Court Opinion

ID: 9459789
Source: CourtListenerOpinion
Date Created: 2023-08-04 21:32:01.282396+00
Date Added: 2024-06-11T17:36:20.509952
License: Public Domain

CLARK, Circuit Judge
(dissenting):
While I expressly agree with what is implicit in the majority opinion — that the issues in this case are novel and important — with deference I cannot agree that a labor organization enjoys a vir*1176tually total immunity from federal antitrust jurisdiction. Where, as here, a union local’s activity not only constitutes a congressionally defined unfair labor practice — secondary boycott1 —but also forces a business engaged in commerce to contract that it will refuse to deal with other firms whose employees are not controlled by the local, I find no bar to judicial relief. The end does not justify the means. The mere fact that the local desires to efficiently spread its organization of plumbing workers cannot legitimatize practices which cut across the business rights of neutral companies, the choice-of-representation rights of employees,2 and the rights of other union groups who may wish to organize employer companies in this craft. Remitting the plaintiff here to an administrative remedy which has already been tried without success is unrealistic and remitting him to the partial remedy of an express statutory right to sue in damages,3 is incongruous.
I would begin my reasoning by emphasizing that Plumbers Local 100 did not seek to force Connell, the object of its economic coercion, to employ union labor — either members of Local 100 or members of any other labor organizations. It had no present or future interest in any employee of Connell. Rather, through the use of picketing which effectively halted all of Connell’s general contract work, Local 100 forced Connell to agree to withhold all mechanical subcontract work from subcontractors who did not have a collective bargaining agreement with Local 100. Through this indirect expedient, the union sought to extend its bargaining power to cover the employees of every plumbing construction firm in the market area in which Connell worked. This classic secondary boycott and the resulting work stoppage, relatively costless to the union in time, manpower, finances or side effects, but completely devastating to the general contractor, could have had only one result — -Connell’s capitulation and execution, under protest, of an agreement to refuse to do business with any subcontracting firm which did not employ members of this one local. Since no general contractor could withstand the pressure of having his entire work picketed, the meaning to everyone in the plumbing trade is clear — get in Plumbers Local 100 or get out of business. This scheme has separate but equally proscribed labor policy and antitrust effects. From the labor standpoint it deprives plumbing workers of the right to ballot for their bargaining representative, destroys interunion rivalry for representation rights, and embroils neutral employers in disputes in which they have no real interest. From the antitrust viewpoint, it clearly restrains trade by requiring general contractors to boycott plumbing contractors with whom Local 100 has been either unwilling or unable to secure a collective agreement.
Two distinct positions are advanced in support of the union’s claim that its conduct, no matter how violative of the antitrust law, is immune from antitrust sanction: First, that its actions are protected by the provisions of the National Labor Relations Act — in particular the “construction proviso” to Section 8(e) of that Act; and second, that even if the secondary picketing and resulting agreement are not exempted by Section 8(e), it does not matter since labor organizations enjoy relatively complete immunity from antitrust regulation. My brothers pretermit consideration of the first and most strenuously guarded defense — the NLRA’s sanction of secondary boycott action at construction sites — and predicate their opinion solely on the second defense — that the union activities here, legal or illegal, are immune from Sherman Act sanctions. With deference, I disagree, not just as to the method of *1177decision, but as to result. Since in my view there is no carte blanc immunity, I must deal with the construction of 8(e) and I would hold that the unions defense urged there is not well taken.
General Antitrust Immunity — The rule which I discern from the existing authorities is two-fold. First, in spite of the general antitrust immunity with which Congress4 and the courts5 have sheltered the labor movement, union conduct, even where lawful under the labor statutes, may violate antitrust provisions if the union either combines with nonlabor groups or pursues nonlabor goals. The majority agrees with this. Second, union conduct which violates the labor laws may fall without the general antitrust immunity conferred by those laws if it is determined that the action which is labor law illegal also violates the antitrust laws.6
There are two principal bases in law as well as solid logic to support this conclusion. The post Apex Hosiery-Hutche-son legal developments are congressional action in adopting the Landrum-Griffin amendments in 1959 to the National Labor Relations Act and the Supreme Court’s decision in Local 189, Amalgamated Meat Cutters v. Jewel Tea Co., 381 U.S. 676, 85 S.Ct. 1596, 14 L.Ed.2d 640 (1965). It comports with my sense of reason that anyone who mandates that another engage in restraint of trade by engaging in a labor practice condemned by Congress ought to be antitrust accountable.
