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AMERICAN FEDERATION OF STATE CTY. v. UNITED DOMESTIC WKRS.

United States District Court, S.D. California


August 9, 2005.

AMERICAN FEDERATION OF STATE COUNTY AND MUNICIPAL EMPLOYEES, AFL-CIO and FLORA WALKER as ADMINISTRATOR OF UNITED DOMESTIC WORKERS OF AMERICA/NUHHCE, AFSCME, AFL-CIO, Plaintiffs,
v.
UNITED DOMESTIC WORKERS OF AMERICA/NUHHCE, AFSCME, AFL-CIO, et al. Defendants.

The opinion of the court was delivered by: BARRY MOSKOWITZ, District Judge

ORDER GRANTING APPLICATION FOR AN OSC RE: CONTEMPT; GRANTING APPLICATION FOR EXPEDITED DISCOVERY; AND DENYING APPLICATION FOR A TRO
Plaintiffs American Federation of State County and Municipal Employees, AFL-CIO ("AFSCME") and Flora Walker, in her capacity as Administrator of United Domestic Workers of America/NUHHCE, AFSCME, AFL-CIO (collectively "Plaintiffs") have filed an ex parte application for (1) an Order to Show Cause Re: Contempt against Defendants Kenneth Seaton Msemaji and Fahari Jeffers; (2) a Temporary Restraining Order and OSC re: Preliminary Injunction in Aid of Arbitration against Defendant SEIU Local 434B; and (3) an Order Granting Leave to Take Expedited Discovery. On August 1, 2005, the Court held a hearing on the ex parte application. For the reasons set forth below, Plaintiffs' applications for an OSC re: contempt and expedited discovery are GRANTED and Plaintiffs' application for a TRO is DENIED. I. PROCEDURAL HISTORY

On June 17, 2005, Plaintiffs filed this action, seeking enforcement of an administratorship imposed upon UDW.

  On June 20, 2005, Plaintiffs filed an application for a temporary restraining order. The following day, the Court held a hearing on the application. The Court granted Plaintiffs' application in part and enjoined Defendants from (1) drawing or transferring funds from UDW's General Fund Account at Neighborhood National Bank or dissipating or transferring any other funds or assets of UDW unless ordered by the Court; and (2) destroying, removing, secreting, or altering the financial records or any other records of UDW or any records relating to UDW, including computer files. The TRO was to remain in effect until the Court ruled on Plaintiffs' motion for preliminary injunction, which was scheduled to be heard on Monday, June 27, 2005 at 2:00 p.m.

  On the afternoon of June 24, 2005, a Friday, the Court received a notice from UDW's counsel that UDW had scheduled a referendum on the issue of merging with Service Employees International Union ("SEIU"), Local 434B. The vote was scheduled to take place at 9:00 a.m. on June 27, 2005. Plaintiffs' counsel also received the notice and telephoned chambers to obtain a hearing for an emergency TRO application.

  The Court held a telephonic hearing at 4:10 p.m. on June 24, 2005. During the hearing, counsel for UDW indicated that the referendum was originally scheduled to take place in July. The Court concluded that UDW was attempting to divest the Court of jurisdiction and render the controversy moot. Based on the actions of UDW, the Court determined that it would be appropriate to enforce the administratorship on a temporary basis and issued a temporary restraining order enjoining Defendants from (1) refusing to turn over possession and control of the offices of UDW to Flora Walker, as Administrator of UDW, or her designee; (2) refusing to deliver all property, funds, books, records, and assets of any kind in their possession to Flora Walker, as Administrator of UDW, or her designee; (3) representing themselves as the authorized officers and/or representatives of UDW, unless so authorized by the Administrator or her designee; (4) interfering in any manner with the conduct of the administratorship by Flora Walker or her designee; or (5) destroying, removing secreting, or altering the financial records of UDW or any financial records relating to UDW.

  In an order filed on June 30, 2005, the Court granted Plaintiffs' motion for preliminary injunction and incorporated the terms of the TRO as the terms of the preliminary injunction.

  On July 26, 2005, Plaintiffs filed a First Amended Verified Complaint for Declaratory and Injunctive Relief ("FAC"), which adds as a defendant SEIU Local 434B.

  II. PERTINENT FACTS

  In June of 2000, UDW/AFSCME and SEIU entered into a Memorandum of Understanding ("MOU"), the purpose of which was to "establish a final determination of organizing jurisdiction for In Home Supportive Services home care workers in the State of California." (Exh. H to FAC.) Pursuant to the agreement, 58 California counties were divided up between AFSCME/UDW or SEIU for the purposes of exclusive organizing jurisdiction. The MOU provided that any future adjustments to the assignments could only be made through discussions or negotiations between UDW/AFSCME and SEIU.

