Appendix — Parker v. Connors Steel Co.

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APPENDIX A

Calvin L. PARKER; Gene A. Childers; Maple L. Copeland; Will

Goodman; Nathaniel Grant; Thomas Ray Loveless; Ruben I.

Pierce; Joe D. Pressley; Virgil Lee Weatherspoon, on their own

behalf and on behalf of all other hourly wage employees of

Connors Steel Company similarly situated, and as representatives

of a class of persons consisting of those employees who on or after

June 1, 1982, were employed as hourly wage earners by Connors

Steel Company and represented by the United Steelworkers of

America, AFL-CIO and its Local Union No. 2250, Plaintiffs-Appel-

lants

CONNORS STEEL COMPANY; H. K. Porter Company, Inc.; and

United Steelworkers of America, AFLO-CIO, CLC, Defendants-

Appellees,

Carl L. Statum; Tom Kimbrell; and James E. Norman, Defendants.

No. 87-7607

United States Court of Appeals,

Eleventh Circuit.

Sept. 29, 1988.

Appeal for the United States District Court for the North-

ern District of Alabama.

Before HATCHET and COX, Circuit Judges, and FLOYD

R. GIBSON’, Senior Circuit Judge.

‘Honorable Floyd R. Gibson, Senior U.S. Circuit Judge for the Eighth

lit, sitting by the designation

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FLOYD R. GIBSON, Senior Circuit Judge:

Appellants, former employees of Connors Steel Company

(Connors) and putative class representatives of approximately 600

former Connors employees, appeal an order of the district court

granting summary judgment to Connors, (H.K. Porter), and

United Steelworkers of America, AFL-CIO, CLC (Union), in this

complicated dispute which followed the closing of Connors’ steel

plant in Birmingham, Alabama. The employees sued Connors, its

parent corporation H.K. Porter (Connors and H.K. Porter are

collectively referred to as the “Company”), and the Union alleging

fraud, a hybrid Section 301 / fair representation claim, breach of the

duty of fair representation, and breach of a collective bargaining

agreement (CBA or agreement) and two concession agreements.

The district court concluded that the state law fraud claims

were preempted by sections 7 and 8 of the National Labor Rela-

tions Act (NLRA or Labor Act). The district court also determined

that there were no genuine issues of material fact and that the

Union was entitled to summary judgment on the fair representa-

tion claim by the former employees asa matter of law. Finding that

the Company’s liability under section 301 of the Labor Manage-

ment Relations Act (LMRA) was conditional on the Union’s

breaching its duty of fair representation, the district court granted

the Company’s motion for summary judgment. We affirm.

BACKGROUND

This case arose out of two concession agreements given by

the employees to the Company which provided for an emergency

reduction in wages and benefits. The first concession agreement

became effective on September 1, 1982 and reduced wages by

twenty percent, reduced certain benefits, and provided for com-

plete repayment of all wage and benefit concessions if Connors

returned to profitability. Connors required the concessions to

keep its Birmingham’ plant open because it was facing vigorous

'During the negotiation of the first concession agreement Connors also

operated a steel plant in Huntington, West Virginia, but this facility was closed on

July 1, 1982.

competition in the reinforcing steel bar market from “mini-mills”

and had incurred $1,595,000 in losses during the first five months

of 1982

Connors believed that given its staggering losses H.K.

Porter would close the Birmingham plant if the workers did not

approve the concessions. The Union met with Connors’ represen-

tatives and based on its review of Connors’ financial records it

decided to recommend the concession package to its membership.

lhe Union membership subsequently approved the concession

agreement

Losses at Connors continued to mount despite the implem-

entation of the concession agreement and the relief it provided. By

the end of 1982 Connors’ vearly losses exceeded $9,000,000

In January 1983 negotiations began ona second concession

agreement which was ratified by the union membership’ and

went into effect on February 27, 1983. The concessions included a

reduction of hourly wages by twenty percent, elimination of

supplemental unemployment contributions, savings and vacation

benefits, Sunday premiums, shift differentials, and vision and

dental benefits. The second package of concessions seemed to

reverse the trend of mounting losses. In February 1983 Connors

lost $1,010,000 and this monthly loss declined in the following

months to $90,000 by August 1983

[he CBA, as modified by the two concession agreements,

was set to expire on September 1, 1983, so Connors began negoti-

ating with the Union ona new agreement to become effective upon

the expiration of the prior agreement. Connors’ final proposal for

a new agreement was rejected by the union membership on

August 8, 1983. The following day Connors gave the Union notice

that the plant would close on September 1. Connorsand the Union

agreed that, pursuant to the grievance and arbitration provisions

of the CBA, all differences between the parties with respect to

ncession

_

sa

payment of benefits upon plant closure would be resolved

through arbitration

In October 1983 a group of former Connors employees met

to discuss the benefits that Connors proposed to pay them as a

result of the plant closure. Seven grievances were prepared

complaining that: vacation pay had not been fully paid; all

employees at closing were entitled to layoff status and the benefits

resulting therefrom; and the employees should be paid the value

of the benefits given up in the concession agreements. Connors

and the Union agreed to present these grievances to an arbitrator

for resolution along with the other issues that they had already

agreed to arbitrate

Prior to the arbitration hearing the employees filed two

unfair labor practice charges with the National Labor Relations

Board (NLRB or Board). The employees alleged that Connors had

bargained in bad faith in violation of section 8(a)(5) of the NLRA

and that the Union violated its duty of fair representation under

section 8(b) of the Act. Shortly after the charges were filed the

Board informed the employees that the charges had been investi-

gated but further proceedings were not warranted because the

charges were not filed within section 10(b)’s six month limitations

period. The employees appealed the dismissal of the charges to

the NLRB General Counsel, but the appeal was denied

The employees then filed this lawsuit in Alabama state

court alleging: 1) various breaches of the Union's duty of fair

representation; 2) a breach of the CBA and concession agreements

by Connors; and 3) fraud and bad faith against the Company in

negotiating and inducing the employees to ratify the two conces-

sion agreements. The case was then removed to federal court

After the case was removed the arbitration hearing took

place. The arbitrator issued a forty-three page decision finding in

favor of the Union on two of the grievances. Connors then

complied with the arbitrator's award by issuing checks to 586

former employees totaling $243,392.66

Thereafter, the district court granted Connors, H.K. Porter,

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and the Union summary judgment. The court concluded that the

employees’ state law fraud claims were preempted by sections 7

and 8 of the NLRA. The court dismissed the fair representation

claims against the Union finding that “[nJeither ineffectiveness

nor ineptitude gives rise toa claim for breach of this duty.” Finally,

the district court granted summary judgment to Connors and H.K.

Porter because their liability for breach of the CBA under Section

301 was conditional on a finding that the Union breached its duty

of fair representation

DISCUSSION

This case is unique because the employees are seeking

redress for claims that have already been the subject of an arbitra-

tion proceeding and presented to the NLRB as unfair labor prac-

tices. Because the employees received only a partial award in the

arbitration proceeding and because the NLRB dismissed their

unfair labor charges, the employees turned to state court to pursue

relief based primarily on state tort theories. The case was removed

and decided on the Company and Union’s motions for summary

judgment. Now on appeal we are faced with the following

questions: 1) the significance of the arbitration award on the

claims raised by the employee; 2) the significance of the NLRB’s

dismissal of the unfair labor practicescharges filed by the employ-

ees; 3) whether the employees claims are preempted by Sections

7 and 8 of the NLRB or section 301 of the LMRA; and finally, we

must determine whether the district court was correct when it

granted summary judgment dismissing the employees; claims of

breach of the duty of fair representation by the Union and Breach

of the CBA by the Company. ’

This type of claim is often referred to as a “hybrid” section Wi suit. See

Hester v. Intern. Union of Operating Engineers, 830 F. 2d 172, 1/75 (lth Cir

| 187) per curiam\”Most duty of fair representations are arise in the context of

what are known as “hybrid” suits. Hybrid suits involve claims by an employee

against both the employer and the union.”)(panel opinion on denial of petition for

rehearing of 818 F.2d 1537), petition for cert filed, 56 U.S.L.W.3627 (March 15, 1988)

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A. State Law Fraud Claims

The crux of the employees’ state law fraud claims is that the

Company fraudulently obtained the 1982 and 1983 concession

agreements by representing that it would keep the Birmingham

steel plant open if the employees granted the concessions. The

employees also allege that the Company intended to close the

plant from the very beginning and obtained the concessions in

order to reduce the costs associated with the plant closing.

[1] The district court concluded that the claims were

nothing more than allegations that the Company failed to bargain

in good faith and thus the claims were arguable within the exclu-

sive jurisdiction of the NRLB.‘ Therefore, the district court

concluded that the claims were preempted by sections 7 and 8 of

the Labor Act citing San Diego Building Trades Council v.

Garmon, 359 U.S, 236, 79 S.Ct. 773, 3 L.Ed.2d 775 (1959). In Garmon

the Supreme Court stated:

When an activity is arguably subject to Section 7

or Section 8 of the Act, the States as well as the

federal courts must defer to the exclusive compe-

tence of the National Labor Relations Board if the

danger of state interference with national policy

is to be averted.

Id. at 245, 79 S. Ct. at 779.

[2] Thus, the employees’ state fraud claims are preempted

if they touch upon an activity that is arguably protected or prohib-

ited by the Labor Act.

In Serrano v. Jones & Laughlin Steel Co., 790 F. 2d 1279

(6th Cir. 1986), the Sixth Circuit was faced with a similar situation.

‘It is clear that to the extent the employees’ state law claims require

the interpretation of the CBA the claims would be preempted by Section 301 of

the LMRA. Lingle v. Norge Division of Magic Chef, Inc.,, . US.

| 108 S. Ct. 1877, 1885, 100 L. Ed. 2d 410 (1988).

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In that case Jones & Laughlin Steel Co. (J & L), also confronted with

the recession in the steel industry, negotiated a concession agree-

ment allowing it to depart from the basic collective bargaining

agreement. The concession agreement, which was signed in July,

1981, was entered in an effort to avoid a shutdown of one of J & L’s

coke plants. Nevertheless, the plant was closed and the Union

filed a grievance which was not pursued through the various steps

provided in the CBA. After the Union terminated the grievance

without pursuing arbitration, the employees filed an action in

Ohio state court which was then removed to federal court. The

employees raised state law fraud claims similar to those raised by

the employees in the instant case. They alleged that despite J & L's

representations that it intended to rebuild its coke facilities if

certain concessions were made by the J & L employees, it actually

intended to rebuild the facilities only if it could obtain an extension

of time within which to comply with Clean Air Act requirements.

The court in Serrano was presented the same arguments

that have been presented in the instant case. The employees

argued that the fraud claims were not preempted because the

controversy presented under state law was not identical to that

which could have been presented to the NLRB. Furthermore, the

claims come within an exception to the preemption doctrine as

claims that touch interests so deeply rooted in local feeling and

responsibility that no congressional intent to preempt can be

inferred.

The Serrano court first concluded that the Garmon

preemption doctrine applied because the state fraud claims

touched upon activity which was arguably prohibited by the

Labor Act. Specifically, the Sixth Circuit determined that if the

employees’ allegations were true, J & L’s conduct would be pro-

hibited by Section 8(d) of the Labor Act which requires an em-

ployer to bargain in good faith “with respect to wages, hours and

other terms and conditions of employment...” 29 U.S.C. Section

158(d).

No matter how it is stated, the gravamen of the

three fraud charges is that J & L did not bargain in

good faith in obtaining concessions from the

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Union in the July agreement. To the extent that

plaintiffs claim fraud unrelated to the July agree-

ment, the same principles apply. ... [W]hether

classified as a violation of the general duty to

bargain in good faith or the more particular duty

to bargain over the effects of a plant closure, the

conduct about which plaintiffs are complaining

was arguably a violation of Section 8.

Serrano, 790 F. 2d at 1286-87.

The same principles and analysis apply to the instant case.

The displaced Connors’ employees raise claims that are in sub-

stance allegations that the Company breached its duty to bargain

in good faith in negotiating the concessions and in failure to reveal

the likelihood ofa plant closure despite the concessions. These are

the types of claims to which the Garmon preemption doctrine was

intended to apply.

In Sears, Roebuck & Co. v. San Diego County District

| Council of Carpenters, 436 U.S. 180, 197, 98 S. Ct. 1745, 1757, 56 L.

Ed. 2d 209 (1978), the Supreme Court stated that:

The critical injury [in the Garmon analysis] is not

whether the State is enforcing a law relating spe-

cifically to labor relations or one of general appli-

cation but whether the controversy presented to

the State court is identical to (as in Gardner) or

different from (as in Farmer) that which could

have been but was not, presented to the Labor

Board. For it is only in the former situation that

a state court’s exercise of jurisdiction necessarily

involves a risk of interference with the unfair

labor practice jurisdiction of the Board which the

arguably prohibited branch of the Garmon doc-

trine was designed to avoid.