I appreciate that the majority does not agree with my view of the manner in- which the existing precedents should be construed and applied. However, if any common principle can be drawn from the Jewel Tea decision (looking both at views of Mr. Justice White, on one hand, and those of Mr. Justice Goldberg on the other) it is that at least some unilateral union activity, though described by the broad language of the Clayton and Norris-LaGuardia Acts, is without the scope of the labor antitrust exemption. Mr. Justice White expressed the view that union-imposed restrictions on the operating hours of employers would be immune to antitrust attack only if those provisions were so intimately related to traditional areas of labor concern, such as wages, hours and working conditions as to fall within the protection of the national labor policy. Mr. Justice Goldberg enunciated a broader exemption, extending to all mandatory bargaining subjects. Thus, no matter whose blend of Jewel Tea is thought to be more palatable, the court there confirms that some behavior declared legitimate by the earlier Clayton and Norris-LaGuardia Acts but proscribed by the National Labor Relations Act as subsequently amended falls without the antitrust exemption.7 Since *1178even Justice Goldberg’s broader opinion provides the basis for holding the local’s activities not insulated from antitrust scrutiny, I premise my dissent on his opinion noting that Justice White’s opinion supports my position, a fortiori.8
Justice Goldberg begins by updating Hutcheson, stating that:
[T]he labor exemption from the antitrust laws dervies from a synthesis of all pertinent congressional legislation — the nature of the Sherman Act itself, §§ 6 and 20 of the Clayton Act, the Norris-LaGuardia Act, the Fair Labor Standards Act, the Walsh-Healy and Davis-Bacon Acts, and the Wagner Act with its Taft-Hartley and Landrum-Griffin amendments.
381 U.S. at 709, 85 S.Ct. at 1614 (footnotes omitted). This language evinces a clear recognition that the scope of antitrust immunity, which was once co-existent with the parameters of the Clayton and Norris-LaGuardia Acts, must be reexamined in the light of more recent congressional action. Moving from premise to decision and applying a mandatory/nonmandatory dichotomy, Justice Goldberg opined that the unfair labor practice of insisting upon a non-mandatory subject could in at least some cases constitute an antitrust violation.
The analogy between Justice Goldberg’s paradigm of a loss of antitrust immunity and the case at bar is imperfect, since Justice Goldberg predicated his reasoning on union insistence on a nonmandatory bargaining subject within an established bargaining relationship, while here Connell and the union had no labor law duty to bargain at all. This lack of symmetry, however, strengthens my view that the union conduct is not antitrust immune. If a union would violate the rule set out by Justice Goldberg by insisting on one nonmandatory term in the course of engaging in labor law required bargaining, surely this local violated the same principle by insisting on the “Local 100 subcontractors only” contract when Connell had no duty to bargain whatsoever.
The principle that I draw from Justice Goldberg’s opinion is that the union antitrust exemption dissipates if the union engages in an unfair labor practice and if the union activity is “at the core of the type of anticompetitive commercial restraint at which the antitrust laws are directed.” 381 U.S. at 733, 85 S.Ct. at 1626. Justice Goldberg focuses on, but does not limit his opinion to, the most frequently litigated antitrust results of union activities, price-fixing or market allocation. The case before us presents another • classic antitrust problem — a concerted boycott of certain other businesses. Clearly, such behavior is also at the core of the behavior proscribed by the antitrust laws.9
Guided by my own reason, the change of statutory law, and the authority of both factions of the Jewel Tea majority, *1179I would conclude that no absolute antitrust immunity necessarily extends to union activities which are forbidden by the statutes regulating labor-management relations. There is no justifiable reason to reflexively afford an antitrust exemption to conduct which Congress has expressly forbidden to labor organizations.10 The secondary boycott prohibitions of the Labor-Management Relations Act, as amended by Labor-Management Reporting and Disclosure Act, were intended to prevent such a use of economic power directed towards neutral parties. When a union seeks to organize those who work for an employer or group of employers there can be no doubt that Congress has granted it freedom from antitrust proscription to act in concert against such employers in order to bring such employees as may be affected into a unified group of sufficient size to allow the union to deal on a par with management. Congress’ balance of the competing interests, as I divine legislative intent, is calculated to produce union peer status, but not union dominance. Therefore, I would hold that where a union bypasses the eongressionally sanctioned methods of organizing the employer whose employees it seeks to unite (here, the individual subcontractors) and illegally brings pressure on a neutral, secondary source of work for all such employers within an area (Connell) to force that unrelated economic entity to execute a contract which requires that all directly involved subcontractors bring their work forces into the membership of this local or starve for lack of work, then that union has passed beyond the scope of antitrust immunity.11 It is incidental to the antitrust problem but cogent to the intent of labor policy that this creates an aggregation of power which not only exceeds any legitimate bargaining objective of a labor organization, but also carries the seed for internal destruction of the labor movement by creating super locals able to gobble up such contract opportunities to the exclusion of all others.
