From Casetext: Smarter Legal Research

Hammond v. Air Line Pilots Association

United States District Court, N.D. Illinois, Eastern Division
Sep 26, 1991
No. 82 C 2792 (N.D. Ill. Sep. 26, 1991)

Opinion

No. 82 C 2792.

September 26, 1991

Robert F. Coleman, Eugene J. Schiltz (Robert F. Coleman Associates), Chicago, Illinois, Jon Gl Carlson, Edwardsville, Illinois, for Plaintiffs. Thomas J. Piskoroki, Patricia J. Hruby (Seyfarth. Shaw, Fairweather Ceraldson), Chicago, Illinois, Michael A. Katz, Mt. Kison, New York, Steven B. Muldof, Michael L. Winston (Cohen, Weiss Simon), New York, New York, Harold A. Katz and Michael B. Erp (Katz, Friedmon, Schur Eagle), Chicago, Illinois, for Defendants.


[ Statement of Cose]


This court granted summary judgment in favor of defendants, Air Line Pilots Association (ALPA) and Trans World Airlines, Inc. (TWA). and against plaintiffs on all counts of the five-count second amended complaint. Plaintiffs appealed and the court of appeals remanded to this court for the limited purpose of this court's entering a stacement of its rcosons fur granting summary judgment. This memorandum is that statement.

This action arises at of the merget of Ozark Airlines, Inc. (Ozark), into TWA. It was brought by several Ozark pilots on behalf of the Ozark pilots as a class. Plaintiffs' action is premised upon their being treated improperly by both defendant TWA and their union, defendant ALPA, in connection with the merger and its aftermath.

The second smended complaint's five counts alleged the following claims: 1) a breach of ALPA's duty of fair representation claim directed at both ALTA and TWA; 2) a breach of a contract known as the "Wraparound Agreement" directed at both ALPA and TWA; 3) a violation of sections 101(a)(1) and 101(a)(2) of the Labor Management Reporting and Disclusure Act (LMRDA), 29 USA §§ 411(a)(1), 411(a)(2), claim directed at ALPA only; 4) a breach of the Ozark-ALPA collective bargaining agreement (Ozark-ALPA CBA) claim directed at TWA only; and 5) a violation of the Railway Labor Act (RLA) claim directed at TWA only.

The law applicable to rulings on motions for summary judgment is well established. Summary judgment should be rendered:

[T]f the pleadings, depoeitions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.

FRCP 56(c). The moving party bears the burden of establishing that there is no genuinc issue of material fact and that it is entitled to judgment as a matter of law. Adickes v. S.H. Kress Co., 398 US 144, 157, 90 S Ct 1598, ___, 26 L Ed 2d 142, ___ (1970). A court in ruling on a motion for summary judgment will draw all reasonable inferences from the facts favorable to the nonmoving party. Hermes v. Hein, 742 F2d 350, 353 (7th Cir. 1984). However, the nonmoving party bears a burden with respect to issues on which it has the burden of proof. As the 7th Circuit has said:

Summary judgment is appropriate where a party "fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 105 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986) . . . The summary judgment standard "mirrurs the standard for a directed verdict under Federal Rule of Civil Procedure 50(a), which is that the trial judge must direct a verdict if, under the governing law, there can be but one reasunable cunclusion as to the verdict." [ Anderson v. Liberty Lobby Inc., 477 US 242, ___, 106 S Ct 2505, 2511, 91 L Ed 2d 202, ___ (1986)]. Teamsters Local 282 Pension Trust Fund v. Angelos, 839 F2d 366, 369-70 (7th Cir 1988).

[ Fair Representation Duty]

Plaintiffs cannot prevail against either defendant on the first count of the second amended complaint unless they can prove a breach by ALPA of its duty of fair representation. In order to prevail on this claim then it would be necessary for plaintiffs to prove that ALPA's actions were arbitrary, discriminatory, or in had faith. Air Line Pilots Association, International v. O'Neill, [118 LC ¶ 10, 597] ___ US ___, ___, 111 S Ct. 1127, 1130, 113 L Ed 2d 51, ___ (1991). Plaintiffs, in their response to ALPA's citation of O'Neill as new authority, contend that ALPA's actions were all three.