Further, we note that the Garmon preemption doctrine

was premised, in part, on what the Supreme Court has termed

notions of “primary jurisdiction,” Id. at 199, 98 S. Ct. at 1758

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“(Primary jurisdiction’ is used to refer to the various considera-

tions articulated in Garmon and its progeny that militate in favor

of pre-empting state-court jurisdiction over activity which is

subject to the unfair labor practice jurisdiction of the federal

Board.” Id. at n. 29,985. Ct. at 1758 n. 29. The Court explained that

the primary jurisdiction rationale justifies preemption only in

situations in which an aggrieved party has a reasonable opportu-

nity either to invoke the Board’s jurisdiction himself or to induce

his adversary to do so. “The primary-jurisdiction rationale un-

questionably requires that when the same controversy may be

presented to the state court or the NLRB, it must be presented to the

Board.” Id. at 202, 98 S. Ct. at 1760.

[3] We believe that the Supreme Court’s primary jurisdic-

tion rationale also requires preempting the employees’ state law

fraud claims. The employees filed two unfair labor practice

charges with the NLRB which were later dismissed* and an

appeal denied by the General Counsel. Consequently, the em-

ployees, through artful drafting, have recast the same claims and

factual allegations to state law fraud claims. We believe that the

primary jurisdiction rationale has the greatest validity when a

party has sought redress for his claims from the NLRB and in the

face of an adverse decision the claims are restructured as state law

claims and pursued in state court. Cf. Communications Workers

v. Beck, _US.__, 108 S. Ct. 2641, 2646-2648, 101 L. Ed. 2d 634

(1988)(“Employees, of course, may not circumvent the primary

jurisdiction of the NLRB simply by casting statutory claims as

violations of the union’s duty of fair representation.”). By initially

pursuing relief with the NLRB the employees have implicitly

recognized the Board’s jurisdiction over their claims.

Further, we do not believe that the employees’ claims bring

this case within any of the recognized exceptions to the Garmon

preemption doctrine.

5 The NLRB dismissed the charges because they were not filed within

the applicable statute of limitations.

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In Garmon the Supreme Court recognized several excep-

tions to preemption. Relevant in this appeal are the exceptions for

cases involving compelling state or local interests and cases where

the issues involved are of peripheral concern to the purposes of the

Labor Act. The employees argue that both exceptions apply to this

case.

The first exception applies “where the regulated conduct

touche[s] interests so deeply rooted in local feeling and responsi-

bility that, in the absence of compelling congressional direction,

we [can] not infer that Congress ha[s] deprived the States of the

power to act.” Garmon, 359 US. at 244, 79 S. Ct. at 779 (footnote

omitted); Amalgamated Association of Street, Electric Railway

& Motor Coach Employees of America v. Lockridge, 403 U.S. 274,

297, 91S. Ct. 1909, 1923, 29 L. Ed. 2d 473 (1971)[hereinafter Motor

Coach Employees].

[4,5] When the activity in question is traditionally subject

to state regulation, then the Court has utilized a flexible approach

giving due consideration to state’s interests. Sears, Roebuck &

Co., 436 US. at 187-88, 98 S. Ct. at 1752-1753. Consistent with this

decision we have balanced Alabama’s interest in protecting its

citizens from the challenged conduct against_the risk of interfer-

ence with the regulatory jurisdiction of the NLRB. In cases where,

as here, the substance of the dispute is the same under both state

and federal law, the state law must yield to the jurisdiction of the

NLRB. Cf. Lumber Production Industrial Workers Local #1054 v.

West Coast Industrial Relations Assoc. Inc., 775 F. 2d 1042, 1048

(9th Cir. 1985) (“[I]f a crucial element of a state court action is

identical to an element of an unfair labor practice that is arguably

covered by the NLRA, then the state action is preempted.”). We

believe that allowing state law fraud claims for conduct that would

also be a violation of the employer's duty to bargain in good faith

would necessarily undermine the Board’s exclusive jurisdiction

and may subject the employer to conflicting substantive rules. See

Local 926, International Union of Operating Engineers v. Jones,

460 US. 669, 676, 103 S. Ct. 1453, 1458-1459, 75 L. Ed. 2d 368

(1983)[hereinafter Operating Engineers]; Motor Coach Employ-

ees, 403 US. at 292, 91S. Ct. at 1920-1921 (“Pre-emption . . . is

designed to shield the system from conflicting regulation of con-

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duct.”). Further, the state’s interest in protecting its citizens from

fraud and misrepresentations does not outweigh our concern in

protecting the NLRB’s jurisdiction from erosion through state

regulation. Serrano, 790 F. 2d at 1287-88. Thus, the balancing of

local interests against the regulatory scheme established by Con-

gress compels preemption.

The employees argue that the Supreme Court's decision in

Belknap, Inc. v. Hale, 463 U.S. 491, 510, 103 S. Ct. 3172, 3183, 77 L. Ed.

2d 798 (1983)(dealing with rights of discharged replacement

employees) removes their state law claims of fraudulent misrepre-

sentation and breach of contract from Garmon preemption. We

disagree. The Sixth Circuit rejected this same argument in Serrano

noting that Belknap was distinguishable because the dispute

presented to the state court was not identical to the dispute which

could have been presented to the Board . In the instant case,

however, the substance of the employees’ labor charge and their

state fraud claims are identical. The facts and allegations of both

claims are also identical. In such circumstances it would not be

proper to allow the employees to escape the Garmon preemption

doctrine through artful drafting. Motor Coach Employees, 403

US. at 292, 91S. Ct. at 1920-1921 (“It is the conduct being regulated,

not the formal description of governing legal standards, that is the

proper focus of concern.”).

The second exception argued by the employees allows

states to regulate conduct that is only of peripheral concern to the

Labor Act. Operating Engineers, 460 U.S. at 676, 103 S. Ct. at 1458-

1459. This exception, however, has no applicability to the instant

case.

Asnoted in Serrano, “[flailure of an employer to bargainin

good faith about terms and conditions of employment is not

peripheral to the concerns of federal labor law; rather, it strikes at

the heart of one of the basic concerns of that law.” 790 F. 2d at 1287.

Good faith bargaining is a core concern of the Labor Act, not a

matter of only peripheral concern. Eroding the Board's jurisdic-

tion over claims involving a failure to bargain in good faith will

inevitably eviscerate the Labor Act and all that it has accom-

plished. Consequently we do not believe that the employees’

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claims fit into any recognized exception to the Garmon preemp-

tion doctrine.

B. Fair Representation and Breach of

Contract Claim

The employees appear to be raising several claims involv-

ing the conduct between the Union and the Company. The claims

appear to be as follows: 1) a hybrid Section 301/ fair representation

claim against the Union and the Company; 2) a separate claim

against the Union for breach of the duty of fair representation in

the ratification of the concession agreements and in the Union's

handling of their grievances; and 3) a separate claim against the

Company for breach of the CBA and the concession agreements.

We believe that the first two claims fail because the evidence does

not establish a breach of the duty of fair representation by the

Union and because the employees have failed to establish a

genuine issue of material fact that would preclude summary

judgment.

In DelCostello v. International Brotherhood of Team-

sters, 462 U.S. 151,103S. Ct. 2281, 76 L. Ed. 2d 476 (1983), the Supreme

Court discussed the nature of a hybrid Section 301/ fair represen-

tation claim as follows:

Such a suit, as a formal matter, comprises two

causes of action. The suit against the employer

rests in Section 301, since the employee rests in

Section 301, since the employee is alleging a

breach of the collective-bargaining agreement.

The suit against the union is one for breach of the

union’s duty of fair representation, which is

implied under the scheme of the National Labor

Relations Act. “Yet the two claims are inextrica-

bly interdependent. “To prevail against either

the company or the Union, . . . employee-plain-

tiffs] must not only show that their discharge was

contrary to the contract but must also carry the

burden of demonstrating breach of duty by the

Union.’” ... Theemployee may, if he chooses, sue

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one defendant and not the other; but the case he

must prove is the same whether he sues one, the

other or both. The suit is thus not a straightfor-

ward breach-of-contract suit under Section 301, .

. . but a hybrid Section 301/fair representation

claim, amounting to “a direct challenge to ‘the

private settlement of disputes under [the collec-

tive-bargaining agreement].””

Id. at 164-65, 103 S. Ct. at 2290-2291 (citations omitted).

The district court determined that the evidence did not

support the employees’ claim that the Union breached its duty of

fair representation and thus their hybrid Section 301/ fair represen-

tation claim failed as a matter of law.

[6] The district court granted the Union and the Company

summary judgment concluding that the Company’s liability

under this claim was conditioned on a finding that the Union

breached its duty of fair representation. We agree with the district

court’s analysis. The above quote from DelCostello makes it clear

that the claims against the Union and the Company are interde-

pendent and in order to prevail the employee must satisfy his

burden of proving a breach of contract by the Company and a

breach of the Union’s duty of fair representation.

[7] The employees claim that the Union breached its duty

of fair representation in the negotiation of the two concession

agreements. As we shall discuss further below, this claim fails

because mere negligence in negotiations does not amount to a

breach of the union’s duty.

In International Brotherhood of Electrical Workers v.

Foust, 442 U.S. 42,995. Ct. 2121, 60 L. Ed. 2d 698 (1979), the Supreme

Court broadly characterized the duty of fair representation:

“Under the doctrine, a union must represent fairly the interests of

all bargaining-unit members during the negotiation, administra-

tion, and enforcement of collective-bargaining agreements.” Id. at

47,995. Ct. at 2125 (emphasis added). See also Communications

Workers v. Beck, _ US. _,108S. Ct. at 2646-2648 (“This

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jurisdiction to adjudicate fair representation claims encompasses

challenges leveled not only at a union’s contract administration

and enforcement efforts, . . . but as its negotiation activities as

well.”) (citations omitted).

[8] The employees allege that the Union breached its duty

of fair representation in the negotiation of the concession agree-

ments, in processing their grievances, and in obtaining ratification

of the concession agreements. The nature of the duty of fair

representation which a Union owes its members is determined by

considering the context in which the duty is asserted. Thus, the

duty of fair representation in the context of negotiations may be

determined by a different standard than is the duty owed in the

processing of grievances or ratification of the concession

agreements. 2 The Developing Labor Law 1321 (C. Morris 2d ed.

1983)[hereinafter Labor Law] (Neither the court nor the Board

have “articulated clear distinctions defining the duty in relation to

the particular aspect of union representation which is being chal-

lenged.”).

[9] A violation of the Union’s duty of fair representation in

the context of negotiations with the Company is established if the

Union’s conduct in negotiations is arbitrary, irrational, or under-

taken in bad faith. See e.g., Hendricks v. Airline Pilots Ass’n

Intern., 696 F. 2d 673, 678 (9th Cir. 1983). The Supreme Court

discussed the Union’s duty in the context of negotiations as

follows:

Any authority to negotiate derives its principal

strength from a delegation to the negotiators of a

discretion to make such concessions and accept

such advantages as, in the light of all relevant

considerations, they believe will best serve the in-

terests of the parties represented. A major re-

sponsibility of negotiators is to weigh the relative

advantages and disadvantages of differing pro-

posals

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The complete satisfaction of all who are repre-

sented is hardly to be expected. A wide range of

reasonableness must be allowed a statutory bar-

gaining representative in serving the unit it rep-

resents, subject always to complete good faith

and honesty of purpose in the exercise of its

discretion.

Ford Motor Co. v. Huffman, 345 US. 330, 337-38, 73S. Ct. 681, 685-

686, 97 L. Ed. 1048 (1953).

[10,11] Applying these standards, we do not believe that the

employees have sustained their burden of showing a breach of the

Union’s fair representation duties in the negotiation process. A

union cannot ensure job security when economic conditions make

it unprofitable to keep a plant operating. Likewise, a company is

not required to keep a plant operating after a CBA has expired®

and the company is not obligated to enter a new CBA’. The Union

was faced with threats of plant closure by the Company if conces-

sions were not given. Now, after ratifying these very concessions,

the employees attempt to hold the Union accountable. We do not

believe that under these circumstances the Union breached its

duty of fair representation in its negotiation of the concession

agreements, but, to the contrary, it appears that the Union officials

did the best they could under difficult conditions, including

imminent closure of the plan. See Dwyer v. Climatrol Industries, Inc.,

544 F.2d 307, 311 (7th Cir.1976) (union did not breach duty of fair

representation in negotiating plant closedown agreement), cert.

denied, 430 U.S. 932, 97 S.ct. 1553, 51 L.Ed.2d 776 (1977).

[12] In the context of grievance processing, in order to

*The CBA in this case expired on September 1, 1983 and the plant

ceased operations on the same day.