Moving completely out of the construction industry context so that my example will not depend upon any interpretation or application of the construction proviso, I would first give the following- as an illustration of the restraint-of-trade potential of such activities which the majority declares to be immune from antitrust remedies. Suppose a Detroit-based local of the Teamsters Union was determined to control the employees of all of the truck lines hauling automobiles, could they engage free of any antitrust sanction in clearly illegal secondary picketing of the Big Three automakers and their component suppliers to secure a contract requiring the manufacturers to boycott all trucking companies not represented by the local? Or second, in terms of the case before us, could Local 100 go one step further and- picket the manufacturing plants of any companies in its area who might intend to construct additional plants anywhere in the United States in order to force these Texas manufacturers to cease doing business with plumbing firms not organized by Local 100 *1180and to cease doing business with contractors who deal with such firms ?
In the absence of clear precedent I would not embrace the proposition that patently illegal union activity must somehow be protected from antitrust proscription. Rather, I would hold that whenever a union crosses the line separating protected activities from prohibited activities it sheds its cloak of total antitrust immunity. Thus, I must reach the question the majority pretermits— the legality of the secondary activity.
Labor Board Preemption — The parties agree that the local’s secondary economic coercion here, unless protected by the construction proviso of Section 8(e), is prohibited by Section 8(b)(4). While conceding that in the usual case the National Labor Relations Board should ordinarily be given the opportunity to make the first interpretation as to whether union conduct constitutes an unfair labor practice, I cannot accept the majority’s proposition that a federal district court is absolutely barred from deciding the issue.
Of course, the Board has the power and authority to seek an injunction of union actions such as secondary picketing which constitutes an unfair labor practice. That the Board may do so, however, does not mean that the primary jurisdiction of the Board ousts completely the power of federal courts to adjudicate violations of antitrust laws committed to their jurisdiction because such violations also happen to be unfair labor practices.
Congressional policy certainly requires no such deference in all labor cases. For example, had this same case been brought as an action for damages under 29 U.S.C. § 187 (Section 303 of the Labor Management Relations Act), a specific grant of jurisdiction would require the same court to make the same determination that today is held to be forbidden.
Moreover, abatement of judicial proceedings pending Board action would be a futile gesture of comity in this case. As Judge Morgan points out, the Board has apparently once resolved the Section 8(e) question adversely to the appellant’s position. That determination was not reviewed by any circuit court. In a ease almost identical to the one presented here (referred to by Judge Morgan as the K.A.S. case), the General Counsel refused to issue an unfair labor practice complaint. The plain meaning of this administrative history is that it did not require great prescience on Connell’s part to anticipate that a resort to administrative remedies for this picketing would be ineffectual.
Justice White in Jewel Tea, unchallenged by any of the other opinions, clearly indicates that the primary jurisdiction doctrine is not to be woodenly applied to prevent court resolution of such issues in the antitrust context. Justice White relied in part on the fact that the Board’s General Counsel, not the Board or a private litigant, will determine whether to issue an unfair labor practice complaint. He also pointed out the futility of requiring resort to “an expensive and merely delaying administrative proceeding when the case must eventually be decided on a controlling legal issue wholly unrelated to determinations for the ascertainment of which the proceeding was sent to the agency.” 381 U.S. at 686, 85 S.Ct. at 1600. In light of the General Counsel’s established reluctance to submit the issue in this case to the Labor Board for resolution, and in view of the serious antitrust questions involved which are surely not within the scope of the Board’s expertise, I would hold that this court and the district court below are not preempted from resolving the labor law problems in this antitrust action.
Scope of the Construction Proviso— Thus, I must reach the question my Brothers leave for another day: Is the union activity permitted by the construction proviso to Section 8(e)? All parties agree that the contract here is a secondary agreement generally prohibited by the main portion of Section 8(e); the only question is whether this con*1181tract is excepted from that prohibition by the construction proviso portion of that section. The language of the relevant portion of that- subsection, including the construction proviso is as follows:
It shall be an unfair labor practice for any labor organization and any employer to enter into any contract or agreement, express or implied, whereby such employer ceases or refrains or agrees to cease or refrain from handling, using, selling, transporting or otherwise dealing in any of the products of*any other employer, or to cease doing business with any other person, and any contract or agreement entered into heretofore or hereafter containing such an agreement shall be to such extent unenforcible and void: Provided, that nothing in this subsection shall apply to an agreement between a labor organization and an employer in the construction industry relating to the contracting or subcontracting of work to be done at the site of the construction, alteration, painting, or repair of a building, structure, or other work ....
