Case Name: MAGILL BROS., INC. (a Corporation), Appellant, v. BUILDING SERVICE EMPLOYEES' INTERNATIONAL UNION (an Unincorporated Association) et al., Respondents
Court: Supreme Court of California
Jurisdiction: California
Decision Date: 1942-07-02
Citations: 20 Cal. 2d 506
Docket Number: L. A. No. 17903
Parties: MAGILL BROS., INC. (a Corporation), Appellant, v. BUILDING SERVICE EMPLOYEES’ INTERNATIONAL UNION (an Unincorporated Association) et al., Respondents.
Judges: 
Reporter: California Reports
Volume: 20
Pages: 506–523

Head Matter:
[L. A. No. 17903.
In Bank.
July 2, 1942.]
MAGILL BROS., INC. (a Corporation), Appellant, v. BUILDING SERVICE EMPLOYEES’ INTERNATIONAL UNION (an Unincorporated Association) et al., Respondents.
Pierson & Block, R. K. Pierson and Samuel P. Block for Appellant.
Ben Koenig, Aaron B. Rosenthal, George Olshausen, Jonathan Rowell and Mathew 0. Tobriner for Respondents.

Opinion:
GIBSON, C. J.
The plaintiff corporation, which is engaged in operating two bowling alleys in the city of Los Angeles, brought this action against the defendant unions and the officers and members thereof. Plaintiff sought to enjoin defendants from maintaining pickets in front of plaintiff's places of business and to recover damages for the allegedly unlawful picketing previously carried on by defendants. The action was tried without a jury and, by stipulation, was tried solely with reference to the alley located at 1953 S. Vermont Avenue in Los Angeles. The trial court found that prior to the filing of the complaint in this action none of plaintiff's employees was engaged in a labor dispute with his employer and that there was no strike of any nature against plaintiff. It found that Local 214 sought to unionize all of plaintiff's employees who were not members of any union and that Local 214 urged plaintiff to sign a contract providing that it would employ only union members. After repeated refusals on the part of plaintiff to sign such a contract (on the theory that it would not force its employees -to become union members), defendants stationed pickets outside the bowling alley who carried signs stating: "This house on strike. A. F. L." At that time, according to the findings of the trial court, none of plaintiff's employees was on strike and no labor dispute existed between employer and employees. Immediately after the establishment of the picket line, however, certain of plaintiff's employees left and remained away from their work. The court found that prior to the establishment of the picket line a ballot was conducted by defendants among those of plaintiff's employees who belonged to the union. The question voted upon was whether a strike should be called against plaintiff but not a single employee (with one possible exception) voted for such a strike. It was found that the sole purpose of the picketing was to compel plaintiff to sign the closed shop agreement and that "the banners and signs carried by said pickets conveyed false and untrue information to the general public insofar as the employees of plaintiff are concerned." The trial court found that the allegations of the complaint charging that the pickets had engaged in acts of force, violence or physical intimidation were untrue. It also found that the allegations of damage in the sum of $25,000 were untrue.
Upon the basis of these findings the trial court rendered a so-called "memorandum, for judgment" in which it ordered that the injunction be granted on the ground that picketing was unlawful in the absence of a labor dispute between the employer and its employees. Following the decision of this court in McKay v. Retail Auto S. L. Union No. 1067, 16 Cal. (2d) 311 [106 P. (2d) 373]), and companion cases, defendants moved to vacate the order previously made by the trial court. This motion was granted and thereafter judgment was entered for defendants denying the permanent injunction and dissolving the preliminary injunction theretofore granted. Plaintiff brings this appeal from the judgment for defendants.
The question for decision is whether, under the facts found by the trial court, it was error to deny plaintiff's request for injunctive relief. Plaintiff concedes that under controlling decisions no injunction could have been granted based upon the absence of a dispute between the employer and his employees (McKay v. Retail Auto. S. L. Union No. 1067, supra, P. 324; C. S. Smith Metropolitan Mkt. Co. v. Lyons, 16 Cal. (2d) 389, 394 [106 P. (2d) 414]; American Federation of Labor v. Swing, 312 U. S. 321 [61 S. Ct. 568, 85 L. Ed. 855]; Bakery and Pastry Drivers and Helpers, etc., v. Wohl — U. S. — [62 S. Ct. 816, 86 L. Ed. —]), or upon the ground that the picketing was being conducted to secure a closed shop contract. (McKay v. Retail S. L. Union No. 1067, supra, p. 322-323; Shafer v. Registered Pharmacists Union, 16 Cal. (2d) 379 [106 P. (2d) 403].) The sole issue, therefore, is whether the trial court erred in denying injunctive relief in a case where it found that the banners and signs carried by the pickets' conveyed false and untrue information to the general public.