  In November of 2000, AFSCME and SEIU entered into a written agreement ("Homecare Council Agreement") pursuant to which UDW/AFSCME was granted membership in the California Homecare Council. (Exh. I to FAC.) Under the agreement, SEIU and UDW/AFSCME agreed to develop coordinated legislative and organizing programs for homecare in California.

  The Homecare Council Agreement provides that "there will be only one local union in the Council organizing or representing workers in each county." (Paragraph 4.1.) The Agreement also incorporates the MOU's assignment of organizing jurisdiction. (Paragraph 5.1.) Disputes regarding the interpretation and application of the Agreement are to be resolved by dispute resolution procedures set forth in Paragraph 7.2 as follows:

If a dispute of any type involving the interpretation and application of the Agreement cannot be resolved by the Homecare Council, the affected local/affiliate may appeal the dispute to the International Presidents who shall direct the Organizing Directors of AFSCME and SEIU to meet in an attempt to resolve the dispute.
If a dispute cannot be resolved by the Organizing Directors, it may be referred by either party to mediation first and, if mediation is not successful, to arbitration . . . The arbitrator shall [have] authority to issue the remedy the arbitrator deems appropriate to effectuate the intent of the parties the decision shall be final and binding.
Plaintiffs claim that since June 2005, SEIU Local 434B, Seaton Msemaji and Jeffers, as well as other former officers and employees of UDW, acting in concert, have engaged in a wide-scale organizing campaign against UDW/AFSCME within several of the counties in which UDW/AFSCME has exclusive jurisdiction.

  Plaintiffs allege that during the week of July 4, 2005, SEIU initiated a mass mailing of literature to existing members of UDW/AFSCME within a majority of the 29 counties assigned to UDW/AFSCME. The mailing included a letter signed by Msemaji and Jeffers, who identify themselves as "UDW Founders," and Tyrone Freeman (General President of SEIU Local 434B) and Amanda Figueroa (Secretary-Treasurer of SEIU Local 434B). (Exh. J to FAC.) The letter states:

In our efforts to WIN you a wage increase from this new money, the founders of UDW and its founding officers have all agreed that we must UNITE HOMECARE workers into ONE strong UNION: SEIU Local 434b.
Therefore, Ken, Fahari, Amanda, and I, ask that you sign the attached membership card and drop it in the mail today, postage paid.
Remember, we are working to build POWER for homecare workers. If you want better wages, benefits, and services, then JOIN our UNITED union today. SIGN and RETURN the enclosed membership card.
The letter attaches a membership form to join SEIU Local 434B.
  According to Plaintiffs, SEIU Local 434B also initiated a mass telephone call campaign in conjunction with the earlier mailings. Pre-recorded telephone messages from Msemaji and Jeffers reiterated that the founders of UDW and its founding officers have agreed to unite home care domestic workers into one union (434B) and urged UDW members to sign the membership card to obtain better wages, benefits, and services. (Transcript of telephone message attached as Exh. K to FAC.)

  Plaintiffs also allege that individuals representing that they were from UDW or acting on behalf of UDW made in-person visits to UDW members residing in counties that have been exclusively assigned to UDW for purposes of organizing. (Frank Decl., ¶ 9.) These individuals made representations that SEIU and UDW were merging and that by signing the membership card, the UDW members were agreeing to the merger. (Exh. A to Frank Decl.) A number of UDW members signed the card based on the erroneous belief that they were supporting a merger of SEIU and UDW. (Declarations of Susan H. Parker, Laura Corbett, Dustin Corbett, and Casandra Wilson.)

  Plaintiffs further allege that Local 434B has been using a UDW/AFSMCE membership list to facilitate its organizing efforts. Plaintiffs claim that this list was provided to Local 434B by former officers of UDW prior to June 14, 2005, for purposes of carrying out the Servicing Agreement.

  On July 25, 2005, AFSCME invoked the dispute resolute and arbitration process under the Homecare Council Agreement.

  III. DISCUSSION

  A. Contempt

  Plaintiffs seek an OSC re: contempt against the individual defendants Kenneth Seaton Msemaji and Fahari Jeffers and request expedited discovery on the issue of contempt. As discussed below, the evidence presented by Plaintiffs suggests that Msemaji and Jeffers may have engaged in contempt. Therefore, without making any findings of fact, the Court finds sufficient cause for an OSC on the grounds set forth below.