7A company’s duty to bargain in good faith with the union does not

require it to enter a CBA that it finds unacceptable. See Lumber Production

Industrial Workers Local #1054, 775 F.2d at 1046 (“collective bargaining

agreements expire according to their own terms and neither employers nor

unions have any implied obligation to enter into a new agreement ma)

; 5 §

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establish that the union has breached its duty of fair representation

the employee must show that the union’s handling of the griev

ance was either arbitrary, discriminatory, or done in bad faith

Harris v. Schwerman Trucking Co., 668 F.2d 1204, 1206 (11th

Cir.1982); see also Vaca v. Sipes, 386 US. 171, 190,87S.Ct. 903, 916

917, 17 L.Ed.2d 842 (1967). An example would be when a union

arbitrarily ignores a meritorious grievance or is perfunctory in its

processing of the grievance. Id.

We note that a union is allowed considerable latitude in its

representation of employees. The grievance and arbitration proc

ess is not conducted in a judicial forum and union representatives

are not held to strict standards of trial advocacy... Cases are

uniform in holding that neither negligence on the part of the union

nor a mistake in judgment is sufficient to support a claim that the

union acted in an arbitrary and perfunctory manner

Harris, 668 F.2d at 1206 (citations omitted)

[13] In the present case the employees have failed to create

a genuine factual dispute with respect to the grievance procedure

and the Union’s handling of their grievances. The employees’

claim is without merit. It is ironic that the employees challenge the

Union's processing of their grievances notwithstanding the fact

that the Union pursued all of their grievances through arbitration

and received an award on two of the grievances presented to the

arbitrator.

[14,15] The employees argue that the Union’s conduct in

seeking ratification of the concession agreements also violated its

duty of fair representation. See, e.g. Bautista v. Pan American

World World Airlines, Inc., 828 F.2d 546, 550 (9th Cir.1987) (duty

of fair representation encompasses a Union’s conduct in seeking

employee ratification of CBA); Anderson v. United Paperworkers

International Union, 641 F.2d 574, 578 (8th Cir.1981); DeBoles v

Trans World Airlines, Inc., 552 F.2d 1005, 1018 (3d Cir), cert

denied, 434 US. 837, 98 S.Ct. 126, 54 L.Ed.2d 98 (1977). While we

agree that in an appropriate case a fair representation claim may

be stated against a union for misrepresenting the terms of an

agreement to its membership, we do not believe that in the present

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case the Union has breached any duty it owes the employees it

represents. In the letter urging ratification of the concession

agreements the Union accurately reflected its negotiation efforts

with the Company and the economic crisis in the steel industry.

The employees have failed to show any misrepresentation made

by the Union in obtaining ratification of the concession agree-

ments.

Taking the facts in the light most favorable to the employ-

ees the Union’s conduct in this case was negligent at most. Rollins

v. Techsouth, Inc. 833 F. 2d 1525, 1528 (llth Cir. 1987)(“In determin-

ing whether a factual issue exists, a court must consider all the

evidence in the light most favorable to the non-moving party.”).

Negligence, however, is not enough to sustain a claim for breach

of the duty of fair representation in any context. The only thing

that the federal courts seem to be in agreement on with respect to

the duty of fair representation is that mere negligence is not a

breach of this duty. See Higdon v. United Steelworkers of

America, 706 F. 2d 1561, 1562 (llth Cir. 1983)(per curiam); Harris, 668

F. 2d at 1206

[16] Because the employees have failed to show any facts to

support their claims that the Union breached its duty of fair

representation in the negotiation process, in its handling of their

grievances, or in the ratification of the concession agreements, the

employees’ hybrid Section 301/ fair representation claim and their

separate claim for breach of the Union’s duty of fair representation

must fail. The hybrid Section 301/ fair representation claim against

the Company and Union fails because a crucial element of sucha

claim is a breach of the union's duty of fair representation

[17] We now address the employees’ separate claim against

the Company for breach of contract. The employees claim that the

Company breached provisions contained in the CBA and the

concession agreements. As noted previously, the district court

concluded that “H. K. Porter and Connors [were] also entitled to

summary judgment, their liability under Section 301 being condi-

tional upon the union’s breaching its duty of fair representation in

lhe grievance and arbitration clause in the CBA required manda-

tory arbitration over “any question relating to wages, hours of

A-18

work, and other conditions of employment or any change

therein.” It also provided that the decision of the arbitrator would

be the final decision on the merits of the grievance. We conclude

that the scope of the grievance and arbitration clause was broad

enough to include all of the employees’ breach of contract claims,

and that all such claims should have been submitted for arbitra-

tion. The employees, therefore, cannot prevail on their claims

against the Company absent a showing that the Union breached its

duty of fair representation, DelCostello, supra, or that the arbitra-

tion award is not final because of misconduct on the part of the

Union in the arbitration process. Hines v. Anchor Motor Freight,

Inc., 424 U.S. 554, 567, 96S. Ct. 1048, 1057-1058, 47 L. Ed. 2d 231 (1976);

United Steelworkers of America v. Enterprise Wheel & Carl

Corp., 363 U.S. 593, 596, 80 S. Ct. 668 F. 2d at 1206. The employees

have not challenged the validity of the award and therefore their

claim is barred because the CBA provides that the decision of the

arbitrator shall be final

C. The Arbitration Award

[18] We also believe that the employees are barred from

raising their state fraud claims in federal court because of the

finality of the arbitration award pursuant to the CBA.

The Company argues that because the employees’ claims

were the subject of arbitration the claims have merged with the

arbitration award and are thus barred. The district court made no

finding as to whether all of the claims presented to it had been

presented to the arbitrator. We need not decide precisely which

claims were presented to the arbitrator, because it is clear that all

claims involving the CBA and the concession agreements,

whether they be denoted as state fraud claims or breach of contract

claims, should have been presented to the arbitrator under the

terms of CBA

In Mason v. Continental Group, Inc., 763 F. 2d 1219 (ith

Cir. 1985), cert. denied, 474 U.S. 1087, 1065S. Ct. 863, 88 L. Ed. 2d 902

(1986), this court was faced with a similar case. In Mason, former

employees of the Continental Can Company claimed that the

company closed its Alabama plant in order to avoid employment

A-19

obligations to its employees after having induced the employees to

continue working on the representation that the plant would

remain open. The employees brought claims against the company

and their union very similar to the claims raised in the present case.

This court rejected the employees’ argument that “since a decision

to shut down a plant for economic reasons does not fall within an

arbitration clause covering ‘wages, hours, and conditions of

employment’ .. .a cause of action for fraudulent concealment and

misrepresentation of that decision would not be covered.” Id. at

1224 (citations omitted). The Mason court noted that “[hjaving

agreed to such a broad arbitration clause, plaintiffs are bound to

submit arguably extrinsic claims, such as fraud, to the grievance

and arbitration process.” Id. at 1223. The same is true with the

fraud claims raised by the employees in the instant case.

The CBA in the present case contained a provision for the

adjustment of complaints and grievances. Section 9C of the

agreement provided:

Should differences arise between the Company

and the Union as to the interpretation or applica-

tion of or compliance with the provisions of this

Agreement or as to any question relating to the

wages, hours of work and other conditions of em-

ployment or any change therein . . . an earnest

effort shall be made to settle the matter promptly

in accordance with the following procedure. .

[emphasis added]

In United Steelworkers of America v. Warrior & Gulf

Navigation Co., 363 U.S. 574, 582-83, 80 S. Ct. 1347, 1352-1353, 4 L.

Ed. 2d 409 (1960), the Supreme Court determined that “[a]n order

to arbitrate [a] particular grievance should not be denied unless it

may be said with positive assurance that the arbitration clause is

not susceptible of an interpretation that covers the asserted dis-

pute. Doubts should be resolved in favor of coverage.” Thus, the

Supreme Court endorses an expansive reading of arbitration

clauses and espouses a “presumption of arbitrability.” 1 Labor

Law, at 881

A-20

The Mason decision coupled with the Supreme Court’s

“presumption of arbitrability” convinces us that all of the employ-

ees’ claims, including fraud claims, should have been submitted to

arbitration, and that they are barred for this reason, whether or not

they were actually submitted.

D. Recusal

After the district court issued its decision, the employees

filed a motion requesting the district judge to recuse himself from

the case. The memorandum opinion issued by the district court

contained a footnote that reads in relevant part:

For the formulation of this opinion, the Court is

indebted to its Law Clerk, William G. Somerville,

III, for his careful analysis of the massive discov-

ery materials and his countless discussions with

the Court as to how the law should be applied to

the material facts as to which there is no genuine

issue.*

The employees argue that the district court judge was

required to recuse himself because his law clerk, William G.

Somerville, III, was the son of William G. Somerville, Jr.,? a partner

in the law firm of Lange, Simpson, Robinson & Somerville, the firm

representing Connors and H. K. Porter. The employees also allege

that Somerville’s participation in the decisional process was criti-

*We note that this is not an isolated case. The district judge has

regularly included such footnotes in published opinions as far back as 196.

See, e.g., Willoughby Roofing & Supply Co., Inc. v. Kajima Intern., Inc., 598

F. Supp. 353, 354 (N.D. Ala. 1984), aff'd, 776 F. 2d 269 (Ith Cir. 1985) (per

curiam); United States Fidelity & Guaranty Co., Slifkin, 200 F. Supp. 563, 582

(N.D. Ala. 196]).

*William G. Somerville, Jr., is apparently a former law clerk to Judge

Lynne. See Id. at 582 (“Credit is due William G. Somerville, Jr., Law Clerk to

the Court, for the preparation of this opinion.”).

A-21

cal to the court’s decision because it was Somerville who reviewed

the voluminous discovery documents and determined that there

were no material issues of fact that would prevent summary

judgment disposition of the case.'° Additionally, the employees

allege that Somerville actually held a hearing with counsel in the

absence of the district judge and later reported the result of the

hearing to the judge. The employees argue that these circum-

stances violate 28 U.S.C. Section 455 and thus require this court to

reverse and reassign this case to another judge.

The Supreme Court very recently discussed Section 455(a)

and its goal of promoting public confidence in the integrity of the

judicial process. In Liljeberg v. Health Services Acquisition

Corp.,__ US. , 108 S. Ct. 2194, 100 L. Ed. 2d 855 (1988), the

Supreme Court held that scienter is not required in order to finda

violation of Section 455(a). The Supreme Court stated:

The judge's lack of knowledge of a disqualifying

circumstances may bear on the question of rem-

edy, but it does not eliminate the risk that ‘his

impartiality might reasonably be questioned’ by

other persons. . .. Moreover, advancement of the

purpose of the provision—to promote public

confidence in the integrity of the judicial process,

... does not depend upon whether or not the

judge actually knew of facts creating an appear-

ance of impropriety, so long as the public might

reasonably believe that he or she knew.

Id. US. at 108 S. Ct. at 2202-2203 (citations omitted).

\°This argument is weakened somewhat by other language which also

appears in the footnote crediting the assistance of Somerville. The dist ‘ict court

stated: “More than two years ago the Court announced its tentative opinion that

defendants were entitled to summary judgment but deferred to the request of

plaintiffs’ counsel that action be withheld pending the completion of discovery,

which proved to be wide-sweeping.” Thus, the district judge had tentatively

ruled against the employees prior to Somerville’s employment.

A-22

[19] Inherent in Section 455(a)’s requirement that a judge

disqualify himself if his impartiality might reasonably be ques-

tioned is the principle that our system our system of “justice must

satisfy the appearance of justice.” Offutt v. United States, 348 US.

l1,14,75S. Ct. ll, 13,99 L. Ed. 111954). “The very purpose of Section

455(a) is to promote confidence in the judiciary by avoiding even

the appearance of impropriety whenever possible.” Liljeberg,

wane , 108 S. Ct. at 2203-2205.

[20] Thus, section 455(a) embodies an objective standard.

The test is whether an objective, disinterested, lay observer fully

informed of the facts underlying the grounds of which recusal was

sought would entertain a significant doubt about the judge’s

impartiality. See Potashnick v. Port City Const. Co., 609 F. 2d 1101,

lll (Sth Cir.), cert. denied, 449 U.S. 820, 101S. Ct. 78, 66 L. Ed. 2d 22

(1980).*?

[21,22] We now turn to the objective facts that might

reasonably cause an objective observer to question Judge Lynne’s

impartiality. First, the close familial relationship between Judge

Lynne’s law clerk and a senior partner in the firm representing

Connors and H.K. Porter might lead an objective observer, espe-

cially alay observer,? to believe that Connors and H.K. Porter will

''Potashnick is binding on this court under the doctrine of Bonnor v.

City of Prichard, 661] F. 2d 1206, 1207 (lth Cir. 1981).

