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ENGELHARDT v. CONRAIL

September 12, 1984

EDWARD ENGELHARDT, EDWARD RAINEY and DAVID ALLEN on behalf of themselves and as representatives of the class herein defined, Plaintiffs, against CONSOLIDATED RAIL CORPORATION and INTERNATIONAL BROTHERHOOD OF LOCOMOTIVE ENGINEERS AND UNITED TRANSPORTATION UNION, Defendants.


The opinion of the court was delivered by: MINER

ROGER J. MINER, D.J.

MEMORANDUM-DECISION and ORDER

 I

 This action arises out of alleged violations by defendant Conrail of collective bargaining agreements, and various breaches of the duty of fair representation by defendants, United Transportation Union and the International Brotherhood of Locomotive Engineers following the 1968 merger of the Pennsylvania Railroad and the New York Central Railroad and the later inclusion of the New Haven Railroad in the merger agreement. In addition, plaintiffs allege a violation of an Interstate Commerce Commission order dealing with the merger and the protective rights to be afforded to the employees of the merging railroads. Jurisdiction is predicated upon Section 2 of the Railway Labor Act, 45 U.S.C. § 152, the employee protective provision of the Rail Passenger Service Act, 45 U.S.C. § 565, and section 11347 of the Interstate Commerce Act, 49 U.S.C. § 11347. *fn1" Before the Court are defendants' motions for summary judgment, Fed. R. Civ. P. 56(b).

 II

 Plaintiffs Edward Engelhardt, Edward Rainey and David Allen bring this action on behalf of themselves and other former New haven Railroad engine service employees *fn2" challenging their placement on consolidated seniority rosters for employment in prior New York Central Railroad Districts following the inclusion of the New Haven Railroad in the merger. Plaintiffs Engelhardt and Rainey currently are "locomotive engineers" employed by defendant Conrail Corporation ("Conrail"). Plaintiff Allen currently is employed as a locomotive engineer by Amtrak with flowback seniority rights to Conrail. *fn3" Conrail is a Pennsylvania corporation organized on April 1, 1976, pursuant to the Regional Rail Reorganization Act of 1973 ("Reorganization Act"), 45 U.S.C. § 741. Conrail was organized for the purpose of consolidating a number of railroads in the northeast, including the former Penn Central Railroad. *fn4" Defendant International Brotherhood of Locomotive Engineers ("BLE") is the representative for Conrail engine service employees. Defendant United Transportation Union ("UTU") is the successor-in-interest to the Brotherhood of Locomotive Firemen and Engineers ("BLF&E") and currently is the representative for Conrail firemen and hostlers.

 A. The Penn Central Merger

 On March 9, 1962, the Pennsylvania Railroad and the New York Central Railroad petitioned the Interstate Commerce Commission ("ICC"), pursuant to section 5(2) of the Interstate Commerce Act, to merge the entities and form the Pennsylvania Central Transportation Company ("Penn Central") and to acquire subsidiary railroads for such merger. On April 6, 1966, the ICC issued an order approving the proposed merger upon further negotiation of the merger conditions. Pennsylvania Railroad-Merger-New York Central Railroad, 327 I.C.C. 475 (1966). Condition 8 of the order required that the New Haven Railroad be included in the merger pending further approval of the terms for inclusion. Id. at 553. The ICC, on November 16, 1967, issued a second order approving the terms and conditions for the New Haven's inclusion. Pennsylvania Railroad-Merger-New York Central Railroad, 331 I.C.C. 643 (1967). The Penn Central merger thus was consummated on February 1, 1968. The New Haven Railroad, however, was not yet included in the merger. Courts twice declined to approve the ICC's inclusion agenda and remanded the matter to the ICC for further consideration. In re New York, New Haven and Hartford Railroad, 289 F. Supp. 451 (D. Conn. 1968); New York, New Haven & Hartford Railroad First Mortgage 4% Bondholders' Committee v. United States, 289 F. Supp. 418 (S.D.N.Y. 1968). The New haven Railroad, therefore, was not included in the Penn Central until January 1, 1969, eleven months subsequent to the Penn Central's formation.

 B. The Merger Protective Agreement

 On May 20, 1964, in light of their merger petition, the Pennsylvania and New York Central Railroads entered into an agreement with twenty-six labor organizations, including the BLE and BLF&E (UTU's predecessor).This agreement, entitled "Agreement for Protection of Employees in Event of Merger of Pennsylvania and New York Central Railroads" ("MPA"), formed the basis for protecting employee rights, privileges and benefits in relation to the merger. Section 1(b) of the agreement provides:

 [N]one of the present employees of either of the said Carriers shall be deprived of employment or placed in a worse position with respect to compensation, rules, working conditions, fringe benefits or rights and privileges pertaining thereto at any time during such employment.

 Conrail Exhibit No. 4, at 3.

