The opinion of the court was delivered by: BONSAL
This is a motion by defendants before answer under Fed.R.Civ.P. 12 to dismiss the causes of action alleged in the complaint on various grounds and for alternative relief. The plaintiff, Genesco, Inc., filed its complaint on June 14, 1963, in which jurisdiction is founded on diversity of citizenship, and on the Labor-Management Relations Act of 1947, as amended (L.M.R.A. §§ 301 and 303 (29 U.S.C . §§ 185 and 187)). The complaint alleges that plaintiff is a Tennessee corporation, engaged in the manufacture, wholesale distribution and retail sale of shoes, having an office in New York City, and that defendant Joint Council 13, United Shoe Workers of America, AFL-CIO (the Union) is an unincorporated association with its principal office in New York City.
The complaint alleges four causes of action: First, breach of two collective bargaining agreements between plaintiff and the Union; second, violation of Section 303 of the L.M.R.A. by the Union; third, inducement by defendants of other labor organizations to break their collective bargaining contracts with plaintiff; and fourth, the taking of certain specified actions by the Union 'as part of a plan or scheme to destroy the plaintiff's business.'
Each of plaintiff's causes of action and defendants' motions with respect thereto will be considered separately.
Plaintiff's First Cause of Action:
Plaintiff alleges that collective bargaining agreements existed between plaintiff and the Union, dated as of October 31, 1962, one such agreement covering plaintiff's 23rd St. shoe factory and the other covering its 11th St. shoe factory (both located in Long Island City, New York, and operated as a Division of plaintiff under the name I. Miller Shoe Company); that each of said collective bargaining agreements contained a no strike clause,
and that commencing on or about November 6, 1962 the Union struck plaintiff's plants in violation of said clause.
Defendants move to dismiss the first cause of action on the ground that the collective bargaining agreements of October 31, 1962 contained arbitration clauses which applied to a strike in violation of the agreement. Defendants state that 'in making this motion the defendants specifically reserve the right, at a future time and in the appropriate forum to assert the defense that no collective bargaining agreement was in fact entered into by the defendants covering the period in question'.
Since defendants posed an issue of fact as to whether or not collective bargaining agreements were in force between plaintiff and the Union at the time of the alleged strike, the Court directed a hearing to take testimony and to receive documentary evidence on this issue. The hearing was duly held on February 5-6, 1964, at which both sides gave testimony and introduced exhibits. Briefly summarized, the facts developed at the hearing were as follows:
Plaintiff, at the time of the strike, was a member of the Shoe Manufacturers Board of Trade of New York, Inc. (Board of Trade), a New York membership corporation composed of employers, which at least since June 15, 1948 had acted for its members in negotiating collective bargaining agreements with the Union. The agreement of June 15, 1948 was extended from time to time, with changes in pay scales, working conditions, etc., the last undisputed extension expiring on October 31, 1962.
On August 29, 1962, the Union addressed identical letters to I. Miller Shoe Co. and to the other nine members of the Board of Trade, giving notice of the termination on October 31, 1962 of the then current contract and offering to meet with such member at the office of the Board of Trade for the purpose of negotiating a new contract. Simultaneously, the Union wrote Mr. Benjamin Seligman, of Seligman & Seligman attorneys for the Board of Trade, and sent him a copy of its notice to the members, stating in its covering letter its understanding that the members 'will be represented by your organization (the Board of Trade) in the coming negotiations for a collective bargaining contract'. The Board of Trade had a negotiating committee composed of one representative of each of the members. The negotiations dragged on, and no agreement having been reached on October 31 when the old contract expired, the Union struck the members of the Board of Trade.
Further negotiations were carried on by the Board through Seligman & Seligman, in the course of which the Union informed the Board of the terms of a settlement it was making with another employers' group (the Quality Group). After consideration of these terms, the Board of Trade notified the Union by telegram on November 5, 1962:
'THE SETTLEMENT IS ACCEPTABLE TO MEMBER FIRMS OF THE SHOE MFRS. BOARD OF TRADE. WE WILL MEET WITH YOU TO WORK OUT CONTRACT LANGUAGE. IN VIEW OF THE ABOVE WE REQUEST YOU HAVE EMPLOYEES OF MEMBER FIRMS REPORT FOR WORK TUESDAY, NOV. 6. SHOE MFRS. BOARD OF TRADE By: IRVING SCHNEIR, PRES.'
Later on November 5, the officers of the Union went to the offices of Seligman & Seligman with a number of unsigned contracts in blank embodying the settlement. Mr. Benjamin Seligman read the form of contract and informed the Union officials that it was acceptable to the Board of Trade. Following previous practice, the plan was that the authorized Union officer would then sign all the blank contracts and deliver them to Mr. Seligman, who would arrange to have contracts signed individually by each member of the Board of Trade, and one signed copy returned to the Union.
While there is some conflict in the testimony as to what happened at this meeting, it appears that immediately before the authorized Union official began to sign the blank contracts, or after the signing had begun, that the Union officials informed Mr. Seligman that the new contract would not be entered into with the two I. Miller Shoe Co. factories unless the plaintiff agreed to transfer the manufacture of its 'Act II' shoes from their 11th St. plant to their 23rd St. plant. The testimony revealed that there had been prior conferences regarding the Act II issue, and that plaintiff considered that it should be resolved through the grievance machinery of the contracts, while the Union considered that it should be negotiated separately. The Union officials testified that at one of the prior conferences they informed Mr. Seligman that as the end of the previous contract was approaching, the Union must know plaintiff's position on the Act II issue, and that Mr. Seligman assured them the issue would be no problem. Mr. Seligman, however, denied that the Union officials had mentioned the Act II issue at this conference. At the November 5 conference the Union took the position that the Act II issue must be resolved before it would enter into the new contracts with plaintiff, while Mr. Seligman who appears to have been acting for both the Board of Trade and the plaintiff, argued that the new contract had been accepted by the Union and the Board of Trade, and that the Union could not discriminate against one of the members of the Board of Trade by insisting on the settlement of the Act II issue as a condition. While the argument was continuing, Mr. Seligman telephoned plaintiff's office in Nashville, Tennessee, and informed its Vice-President, Mr. Buchanan, of the problem, and it was arranged that Mr. Buchanan would meet with Mr. Seligman and the Union officials in New York the following morning to discuss it. The authorized Union official, Mr. Scimeca, completed the signing of the blank contracts and delivered them to Mr. Seligman, but neither side changed its position on the Act II issue. Mr. Seligman was informed at the close of the meeting by the Union officials that the I. Miller employees would not return to work the next day. The Union officials testified that Mr. Seligman promised that the contracts would not be presented to plaintiff for signature; Mr. Seligman testified that he did not make any such promise.
Following the Nov. 5 meeting, the Union called off the strike effective Nov. 6, except as to ...