On its face it would appear that the proper answer to this novel question of statutory interpretation would turn on whether Connell is to be deemed “an employer in the construction industry.” Even assuming, however, that the language unambiguously includes Connell, such a mechanical parsing of the statute ignores the Supreme Court’s admonition that such dictionary adjudication cannot obviate the need for judicial inquiry into Congressional purpose:
It is a “familiar rule, that a thing may be within the letter of the statute and yet not within the statute, because not within its spirit nor within the intention of its makers.” . . . That principle has particular application in the construction of labor legislation which is “to a marked degree, the result of conflict and compromise between strong contending forces and deeply held views on the role of organized labor in the free economic life of
the Nation and the appropriate balance to be struck between the uncontrolled power of management and labor to further their respective interests.” . . .
National Woodwork Mfrs. Ass’n v. N.L.R.B., 386 U.S. 612, 619, 87 S.Ct. 1250, 1255,18 L.Ed.2d 357 (1967).
The difference between the traditional “hot cargo” clause entered into as a part of an established bargaining relationship and the one-shot, single-object contract presented here are substantial. First, and perhaps foremost, a general contractor in an established bargaining relationship has some economic power to resist the inclusion of a hot cargo clause in the collective bargaining agreement. Such a contractor can bargain over proposed clauses and possibly avoid their inclusion or require their modification by trading on some other point. Further, a strike in an established bargaining relationship is much more costly to the union than the relatively painless picketing utilized by the local in this case;. here, since the local had no real interest in whether work on this project would ever be resumed, it probably could have maintained its pickets indefinitely. One other distinction between the union behavior here and the behavior which has been heretofore permitted under the Section 8(e) proviso is the much greater possibility of rival unions or locals seeking contradictory subcontracting contracts from the neutral general contractor.
What legislative history there is convinces me that Congress never intended to make legitimate hot cargo contracts between totally non-related parties or to condone the use of economic sanctions to compel such agreements. The limited exemption afforded to construction unions by the proviso
was granted apparently in recognition of problems peculiar to the construction industry, particularly those resulting from sporadic work stoppages occasioned by the traditional refusal of craft unionists to work alongside non-union men on the same project. *1182Essex County and Vicinity Dist. Council of Carpenters v. N.L.R.B., 332 F.2d 636, 640 (3d Cir. 1964). The Supreme Court in National Woodwork cited the Essex County decision and stated:
[t]he construction proviso was intended to be, a measure designed to allow agreements pertaining to certain secondary activities on the construction site because of the close community of interest there, but to ban secondary-objective agreements concerning non jobsite work in which respect the construction industry is no different from any other.
386 U.S. at 638-639, 87 S.Ct. at 1265. The Essex County-National Woodwork rationale for the proviso — the community of interests at the construction site —will not support its application in the situation presented by the case at bar. Here there were no union laborers refusing to work alongside the nonunion plumbers. Such an objection was altogether impossible because the plumbers on this job were members of the union. The only statutorily related dissatisfaction of Local 100 here was the possibility that a firm employing nonunion plumbers might work on Connell’s next job. This concern of the union plumbers — to extend their influence to other plumbing firms either not then employed or working on other projects — is not one related to the “close community of interest” on the construction site; rather, that concern is one “in which respect the construction industry is no different from any other.”
Moreover, the proper interpretation of this proviso is dependent on a recognition that it was a compromise in order to preserve the established pattern of bargaining in the construction industry. See National Woodwork, supra, 386 U.S. at 637, 87 S.Ct. at 1265, and the legislative history there cited. This court requested supplemental briefs from all the parties and amici as to the pattern of bargaining practices utilized in the industry prior to the Landrum-Griffin amendments in 1959. In response to this specific inquiry the union was unable to point out any source of information which would show that subcontractor contracts such as the one in this case were even occasionally utilized in the industry prior to 1959, much less so common a practice that we could assume Congress intended to preserve that part of the pattern of collective bargaining in the industry.
In light of the total lack of any evidence to support the proposition that Congress intended to exempt this wide-ranging type of secondary behavior from the general rule, and considering the probable harm of extensive picketing of neutral parties by various, possibly rival, locals for the purpose of securing recognition of bargaining status from virtually all subcontractors in a given area, I feel compelled to reach the conclusion that this conduct is not protected by the proviso.12