Plaintiffs contend that ALPA acted arbitrarily in that:

At the time of the TWA/Ozark merger, ALPA had in place a hinding merger policy. . . . That policy established specific procedures which ALPA bad committed itself to follow in all mergers between two ALPA carriers. . . . at bottom, the policy required that the two pilot groups involved submit whatever differences they could not resolve through negotiation to binding arbitration. . . . As the courts have recognized. ALPA adopted these procedures to insulate itself from the political pressure to favor one of its pilot groups over the other that it would otherwise be under in every merger. . . . In the TWA/Ozark merger, for the only time in its history . . ., ALPA arbitrarily discarded its merger policy in response to the demands of the larger, and more politically powerful, pilot group, and allowed that group to control the seniority integration process.

Plaintiffs do not provide a completely accurate description of the situation in which ALPA found itself, or what ALPA did. Arrayed against the Ozark pllots was not just the TWA pilots but TWA as well. This is because TWA management felt a loyalty to the TWA pilots who had made prior contract concessions.

The dispute between the two pilot groups centered on the integration of the seniority lists of the two carriers. It played itself out as a dispute between the two groups over the procedure by which the seniority lists would be integrated. The TWA pilots did not want the ALPA merger policy implemented; Ozark pilots did want it implemented. ALPA attempted in obtain an agreement between the two pilot groups on seniority integration. This allempt was unsucessful and the merger policy was ultimately implemented. Loo late to be of any use according to plaintiffs. However, ALPA's delay in implementing merger policy can hardly be characterized as arbitrary when the delay was caused by ALPA's attempts to obtain an agreement between the two pilot groups. Plaintiffs' position seems to be that unless ALPA implemented its merger policy immediately it was acting arbitrarily. At the time, it appeared that this could result in layoffs of the Ozark pilots by TWA. Even if plaintiffs are correct and the layoffs would have been illegal, vindication of those rights would have required litigation with perhaps a lengthy period of joblessness for the Ozark pilots. The delay in the implementation of merger policy thus was not arbitrary. In addition, the settlement itself, including the settlement of the integration of the seniority lists, and the decision to settle were not arbitrary and were approved by the overwhelming majority of the Ozark pilots.

Plaintiffs contend that ALPA's actions were discriminatory in that:

ALPA's actions in this case were motivated, among other things, by its desire to placate a larger more politically powerful segment of its membership at the expense of a much smaller, weaker group; to advance the political interest of its President, Hank Duffy; and to benefit the existing TWA pilot group at the expense of the Ozark pilots combining with it. . . . It is a breach of the duty of fair representation to demonstrate for any of these reasons, whether to placate a more politically, powerful segment of the union at the expense of a minority acgment, . . . to advance or protect the political interests of a union official, . . . or to favor existing employees over newcomers in a merger of two union groups,. . . .

Plaintiffs have not presented evidence that ALPA acted for any of the motives attributed to it. It appears rather that ALPA was attempting to obtain the hest bargain possible for the minority Ozark pilots in circumstances in which the Ozark pilots were in an incredibly weak bargaining position. And it is the great wealcess of the bargaining position of the Ozark pilots, rather than a breach of ALPA's duty of fair represontation, that resulted in the settlement to which plaintiffs object. It is interesting, as well that, asids from the lack of evidence that ALPA was acting to politically benefit its president, there is in fact some evidence that Mr. Duffy would have been benefited politically by taking the strongest possible pro-Ozark-pilots line. This is because the TWA pilots had threatened to leave ALPA for another union, so a strong pro-Ozark-Pllots line would logically have turned Ozark pilots into Duffy supporters and turned TWA pilots into non-members of ALPA.

Plaintiffs contend that ALPA's actions were in bad faith in that:

ALPA demonstrated its bad faith both by discriminating against the Ozark pilots for the impermissible reasons set forth above and by a number of specific acts detailed in plaintiffs' summary judgment papers. One such act is particularly relevant here. . . . ALPA's recommendation that the Ozark pilots capitulate was based on its lawyer's intentional mis-representation of facts relating to the meaning of the wraparound agreement, information crucial to the decision confronting the Ozark pilots.

The claim of discrimination has already been disposed of cuntrary to plaintiffs' position. The many unspecified "specific acts detailed in plaintiffs' summary judgment papers" are difficult to discern, apart from the claims of discrimination. Suffice it to say that the court finds nothing in plaintiffs' brief in opposition to the motions for summary judgment that would constitute bad faith in the context under discussion.

Plaintiffs' contention that ALPA's lawyer intentionally misrepresented facts is nothing short of scurrilous. The wraparound agreement was negotiated by ALPA on behalf of the TWA pilots prior to the merger with Ozark. The use of the word "ALPA" in the wraparound agreement to describe one of the parties to the agreement has given rise to a dispute over whether the wraparound agreement was with ALPA as a whole including the Ozark pilots or with ALPA solely as representative of the TWA pilots. ALPA's lawyer's interpretation of the wrap-around agreement to apply only to the TWA pilots was certainly a legitimate one (with which this court agrees) and does not warrant the defamatory statement made in plaintiffs' brief.