'? Generally, those trained in the law understand that a judge, or even an

advocate, is able to maintain social contacts with other members in the profession

without allowing these friends to have any impact whatsoever on his/her

professional obligations. See United States v. Murphy, 768 F. 2d (7th Cir. 1985),

cert. denied, 475 U.S. 1012, 106 S. Ct. 1188, 89 L. Ed. 2d 304 (1986).

The statutory standard puts to the judgea question about the

objective state of the legal and lay culture. The court must

consider whether an astute observer in either culture would

conclude that the relation between judge and lawyer (a) is

very much out of the ordinary course, and (b) presents a

potential for actual impropriety if the worst implications are

realized. The inquiry is entirely objective.

768 F. 2d at 1537 (citation omitted).

A-23

receive favorable treatment from the district judge. This is com-

pounded by the observation that William G. Somerville, Jr., is a

former law clerk to Judge Lynne.’?

Judge Lynne’s practice of giving credit to his law clerk ina

footnote may erroneously lead some to believe that the law clerk

decided the case. While it has not been suggested that the decision

in this case was made by Judge Lynne’s law clerk and we have no

reason to believe that was, it is not unreasonable to believe that the

public may come to the conclusion. See, e.g., Acceptance Ins. Co.

v. Schafner, 651 F. Supp. 776, 778 (N.D. Ala. 1986)(“This Memoran-

dum of Opinion was prepared by William G. Somerville, IIL, Law

Clerk, in which the Court fully concurs.”)(emphasis added);

Cone v. The Florida Bar, 626 F. Supp. 132, 137 (M.D. Fila.

1985)(Judge Lynne, sitting by designation)(“This opinion is the

product of exhaustive research and careful analysis by Luther M.

Dorr, Jr., Law Clerk.”). It goes without saying that it would be

improper for a judge to delegate the adjudicative function of his

office to one that was neither appointed by the President nor

confirmed by the Senate.

Finally, we believe that when Somerville held a hearing in

Judge Lynn’s absence and later reported the results of the hearing

to the judge this contributed to the appearance of impropriety.’

We believe that these facts might cast doubt in the public’s

mind on Judge Lynne’s ability to remain impartial and at a

minimum these facts raise the appearance of impropriety. It has

'53We recognize, however, that ordinarily disqualification of an entire

law firm is not required “when the propriety of a former law clerk’s participation

inacaseis drawn in question.” Fredonia Broadcasting Corp., Inc. v. RCA Corp.,

569 F. 2d 251, 255 (Sth Cir.), cert. denied, 439 U.S. 859, 99 S. Ct. 177, 58 L. Ed. 2d 167

(1978). William G. Somerville, Jr. did not actually participate in the instant case,

but his relationship with Judge Lynne’s law clerk and the fact that he is a former

law clerk to Judge Lynne contribute to the appearance of soe ee 4

‘There does not appear to be any dispute over the fact that Somerville

held a hearing in order to determine legal positions of the parties.

A-24

been stated on numerous occasions that when a judge harbors any

doubts concerning whether his disqualification is required he

should resolve the doubt in favor of disqualification. See United

States v. Alabama, 828 F. 2d 1532, 1540 (llth Cir. 1987)(per curiam),

cert. denied sub nom., US. , 108 S. Ct. 2857, 101 L. Ed.

2d 894 (1988); Hall v. Small Business Administration, 695 F. 2d

175, 178-79 (Sth Cir. 1983).

We express no opinion on whether any of the above facts

standing along would rise to the level of a Section 455(a) violation.

We merely conclude that all of these facts taken together raise the

appearance of impropriety and may cause one to reasonably

question Judge Lynne’s impartiality.

In Hall the Fifth Circuit found a violation of Section 455(a)

because a magistrate refused to disqualify himself after it was

revealed that his law clerk was a member of the plaintiff class

involved in the suit and had accepted employment with class

counsel before judgment was rendered. The Fifth Circuit noted

that

Law clerks are not merely the judge’s errand

runners. They are sounding boards for tentative

opinions and legal researchers who seek the

authorities that affect decision. Clerks are privy

to the judge’s thoughts in a way that neither par-

ties to the lawsuit nor his most intimate family

members may be.

Id. at 179.

This case was later characterized by the Second Circuit as

involving actual bias on the part of the law clerk that was imputed

to the court. See United States v. Murphy, 768 F. 2d at 1539 n. 3.

Our decision in the instant case should not be interpreted as

imputing to the district judge any appearance of impartiality on

the part of the lawclerk. See In re Corrugated Container Antitrust

Litigation, 614 F. 2d 958, 968 (Sth Cir.)(for purpose of determining

whether a judge should disqualify himself, views of the judge's

law clerk cannot be attributed to the judge), cert. denied sub nom.,

A-25

449 U.S. 888, 101 S. Ct. 244, 66 L. Ed. 2d 114 (1980); cf. Hunt v.

American Bank & Trust Co., 783 F. 2d 1011, 1015-16 (lth Cir. 1986)(“A

judge is not necessarily forbidden, however, to do all that is

prohibited to each of his clerks.”). We recognize the importance

that some law clerks play in the decisional process and it is for this

reason that a “clerk is forbidden to do all that is prohibited to the

Judge.” Id. at 1015 (quoting Hall, 695 F. 2d at 179). Similarly, when

a judge’s law clerk has a possible conflict of interest or knows of

other disqualifying factors it is the clerk, not the judge, who must

be disqualified. Id. at 1016. This problem might have been avoided

if Judge Lynne would have taken steps to isolate Somerville from

this case.

[23] A law clerk, as well as a judge, should stay informed

of circumstances that may raise the appearance of impartiality or

impropriety. And when such circumstances are present appro-

priate actions should be taken. In the instant case either Judge

Lynne or his law clerk must have known of the grounds for

disqualification and either of them should have raised the issue.

If the issue had been raised and fully disclosed the employees

may have waived the grounds for disqualification.»

Having determined that a violation of Section 455(a) is

presented, we now must determine the proper remedy.'* In

Liljeberg the Court noted that:

As in other areas of the law, there is surely room

15928 U.S.C. Section 455(e) allows a judge to accept a waiver of any ground

for disqualification under Section 455(a) after a “full disclosure on the record of

the basis for disqualification.”

16Most courts hold that section 455(a) embodies a timeliness requirement

in order to prevent counsel from withholding facts which support a issue only

after receiving an adverse ruling on the merits. See, e.g., United States v.

Alabama, 828 F. 2d at 1544 n. 49; Phillips v. Amoco Oil Co.,799 F.2d 1464, 1472 (llth

Cir. 1986), cert. denied, US. , 107 S. Ct. 1893, 95 L. Ed. 2d 500 (1987); Hall,

695 F. 2d at 179. We need not address this issue in the present case, however,

because the employees’ attorneys have filed affidavits stating that they did not

kriow of the grounds for recusal until after the district court’s opinion was

A-26

for harmless error committed by busy judges

who inadvertently overlook a disqualifying

circumstance. There need not be a draconian

remedy for every violation of Section 455(a).

U.S. at , 108 S. Ct. at 2202-2203 (footnote omitted).

[24] We believe that in this case Judge Lynne’s refusal to

disqualify himself was indeed harmless error. In determining the

proper remedy for a Section 455(a) violation the Supreme Court

has suggested the following test. Consider : 1) the risk of injustice

to the parties in the particular case; 2) the risk that the denial of

relief will produce injustice in other cases; and 3) the risk of

undermining the public’s confidence in the judicial process. Id.

___US.at___, L08S. CT. AT 2203-2205, 56 U.S.L.W. We believe

that these factors weigh heavily in favor of our conciusion that

Judge Lynne’s decision not to recuse himself was harmless error.

First, the risk of injustice to the parties in this case if relief

is denied is nonexistent. To the contrary, if we grant the employees

relief for the Section 455(a) violation and vacated the district court’

decision then our action will create an injustice. The district court

dismissed the case on summary judgment and therefore this court

is in as good a position to determine the merits of the employees’

claims as was the district court.'’? See Rollins v. Techsouth, Inc.

883 F. 2d at 1527 (“In reviewing a grant of summary judgment, we

released. Counsel saw Somerville’s name in the footnote and it was then that the

connection between Somerville and the Company’s counsel became known.

Section 455 does not require a judge to accept as true all allegations made by a

moving party. See United States v. Alabama, 828 F. 2d at 1541; Phillips v. Joint

Legislature Comm., 637 F. 2d 1014, 1019-20 n. 6 (Sth Cir. 1981), cert. denied, 456 U.S.

960, 102 S. Ct. 2035, 72 L. Ed. 2d 483 (1982). However, in this case the district judge

did not hold a hearing or question the accuracy of the affidavits in any way and

thus we will accept them as true.

In Phillips v. Amoco Oil Co., this court was faced with a similar

Section 455(a) question. In that case it was claimed that an appearance of

impropriety arose when the law clerk who had drafted Judge Lynne’s memoran-

dum opinion accepted employment with one of the law firms involving in the

A-27

must give the judgment plenary review, applying the same legal

standards that bound the district court”). As discussed previ-

ously, we agree with the district court that summary judgment

was proper. It would, therefore, be ridiculous to remand this case

and reassign it to another judge after we have already exercised

plenary review and have concluded that summary judgment was

proper. We also note that Judge Lynne announced his tentative

decision to grant the Company and the Union summary judgment

prior to Somerville joining his staff. Therefore, the risk that Judge

litigation prior to drafting the opinion. This court ted several factors that

5 %

lessened any appearance of impropriety

The case had been before the judge for many years and many

clerks had worked onit. By the time the law clerk at issue was

hired, the judge had formed the conclusion that the employ

ees’ claims were without merit. Furthermore, the court

granted Norgas’ motion for summary judgment at oral argu

ment, before the law clerk began work on the opinion justi

fying the decision. Additionally, the claims against Norgas

were meritless, if not frivolous. Finally, because this case

was decided on summary judgment motions, the court was

not called upon to resolve conflicts in evidence weight the

credibility of witnesses or exercise judicial discretion. Th«

district court’s decision has been subjected to de novo review

by this court

‘ . 7/7

99 | 2G at 14 4

We believe that some of these factors are pr perly «

ered in the harmless error analysis rather than in the initia

determination of whether there is an appearance of impart

ality Section 455(a) requires consideration of only the

objective facts, Hall, 695 F. 2d at 179, thus factors that tend to

lessen the appearance of impartiality must likewise be obxex

tively ascertainable. Cf. Liljeberg, US. at 08S. Ct

at 2202-2203. Consequently, considering the merits of the

case and its summary judgment disposition is more appro

priate when determining whether any error was harmiles:

error rather than when determining whether a violation of

Section 455(a) has occurred

A-28

Lynne based his decision on Somerville’s involvement is remote.

But see Hall, 695 F. 2d at 180 (“The Judge’s assertion that he had

made up his mind immediately after hearing the case, without the

law clerk's assistance, is immaterial. Every judge has suffered a

change of heart after reaching a tentative decision. Much might

happen during research and opinion writing to affect the deci-

sion.”)

In Liljeberg the Court noted that it is “appropriate to

vacate the judgment unless it can be said that respondent did not

make a timely request for relief, or that it would otherwise be

unfair to deprive the prevailing party of its judgment.” __ US.

at__, 108 S. Ct. at 2205-2207 (emphasis added). As already

discussed, it would be unfair to deprive the Company and the

Union of their judgment under the circumstances of this case.

Next, we do not believe that denying relief in this case will

produce injustice in other cases. Provided Judge Lynne refrains in

the future from using law clerks to hold hearings with counsel or

using law clerks whose impartiality might be questioned, there is

no risk of injustice in future cases. Further, since this case was

decided on summary judgment our decision will not produce any

injustice in future cases.

Finally, we do not believe that the public’s confidence in

the judicial process will be undermined if we conclude that the

Section 455(a) violation was harmless error. Since we have deter-

mined that in fact a violation occurred and strongly urge Judge

Lynne to discontinue his practice of crediting the work of his law

clerks, we believe that our decision will instill greater confidence

in our judiciary. To the extent that public confidence has already

been undermined we do not believe that granting relief in this case

will change the public’s perception in any appreciable way. Such

harm cannot be remedied by vacating the district court’s decision

and reassigning this case to a different judge. In fact, if we reverse

and vacate a decision that we have already determined to be

proper, the public will lose faith in our system of justice because

the case will be overturned without regard to the merits of the

employees’ claims. Judicial decisions based on such technical

arguments not relevant to the merits contribute to the public’s

A-29

distrust in our system of justice.

The employees also argue that Judge Lynne was disquali-

fied from presiding over this case under 28 U.S.C. Section

455(b)(5)(iii) which would disqualify a judge whose father is a

lawyer in the case.** See, e.g., Potashnick, 609 F. 2d at I13

(“[W]hen a partner in a law firm is related to a judge within the

third degree, that partner will always be ‘known by the judge to

have an interest that could be substantially affected by the

outcome’ of a proceeding involving the partners’ law firm.”).

