The daily shapers are divided into three groups with descending hiring priorities. Those shapers on the Group I list have first priority, after the regular situation holders, in order of their shop seniority. The next priority belongs to Group II shapers. Group II consists of all persons holding regular situations or Group I positions with other employers in the industry. Last in order of priority are the Group III shapers.
The Settlement Agreement also established an Administrator, appointed by the Court, to implement the provisions of the Consent Decree and supervise its performance. The Consent Decree authorizes the Administrator to hear claims concerning violations of the Decree. Appeals from his decisions are heard in this Court.
Pursuant to the Settlement Agreement, defendants Magazine Distributors, Inc. ("MDI") and MDI Distributors, Limited Partnership (the "Partnership") seek review of a determination by Administrator William S. Ellis, Esq. (the "Administrator"), denominated "Claim 274." The Court has reviewed the memoranda and exhibits relied upon by the Administrator, as well as the arguments submitted to this Court by the parties. For the reasons set forth below, the Administrator's decision is affirmed.
Imperial News Co. ("Imperial"), a wholesale distributor of magazines and paperback books for markets in Nassau, Suffolk, lower Westchester and in parts of Fairfield County, Connecticut, was a party defendant in Patterson and a signatory to the Settlement Agreement. For many years, Imperial conducted its business out of a facility in Melville, New York. NMDU represented some, but not all, of the drivers and warehouse employees at Imperial. Of its 96 NMDU-represented employees, 19 (or 19.8% of the total) were minorities.
MDI is a Connecticut-based wholesale distributor of newspapers and periodicals and has been in business for over thirty years. Unlike Imperial, MDI is neither a party defendant in Patterson nor a signatory to the Settlement Agreement. Prior to December 1990, MDI operated exclusively out of Connecticut and competed with Imperial in Long Island from its Connecticut base.
In November 1990, Local 917 of the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, AFL-CIO ("Local 917"), was recognized as the exclusive bargaining representative of MDI's drivers and warehousemen based in Plainville, Connecticut. The MDI-Local 917 collective bargaining agreement contained an "accretion" clause, wherein MDI agreed that if it expanded its business or opened a new facility, MDI employees at the new locations would be covered by Local 917. Also in November 1990, MDI leased a site in Hicksville, New York. In December 1990, MDI hired drivers for its Hicksville site, and recognized Local 917 as its bargaining representative.
On January 23, 1991, Imperial terminated all of its employees and ceased operations. On March 8, 1991, Imperial and the Partnership entered into an asset purchase agreement (the "Purchase Agreement"), with the latter purchasing substantially all of Imperial's assets. Paragraph 1.1 of the Purchase Agreement provided, inter alia, that:
MDI shall purchase from Imperial, the following assets of Imperial . . . subject to the MNC Lien, but otherwise free and clear of any liabilities and obligations with respect thereto, whether absolute, contingent or otherwise, and free and clear of all liens, claims, judgments, pledges, mortgages, options, interests, or other encumbrances of any kind[.]