Thus, there is no genuine issue of material fact as to whether ALPA's actions were arbitrary, discriminatory, or in bad faith; they were not. Both defendants are therefore entitled to summary judgment on Count I of the second amended complaint.

[ Breach of Contract]

The second count of the second amended complaint is a claim against both defendants for breach of the contract known as the wraparound agreement. However, the wraparound agreement does not give any rights to the Ozark pilots.

The wraparound was an agreement negotiated by ALPA with TWA and Carl C. Icahn and his affiliates prior to the acquisition of TWA by Mr. Icahn. It was negotiated on behalf of the TWA pilats; not on behalf of all members of ALPA as plaintiffs would have it. This is seen in many provisions of the wraparound agreement which only make sense if it was negotiated on behalf of the TWA pilots. For example, the first paragraph, which states that "the Amendment of Agrement annexed hereto as Exhibit A constitutes the New CBA." The document referred to is entitled "Letter of Agreement between Trans World Airlines, Inc. and the Air Line Pilots in the service of Trans World Airlines, Inc. as represented by the Air Lines Pilots Association International" (or LOA #19). Later, the wraparound agreement provides that "In accordance with Section 15(c) of the Agreement. ALPA agrees that employees in the bargaining unit represented by ALPA shall not engage in sympathy strikes against TWA or New TWA or refuse in the course of their employment to cross any picket line." Other provisions of the wraparound agreement are consistent with its application only to TWA pilots and not to ALPA members generally.

Moreover, the provisions on which plaintiffs would principally rest their claim to rights under the wraparound agreement are not inconsistent with the wraparound agrement only granting rights to the TWA pilots. In discussing the wraparound agreement, plaintiffs state that:

Two key rights are relevant here: (1) ALPA's right to prevent an operational merger of TWA and the acquired airline, and (2) ALPA's right to determine the means by which the seniority lists of TWA and the acquired airline will be merged.

It is important to note what exactly that portion of the wraparound agreement provides. The provision at issue states:

The Icahn Group and ALPA further agree that if TWA, New TWA or the Icahn Group acquires "control" of a company . . . which company owns or operates another airline . . ., then: (a) for the period through December 31, 1988 . . . (i) the Icahn Group shall cause such airline to be operated as or by a separate wholly-owned subsidiary or separate operating division of TWA or New TWA, (ii) there will be no full or partial merger underlaken of the pilot seniority lists of the airline operated by TWA or New TWA ("TWA Airline") and such other airline ("Acquired Airline") without prior consent of ALPA, (iii) the fleet size of the TWA Airline as it existed immediately prior to such acquisition shall not be reduced by TWA or New TWA except to the extent airplanes can be sold or otherwise disposed of pursuant to Section 7 of the Agreement, (iv) any exchange of airplanes between the TWA Airline and the Acquired Airline shall not be permitted to result in substantial adverse impact on the group of pilots protected under the provisions of Letter of Agreement XIX between ALPA and TWA ("LOA #19") because of changes in the makeup of the TWA Airline fleet, (v) if the annualized level of block hours of flying of the TWA Airline is reduced below 469,000 hours as a result of acquiring such other airline and the monthly credit/pay cap for TWA Airline pilots is lowered to 65 hours as provided in LOA #19, there shall be no furlough of Pilots protected under LOA #19 provided, however, that this shall not affect the application of LOA #19 in other circumstances, and (vi) Section 1. paragraph 3 and Section 4(d)(8) of the TWA-ALPA collective bargaining agreement shall not be triggered as a result of such acquisition. . . .

There can be no doubt that these provisions were negotiated on behalf of the TWA pilots in order to protect TWA pilote in the event of a merger; not to protect the pilots of any acquired airline. The Ozark pilots were therefore neither parties to nor third party beneficiaries of the wraparound agreement.

So the wraparound agreement is unambiguous; it gives rights only to TWA pilots. While it is unncessary at this point to consider it, the court would note that the extrinsic evidence of the understanding of the parties signing the agreement is consistent with this interpretation. The court also notes that the Ozark pilots (a/k/a plaintiff closs) overwhelmingly approved the integration of the seniority lists that plaintiffs now seek to have undone.