. 29 U.S.C. § 158, particularly sub-sections (b) (4) (ii), (b)(7)(C) and (e).

. 29 U.S.C. § 159.

. 29 U.S.C. § 187.

. Sections 6 and 20 of the Clayton Act (15 U.S.C. § 17, 29 U.S.C. § 52) and Section 4 of the Norris-LaGuardia Act (29 U.S.C. § 104).

. Apex Hosiery Co. v. Leader, 310 U.S. 469, 60 S.Ct. 982, 84 L.Ed. 1311 (1940) ; United States v. Hutcheson, 312 U.S. 219, 61 S.Ct. 463, 85 L.Ed. 788 (1941).

. Cedar Crest Hats, Inc. v. United Hatters, 362 F.2d 322 (5th Cir. 1966), is not to . the contrary. There this court stated:
[I]n order for union activity to constitute a violation of antitrust laws in the circumstances here presented, there must be a combination of union and nonunion business groups to create a monopoly, resulting in a restraint of trade or interstate commerce. 362 F.2d at 326 (emphasis added) (footnote omitted). In Cedar Crest Mats the court specifically found that the union activity was protected by the labor acts. Thus that case did not purport to consider antitrust immunity in the context of an unfair labor practice such as is present in Connell’s case.

. Arguably Mr. Justice White might even condemn some contractual provisions which were mandatory bargaining subjects if such provisions had only a remote and indirect effect on wages, hours, and working conditions. See Justice White’s opinion at 381 U.S. at 689-690, 85 S.Ct. at 1602; and Justice Goldberg’s concurrence, 381 U.S. at 727, 85 S.Ct. at 1623. Compare Teamsters Local No. 24 v. Oli*1178ver, 358 U.S. 283, 79 S.Ct. 297, 3 L.Ed. 2d 312 (1959).

. As Judge Morgan points out, six judges in Jewel Tea held that there was no sustainable allegation of conspiracy with non-labor groups. The other three judges, spokesmaned by Mr. Justice Douglas would have found the requisite conspiracy in the collective bargaining agreement signed by the employers. Under that analysis this case too would involve a conspiracy if employers other than Con-nell had also agreed to boycott non-Local 100 subcontractors, since the contractors could not have agreed among themselves to boycott certain subcontractors any more than they could have agreed to fix prices or allocate markets. Thus the Douglas opinion in Jewel Tea would also find the agreement here within the scope of the Sherman Act if, as seems likely, other employers had also agreed to the boycott. Apparently Justice Douglas’s opinion is predicated on the view that the union concern in marketing hours was not “immediate and direct”; there is no indication as to whether such concern is coextensive with mandatory bargaining subjects.

. See, e. g., Klor’s, Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207, 79 S.Ct. 705, 3 L.Ed.2d 741 (1959) ; Fashion Originators’ Guild of America v. FTC, 312 U.S. 457, 61 S.Ct. 703, 85 L.Ed. 949 (1941) ; Eastern States Retail Lumber Dealers’ Ass’n v. United States, 234 U.S. 600, 34 S.Ct. 951, 58 L.Ed. 1490 (1914).

. Not all union misconduct constituting an unfair labor practice should entail a loss of union antitrust exemption; only that conduct which violates the eongres-sionally-protected commercial rights of neutral parties would normally fall without the exemption. It is neither necessary nor appropriate for this dissent to attempt a complete catalogue of that labor law illegal conduct which falls without the exemption. Suffice it to say that since Section 8(e) is designed and intended to protect neutral parties from concerted boycotts required by union activity, a violation of that provision under circumstances similar to those here will place a union beyond the scope of the exemption.

. The rule which I would follow may bear a superficial resemblance to Duplex Printing Press Co. v. Deering, 254 U.S. 443, 41 S.Ct. 172, 65 L.Ed. 349 (1921), which Apex Hosiery declared to have been effectively overruled by the enactment of the Norris-LaGuardia Act. The critical distinction, however, is that the reasoning I favor draws its sustenance from the express declaration by Congress that secondary picketing is not a legitimate union tool, except where it is expressly permitted.

. No claim based on Section 8(b)(7) is presented here. Compare Building Construction Trades Council of Philadelphia, and Samuel E. Long, Inc., 201 NLRB No. 42 (1973).