There can be no doubt that untruthful picketing is unlawful picketing. Cases involving the right of labor to picket peacefully have consistently held that the picketing must also be honest and truthful. (McKay v. Retail Auto. S. L. Union No. 1067, supra, p. 319-320; Steiner v. Long Beach Local No. 128, 19 Cal. (2d) 676, 682-683 [123 P. (2d) 20]; Euclid Candy Co. v. International Longshoremen, 49 Cal. App. (2d) 137, 143 [121 P. (2d) 91]; cf. Davitt v. American Bakers' Union, 124 Cal. 99 [56 Pac. 775]; Weist v. Dirks, 215 Ind. 568 [20 N. E. (2d) 969, 971); Wilner v. Bless, 243 N. Y. 544 [154 N. E. 598]; Olympia Operating Co. v. Costello, 278 Mass. 125 (179 N. E. 804]; 1 Teller, Labor Disputes and Col lective Bargaining (1940), § § 126-128, pp. 388, et seq.) In certain cases it has been difficult to determine whether the particular signs used in picketing were actually false (cf. Teller, op. cit. supra; (1941) 29 Cal. L. Rev. 366, 370, n. 12), but since there is no challenge to the trial court's finding upon this point it is unnecessary in the present case to consider the question. Conceding, in effect, that the picketing in the present ease conveyed false information to the public, defendants contend that the action of the trial court should be sustained upon the ground that equity will not enjoin picketing under such circumstances because it is so closely identified with the constitutional right of free speech. In support of this proposition defendants rely upon cases which set forth the principle that equity will not grant injunctive relief against the publication of what might be, after publication, a libel or slander. (Dailey v. Superior Court, 112 Cal. 94 [44 Pac. 458, 53 Am. St. Rep. 160, 32 L. R. A. 273]; In re Wood, 194 Cal. 49, 60 [227 Pac. 908); cf. People v. Armentrout, 118 Cal. App. (Supp.) 761, 769 [1 P. (2d) 556]; Goldberg, Bowen & Co. v. Stablemen's Union, 149 Cal. 429, 434 [86 Pac. 806, 117 Am. St. Rep. 145, 9 Ann. Cas. 1219, 8 L. R. A. (N. S.) 460].) Defendants' position in this regard cannot be sustained. If defendants had remained at home and had uttered false statements concerning plaintiff, the rule cited might have been relied upon. Not so in the present case, however, for, assuming that the rule is correct, here is not the utterance of false statements which is sought to be enjoined, but the conduct of picketing in an unlawful manner. The rule in this regard is analogous to the principle that while equity will not ordinarily enjoin activity which is criminal in nature, neither will it refuse to act where an independent ground for relief is presented merely because the acts sought to be enjoined are also criminal. (See 5 Pomeroy, Equity Jurisprudence (Equitable Remedies, (2d ed.) §2050, p. 4630.) Despite theoretical criticism (see 1 Teller, op. cit. supra, p. 404; (1941) 29 Cal. L. Rev. 366, 377-378) and despite the fact that the publication of false statements alone will not justify equitable relief, it is the nearly unanimous rule throughout the country that equity will intervene where false or fraudulent statements are combined with picketing and where, under local policy, this renders the picketing illegal. (Cf. McKay v. Retail Auto. S. L. Union No. 1067, supra; J. H. & S. Theatres v. Fay, 260 N. Y. 315 [183 N. E. 509, 512]; Wilner v. Bless, supra; Wiest v. Dirks, supra; Olympia Operating Co. v. Costello, supra; 1 Teller, op. cit. supra, p. 388, et seq.; (1941) 90 U. of Pa. L. Rev. 201, 211-212; (1941) 41 Columb. L. Rev. 89, 101, n. 79-80; 116 A. L. R. 484, 497; 27 A. L. R. 651, 653.)