The employees argue that since Somerville acted as the judge's

alter ego when he conducted the hearing in the judge’s absence,

section 455(b)(5)(iii) requires Judge Lynne’s disqualification.

We do not believe that we have to reach this question in

the present case. if we assume that there was a violation of

Section 455(b) we believe that our discussion of the remedy for

the Section 455(a) violation would also apply and reversal would

not be mandated. In Liljeberg the Supreme Court made it clear

that harmless error analysis would be appropriate for a Section

455(a) violation. See US.at _, 108S. Ct. at 2202-2203.

However, it was not made clear whether a violation of Section

455(b) could constitute harmless error. Section 455 neither

prescribes nor prohibits any particular remedy fora violation of

the duties it imposes. Id. (“Congress has wisely delegated to the

Section 455(b)(5)(iii) provides

(b) [A judge] shall also disqualify himself in the following circum-

stances

(5) He or his spouse, or a person within the third degree of relationship to

either of them, or the spouse of such a person

(iii) Is known by the judge to have an interest that could be

substantially affected by the outcome of the proceeding

28 U.S.C. Section 455(b)(5)iii). Grounds for disqualification under Section

455(b) cannot be waived by the parties. Sex 28 U.S.C. Section 455(e)

A-3O

judiciary the task of fashioning the remedies that will best serve

the purpose of the legislation.”).

[25-27] We begin our analysis by noting some of the

differences between Section 455(a) and Section 455(b). Section

455(a) may be waived by the parties after full disclosure,

whereas section 455(b) may not. 28 U.S.C. Section 455(e); United

States v. Murphy, 768 F. 2d at 1540. In addition, Section 455(b)

is a per se rule that lists particular circumstances requiring

recusal. United States v. Alabama, 828 F. 2d at 1541 (“The statute

also states that the parties cannot waive the per se rules of

disqualification set out in Section 455(b).”) (footnote omitted).

Thus, Section 455(b) is stricter than Section 455(a) and is con-

cerned with situations that may involve actual bias rather than

Section 455(a)’s concern with the public’s perception of the

judicial process. Nevertheless, we do not believe that these

differences preclude the application of harmless error analysis in

the context of a Section 455(b) violation.

We believe that this conclusion is supported by the Su-

preme Court's Liljeberg decision. When the Supreme Court

outlined the test for determining whether a judgment should be

vacated due toa Section 455 violation the Court did not draw any

distinctions between Section 455(a) and Section 455(b). Further,

in the sentence immediately preceding its test to be used when

evaluating the appropriate remedy fora Section 455 violation the

Court stated: “Rule 60(b)(6) relief is accordingly neither cate-

gorically available nor categorically unavailable for all Section

455 violations.” _U.S.at__, 108 S. Ct. at 2203-2205 (empha-

sis added). Therefore, we are confident that the Supreme Court

intended its test to be applied to all Section 455 violations,

whether involving subsection a or subsection b. Accordingly, a

determination that Section 455(b)(5)iii) was violated in this case

would not change our ruling and we decline to address the

merits of the Section 455(b) claim

CONCLUSION

We conclude that the employees’ state fraud claims are

arguably prohibited by section 8’s requirement of good faith

’

pargal y and theretore art preempted uncer the principles

recognized in Garmon. W* do not believe that the state fraud

‘ ims touch ups n local interests that are compelling enough to

. ,

tity an ¢« xception to preemption nor do the claims reiate to

matters that are of only peripheral concern to the Labor Act

. Consequently, the claims are preempted

neem yet claims that the Uniot breached its duty ol

lair re presentation in negotiating the c ncessions, in processing

mm of the concessions

their grievances, and in seeking ratificati

were also properly disp sed of on summary judgment. Mere

negligence will not sustain a claim that the duty of fair represen

i jin anv of these contexts The employees

lispute over the material fa ts that

improper. We also hold that

would make summary judgment impt

?

h of contract against the ( ompany is barred by

rerTLiTiT :

‘

have notsnown any genuine «

the claim for breach of c

ling and the finality

; ; =, wt ae t) ehitrat ——.

e award entered ea proceeding and

"A

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APPENDIX B

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NJ THE UNITED STATES DISTRICT COURT FOR TH!

NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

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CONNORS STEEL COMPANY FILED

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APPENDIX C

IN THE UNITED STATES DISTRICT COURT FOR THE

NORTHERN DISTRICT OF ALABAMA,

SOUTHERN DIVISION

CALVIN L. PARKER, ET AL,

Plaintiffs, CIVIL ACTION NO.

CV-84-L-0030-S

CONNORS STEEL COMPANY, ——

)

)

H. K. PORTER COMPANY, INC.; _ ) UNITED STATES DISTRICT

and UNITED STEELWORKERS OF ) NORTHERN DISTRICT OF

AMERICA, AFL-CIO, CLC,

ALABAMA

HARLES T. CLIVER, CLERK

ENTERED

JUL 31 1987

Defendants. )

MEMORANDUM OF OPINION

This is an action by the bargaining unit a the now-defunct

Connors Steel, Inc. (Connors), operation at Birmingham, Ala-

bama, for fraud, breach of the duty of fair representation, and

breach of a collective bargaining agreement. For reasons set forth

below, the Court now grants summary judgment in favor of all

remaining defendants.

FACTS

In the latter part of 1981, officials of Connors informed

representatives of Local 2250 (Local) of the United Steelworkers

(Steelworkers) that Connors’ Birmingham facility was losing vast

sums of money. Some of the named plaintiffs contend that they

were told by Connors’ officials that Connors would keep the plant

open if the bargaining unit approved certain wage and benefit

concessions varying the terms of the collective bargaining agree-

ment concluded in 1980 and in effect until August 1, 1983. Other

plaintiffs, however, together with all defendants, have stated that

the bargaining unit was told simply that the plant would close if

such concessions were not granted. Regardless of what induce-

ments might have been offered, the bargaining unit ratified,

effective July 1, 1982 Memorandum of Emergency Agreement. By

the agreement's terms, if Connors returned to profitability, then

the conceded wages and benefits would be restored.

The 1982 agreement proved in the long run, however, not

to satisfy Connors, which sought more concessions in the latter

part of 1982. The bargaining unit and Connors concluded yet

another Memorandum of Emergency Agreement, this one dated

February 24, 1983. Again, the representative plaintiffs disagree

over whether or not Connors promised to keep the plant open in

C-3

return for such concessions. Like its predecessor, the 1983 agree-

ment provided that the concessions would be repaid if the plant

returned to profitability.

In August, 1983, Steelworkers and Connors submitted for

the bargaining unit’s approval new collective bargaining agree-

ment to replace the one due to expire on September 1, 1983. Twice

the bargaining unit’s members voted on the proposal, and twice

they rejected it. Shortly afterwards, Connors closed the facility

and sold it.

Out of work, the plaintiffs met at a Birmingham church

where they elected representatives (not certified by the NLRB)

who prepared and filed grievances relating to the concessions

themselves and the plant closing. The Steelworkers took these

grievances to arbitration, and some of the grievances formed the

basis for an award. Before the arbitration was completed, how-

ever, the plaintiffs filed this lawsuit on behalf of the entire bargain-

ing unit, alleging that Connors and its parent company, H. K.

Porter, Inc. (Porter), had intended all along to close the plant, and

fraudulently induced the bargaining unit to vote for the 1982 and

1983 concession agreements. Plaintiffs also allege that Connors

and Porter breached the collective bargaining agreement, and that,

both in negotiating the concession agreements and in processing

=

the grievances, the Steelworkers and the Local breached their duty

of fair representation

DISCUSSION

This court rules, first, that the fraud claim is pre-empted by

Sections 7 and 8 of the National Labor Relations Act, and that the

fraud count therefore fails to state a claim upon which relief can be

granted. See Serrano v. Jones & Laughlin Steel Co., 790 F. 2d 1279

(6th Cir. 1986). In essence, the plaintiffs allege that Porter and

Connors fraudulently obtained the 1982 and 1983 concession agree

ments by representing that they would keep the plant open if the

employees granted such concession. Also, the plaintiffs allege,

Porter and Connors intended all along to close the plant, and

obtained the concessions solely in order to reduce the fixed costs

of shutting it down. This count alleges nothing more than that the

employers failed to bargain in good faith, and it is thus arguably

*As another court ruled in analyzing a virtually identical allegation,

“[D]efendants had the duty to disclose any information they had concerning a shutdown

of the . . . plant as it relates to concessions made in the Memorandum of the Agreement 1

during the entire period of that agreement. Failure to make the disclosures would constitute

a failure to bargain in good faith.” Serrano v. Jones & Laughlin Steel Co., District Court

Memorandum Opinion, cited at 790 F.2d 1283.

It seems to have occurred to plaintiffs that their claims were subject to the }

within the exclusive jurisdiction of the NLRB. See San Diego

Building Trades Council v. Garmon, 359 US. 236 (1959). The

fraud count, therefore, is due to be dismissed.

Next, the court turns to the fair representation claims

against the union and local. The complaint itself alleges that this

duty was breached both in the negotiation of the concession and in

processing the grievances. The evidence, however, does not

support the complaint in either claim. Nowhere in the substantial

record lies any evidence whatever that the union acted arbitrarily,

capriciously, or in bad faith. Counsel for the plaintiff strenuously

argues that the record shows that the union negotiations negli-

gently failed to ascertain the employers’ fraudulent intentions;

that they negligently failed to insist upon a contractual provision

that would ensure repayment of the concessions and that they

negligently failed to examine the employers’ books adequately.

Assuming for the moment that the record contained such evi-

dence, the defendants still would be entitled to summary judg-

jurisdiction of the NLRB; indeed, the plaintiffs filed unfair labor practice charges on

November 30, 1983. On January 6, 1984, the Regional Director of Region 10 of the NLRB

wrote to the plaintiffs’ counsel, informing him that the charges were barred by the statute

of limitations.

ment. Neither ineffectiveness nor ineptitude gives rise to a claim

for breach of this duty. Harris v. Schwerman Trucking Co., 668

F.2d 1204, 1207 (llth Cir. 1982); see also Freeman v. O’ Neal Steel,

Inc., 609 F.2d 1123, 1127 (Sth Cir.), cert. denied 449 U.S. 833 (1980)

(“The union representative is not a lawyer and he cannot be

expected to function as one.”); Conally v. Transcon Lines, 583 F.2d

199, 203 (5th Cir. 1978)(Union representatives are not to be expected

to provide “perfect” representation); Brough v. United Steel-

workers of America, 437 F.2d 748, 750 (3rd Cir. 1970) (no cause of

action exists for negligent representation); see also R. Gorman,

Basic Text on Labor Law, Unionization, and Collective Bargain-

ing 721 (1976) (no cause of action exists for negligence, at least in

the realm of contract negotiation).

Likewise, the record contains no evidence that the arbitral

award was influenced by misconduct on the part of the union.

Because the parties have had ample time for discovery, and

because discovery has yielded no evidence that would create a

genuine issue of material fact with respect to the allegations in the

complaint, or with respect to any other claims upon which relief

might be granted, the defendant international and local unions are

entitled to summary judgment as a matter of law. Celotex Corp.

v. Catrett, 106 S.Ct. 2548 (1986). H. K. Porter and Connors are also

entitled to summary judgment, their liability under Section 30]

being conditional upon the union’s breaching its duty of fair

representation. DelCostello v. Teamsters, 462 U.S. 151 (1983); Vaca

v. Sipes, 386 U.S. 171 (1967).”

DONE this 3lst dav of lulyv. 1987

S/Seybourn H. Lynne

SENIOR TUDGE

**More than two years ago the Court announced its tentative opinion that

defendants were entitled to summary judgment but deferred to the request of plaintiffs’

counsel that action be withheld pending the completion of discovery, which proved to be

wide-sweeping. For the formulation of his opinion, the Court is indebted to its Law Clerk,

William G. Somerville, ITI for his careful analysis of the massive discovery materials and

his countless discussions with the Court as to how the law should be applied to the material

facts as to which there is no genuine issue

D-1

APPENDIX D

UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

No. 87-7607

D.C. Docket No. 84-0030

CALVIN L. PARKER, GENE A. CHILDERS;

MAPLE L. COPELAND, WILL GOODMAN,

NATHANIEL GRANT, THOMAS RAY LOVELESS,

RUBEN I. PIERCE, JOE D. PRESSLEY,

VIRGIL LEE WEATHERSPOON, on their

own behalf and on behalf of all other

hourly wage employees of Connors Steel

Company similarly situated, and as

representatives of a class of persons consisting

of those employees who on or afterJune 1,

1982, were employed as hourly wage earners

by Connors SteelCompany and represented

by the UnitedSteelworkers of America,

ALF-C1O and its Local Union No. 2250,

Plaintiffs-Appellants,

CONNORS STEEL COMPANY;

H. K. PORTER COMPANY, INC.,

UNITED STEELWORKERS OF AMERICA,

AFL-CIO, CLC,

[ Yefendants Appellees,

CARL L. STATUM, TOM KIMBRELL, and

JAMES E. NORMAN,

Defendants

\ppeal for the United States District Court for |

Northern District of Alabama

Before HATCHETT and COX, Circuit Judes 7

Senior Circuit Judge

This cause came on to be heard on the transc1

record from the United States District Court for the

District of Alabama, and was argued by counsel!