 Section 2 of the agreement provides:

 In the event merger or control of other carriers not now involved in the aforesaid merger proceedings should be ordered by the Commission as a condition of its approval of the pending transaction, this Agreement shall be subject to amendment by the parties so as to provide the employee benefits set forth in Section 1 hereof to the employees of any such carrier controlled by or merged into the Merged Company.

 Id. at 9.

 In the initial ICC order approving the merger, the Commission expressly referred to the MPA in determining that it "does not render the proposed transaction inconsistent with the public interest." 331 I.C.C. at 544. Pursuant to this approval of the provisions of the MPA, the Pennsylvania and New York Central entered into an agreement with BLE and BLF&E on October 11, 1966, to more clearly define the application of the MPA to the engine service employees of the merging railroads and to expedite the consolidation of services and operations of the newly formed Penn Central. See Conrail Exhibit No. 2. This agreement established new seniority districts for engine service employees which would take effect upon consummation of the merger and also consolidated the current seniority rosters of the respective merging railroads.

 Two further agreements entitled "Agreement for the Protection of Employees in Event of Inclusion of New York, New Haven and Hartford Railroad into the Pennsylvania, New York Central Transportation Company" and "Merger Protective Agreement-New Haven Employees," were entered into on December 20, 1966, and January 9, 1967, between the railroads and BLE and BLF&E respectively. The agreements enacted section 2 of the MPA by applying the provisions of the MPA to the inclusion of the New Have Railroad in the merger. The agreements provided that "the terms and conditions of the said Merger Protective Agreement shall be applicable to the employees of the New Haven represented . . . the same as though they were employees of the Pennsylvania or Central." *fn5" December 20, 1966 Agreement, at 2; January 9, 1967 Agreement, at 2. The ICC order approving the inclusion of the New Haven Railroad in the merger expressly determined that the December 20, 1966, and January 9, 1967 agreements between the New Haven employees' representatives and the merging railroads "do not render the inclusion inconsistent with the public interest," 331 I.C.C. at 729, and thus approved application of the MPA to the employees of the New Haven. These agreements, negotiated between the merging railroads and the unions, became the basis for the establishment of the new seniority rosters and the initiation of this action.

 C. The Seniority Roster

 On November 14, 1968, and pursuant to the October 11, 1966 agreement which initially organized the seniority districts for the ranking of engine service employees in relation to jobs available on former New York Central Railroad tracks, the two merging railroads and the BLE and BLF&E entered into a further agreement for the establishment of the Penn Central Seniority District No. 6 - New York ("PC-6"). Conrail Exhibit No. 3. The agreement stipulated that effective February 1, 1968, New York Central engineers and firemen on ten former New York Central seniority districts, hostlers on three New York Central seniority districts, and hostlers on one Pennsylvania roster were given "prior rights" *fn6" protection as to positions in their former seniority districts. In addition, the engineers and firemen were given a February 1, 1968 seniority date for the entire PC-6 district.

 On November 15, 1968, the same parties entered into an agreement regarding the status of New Haven employees in relation to the new PC-6 seniority district. The agreement revised the October 11, 1966 agreement to include the New Haven and revised the PC-6 district to include former New Haven routes. In addition, individuals employed as firemen on the New Haven as of November 1, 1968, were placed on the PC-6 seniority roster as of October 31, 1968, which determined their relative promotional standing on the engineers seniority roster.

 Finally, on April 29, 1969, the Penn Central entered into an agreement with the BLE and UTU, now the successor to the BLF&E, confirming the consolidation of the various railroads into the Penn Central. Under the provisions of this agreement, all New Haven engine service employees hired prior to November 1, 1968, were placed on a Combined Prior Right New Haven Seniority District Roster. Hostlers and helpers who were ineligible for firemen positions due to past New Haven contracts were placed at the bottom of this roster. New Haven engine service personnel were given prior rights as to their former New Haven seniority districts to the exclusion of all Pennsylvania and New York Central personnel as well as other New haven engine service employees from other New Haven seniority districts. These employees also were given prior rights against Penn Central employees in relation to the entire former New Haven system. In regard to the PC-6 seniority district, New haven employees were given a seniority rights date of November 1, 1968. Thus, due to this later seniority rights date, the entire Combined Prior Right New haven Seniority District Roster was placed at the end of the PC-6 roster. If a New Haven employee sought a job in the Penn Central outside of New Haven routes, the PC-6 roster would be used to determine such rights as against former Pennsylvania and New York Central employees. *fn7"

 On August 29, 1969, the PC-6 roster was posted for review. All protests were required to be filed by November 11, 1969. Between February 1, 1968, and October 31, 1968, Penn Central hired seventy-eight new firemen employees for work within the PC-6 district. Because New Haven employees' seniority rights on the PC-6 roster did not accrue until November 1, 1968, ...


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