by the owner-driver, with the latter carrying out the duties of an employer in respect to workmen's compensation, unemployment compensation, social security taxes, and withholding taxes. While vehicles are being operated pursuant to lease agreements, plaintiff has their exclusive use and control. All vehicle drivers must be qualified by plaintiff; nd plaintiff, pursuant to I.C.C. rules, carries liability insurance covering all the vehicles. The vehicles carry the name of Aetna Freight Lines, Inc., as well as that of the owner. Plaintiff also hires a relatively small number of persons, who are admittedly employees, to perform supervisory, administrative, and other tasks.

Defendant union is the collective bargaining representative of some employees of trucking firms operating in the Buffalo area in competition with plaintiff. Judge Knight found that in July, 1954, the Union through its agent Clayton demanded that plaintiff enter into a collective bargaining agreement with it as representative of the owner-operators of transportation equipment. The contention of the Union was that it demanded merely that plaintiff conform to the economic provisions of the contract, which were imposed on its competitors by virtue of their similar agreements with the Union. Although we accept the finding of the court below with respect to this point, it does not affect the result. Among the demands made by the Union was one that Aetna vehicles take on a "city man," a member of Local 375, to help with loading and unloading and other duties in the local area. Judge Knight found that compliance with the Union's demands would violate plaintiff's leases with the individual owner-operators of motor equipment.

After plaintiff had failed to grant its demands, the Union placed a picket at Aetna's terminal and dispatching place in Buffalo, who carried signs on which was printed, "Aetna Freight Lines is unfair to Local No. 375." The Union also picketed the entrance of Bethlehem Steel Corporation, Lackawanna, New York, and General Drop Forge Company, Buffalo, New York, at times when plaintiff's vehicles were loading and unloading at these locations. It was found that, as a result of the picketing, plaintiff was prevented from rendering service as required under its certificate with the Interstate Commerce Commission, that plaintiff's trade and commerce was injured and impaired, causing irreparable damage in excess of $3,000, and that, since defendants were financially irresponsible, there was no adequate remedy at law. The court therefore granted a temporary restraining order against the picketing on November 10, 1945, and a preliminary injunction followed on December 10. It decided (1) that the individual owner-operators were independent contractors, and not employees of the plaintiff; and (2) that it was therefore "academic" and "unnecessary" to determine whether or not a labor dispute existed. We cannot agree with this analysis.

The Norris-LaGuardia Act, 29 U.S.C. §§ 100-115, removes from the courts of the United States jurisdiction to issue injunctions in cases involving or growing out of labor disputes except in strict conformity with the provisions of the Act. Since it is not contended that the provisions of the Act have been followed in this case, the district court lacked jurisdiction if this is a case "involving or growing out of a labor dispute." Paragraphs (a), (b), and (c) of § 13 of the Act, 29 U.S.C. § 113(a), (b), and (c), define "labor dispute" in a broad and complex manner. Paragraph (a) lists a number of situations which "involve or * * * grow out of a labor dispute"; paragraph (b) defines a person "participating or interested in a labor dispute"; and paragraph (c) defines the term "labor dispute." These paragraphs, treated as a whole, are controlling of the question here presented.

This controversy falls into a number of the categories listed in paragraph (a) of § 13. First, it "involves persons who are engaged in the same industry * * *"; second, it involves persons who "have direct or indirect interests therein"; third, it "involves any conflicting or competing interests in a 'labor dispute' (as defined in this section) of 'persons participating or interested' therein (as defined in this section)." The definition in paragraph (b) of "person or association * * * participating or interested in a labor dispute" is clearly broad enough to cover the present case, provided a "labor dispute" is found. And in paragraph (c), the definition of labor dispute includes not only "any controversy concerning terms or conditions of employment," but also any controversy "concerning the association or representation of persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment, regardless of whether or not the disputants stand in the proximate relation of employer and employee."

The Union in this case was attempting to enforce uniform terms and conditions of employment throughout the Buffalo area for drivers and helpers in the steel hauling business. The Union believed that Aetna's conduct of its business was a threat to the position of the Union throughout the area. Neither the fact that persons working for Aetna may be independent contractors nor the fact that Aetna's dispute was with an organization of persons not its employees would be sufficient to remove this controversy from the broad definition of § 13. There was testimony that defendant union had made agreements both with steel haulers whose drivers were admittedly employees and with companies who operated through the use of lease agreements. Whatever the arrangements of the companies with their drivers, the efforts of the Union to secure more uniform observance throughout the industry of the working conditions enjoyed by its members was a labor matter; and this controversy arising directly from such effort was a "labor dispute" within the meaning of the Act.