ON CONSIDERATION WHEREOF, it is now her:

dered and adjudged by this Court that the judgment of the sa

District Court in this cause be and the same is hereby AFFIRMED

IT IS FURTHER ORDERED that plaintiffs-appellants pay

to defendants-appellees, the costs on appeal to be taxed by the

rr

Clerk of this Court

*Honorable Floyd R. Gibson, Senior U. S. Circuit

Eighth Circuit, sitting by designat

ISSUED AS MANDATE: DEC 23 1988

iovees wno on

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K. PORTER COMPANY

NITED STEELWORKERS O}

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ited States District Court for the

District of Alabama

ARING ANDS (,(,! > ON >

ARING IN BAN

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Befors OX, ¢ t iges, and FLOYD R

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(X) The Petitior for Rehearing are DENIED and no member of

this panel nor other Judge in regular active service on the Court

having requested that the Court be polled on rehearing In Bar«

(Rule 35, Federal Rules of Appellate Procedure; Eleventh Circuit

Rule 35-5), the Suggestion(s) of Rehearing In Banc are DENIED

( ) The Petition (s) for Rehearing are DENIED and the Court

having been polled at the request of one of the members of the

Court and a majority of the Circuit Judges whoare in regular active

service not having voted in favor of it (Rule 35, Federal Rules of

Appellate Procedure; Eleventh Circuit Rule 35-5), the Suggestion

(s) of Rehearing In Banc are also DENIED

( ) Amember of the Court in active service having requested a poll

on the reconsideration of this cause In Banc, and a majority of the

judges in active service not having voted in favor of it, Rehearing

4

In , at >} NJ }

‘ TY r) ' '

ENTERED FOR THE COUK

. ‘+ if CT } V HLatchett

United States Circuit Judges

‘ ) +)

*Honorable Floyd R. Gibson, Senior U.S. Circuit Judge for the

Eighth Circuit, sitting by designatio1

’

APPENDIX F

CALVIN L. PARKER; GENE A.

CHILDERS; MAPLE L. COPELAND;

WILL GOODMAN; NATHANIEL

GRANT; THOMAS RAY LOVELESS;

RUBEN I. PIERCE; JOE D. PRESSLEY;

VIRGIL LEE WEATHERSPOON; on

their own behalf and on be-

half of all other hourly wage employees

of Connors Steel Company similarly

situated, and as representatives of a class

of persons consisting of those employees

who on or after June 1, 1982, were

employed as hourly wage earners by

Connors Steel Company and represented

bythe United Steelworkers of

America, AFL-CIO and its

Local Union NO. 2250,

Plaintiffs,

VS.

CONNORS STEEL COMPANY; H.K.

PORTER COMPANY, INC.; UNITED

STEELWORKERS OF AMERCA,

AFL-CIO; CARL L. STATUM;

TOM KIMBRELL; AND JAMES E.

NORMAN,

Defendants.

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

IN THE CIRCUIT COURT OF JEFFERSON COUNTY,

ALABAMAEQUITY DIVISION

FILED

IN OFFICE

'B3 Dec 28 P439

D.L. Cockrell

Register

EOD

CIVIL ACTION

NO.

CV 83 505-222 JDC

FIRST AMENDED COMPLAINT

Come now the plaintiffs and amend the complaint hereto-

fore filed in this cause to read as follows:

Parties

1. The plaintiffs, Calvin L. Parker, Gene A. Childers, Maple

L. Copeland, Will Goodman, Nathaniel Grant, Thomas Ray Love-

less, Ruben I. Pierce, Joe D. Pressley and Virgil Lee Weatherspoon

are members of the United Steelworkers of America, AFL-CIO

Local Union No. 2250 and were employed by Connors Steel

Company as hourly wage earners during the period June 1, 1982,

through August 31, 1983.

2. Connors Steel Company (Connors) is a domestic corpo-

ration organized and existing under the laws of the State of

Alabama and located in Jefferson County and is a wholly-owned

subsidiary of H. K. Porter Company.

3. H. K. Porter Company, Inc. (Porter) is a foreign corpo-

ration organized and existing under the laws of the State of

Delaware, qualified to do business in the State of Alabama and

which dominated and controlled the actions of Connors at all

times relevant to this complaint.

4. The United Steelworkers of America, AFL-CIO (Steel-

workers) is a labor union conducting its international business in

Pittsburgh, Pennsylvania and through a Local Union No. 2250,

located in Jefferson County, Alabama.

5. Carl L. Statum is an individual over nineteen years of age

and residing in Jefferson County, Alabama.

6. Tom Kimbrell is an individual over nineteen years of age

and residing in Walker County, Alabama.

7. James E. Norman is an individual over nineteen years of

ave 4

age ana

residing in Jefferson County, Alabama

CLASS ACTION ALLEGATIONS

8. The class of the plaintiffs herein is defined as all

hourly wage employees of Connors, other than the defendants,

who were represented by the United Steelworkers of America,

AFL-CIO, and it Local Union No. 2250, since June 1, 1982.

9. The class of plaintiffs is so numerous that joinder of

all members is impractical, numbering approximately 600

persons.

10. Common questions of law and fact will predominate in

this litigation over issues peculiar to individual class members, or

groups of them. Among the questions common to the class are:

(a) Whether the Steelworkers, Carl L.

Statum, Tom Kimbrell and James E. Norman acted

arbitrarily, capriciously, in bad faith and in a per-

functory manner when negotiating on behalf of the

plaintiffs between June 1, 1982, and the present

(b) Whether the aforementioned arbitrary,

capricious, bad faith and perfunctory conduct in

negotiating agreements on behalf of plaintiffs was

so grossly negligent as to be discriminatory and

thereby constituted a failure on the part of the said

defendants to uphold their statutory duty of fair

representation of the plaintiffs;

(c) Whether the Steelworkers, Carl L

Statum, Tom Kimbrell and James E. Norman acted

arbitrarily, capriciously, in bad faith and in a per-

functory manner in failing to properly prosecute

the October 4, 1983, grievances filed on behalf of the

plaintiffs;

(d) Whether Connors and Porter violated

theSeptember 1, 1980, Collective Bargaining Agree-

ment by failing to compensate the plaintiffs pursu-

ant to the September 1, 1980, Collective Bargaining

Agreement following the September 1, 1983, plant

closing;

(e) Whether Porter and Connors acted

individually and as part of a conspiracy to perpe

trate a fraud upon the plaintiffs;

(f) Whether Porter and Connors engaged in

bad faith bargaining with the Steelworkers and

plaintiffs which was calculated to deprive the

plaintiffs of the level of retirement, severance pay

and other benefits to which they were entitled

under the September 1, 1980, Collective Bargaining

Agreement;

(g) Whether the conduct of Porter and

Connors in the negotiations of June 1, 1982, to

August 31, 1983, was violative of the National

Labor Relations Act;

(h) Whether the conduct of Porter and

Connors in

the negotiations of June 1, 1982, to August 31, 1983,

was violative of Section 6-5-101, Code of Alabama,

1975.

(i) Whether the conduct of Porter and

Connors in the negotiations of June 1, 1982, to

August 31, 1983, was violative of Section 6-5-102,

Code of Alabama, 1975;

(j) Whether the conduct of Porter and

Connors in the negotiations of June 1, 1982, to

August 31, 1983, was violative of Section 6-5-103,

Code of Alabama, 1975;

(k) Whether the conduct of Porter and Con-

nors in the negotiations of June 1, 1982, to August 31,

1983, was violative of Section 6-5-104, Code of Ala-

bama, 1975;

(1) Whether the laws of the United States and

the State of Alabama imposed on Porter and Con

nors the duty to bargain in good faith with the class

represented by the named plaintiffs;

(m) Whether the Steelworkers was in viola-

tion of its duty, imposed by the laws of the United

States and the State of Alabama, to fairly and ade-

quately represent the class of plaintiffs represented

by the name plaintiffs;

(n) Whether the laws of the United States

and the State of Alabama impose on the Steelwork-

ers the duty to fairly and adequately represent the

class of plaintiffs represented by the named plain-

tiffs;

(0) Whether Connors and Porter negotiated

directly with the plaintiffs in an effort to induce the

plaintiffs to vote in favor of the wage and benefit

concessions proposed by Connors and Porter and

whether such conduct was in violation of 29 U.S.C.

Section 159;

(p) Whether Connors and Porter made false

and fraudulent misrepresentations directly to the

plaintiffs in an effort to induce the plaintiffs to vote

in favor of the wage and benefit concessions pro

posed by Connors and Porter; and,

(q) Whether Connors and Porter were en

gaged ina course of fraudulent conduct designed to

obtain wage and benefit concessions at all of Con-

nors’ plants so that such plants could be closed more

cheaply than would be the case in the event the

original Collective Bargaining Agreements were to

remain in full force and effect

11. The claims of the representative parties are typical of

the claims of the class. This class action is superior to the

maintenance of individual suits as a vehicle for conducting this

litigation which involves numerous questions of law and fact

common among members of the class.

12. The plaintiffs will fairly and adequately represent the

interests of all class members.

FACTUAL ALLEGATIONS

13. Connors is a wholly-owned subsidiary of Porter and

was engaged in the production of steel and its related products in

Birmingham, Alabama, and Huntington, West Virginia. Plain-

tiffs further aver that Porter completely controlled Connors

through ownership of its stock and through management teams

for which Connors paid Porter a management fee. The plaintiffs

aver that Connors was a mere alter ego of Porter.

14. The Steelworkers and its Local Union No. 2250 (here-

inafter Local) is the union authorized to represent the non-

management employees of Connors in Birmingham, Alabama, as

exclusive bargaining agents. Tom Kimbrell and James E. Norman

were the respective President and Vice President of the Local and

were the officers in control of the Local since their election in May,

1982. Carl L. Statum is the Steelworkers’ Sub-District Director for

Sub-District No. 36 and is the district representative of the Steel-

workers for the union employees of Connors. The Steelworkers

was also the exclusive bargaining agent for the union employees

of Connors at the Huntington, West Virginia plant before it was

closed on July 1, 1982.

15. On or about September 1, 1980, Connors and the

Steelworkers entered into a Collective Bargaining Agreement for

the purpose of establishing rates of pay, hours of work, conditions

of employments and a mechanism for adjustment of labor griev-

ances. This agreement was to have a life and duration of three

years, expiring on August 31, 1983.

16. On or about January 1, 1981, Connors and the Steel-

workers entered into an Insurance Agreement whereby hospital

and physician’s service benefits, sickness and accident benefits,

dental and vision care benefits were to be provided to bargaining

unit employees through December 31, 1983.

17. The plaintiffs aver that at some time prior to June 1,

1982, Porter made a decision to close the active plants of Connors

located in Huntington, West Virginia and Birmingham, Ala-

bama. Porter was aware that, under the terms of the existing

labor contracts, such closures would be very costly. Porter,

therefore, decided to embark on a scheme to greatly reduce such

costs by representing to the Steelworkers and its members that

the Connors plants in question would be closed immediately

unless wage and benefit concessions were made by the employ-

ees represented by the Steelworkers. The object of this fraudulent

scheme was to induce the employees represented by the Steel-

workers to vote for wage and benefit concessions in the belief that

such concessions would result in the plants continuing to operate

and thus continue to provide employment to the employees. In

truth and in fact, Porter never intended to allow Connors to

continue to operate the plants, but intended to close the plants as

soon as Connors had obtained all of the wage and benefit conces-

sions possible as a result of the fraudulent scheme. Porter and

Connors would thus be able to reduce the cost of closing the

plants and would be able to greatly reduce wage and benefit costs

as the plants operated prior to their closure.

18. Porter and Connors decided to initially implement this

plan and scheme at the Connors plant located in Huntington,

West Virginia. Porter and Connors were successful in obtaining

wage and benefit concessions from the employees at the West

Virginia plant under threat of closing the plant unless such wage

and benefit concessions were obtained. The Steelworkers, repre-

senting the West Virginia employees, negotiated the agreements

concerned. Connors and Porter, having obtained all the wage and

benefit concessions reasonably possible, announced in May of

1982 that the West Virginia plant would be closed on or about July

1, 1982.