There is no genuine issue of material fact on the question of whether plaintiffs are entitled to relief from either defendant for a breach of the wraparound agreement; plaintiffs are not entitled to such relief. Defendants are both entitled to summary judgment on Count II of the second a mended complaint.

[ Right to Vote]

The third count of the second a mended complaint is a claim against defendant ALPA for violation of sections 101(a)(1) and 101(a)(2) the LMRDA. 29 USC §§ 411(a)(1). 411(a)(2). Plaintiffs contend that ALPA committed three separate violations of section 101 of the LMRDA.

Plaintiffs contend:

First, ALPA's refusal to allow the Ozark plluts the right to vote on the TWA-ALPA collective bargaining agreement violated Section 101(a)(1) of the LMRDA. Under Section 101(a)(1), a union cannot unreasonably deny membership the right to vote on a collective bargaining agreement if that right is provided by the union's constitution and by-laws. . . . Section 101(a)(1) mandates that wing rights given to some members must be given to all. . . . As stated in Bunz v. Moving Picture Machine Operators, Etc., [82 LC ¶ 10,210] 567 F.2d 1117, 1121 (D.C. Cir. 1977), "[a]union's discrimination against its members is most obvious, of course, when it denies some of them the right to vote outright."

At the time the TWA pilots voted on the TWA-ALPA collective hargaining agreement (TWA-ALPA CBA), the Ozark pilots' own representatives (who were other Ozark pilots) on the Ozark MEC were taking the position that the Ozark pilots were covered by the Ozark-ALPA CBA. It is Jiffieult to see how ALPA violated the LMRDA by acceding to the position of the Ozark MEC that the TWA-ALI's CBA did not cover the Ozark pilots. Also, as ALPA points out, the TWA-ALPA CBA would have been ratified even if every Ozark pilot had voted against it. So, even if there had been a violation of the LMRDA by ALPA in not allowing the Ozark pilots to vote on the TWA-ALPA CBA, it would not have made any practical difference in the reault.

Plaintiffs also contend:

ALPA also violated the Ozark pilots' rights under Section 101(a)(1) of the LMRDA by falling to allow them a meaningful vots on the merge agreements. Though the Ozark pilots were given the right to vote, the LMRDA requires that each pilot's vole must be "meaningful." . . . By failing to fully enforce its merger policy and its rights under the wraparound agreement, ALPA created a situation in which the Ozark pilots were voting under severe and unlawful duress and coercion, Thereby denying them a meaningful vote on the merger documents.

As noted previously. the rights under the wraparoung agreement belonged to the TWA pilots, not to the membership of ALPA generally. The failure to fully enforce the merger policy claim is really a claim that ALPA enforced its merger policy later than would have been most helpful to plaintiffs.

As explained earlier, ALPA had good reasons for delaying implementation of its merger policy as it was attempting to resolve the seniority-list-integration issue on a basis acceptable to both pilot groups. The duress and coercion to which plaintiffs refer were TWA's transfer of alreaft from Ozark to TWA, furloughing of some Ozark pilots, and threat to do more if the Ozark pilots did not ratify the seniority list integration and other aspects of the merger. Plaintiffs do not note any particular provision of any agreement giving Ozark pilots rights that would prohibit TWA from transferring aircraft or furloughing pilots. Rough as it may be, the not of economic pressure applied by TWA is conunon in labor disputes and is not of itself unlawful. ALPA was willing to back the Ozark pilots if they chose to stand on their presumed rights and not ratify the new agreement TWA was seeking with them; however, the Ozark pilots overwhelmingly ratified that agreement. That overwhelming ratification was not the result of any violation of the Ozark pilots' rights under the LMRDA by ALPA but rather a rational decision that the Ozark pilots were better off ratifying the agreement than they would be laking their chances on an uncertain lawsuit during which many if not all of them might be out of work.

Plaintiffs also contend:

ALPA's third LMRDA violation occurred when Duffy refused to ballot the Executive Board in violation of ALPA's constitution. By denying the Ozark pilocs the right to appeal the Executive Commitlee's action not to impose ALPA Merger Policy on September 9, 1986, ALPA clearly interfered with the Ozark pilots' right to express their views and arguments to the Executive Board, in violotion of section 101(a)(2) of the LMRDA.

The statute upon which this claim is purportedly premised states:

Every member of any labor organization shall have the right to meet and assemble freely with other members; and to express any views, arguments, or opinions; and to express at meetings of the labor organization his views, upon candidates in an election of the labor organization or upon any business properly before the meeting, subject to the organization's established and reasonable rules pertaining to the conduct of meangs. . . .
29 USC § 411(a)(2). Duffy's refusal to ballot the Executive Board, if it occurred, would not have denied plaintiffs their right "to meet and assemble freely with other members;" their right "to express any views, arguments, or opipions;" or their right to "to express at meetings of the labor organization . . . [their] views, upon candldates in an election of the labor organization or upon any business properly before the meeting."