The application of the Act to disputes between employers and persons or organizations not their employees has been often upheld. Section 13(c) of the Act has been held applicable to a dispute in which a union picketed an employer to make him require his employees to join the union. Lauf v. E. G. Shinner & Co., 303 U.S. 323. Similarly, where an association of colored persons picketed an employer to induce him to hire Negroes, there was a "labor dispute." New Negro Alliance v. Sanitary Grocery Co., 303 U.S. 552. In Milk Wagon Drivers' Union, Local No. 753 v. Lake Valley Farm Products, Inc., 311 U.S. 91, the defendant was a union of milk wagon drivers of certain dairies. Competing dairies used the "vendor" system whereby peddlers who owned their own trucks bought milk from the dairies wholesale and resold it to retail stores. Competition from these "vendors" was a threat to the working standards of the defendant union, and it picketed the stores to which deliveries were made. In that case, if the "vendors" joined the union, they would presumably have ceased to operate as "vendors" and would have assumed a clear employee status. Nonetheless, the Court concluded, per Mr. Justice Black, 311 U.S. 91, 99:

"To say, as the Circuit Court of Appeals did, that the conflict here is not a good faith labor issue, and that therefore there is no 'labor dispute,' is to ignore the statutory definition of the term; to say, further, that the conditioned abandonment of the vendor system, under the circumstances, was an issue unrelated to labor's efforts to improve working conditions, is to shut one's eyes to the everyday elements of industrial strife."

It is true that in the Milk Wagon Drivers' case there was evidence that the actual status of the "vendors" was in some respects that of employees, and the "vendors" were members of another union, one of the plaintiffs in the case. Nevertheless, the decision does not turn upon any narrow finding of the status of the operators involved; rather it rests upon the reality of a dispute affecting working conditions in the industry, whether applicable to workers described as "vendors" or as "employees." The principle of the Milk Wagon Drivers' case is broad enough to control this case, and hence the district court was without jurisdiction to issue an injunction. See also United States v. Hutcheson, 312 U.S. 219, 234; Donnelly Garment Co. v. Dubinsky, 8 Cir., 154 F.2d 38; Amazon Cotton Mill Co. v. Textile Workers Union of America, 4 Cir. 167 F.2d 183; Mitchell v. Gibbons, 8 Cir., 172 F.2d 970; Notes, 26 Corn. L.Q. 328; 39 Mich. L. Rev. 663.

In addition to the bar provided by the Norris-LaGuardia Act, the district court was without jurisdiction because plaintiff's exclusive remedy is before the National Labor Relations Board. Here the plaintiff had made no complaint to, or request for relief of, the Board. The district court found that the conduct of the defendants did not violate the National Labor Relations Act of 1947, as amended, 29 U.S.C. §§ 151 et seq. We find it unnecessary to pass upon the correctness of this finding, beyond saying that the complaint did allege facts which the Labor Board might reasonably hold to constitute unfair labor practices. The picketing at Bethlehem Steel and at General Drop Forge may easily constitute violations of § 8(b)(4)(A) of the Act, and the picketing at plaintiff's own premises may be violative of § 8(b)(2) - see Pocahontas Terminal Corp. v. Portland Bldg. & Const. Trade Council, D.C. Me., 93 F.Supp. 217 - or of § 8(b)(4). The demand for the hiring of "city men" may conceivably present a case of a § 8(b)(6) violation. But whether or not those acts constitute unfair labor practices is for the Board to determine.

Whenever, in a dispute affecting interstate commerce, peaceful picketing which is reasonably cognizable as an unfair labor practice under the Act is alleged, the comprehensive remedy provided by Congress is exclusive, and injunctive relief outside the Act is barred. Garner v. Teamsters, Chauffeurs and Helpers Local Union No. 776 (A.F.L.), 346 U.S. 485; Weber v. Anheuser-Busch, Inc., 348 U.S. 468; Amalgamated Clothing Workers of America v. Richman Bros. Co., 348 U.S. 511; Mitchell v. Gibbons, supra, 8 Cir., 172 F.2d 970.

In the Garner case the Supreme Court found it unnecessary and inappropriate to decide whether or not an unfair labor practice had in fact been committed, but left that determination to the Labor Board. It was enough that the Board could entertain plaintiff's grievance and undertake appropriate action. Further, in the Garner case, which, like this case, involved peaceful stranger picketing, the ...

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