19. On or about June 1, 1982, encouraged by the success of

the scheme in West Virginia, Connors notified the Steelworkers,

F-10

the Steelworkers Sub-District Director, Carl L. Statum, and Local

officers, Tom Kimbrell and James E. Norman, that Connors

Birmingham operations were suffering financial losses and that

unless the plaintiff members of the Local agreed to a wage and

benefit reduction, the Birmingham operation of Connors would

cease. Porter and Connors had already successfully implemented

the aforesaid fraudulent scheme in Huntington, West Virginia by

fraudulently inducing the employees represented by the Steel-

workers at that plant to make major wage and benefit concessions

in the vain hope of continued employment at the plant. Thus

encouraged, Porter and Connors now began to implement the

scheme in Birmingham.

20. Plaintiffs aver that following the Connors’ demand for

wage and benefit reductions, bargaining representatives of the

Steelworkers, including Carl L. Statum, Tom Kimbrell and James

E. Norman entered into negotiations with Connors and Porter.

Plaintiffs aver that Porter was directly involved in these negotia-

tions. The aforesaid negotiations resulted in an agreement be-

tween the bargaining team for the Steelworkers and Connors and

Porter. Ballots on the contract concession were mailed directly to

the members of the Local by Carl L. Statum, Tom Kimbrell and

James E. Norman on June 23, 1982.

21. Theclass of plaintiffs was fraudulently induced to vote

in favor of the said agreement by the fraudulent representations

of Connors and Porter that the wage and benefit concessions set

forth in the agreement might provide a basis for keeping the

Birmingham plant of Connors in operation, when, in truth and in

fact, Porter and Connors had no intention of keeping the Birming-

ham plant of Connors in operation. The Steelworkers, through its

F-11

bargaining team, recklessly disregarded the duty to fairly and

adequately represent the class of plaintiffs by failing to investi-

gate the facts relative to Connors’ and Porter's true intentions and

by failing to negotiate some standards so that if the wage and

benefit concessions set out in the agreement resulted in certain

specific reductions in losses Porter and Connors would be obli-

gated to continue operations of the Birmingham plant. In fact, the

Steelworkers by and through the said bargaining team com-

pletely failed to negotiate any protections for the class of plaintiffs

to insure that the concessions made by them would benefit them

despite the fact that the Steelworkers were aware of the events at

the Huntington, West Virginia plant which resulted in the closing

of that plant despite the wage and benefit reductions

22. On or about July 1, 1982, Connors, the Steelworkers

and the Local entered into an Emergency Agreement whereby

each hourly job base rate earnings were reduced by twenty (20)

percent and the following benefits were suspended: a paid

holiday for calendar year 1982; three additional paid holidays for

calendar year 1983; vacation bonus for calendar year 1983; and

calendar 1983 vacation and extended vacations were each short-

ened by one week. In addition to the aforementioned wage and

benefit reductions, certain job/ force reductions were authorized

and certain negotiated benefits not in effect were suspended. The

wage and benefit concessions contained in the Emergency Agree-

ment were scheduled to expire on August 28, 1983

23. On or about July 1, 1982, Porter closed the Huntington,

West Virginia, division of Connors. The scheme to fraudulently

obtain wage and benefit concessions had been successfully im-

plemented there by Porter and Connors, and having obtained all

F-12

possible concessions, Porter and Connors closed the West Vir-

ginia plant saving and making large amounts of money as a result

of the successful fraud.

24. In return for the wage and benefit concessions, the

defendants Porter, Connors, Steelworkers, Carl L. Statum, Tom

Kimbrell and James E. Norman negotiated the January 21, 1983,

Deferred Compensation Plan, whereby restoration payments for

the wages and benefits lost under the July 1, 1982, Emergency

Agreement would be made to union employees if post-1984,

calendar year profits exceeded Four Million Dollars ($4,000,000.00)

a year. The restoration payments were limited to fifty (50) percent

of the amount by which profit exceeded Four Million Dollars

($4,000,000.00) a year. This provision was a deliberate and

intentional fraud on the part of Porter and Connors as they had

no intention at the time of entering into this agreement tocontinue

to operate the Birmingham plant long enough to make such a

provision a reality.

25. On or about February 1, 1983, Connors and Porter

notified the Steelworkers, Carl L. Statum, Tom Kimbrell and

James E. Norman that the 1982 wage and benefit concessions

were inadequate, that Connors was continuing to lose money,

and that unless the September 1, 1980, Collective Bargaining

Agreement, as amended by the July 1, 1982, Emergency Agree-

ment, was further amended, Porter would cause Connors to close

its Birmingham operations by March 1, 1983.

26. On or before February 9, 1983, the Steelworkers, and its

bargaining representatives Carl L. Statum, Tom Kimbrell and

James E. Norman began negotiating further wage and benefit

reductions on behalf of the members of the Local. These wage and

K-13

benefit reduction negotiations resulted in an agreement between

the Steelworkers and its bargaining team and Connors. Ballots on

a second wage and benefit reduction were mailed directly to the

members of the Local by Carl L. Statum, Tom Kimbrell and James

E. Norman on February 16, 1983.

27. Porter and Connors negotiated the agreement in bad

faith and fraudulently in that Porter and Connors never intended

to continue to operate the Birmingham plant and obtained the

wage and benefits concession to reduce costs of closing the

facility. In fact, these negotiations were simply another step in the

implementation of the fraudulent scheme of Connors and Porter

as set forth above. The Steelworkers and Statum, Kimbrell and

Norman failed to fairly represent the plaintiffs in the said nego-

tiations. In fact, despite the West Virginia example and the failure

of Connors and Porter to be satisfied with the 20% concessions

already obtained, no protections were negotiated to insure the

plaintiffs’ sacrifice would benefit them.

28. On or about March 1, 1983, Connors, Steelworkers and

the Local entered into the Memorandum of 1983 Emergency

Agreement which further modified the September 1, 1980, Col-

lective Bargaining Agreement. The substantative wage and

benefit provisions of the agreement provided for another twenty

(20) percent reduction in the hourly job base rate, eliminated the

dental and vision insurance plan, eliminated another week from

the existing regular vacation schedule and deleted the following

benefits: Sunday premium, shift differential, savings and vaca-

tion plan and supplemental unemployment benefits (S.U.B.)

contributions. In return for the wage and benefit concessions,

Porter and Connors fraudulently agreed to attempt to repay the

F-14

additional wageand benefit reductions througha scheme whereby

fifty (50) percent of the monthly income before taxes would be

distributed to the employees; provided that the employee's dis-

tributable share exceeded Fifty Thousand Dollars ($50,000.00) in

one month, and then it would accumulate until said amount

exceeded Fifty Thousand Dollars ($50,000.00). The Memoran-

dum of 1983 Emergency Agreement also provided that the Agree-

ment would become void if Connors were sold or terminated

operations. The wage and benefit reductions contained in the

Memorandum of 1983 Emergency Agreement were to expire on

August 28, 1983, Porter and Connors knew that this repayment

plan was a fraudulent representation as Porter and Connors had

no intention of operating the plant in Birmingham for a period

sufficient to allow such plan to be implemented.

29. During the period preceding the Memorandum of 1983

Emergency Agreement, Porter and Connors negotiated directly

with the plaintiffs in violation of 29 U.S.C. Section 159. Moreover,

such negotiations were conducted by fraudulent means. For

example, on February 17, 1983, Connors sent a letter directly to

the plaintiffs urging a favorable vote for the 1983 Emergency

Agreement. This letter contained a number of false and fraudu-

lent representations. Among these were the following:

(a) That the concessions in the agreement

would “buy time” for the plant to return to profita-

bility and thus save the jobs of the plaintiffs, when

Porter and Connors had no intention of keeping the

plant open;

F-15

(b) That the concessions would be repaid

when Connors returned to profitability, though

Porter and Connors knew this would not happen;

and,

(c) That the alternative to the concession for

most of the plaintiffs would be unemployment,

when Porter and Connors knew that his would be

the result of whether or not the concessions were

accepted by the plaintiffs.

30. Plaintiffs aver that during the summer of 1983 negotia-

tions to replace the September 1, 1980, Collective Bargaining

Agreement, Connors notified the Steelworkers, Carl L. Statum,

Tom Kimbrell and James E. Norman that the financial situation

at Connors had improved but that the improvements were not

sufficient to satisfy Connors’ parent company, Porter. Connors

demanded that the members of the Local accept a new three year

agreement that essentially incorporated the wage and benefit

reductions of the 1982 and 1983 Emergency Agreements, incorpo-

rated a pay back plan similar to the one contained in the 1983

Memorandum of Emergency Agreement, and authorized Con-

nors to terminate the Labor, Insurance and Pension agreements

upon thirty (30) days’ notice. Plaintiffs aver that this was the final

step in the implementation of the fraudulent plan and scheme

established by Porter and Connors. The thirty day cancellation

clause would allow Porter and Connors to close the Birmingham

plant at any time of their choosing by giving thirty days’ notice to

the Steelworkers and that the closing would be effected at the

F-16

reduced rates of wages and benefits obtained as a result of the

fraudulent scheme.

31. Plaintiffs aver that the proposed Collective Bargaining

Agreement was rejected by the majority of the members of the

Steelworkers Local and that Porter caused Connors to close its

Birmingham plant on September 1, 1983. Connors and Porter

again negotiated with the Steelworkers in bad faith. Connors and

Porter never intended to continue operating the Birmingham

plant and sought this last agreement only to reduce the costs of

closing the plant.

32. The Plaintiffs aver that they did not, and, in the exercise

of reasonable diligence could not, discover the fraud and the

other wrongdoings of the defendants until August 4, 1983.

33. Plaintiffs aver that on October 4, 1983, seven (7)

grievances were filed on behalf of the plaintiff members of the

Local and that plaintiffs allege these grievances are not being

properly processed by the defendants Steelworkers, Kimbrell,

Norman and Statum.

34. Plaintiffs aver that the Local president, Tom Kim-

brell, and vice president, James E. Norman, have abandoned their

positions as Local officers in that they have failed to hold regular

monthly meetings of the Local since September, 1983, pursuant to

the Local constitution and by-laws, that the officers have failed to

faithfully prosecute the grievances filed on October 4, 1983, and

that the officers have failed to communicate the present status of

the October 4, 1983, grievances to the local membership. Plaintiffs

aver they are without meaningful representation at this time.

F-17

FIRST CAUSE OF ACTION

35. The plaintiffs incorporate by reference each and

every allegation of the preceding paragraphs as if fully set out

herein.

36. The plaintiffs aver that the defendants, Steelwork-

ers, Statum, Kimbrell and Norman acted arbitrarily, capriciously,

in bad faith and in a perfunctory manner when negotiating the

July 1, 1982, Emergency Agreement, and the March 1, 1983,

Memorandum of Emergency Agreement with Connors in that

they: (a) failed to properly investigate and evaluate the alleged

financial difficulties of Connors before entering into wage and

benefit concession negotiations on behalf of the Local members;

(b) failed to properly investigate and evaluate the wage and

benefit concessions contained in the July 1, 1983, Emergency

Agreement to ascertain whether said concessions would alleviate

the alleged financial difficulty of Connors; (c) failed the properly

investigate and evaluate the wage and benefit concessions con-

tained in the March 1, 1983, Memorandum of Emergency Agree-

ment to ascertain the said concessions contained in that agree-

ment would guarantee the financial stability of the Company; (d)

failed to secure adequate assurances of benefit restoration follow-

ing a plant sale or closing by Connors; (e) failed to negotiate in

either agreement any standards to insure that it the wage and

benefit concessions amounted to a certain savings that Porter and

Connors would be obligated to continue operation of the Bir-

mingham plant; and that they (f) violated the constitution and by-

laws of the Local by failing to call meetings to discuss the two

concession agreements and by failing to provide for secret ballot

F-18

ratification votes on the July 1, 1982, and March 1, 1983, conces-

sion agreements. The plaintiffs further aver that the defendants,

Steelworkers, Statum, Kimbrell and Norman through the afore-

mentioned arbitrary, capricious, bad faith and perfunctory ac-

tions in negotiating the concessions to the 1980 Collective Bar-

gaining Agreement did violate their statutory duty to fairly

represent the rank and file membership of the Local, the plaintiffs,

by their conduct in the negotiation and ratification process which

were so grossly negligent as to be discriminatory and that said

failure to properly represent the membership of the Local has

caused the plaintiffs to lose wages and benefits and suffer other

damages.

WHEREFORE, THE PREMISES CONSIDERED, the plain-

tiffs demand a judgment against the defendants Steelworkers,

Statum, Kimbrell and Norman in the amount of Five Million

Dollars ($5,000,000.00), a reasonably attorney’s fee, the costs of

this action and any and all other relief to which the plaintiffs may

be entitled.

