Court Opinion

ID: 8909169
Source: CourtListenerOpinion
Date Created: 2022-11-27 02:23:42.893733+00
Date Added: 2024-06-11T17:08:23.709540
License: Public Domain

ROSS, Circuit Judge,
dissenting.

COUNT II

I would reverse the dismissal of appellants’ section 501 claim, because I do not agree that as a matter of law the challenged expenditures were “clearly authorized” by the UAW constitution.
By dismissing the section 501 claim at this stage of the proceedings,1 the majority *675in effect confers unlimited discretion upon UAW International officers in their expenditure of the huge amounts of money collected annually from the union membership.2 In my opinion, the UAW constitution does not grant completely unfettered discretion to the officers in their expenditure of union funds.3
The UAW’s objectives as set forth in Article 2 of its constitution include improving working conditions, seeking election of candidates and passage of legislation “in the interests of all labor,” working for repeal of laws “unjust to labor,” obtaining unemployment insurance, engaging in political and other activities “which further, directly or indirectly, the joint interests of the membership * * * in the improvement of general economic and social conditions,” and assisting organizations “having purposes and objectives similar or related ” to those of the UAW. (Emphasis supplied.)
Article 7(2) authorizes expenditure of UAW funds to achieve these purposes and objectives “not inconsistent therewith” and purposes the Executive Board believes “will further the general interest and welfare of the membership," (Emphasis supplied.)
Article 23(1) indicates that.the function of the UAW Community Action Program is “to improve the economic and social conditions of UAW members and their families and to promote the general welfare and democratic way of life for all people." (Emphasis supplied.)
I do not consider the above-quoted language meaningless or superfluous. The union constitution clearly contemplates a relationship of some kind between the use of union funds and the interests and welfare of the union membership. Had the contested contributions been made to foreign governments, terrorist organizations or groups seeking destruction of the “democratic way of life,” none of the avowed objectives, of the UAW would have been served and the donations clearly would not have been authorized.
Appellants assert in Count II that appellees have contributed union assets “to various organizations and groups espousing and promoting ideological doctrines and causes totally unrelated to, and in many instances antithetical to, the interests and welfare of the union and its members.” The complaint lists thirteen organizations as recipients of these union funds as heretofore set forth in the majority opinion.
Because appellants were denied discovery and an opportunity to prove their claim, the record does not reflect the goals and methods espoused by the recipients of the challenged UAW contributions. If the ends and means adopted by these organizations were, as alleged, antithetical to the interests and welfare of the UAW membership and inconsistent with the objectives of the UAW, I believe appellants have a cause of action under section 501 for misuse of union funds by UAW officers.
Both the majority and the panel of the Seventh Circuit in McNamara v. Johnston, 522 F.2d 1157 (7th Cir. 1975), cert. denied, 425 U.S. 911, 96 S.Ct. 1506, 47 L.Ed.2d 761 (1976), pay lip service to the requirement *676that union funds be spent as authorized by the constitution, bylaws or appropriate convention resolution. But they ignore the allegation of appellants that the questioned expenditures were in violation of the union’s constitution since they were alleged to be not “in the interests of all labor” or “which further, directly or indirectly, the joint interests of the membership * * ” or in “the general interest and welfare of the membership.” It is upon this aspect of the case that I have attempted to focus my dissent and the aspect thereof which the majority has all but ignored.
STEPHENSON and HENLEY, JJ., join in this dissenting opinion.

. Although treated as a summary judgment because matters outside the pleadings were considered, Count II was dismissed for failure to state a claim. See Fed.R.Civ.P. 12(b). We therefore review the dismissal in light of the following standards:
[A] complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief. * * *
[A] complaint should not be dismissed merely because a plaintiffs allegations do not support the particular legal theory he advances, for the court is under a duty to examine the complaint to determine if the allegations provide for relief on any possible theory. Nor should a complaint be dismissed that does not state with precision all elements that give rise to a legal basis for recovery. Finally, a complaint should not be dismissed merely because the court doubts that a plaintiff will *675prevail in the action. That determination is properly made on the basis of proof and not merely on the pleadings.
The question, therefore, is whether in the light most favorable to the plaintiff, the complaint states any valid claim for relief. Thus, as a practical matter, a dismissal under Rule 12(b)(6) is likely to be granted only in the unusual case in which a plaintiff includes allegations that show on the face of the complaint that there is some insuperable bar to relief.
Jackson Sawmill Co. v. United States, 580 F.2d 302, 306 (8th Cir.) (citations omitted), petition for cert. filed, — U.S. -, 99 S.Ct. 839, 59 L.Ed.2d 35 (1978).

. The record reflects that the combined dues income of the International and Local unions for the years 1969, 1970 and 1971 averaged $148,409,826.00 per year.

. Any resolution passed by the governing officers which conflicted with the provisions of the UAW constitution or exceeded the powers conferred therein would be invalid and could not be relied upon as authority for expenditures of union funds. Highway Truck Drivers and Helpers, Local 107 v. Cohen, 284 F.2d 162, 164 (3d Cir. 1960), affirming, 182 F.Supp. 608, 616-22 (E.D.Pa.1960).