  1. Refusal of Local 434B to return membership list

  The preliminary injunction enjoins Msemaji and Jeffers and "all persons acting at the direction of or in concert with them, from . . . refusing to deliver all property, funds, books, records and assets of any kind in their possession to Flora Walker, as Administrator of UDW, or her designee." Plaintiffs take the position that the membership list previously provided to Local 434B is a record or other property of UDW and that Local 434B, in concert with Msemaji and Jeffers, is violating the preliminary injunction by refusing to turn it over. This argument is not persuasive.

  Clearly, AFSCME is concerned with the information that Local 434B possesses, not the piece of paper. The information does not fall within the scope of the Court's order. Furthermore, it appears that prior to the TRO, officers of UDW gave the membership list to SIEU. Thus, UDW waived any proprietary right it would otherwise have to the return of the list.

  In addition, it is unclear whether the list was ever in the possession of Msejami and Jeffers and whether these defendants have any control over whether Local 434B will give the list back. Therefore, an OSC will not issue on this ground.

  2. Representing that they are authorized officers and/or reps of UDW

  The preliminary injunction enjoins Msemaji and Jeffers and "all persons acting at the direction of or in concert with them" from "representing themselves as the authorized officers and/or representatives of UDW." Plaintiffs argue that Msemaji and Jeffers, and individuals acting in concert with them, improperly represented themselves as acting on behalf of UDW in soliciting membership cards for SEIU Local 434B. Plaintiffs have presented sufficient evidence of this type of conduct to warrant an OSC re: contempt.

  In the July 8, 2005 letter and recorded message, Msemaji and Jeffers do not explicitly say that they are authorized representatives of UDW. Instead, they identify themselves as "UDW Founders." However, the letter and recorded statements may be understood as conveying the false impression that Msemaji and Jeffers are acting on behalf of UDW. They talk about "our efforts to win you a wage increase," implying that they represent the UDW members. Similarly, they state, "If you want better wages, benefits and services, then join our united union today." Seaton-Msemaji and Jeffers never clarify that they are no longer officers of UDW and do not represent UDW.

  Overall, the letter and recorded message can be deemed to be misleading and could cause a reasonable person to believe that Msemaji and Jeffers are speaking on behalf of UDW. If Msemaji and Jeffers intended to give the false impression that they are acting on behalf of UDW, their actions are in violation of the Court's preliminary injunction order.

  Plaintiffs also present evidence that other unidentified individuals represented themselves as acting on behalf of UDW and encouraged UDW members to sign the SEIU membership card in support of the "merger" between UDW and SEIU. Although Plaintiffs have not established that these individuals were in fact acting in concert with the individual defendants or that the individual defendants knew about or encouraged any misrepresentations that were made, there is sufficient circumstantial evidence meriting a hearing as to these issues at an OSC hearing.

  The OSC shall be limited to the following issues: (1) whether the individual defendants, or others acting in concert with them, intentionally misled others into believing that they were acting on behalf of UDW, and (2) whether the individual defendants, or others acting in concert with them, interfered with the administratorship by falsely representing that UDW and SEIU Local 434B have merged or are merging.

  The Court emphasizes that under the existing preliminary injunction, Defendants Kenneth Seaton Msemaji and Fahari Jeffers and all persons acting at the direction of or in concert with them, are enjoined from:

(a) making statements that are intended to have the effect and actually have the effect of misleading others into believing that they are acting on behalf of UDW; and
(b) making false representations that UDW has merged or is merging with SEIU Local 434B.
  Plaintiffs request expedited discovery in connection with the OSC hearing. The Court believes this to be appropriate and grants Plaintiffs' request for expedited discovery on the issues to be considered at the OSC hearing. The expedited discovery shall be completed within 45 days of a discovery conference to be held before Magistrate Judge Porter on August 16, 2005 at 3:00 p.m. 3. "Raiding" of Members

  The preliminary injunction restrains Msemaji and Jeffers "and all persons acting at the direction of or in concert with them" from "[i]nterfering in any manner with the conduct of the administratorship by Flora Walker or her designee." Plaintiffs argue that Msemaji and Jeffers are interfering with the administratorship by allying themselves with a competing union and attempting to steal away UDW/AFSCME's members in violation of the exclusive jurisdictional agreements. The Court declines to premise a finding of contempt on this ground.

  Whether Msemaji and Jeffers' actions constitute interference with the administratorship depends on whether their actions are permissible under labor law and the agreements between SEIU and UDW/AFSCME. If Msemaji and Jeffers ordinarily would be entitled to participate in decertification efforts, the existence of an administratorship should not interfere with those rights.

