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May 16, 1972

MacFadden-Bartell Corp., Plaintiff,
Local 1034, affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, et al., Defendants

Lasker, D.J.

The opinion of the court was delivered by: LASKER


MacFadden-Bartell Corp. ("Bartell") is engaged in the business of publication and distribution of magazines throughout the United States. Local 1034 is a labor organization representing the so-called "cage" employees of Bartell. Bartell moves for a preliminary injunction to terminate picketing of its premises by members of Local 1034, alleged work stoppages, and other claimed interference with its business operations.


 On March 1, 1971, Bartell and Local 1034 entered into a collective bargaining agreement which contains the following arbitration clause:

"Should any dispute or difference between the Employer and the Union arise out of or under this agreement, it shall be discussed between the Employer or its representative and an authorized representative of the Union in an effort to adjust the same. In the event that within two weeks, or such other time as the parties agree, no settlement can be reached, the matter may be submitted to arbitration by an arbitrator designated by the New York State Board of Mediation (the 'Mediation Board'). Any such dispute shall be submitted to arbitration by the Union not later than six months after the Union shall acquire knowledge thereof. The parties hereby confer jurisdiction on the Mediation Board for that purpose, and do further confer jurisdiction to the courts of the State of New York and further agree that the arbitration and all proceedings in connection therewith shall be in accordance with the arbitration laws of the State of New York. All notices required to institute, proceed with and conduct the arbitration or any proceedings to enforce the award of the arbitrator may be served personally within or without the State of New York, or by certified mail to the last known address, and shall have the same effect as if service was made personally within the State of New York. The decision of the arbitrator shall be final and binding on the parties and enforceable in any court of competent jurisdiction. It is agreed that legal as well as equitable consideration may be entertained by the arbitrator."

 The collective bargaining agreement also contains a "management rights" provision which reads:

"Except as expressly limited by the provisions of this agreement, the Employer reserves and retains exclusively all of its common law rights to manage its business. The exclusive rights of management shall include its right to determine the number, location, relocation and types of its operations, and the methods and processes to be employed; to discontinue processes or operations due to economic conditions; to establish and change work schedules and assignments; and otherwise to take such measures as management may determine to be necessary for the orderly, efficient and profitable operation of its business."

 Bartell insists that the terms of the management rights provision authorize it to discontinue any portion of its operations without consulting the Union. The Union vigorously contests the proposition.

 The dispute arises from Bartell's discontinuance on May 3, 1972 of its "caging" operations. For a number of years Bartell has performed such operations for Downe Publishing, Inc. ("Downe"). The Downe account comprised approximately 75% of Bartell's volume in its caging operations. Upon the demise of Look magazine, Downe acquired Look's computer and subscription processing system. It then advised Bartell that commencing May 1, 1972, it would do its own caging work. As a result, Bartell decided to abandon its operations and subcontract them to Downe, since it appeared certain that Bartell's caging operations could only be conducted at a loss if it no longer had Downe's business. Other savings appeared possible by transferring to the Downe plant, such as a reduction in "cash processing time," and the Downe plant had other advantages such as document microfilming capability and superior retrieval arrangements.

 On April 19th, Bartell's treasurer, A. C. Clapp, Jr., advised Alan Adelstein, a business agent for Local 1034, that the plaintiff contemplated transferring its Cage Department to Iowa. Adelstein contended that the company was doing this solely to discourage Local 1034's further organizing efforts at Bartell and that, in any event, it violated Section 31 of the collective bargaining agreement, which provided in pertinent part that "[all] of the work of the categories covered by this agreement shall be performed only by regular employees (members of the bargaining unit as herein provided) in accordance with the wage rates, terms and conditions herein set forth."

 On or about April 20th, Local 1034 formally submitted the dispute to the New York State Board of Mediation for arbitration.

 On April 28th, Albert S. Traina ("Traina"), Bartell's president, met with Bernard and Martin Adelstein, the controlling officers of Local 1034, and informed them that Bartell intended to discontinue its caging operations and remove them to the Downe plant. On May 2nd Traina and Bernard Adelstein reviewed the situation. Since it appeared that the employees affected were not eligible for severance pay under the plan provided for by the collective bargaining agreement, Traina agreed that the company would voluntarily provide two weeks' severance pay for persons employed more than one year and one week's pay for employees of less than a year. The matter remained unresolved.

 On May 3d, Clapp wrote a memorandum to all cage employees informing them that effective that day they were to be furloughed because the operation was being relocated at Downe. The department has remained closed since then.

 On May 4th, a picket line was established around the Bartell plant. Approximately 21 pickets carried two signs stating, "Cage Workers MacFadden-Bartell ...

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