The U.S. Court of Appeals for the Ninth Circuit (AK, AZ, CA, HI, ID, MT, NV, OR, WA, Guam) has upheld the dismissal of two lawsuits brought by the Carpenters against various AFL-CIO affiliates and representatives. The cases stem from actions allegedly taken by the AFL-CIO’s Building and Construction Trades Department (“BCTD”) and others during a “Push-Back-Carpenters Campaign" aimed at forcing the Carpenters to re-affiliate with the BCTD.
In the primary case, the Carpenters claimed that the BCTD violated the Racketeer Influenced and Corrupt Organizations Act (“RICO”) and the Labor Management Reporting and Disclosures Act (“LMRDA”). The Carpenters cited various acts by the BCTD to exert intense economic pressure as well as vandalism and threats of force in support of their claims. The court, however, concluded that the Carpenters’ allegations, as a matter of law, failed to state a claim under either RICO or the LMRDA. The court found that the allegations did not amount to racketeering activity under federal or state extortion law. It further found that allegations that BCTD officers orchestrated the termination of an affiliation agreement between the Carpenters and the AFL-CIO’s Metal Trades Department (“MTD”) were inadequate to establish an LMRDA violation.
In the second case, the Carpenters sued the MTD and the Hanford Atomic Metal Trades Council for breach of the duty of fair representation under the National Labor Relations Act. According to the Carpenters, after terminating the affiliation agreement in accordance with the BCTD’s wishes, the MTD ousted Carpenters members from positions as stewards solely because of their Carpenters union membership. The court held that the duty of fair representation does not prevent unions from appointing or removing stewards based on union affiliation. Selecting stewards based on the expectation of undivided loyalty is not unreasonable discrimination and does not, by itself, breach the duty of fair representation, said the court.
In a memorandum opinion issued the same day as the above decisions, the court also affirmed the dismissal of another Carpenters’ claim against the MTD. The claim included various other actions allegedly taken by the MTD against individual Carpenters members in violation of the duty of fair representation. The court found that the complaint actually alleged wrongdoing on the part of MTD-affiliated unions, not the MTD, and failed to establish any agency relationship by which the MTD should be held liable.
Bredhoff & Kaiser PLLC, the law firm representing the BCTD, lauded the RICO decision as “a landmark ruling of great importance to unions and other activist organizations.” By holding that “the non-violent use of economic pressure, including ‘intense’ economic pressure that may be tortious under state law, is not ‘extortion’ under (RICO)…the Ninth Circuit’s ruling clears the way for labor organizations and other groups to attempt to change corporate and other institutional behavior by engaging in comprehensive campaigns, sometimes referred to as ‘corporate campaigns,’” said the firm in a website posting. AGC will keep an eye out for an upturn in such activity and welcomes receiving relevant information. To report significant developments, contact Denise Gold at goldd@agc.org.
United Bhd. of Carpenters & Joiners of America v. Building and Construction Trades Dep’t, AFL-CIO, Case No. 12-36049 (9th Cir., 10/28/14); United Bhd. of Carpenters & Joiners of America v. Metal Trades Dep’t, AFL-CIO, Case No. 13-35095 (9th Cir., 10/28/14).
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