  Plaintiffs do not dispute that the ongoing decertification efforts are in compliance with applicable labor laws. Apparently, all of the petitions are being filed during open periods permitted by law.

  There is a dispute over whether Defendants' decertification efforts are in breach of the MOU and Homecare Council Agreement. However, this dispute must be resolved by the arbitrator, not this Court. The Court declines to make any findings regarding the alleged breach of the MOU and Homecare Council Agreement.

  B. Injunctive Relief in Aid of Arbitration

  Plaintiffs seek to temporarily enjoin SEIU Local 434B and all persons acting at the direction of or in concert with SEIU Local 434B from engaging in any organizing activities within the 29 counties designated in the MOU and Homecare Council Agreement as the exclusive organizational and representational jurisdictions of UDW/AFSCME. The Court denies Plaintiffs' request for a TRO.

  The Court has serious doubts about the merits of Plaintiffs' claim for injunctive relief. Plaintiffs argue that they are entitled to an injunction to maintain the status quo pending arbitration. However, it appears that the Court lacks jurisdiction to grant such an injunction.

  Section 4 of the Norris-LaGuardia Act provides:

No court of the United States shall have jurisdiction to issue any restraining order or temporary or permanent injunction in any case involving or growing out of any labor dispute to prohibit any person or persons participating or interested in such dispute . . . from doing . . . any of the following acts:
(b) Becoming or remaining a member of any labor organization or of any employer organization . . .
(f) Assembling peaceably to act or to organize to act in promotion of their interests in a labor dispute;
(g) Advising or notifying any person of an intention to do any of the acts heretofore specified;
(h) Agreeing with other persons to do or not to do any of the acts heretofore specified; and
(i) Advising, urging, or otherwise causing or inducing without fraud or violence the acts heretofore specified. . . .
29 U.S.C. § 104.

  The term "labor dispute" is defined broadly as any "controversy concerning terms or conditions of employment, or concerning the association or representation of persons in negotiating . . . terms or conditions of employment, regardless of whether or not the disputants stand in the proximate relation of employer and employee." 29 U.S.C. § 113(c) (emphasis added). The Supreme Court explained that Congress deliberately included a broad definition of "labor dispute" to "overrule judicial decisions that had unduly restricted the Clayton Act's labor exemption for the antitrust laws." Jacksonville Bulk Terminals v. International Longshoremen's Ass'n, 457 U.S. 702, 712 (1982). A particular controversy qualifies as a "labor dispute" as long as "the employer-employee relationship [is] the matrix of the controversy." Id. (quoting Columbia River Packers Ass'n v. Hinton, 315 U.S. 143, 147 (1942)).

  The employer-employee relationship is the "matrix" of the instant controversy between SEIU Local 434B and UDW/AFSCME. This dispute concerns who may serve as the bargaining representative of healthcare workers in certain counties and implicates the right to organize and designate representatives of one's own choosing, public policies at the heart of the Norris-LaGuardia Act. See 29 U.S.C. § 102.

  Courts have held that jurisdictional disputes between unions regarding which union may represent certain employees are "labor disputes" within the meaning of the Norris-LaGuardia Act. See, e.g., Green v. Obergfell, 121 F.2d 46 (D.C. Cir. 1941) (explaining in case of jurisdictional dispute between two international unions that "[i]t would be difficult to imagine a case which more clearly involves a labor dispute within the meaning of the Norris-LaGuardia Act."); Blankenship v. Kurfman, 96 F.2d 450 (7th Cir. 1938) (holding that jurisdictional dispute between unions fell within Norris-LaGuardia Act). In arguing that the instant dispute is not a "labor dispute," Plaintiffs point to Drywall Tapers and Pointers of Greater New York, Local 1974 v. Operative Plasterers' and Cement Masons' Int'l Ass'n, 537 F.2d 669 (2d Cir. 1976). However, Drywall is distinguishable because it involved a work assignment dispute between unions. As explained by the court in Drywall: "The injunctive relief sought here will not infringe upon the workers' organizational or bargaining rights but will instead enforce a work assignment agreement negotiated by the unions themselves." Id. at 673-74. The same cannot be said here.