The basis for equity's intervention in cases such as this rests upon the fact that picketing is one of the forms of collective labor activity which seeks to exert economic pressure upon an employer. (See Bestatement, Torts, § 796, et seq.) As was said in a recent opinion of the United States Supreme Court, "Picketing by an organized group is more than free speech, since it involves patrol of a particular locality and since the very presence of a picket line may induce action of one kind or another, quite irrespective of the nature of the ideas which are being disseminated. Hence those aspects of picketing make it the subject of restrictive regulation." (Bakery and Pastry Drivers and Helpers, etc., v. Wohl, supra, p. 819, Douglas, J. concurring.) Such collective labor activity is permissible only when conducted according to the requirements imposed by law, and if in violation of such requirements, picketing is subject under ordinary circumstances to the restraint of a court of equity. (1 Teller, op. cit. supra, chap. 8, pp. 319, et seq.) The standards imposed for determining whether picketing is lawful and permissible, or unlawful and enjoinable, are matters of state law which have varied from time to time and from jurisdiction to jurisdiction. (See (1940) 39 Mich. L. Rev. 110, 111; (1941) 26 Corn. L. Q. 470, 471-472.) Thus, at various times in the past picketing has been enjoined on the theory that it is unlawful per se (Pierce v. Stablemen's Union, 156 Cal. 70 [103 Pac. 324]; 1 Teller, op. cit. supra, § 112), or on the theory that it is unlawful in the absence of a dispute between employer and employee. (See 1 Teller, op. cit. supra, § 117, et seq.) Neither of these criteria for determining the legality of picketing has application in California today, but violent picketing and untruthful picketing remain unlawful. (See McKay v. Retail Auto. S. L. Union No. 1067, supra.) Unless there is a statutory or constitutional restriction on the power of a court of equity under the circumstances here presented, therefore, it seems clear that plaintiff is entitled to a decree enjoining defendants from picketing falsely and untruth fully. (See J. H. & S. Theatres v. Fay, supra; Olympia Operating Co. v. Costello, supra; 1 Teller, op. cit. supra, p. 388, et seq.)
There is no anti-injunction statute which places a restraint upon the power of courts of equity in this state where labor disputes are involved. Defendants suggest, however, that the constitutional guarantee of freedom of speech constitutes a bar to the intervention of equity where untruthful picketing is involved. There is no suggestion in our cases that the provisions of the California Constitution should be so interpreted, but defendants cite certain recent decisions of the United States Supreme Court. These cases, it is true, have held that where individual states set up standards which define picketing as lawful or unlawful and where such standards are sought to be enforced by the power of equity, the state policy is subordinate to the constitutional guarantee of free speech. (American Federation of Labor v. Swing, supra; Bakery and Pastry Drivers and Helpers, etc., v. Wohl, supra; see (1941) 90 U. of Pa. L. Rev. 201, 202; (1941) 29 Cal. L. Rev. 366, et seq.) Thus, where the State of Illinois sought to enjoin picketing as unlawful because there was no controversy between the employer and his employees, the state policy was overruled because it was held to constitute an unwarranted infringement of the guarantee of free speech. (Swing v. American Federation of Labor, 372 Ill. 91 [22 N. E. (2d) 857], reversed in American Federation of Labor v. Swing, supra; cf. Miller's Inc. v. Journeymen Tailors Union Local No. 195 (N. J. Eq.) 15 A. (2d) 822, reversed in Journeymen Tailors Union Local No. 195 v. Miller's Inc., 312 U. S. 658 [61 S. Ct. 732, 85 L. Ed. 1106].) Similarly where the State of New York sought to enjoin picketing as unlawful in the absence of any labor dispute the state policy was reversed. (Wohl v. Bakery and Pastry Drivers and Helpers, etc., 259 App. Div. 868 [19 N. Y. S. (2d) 811], affirmed 284 N. Y. 784, 788 (31 N. E. (2d) 765), reversed in Bakery and Pastry Drivers and Helpers, etc., v. Wohl, supra.) In the Wohl ease, supra, the court made it perfectly clear that the picketing involved was truthful in nature and in the Swing case, supra, where it was charged in the trial court that the placards were false, the Supreme Court specifically indicated that it was forced to reverse the judgment of the highest state court because that court apparently rested the injunction solely upon the absence of a dispute between the employer and his employees. We find no suggestion in these cases, therefore, that a state policy characterizing untruthful picketing as unlawful and enjoinable is in violation of the constitutional provision. (Cf. (1940) 39 Mich. L. Rev. 110, 118; (1941) 90 U. of Pa. L. Rev. 201, 211-212.) The right to restrain the use of false or untruthful statements made in connection with picketing does not restrict the right to picket peacefully and honestly. It is a familiar doctrine of equity that the scope of the injunction will be limited to the wrongful act sought to be prevented. The effect of the decree is to protect every legitimate right of the defendants and at the same time prevent unlawful interference with the rights of plaintiffs. The policy of this state which characterizes the use of false or fraudulent statements in picketing as unlawful is within the permissible limits which a state may impose upon industrial combatants without impairing the right of free speech. (See Thornhill v. Alabama, 310 U. S. 88, 104, 105 [60 S. Ct. 736, 84 L. Ed. 1093].) Under the facts set forth in this case, therefore, plaintiffs are entitled to a decree restraining defendants from the use of false or untruthful statements in the exercise of their right to picket.
The judgment is reversed.
Shenk, J., Curtis, J., Edmonds, J., and Traynor, J., concurred.