Moore and Feinberg Circuit Judges, and McLean, District Judge.*fn*
Defendant Railway Express Agency, Incorporated, appeals from a preliminary injunction of the United States District Court for the Western District of New York, John T. Curtin, J., restraining it for a period of 60 days from moving certain operations from Buffalo to Albany. The injunction was stayed by this court pending hearing and determination of this appeal. For reasons given below, we affirm the district court.
Railway Express is a carrier of freight, baggage and merchandise, which has been conducting its line haul intercity transportation to and from 24 so-called hub cities, including Buffalo and Albany, New York. A hub city is a central transfer point in a region through which freight is routed to its final destination. This litigation grows out of a management determination that it was economically wasteful to have both Buffalo and Albany as hub cities. By January 1969, and perhaps earlier, Railway Express had decided to eliminate Buffalo as a hub city and to reroute hub traffic from that city to Albany. Plaintiff Local Lodge 2144, Brotherhood of Railway, Airline and Steamship Clerks, Freight Handlers, Express and Station Employees, represents various employees of Railway Express in Buffalo, including plaintiff Thill. As soon as Lodge 2144 was informed of the contemplated move, it objected to it. Lodge 2144 claimed that the proposed change in operations was covered by the collective bargaining agreement between the parties, which, among other things, called for discussions for 60 days prior to making the move and certain protections for the Buffalo employees. Railway Express took the position that the contract was inapplicable.
Events moved rapidly after that: On February 11, 1969, Lodge 2144 began an action in the United States District Court in Buffalo to enjoin the transfer and on the same date obtained a temporary restraining order. That order expired by its terms on February 13, and the district court refused to extend it. On February 14, 18, and 19, the court conducted a hearing. Meanwhile, by February 17, Railway Express had transferred its Buffalo hub operations to Albany. Undoubtedly working under great pressure, Judge Curtin filed a 17-page detailed opinion on February 25, which granted plaintiff Lodge 2144 a preliminary injunction, restoring the status quo for 60 days. However, the judge postponed the effective date of the injunction until March 7, 1969, to give Railway Express time to transfer the hub operations from Albany back to Buffalo. On March 6, this court stayed the effective date of Judge Curtin's order and expedited the appeal so that it was heard eight days later. In the meantime, the change in operations has remained in effect.
What is at stake in the litigation are jobs and economic benefits for the Buffalo employees represented by Lodge 2144. Basic to an understanding of the dispute is Rule 12 of the collective bargaining agreement, which is set out in full in the margin.*fn1 That Rule deals with consolidations of departments and transfers of work or positions from "one seniority district to another." If the Rule applies, Railway Express has to give notice to the union of a "contemplated change " in operations, and confer with it for 60 days regarding the change. If no agreement is reached, either party may refer the matter for binding arbitration under the Railway Labor Act, 45 U.S.C. §§ 153, 157, on various issues growing out of the change. Under the Rule, employees in the district from which the work is transferred are given certain rights to "follow their positions or work" and, if a change in residence is required, the employees are entitled to transportation for themselves and their families, a $500 transportation allowance and protection against loss in the sale of homes or cancellation of leases. Although the Rule is an obvious attempt to minimize the unsettling effect on employees of a management decision to transfer or consolidate work, there is no doubt that Railway Express has the ultimate right to move the locus of the work. Lodge 2144 at most questions only the manner of making the change, its timing and its contractual consequences. Thus, Rule 12 provides that any arbitration "shall not include any question as to the right of the Company to make the change but shall be confined to the manner of implementing the contemplated change."
With this background, we turn to the legal issues that were before Judge Curtin. We do not have here the problem -- itself often major -- of characterizing this railway labor dispute as "major" or "minor." Although Railway Express had taken the position with the Lodge that Rule 12 was inapplicable because the change in operations was merely a rerouting of traffic rather than a transfer or consolidation, both sides agreed in the district court that they were involved in a "minor dispute," i.e., one concerning the application or interpretation of a provision of the collective bargaining agreement. See, e.g., Elgin, Joliet & Eastern Ry. v. Burley, 325 U.S. 711, 723, 89 L. Ed. 1886, 65 S. Ct. 1282 (1945); Rutland Ry. v. Brotherhood of Locomotive Engineers, 307 F.2d 21, 31-36 (2d Cir. 1962), cert. denied, 372 U.S. 954, 9 L. Ed. 2d 978, 83 S. Ct. 949 (1963). Rule 12 actually applies; both acknowledge that that question is for the National Railroad Adjustment Board. Pending a decision by the Board, however, Local 2144 claimed that the court should grant a preliminary injunction to maintain the status quo. Judge Curtin held that he had the power to grant that relief, and did so, after considering the competing equities.
Before us, appellant Railway Express argues that the injunction was improper, claiming that the balance of the equities was against the Lodge and for Railway Express, the district court invaded the primary jurisdiction of the Adjustment Board by granting the injunction, and the court should have dismissed the complaint for failure to state a claim and lack of subject matter jurisdiction. We shall deal with these arguments in turn.
It should first be noted that Railway Express apparently agrees that in a proper case involving a minor dispute, a district court has the power to
enjoin a carrier from effectuating the changes which gave rise to and constitute the subject matter of the dispute, independently of any suit by the railroad for equitable relief.
The issue of power was thus phrased by the Supreme Court in Brotherhood of Locomotive Engineers v. Missouri-Kansas-Texas R.R., 363 U.S. 528, 531, 4 L. Ed. 2d 1379, 80 S. Ct. 1326 n. 3 (1960). Thereafter, this court squarely held that a federal court can issue such an injunction
to restore the status quo in a minor dispute if the court's discretion is soundly exercised to preserve the primary ...