There is no genuinc issue of matcrial fact as to whether plaintiffs are entitled to relief from ALPA for a violation of the LMRDA. Plaintiffs are not entitled to that relief and defendant ALPA is entitled to summary judgment on Count III of the second amended complaint.

The fourth count of the second amended complaint is a claim against defendant TWA for breach of the Ozark-ALPA CBA. The fifth count of the second amended complaint is a claim against TWA for a change in agreements affecting cates of pay, rules, or working conditions in violation of the RLA. The terms of the Ozark-ALPA CBA and the RLA make it useful to discuss these two counts together.

The RLA provides, intes alia:

No carrier, its officers of agents shall change the rates of pay; rules, or working conditions of its employees, as a class as embodied in agreements except in the manner prescribed in such agreements or in section 150 of this title.
45 USCA § 152, Seventh (West 1986) (emphasis added). Thus, if the change in rates of pay, rules, or working conditions were changed in a manner prescribed in the Ozark-ALPA CBA, the RLA was not violated.

The Ozark-ALPA CBA provided, inter alis:

H. The provisions of this Agreement shall be binding upon any successor or merged company or companies, or any successor in the control of the Company, unless and until changed in accordance with the provisions of the Railway Labor Act.

To this point, it appears that (1) the CBA would be applicable to TWA as Ozark's successor and (2) the only way to change provisions of the agreement would be in accordance with the RLA which, for changes in rates of pay, rules, or working conditions, means compliance with section 156 of title 45. However. the next paragraph of the Ozark-ALPA CBA changes things considerably:

I. Either party may at any time propose in writing to the other party any amendment which cither porty may desire to make in this Agreement and, if such amendment is agreed to by both parties hereto, such amendment shall be stated in writing. signed by both parties, and the amendment shall be deemed to be included in and shall become a part of this Agreement.

There is no indication in the CBA that the amendments contemplated are required to be minor, no indication that there could not even be an amendment of the whole CBA by substitution of a new CBA.

What effectively occurred in the case at bar was that TWA proposed agreements that were amendments of the Ozark-ALPA CBA. The proposed amendments were in writing. The Ozark pilots overwhelmingly ratified the new agreements and, of course, TWA agreed to them. All that was left at this point was for both parties to sign the agreements, which they did.

The overwhelming voce ratifying the agreements is significant, as it shows that a large majority of Oazark pilots preferred the new arrangements with TWA to the alternative. It is also noteworthy that among the agreements exccuted on February 20, 1987. was one by which all disputes regarding the terms and conditions of employment of the Ozark pilots were resolved. In this case, where there was no breach by ALPA of its duty of fair representation and where there was no coercion or duress that would vitiate the vote of the Ozark pilots, the court believes that the ratification and signature of the agreements waived any rights plaintiffs might otherwise have had under the Ozark-ALPA CBA or the RLA.

There is no genuine issue of material fact as to whether plaintiffs are entitled to relief from TWA for a breach of the Ozark-ALPA CBA or for a violation of the RLA; plaintiffs are entitled to relief for neither of these claims. Defendant TWA is entitled to summary judgment on Counts IV and V of the second amended complaint.

For the foregoing reasons, this court concluded that there was no genuine issue as to any material fact and that defendants TWA and ALPA were entitled to judgment as a matter of law. FRCP 56(c). Therefore, this court granted in their entirety the motions for summary judgement of both defendants and entered judgment in favor of defendants ALPA and TWA and against plaintiffs on all five counts of the second amended complaint.


Summaries of

Hammond v. Air Line Pilots Association

United States District Court, N.D. Illinois, Eastern Division
Sep 26, 1991
No. 82 C 2792 (N.D. Ill. Sep. 26, 1991)
Case details for

Hammond v. Air Line Pilots Association

Case Details

Full title:David A. Hammond et al., Plaintiffs v. Air Line Pilots Association et al.…

Court:United States District Court, N.D. Illinois, Eastern Division

Date published: Sep 26, 1991

Citations

No. 82 C 2792 (N.D. Ill. Sep. 26, 1991)

Citing Cases

Rakestraw v. United Airlines, Inc.

Interested persons may glean additional particulars from the district court's opinions, our own prior opinion…