  Plaintiffs argue that even if the instant dispute is a "labor dispute," the Court can issue an injunction under the Boys Markets exception. The Court disagrees. In Boys Markets, Inc. v. Retail Clerks Union, Local 770, 398 U.S. 235 (1970), the Supreme Court held that under certain circumstances, employers can obtain injunctions against strikes in violation of a collective bargaining agreement when the strikes are over a grievance which both parties are contractually bound to arbitrate. The Court's holding was a "narrow one" designed to further the important policy favoring "the voluntary establishment of a mechanism for the peaceful resolution of labor disputes." Id. at 252-53.

  The Court explained that a no-strike obligation, whether explicit or implied, is the "quid pro quo" for an agreement by the employer to submit grievance disputes to arbitration. Id. at 248. The Court further explained that if injunctive relief were not available to enforce the no-strike obligation, employers would lack incentive to agree to arbitration and such agreements would be rendered largely ineffective: "Indeed, the very purpose of arbitration procedures is to provide a mechanism for the expeditious settlement of industrial disputes without resort to strikes, lockouts, or other self-help measures. This basic purpose is obviously largely undercut if there is no immediate, effective remedy for those very tactics that arbitration is designed to obviate." Id. at 249.

  In Buffalo Forge Co. v. United Steelworkers of America, 428 U.S. 397 (1976), the Supreme Court clarified that Boys Markets does not authorize the injunction of a strike where the union is striking in violation of a no strike-clause but the underlying dispute is not subject to an obligation to arbitrate. In such a situation, the strike has "neither the purpose nor the effect of denying or evading an obligation to arbitrate or of depriving the employer of its bargain." Id. at 408. In other words, "in agreeing to broad arbitration and no-strike clauses, the parties do not bargain for injunctive relief to restore the status quo pending the arbitrator's decision agreement, without regard to what triggered the strike. Instead, they bargain only for specific enforcement of the union's promise to arbitrate the underlying grievance before resorting to a strike." Jacksonville, 457 U.S. at 723.

  Boys Markets does not apply here. Plaintiffs do not seek an injunction to specifically enforce a promise to arbitrate. Rather, Plaintiffs seek to enjoin Local 434B's organizing efforts to maintain the status quo pending arbitration regarding Local 434B's alleged breach of contract.*fn1 This is exactly the type of relief that is forbidden by the Norris-LaGuardia Act. As explained in Buffalo Forge:

If an injunction could issue against the strike in this case, so in proper circumstances could a court enjoin any other alleged breach of contract pending the exhaustion of the applicable grievance and arbitration provisions even though the injunction would otherwise violate one of the express prohibitions of § 4. The court in such cases would be permitted, if the dispute was arbitrable, to hold hearings, make findings of fact, interpret the applicable provisions of the contract and issue injunctions so as to restore the status quo, or to otherwise regulate the relationship of the parties pending exhaustion of the arbitration process. This would cut deeply into the policy of the Norris-LaGuardia Act and make the courts potential participants in a wide range of arbitrable disputes under the many existing and future collective-bargaining contracts, not just for the purpose of enforcing promises to arbitrate, which was the limit of Boys Markets, but for the purpose of preliminarily dealing with the merits of the factual and legal issues that are subjects for the arbitrator and of issuing injunctions that would otherwise be forbidden by the Norris-LaGuardia Act.
Id. at 410-11.

  Plaintiffs are not likely to succeed on the merits of their claim. In addition, the granting of a TRO could cause irreparable harm to Local 434B and members of UDW who wish to have Local 434B as their representative. At the present time, petitions to decertify UDW may be filed under the rules of the MMBA and LMRA. However, if the Court were to issue a TRO, the open period for filing decertification petitions could close and Local 434B could be precluded from representing employees in certain jurisdictions.

  IV. CONCLUSION

  For the reasons discussed above, the Court GRANTS Plaintiffs' request for an OSC re: contempt. The OSC shall be heard on October 31, 2005 at 9:00 a.m. Plaintiffs may file supplemental papers regarding the alleged contempt on or before October 12, 2005. The individual defendants may file a supplemental response on or before October 26, 2005. The scope of the OSC hearing shall be limited as set forth in this order.

  The Court GRANTS Plaintiffs' request for expedited discovery as to the issues to be considered at the OSC hearing. The Court orders the parties to appear before Magistrate Judge Porter for a discovery conference on August 16, 2005 at 3:00 p.m. The expedited discovery shall be completed within 45 days of the discovery conference. No deposition shall exceed three hours unless extended by order of the Magistrate Judge. Magistrate Judge Porter shall have full authority to regulate and streamline the discovery authorized by this order. The Court DENIES Plaintiffs' request for a TRO in aid of arbitration against SEIU Local 434B.

  IT IS SO ORDERED.

20050809

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