SECOND CAUSE OF ACTION

37. Plaintiffs incorporate by reference each and every

allegation of the preceding paragraphs as if fully set out herein.

38. Plaintiffs aver that the defendants, Connors and

Porter have violated the September 1, 1980, Collective Bargaining

Agreement as amended by the July 1, 1982, Emergency Agree-

ment and March 1, 1983, Memorandum of Emergency Agree

ment in that following the September 1, 1983, closing of the

F-19

Connors plant in Birmingham, Alabama, Connors and Porter

failed to compensate the plaintiffs pursuant to the July 1, 1980,

Collective Bargaining Agreement.

39. Plaintiffs aver that the continued prosecution of the

October 4, 1983, grievances filed with the Local is futile and

should therefore be excused in that Kimbrell, Statum, Norman

and the Steelworkers have failed to fairly and adequately repre-

sent the plaintiffs in such grievances proceedings; Kimbrell and

Norman have abandoned their offices as President and Vice

President of the Local; the grievances concern events in which the

Steelworkers, its local representatives and officers were involved;

and in which the Steelworkers and its local representatives and

officers acted arbitrarily, capriciously, in bad faith and in a

perfunctory manner in violation of their duty of fair representa-

tion of the plaintiffs.

40. Plaintiffs aver that the Steelworkers, Statum, Kim-

brelland Norman have acted arbitrarily, capriciously, in bad faith

and in a perfunctory manner in arbitrating or failing to arbitrate

the October 4, 1983, grievances filed on behalf of the plaintiffs,

and that said actions constitute a violation of their fiduciary duty

of fair representation.

41. As a result of Connors and Porter's violation of the

September 1, 1980, Collective Bargaining Agreement and the

Steelworkers, Statum, Kimbrell, and Norman’s breaches of their

duty of fair representation, the plaintiffs have been wrongfully

denied the benefits of the September 1, 1980, Collective Bargain-

ing Agreement and have been caused to lose wages and benefits,

and suffered other damages, including mental distress and in-

jury.

WHEREFORE, THE PREMISES CONSIDERED, the plain-

tiffs demand a judgment against Connors, Porter, the Steelwork-

ers, Statum, Kimbrell, and Norman in the amount of Five Million

Dollars ($5,000,000.00), a reasonable attorney’s fee, costs of this

action and any and all other relief to which the plaintiffs may be

entitled.

THIRD CAUSE OF ACTION

42. Plaintiffs incorporate by reference each and every

allegation of the preceding paragraphs as if fully set out herein.

43. Plaintiffs aver the following with respect to the

defendants Porter and Connors:

(a) Plaintiffs aver that the decisions

affecting the continued operation of Connors’ Bir-

mingham facility, and the decision to seek wage

and benefit reductions from the membership of

Steelworkers Local were made by Porter.

(b) Plaintiffs aver that before, during

and after the negotiations which led to the July 1,

1982, Emergency Agreement between the Steel-

workers, plaintiffs and Connors, Porter, knew or

should have known that achieving profitability at

the Birmingham facility of Connors by September

1, 1983, through wage and benefit reductions, as

represented to the plaintiffs, was not possible.

(c) Plaintiffs aver that the January 21,

1983, deferred compensation plan which was

adopted as a codicil to the July 1, 1982, Emergency !

Agreement, was negotiated by Connors with the

intent to deceive the plaintiffs into believing that

the wage and benefit concessions made in the July i

F-21

1, 1982, Emergency Agreement could be recovered

through profitable operations of Connors exceed

ing Four Million Dollars ($4,000,000.00) per year

after calendar year 1984; when in fact Porter and

Connors knew or should have known that said

profitable operations were not possible or that said

company would not be operating at that time.

(d) Plaintiffs aver that before, during

and after the negotiations which led to the wage

and benefit concessions contained in the March 1,

1983, Memorandum of Emergency Agreement

between Connors and Steelworkers of Local, Por

ter knew or should have known that achieving

profitability at the Birmingham facility of Connors

by September 1, 1983, through wage and benefit

concessions, as represented to the plaintiffs, was

not possible.

(e) Plaintiffs aver that the Pay Back Plan

was an integral part of the March 1, 1983, Memo-

randum of Emergency Agreement and was negoti-

ated by Connors and Porter with the intent to

deceive the plaintiffs into believing that profitable

operations of the Birmingham facility of Connors

were possible and that wage and benefit conces-

sions made in the agreement could be recovered

through profitable operation of Connors; when in

fact, Porter and Connors knew or should have

known that said profitable operations were not

possible and that no wage and benefit reductions

would be recovered because the facility would be

closed by Porter.

(f) Plaintiffs aver that Porter repre

sented that if the plaintiffs made wage and benefit

concessions, new product lines would be initiated

to help achieve profitability at the Birmingham

facility of Connors. Plaintiffs further aver that said

representations of new product lines were made

}- Ce.

for the sole purpose of securing additional wage

and benefit concessions and that the defendant

Porter had no intention of permanently expanding

into new areas of operation at the Birmingham

facility of Connors.

(g) Plaintiffs aver that any and all

modernization of the steelmaking facilities at

Connors’ Birmingham plant were not made for the

purpose of continued operation and meeting the

alleged profit objectives at the Birmingham facility

of Connors as represented to the plaintiffs, but

were made to prepare the facility to be closed at the

expiration of the September 1, 1980, Collective

Bargaining Agreement so that Connors’ parent

company, Porter could receive significant tax bene-

fits from the sale or other disposition of Connors.

(h) Plaintiffs aver that the wage and

benefit concessions demand by Connors and Por-

ter in the July 1, 1982, Emergency Agreement and

November 1, 1983, Memorandum of 1983 Emer-

gency Agreement, were not demanded for the

purpose of continued operation and attaining al-

leged profitable operations at the Birmingham

facility of Connors as represented to the plaintiffs,

but were calculated to deprive the plaintiffs of their

compensation and benefits and level of retirement,

severance pay, and other benefits to which the

plaintiffs were entitled under the original Septem-

ber 1, 1980, Collective Bargaining Agreement.

(i) Plaintiffs aver that the wage and

benefit concessions sought by Connors at the Bir-

mingham facility and the accompanying closing of

the plant, followed by anattempt to sell the facility,

does follow a similar scheme utilized by the defen-

dant Porter when Porter closed its Connors facility

in Huntington, West Virginia, during 1982.

F-23

44. Plaintiffs aver that defendants Porter and Connors

acted in their individual capacities and as members of a conspir-

acy, and did commit the aforementioned overt acts to perpetrate

a fraud on the plaintiffs in that they: (a) did make the aforesaid

misrepresentations of material fact willfully to deceive the plain-

tiffs, or recklessly without knowledge, or by mistake, and the

plaintiffs relied on said misrepresentations to their detriment, and

therefore, Porter and Connors are liable to the plaintiffs for fraud

pursuant to Section 6-5-101, Code of Alabama, 1975; (b) sup-

pressed the aforesaid material facts and that said suppression of

the material facts constitutes a fraud on the plaintiffs, since Porter

and Connors had an obligation to communicate all the material

facts to the plaintiffs and failed to do so and that said failure to

communicate the facts caused injury to the plaintiffs, Porter and

Connors are liable to the plaintiffs pursuant to Section 6-5-102,

Code of Alabama, 1975; (c) Porter and Connors did make the

aforesaid willful misrepresentations of material facts to the plain-

tiffs to induce the plaintiffs to act, that the plaintiffs did, in fact, rely

on these willful misrepresentations, suffering monetary loss and

other damages whereby the defendants Porter and Connors are

liable to the plaintiffs pursuant to Section 6-5-103, Code of Ala-

bama, 1975, and that (d) the defendants Porter and Connors did

willfully deceive the plaintiffs with the intent to induce them to

alter their positions to their injury; by suggesting facts to the

plaintiffs which were not true and which the defendants knew

were not true or had no reasonable ground for believing were true,

and through reliance on said misrepresentations by Porter and

Connors the plaintiffs suffered a loss whereby the defendants are

F-24

liable to them pursuant to Section 6-5-104, Code of Alabama, 1975

WHEREFORE, THE PREMISES CONSIDERED, the plain

tiffs demand a judgment against Porterand Connors inthe amount

of Fifty Million Dollars ($50,000,000.00), a reasonable attorney’s

fee, the costs of this action, and any and all additional relief to

which the plaintiffs may be entitled.

FOURTH CAUSE OF ACTION

45. Plaintiffs incorporate by reference each and every

allegation of the preceding paragraphs as if fully set out herein

46. Plaintiffs aver that the defendants Connors and

Porter conducted the negotiations prior to the July 1, 1982, Emer

gency Agreement and March 1, 1983, Memorandum of 1983

Emergency Agreement in bad faith, calculated to deprive the

plaintiffs of their level of retirement, severance pay and other

closing benefits to which the plaintiffs were entitled to under the

original September 1, 1980, Collective Bargaining Agreement, and

as a result of the bad faith negotiations on the part of Connors and

Porter, the plaintiffs suffered a loss of said wages and benefits.

WHEREFORE, THE PREMISES CONSIDERED, the plain

tiffs demand a judgment against the defendants Connors and

Porter, intheamount of TEN MILLION DOLLARS ($10,000,000.00),

reasonable attorney’s fee, the costs of this action and any and all

additional relief to which the plaintiffs may be entitled

OF COUNSEI

W. EUGENE RUTLEDG!

& ASSOCIATES, P.

1300 Brown Marx Tower

Birmingham, Alabama 352

(205) 322-8761

PLAINTIFFS’ ADDRESSES

‘alvin L. Parker

601 Edgemoor Drive

Birmingham, Alabama 35209

( ene A Childers

Post Office Box 294

Helena, Alabama 35080

Maple L. Copeland

7105 Naples Avenue South

Birmingham, Alabama 3520¢

Will Goodman

9321 11th Avenue, North

Birmingham, Alabama 35206

; . wat on

rurgene Rutledge

ugene Rutledge

yrnevy for Plaintiffs

Nathaniel Grant

2708 Princeton Avenue, Southws

Birmingham, Alabama 35211

Thomas Ray Loveless

Post Office Box 482

Helena, Alabama 3508%

Ruben I. Pierce

205 Windview Trace

Birmingham, Alabama

Joe LD. Pressley

1501 Woodland Avenue

Birmingham, Alabama 35211

Virgil Lee Weatherspoon

4337 44th Avenue, North

Birmingham, Alabama 35234

SERVE DEFENDANTS AT:

BY CERTIFIED MAIL:

Connors Steel Company

c/o Agent for Service of Process

Richard A. Ball

60 Commerce Street

Montgomery, Alabama 36103

H. K. Porter Company, In

c/o Agent for Service of Process

The Corporation Company

60 Commerce Street

Montgomery, Alabama 36

Tom Kimbrell

Route 2, Box 238

Jasper, Alabama 35501

Lynn William

Acting Temporary President

United Steelworkers of America

5 Gateway Center

Pittsburgh, Pennsylvania 15222

B

Carl L. Statum

1825 Morris Ave nue

Suite B

|

Birmingham, Alabama

lames E. Norman

1123 Appala: hee Street

Birmingham, Alabama

G-1

APPENDIX G

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ALBAMA

SOUTHERN DIVISION

CALVIN L. PARKER, et al., )

Plaintiffs, )

VS. ) CIVIL ACTION

) NO. 84-L-0030-S

CONNORS STEEL COMPANY, )

et al., )

Defendants. )

ANSWER

Come now Defendants, United Steelworkers of America,

AFL-CIO, Carl L. Statum, Tom Kimbrell, and James E. Norman,

and for answer for the First Amended Complaint, state as follows:

1. Defendants deny that the name Plaintiffs, except

G-2

possibly Plaintiff, Ruben I. Pierce, and Plaintiff, Maple L. Copeland,

are members in good standing of the United Steelworkers of

America, AFL-CIO, Local Union No. 2250, as alleged in paragraph

1 of the Complaint. Defendants admit Plaintiffs were employed by

Defendant, Connors Steel Company, as hourly wage earners.

Except as herein admitted, all other allegations contained in para-

graph 1 are denied.

2. For answer to paragraph 2 of the Complaint, Defen-

dants admit that Connors Steel Company operated a plant facility

in Jefferson County, Alabama. Defendants are without sufficient

knowledge or information to either admit or deny the exact

corporate status of Connors Steel Company.

3. Defendants admit that H. K. Porter Company, Inc.,

is a foreign corporation as alleged in paragraph 3 of the Complaint.

Defendants are without sufficient knowledge or information to

either admit or deny the remaining allegations contained in para-

graph 3 of the Complaint.

4. For answer to paragraph 4 of the Complaint, Defen-

dants admit the United Steelworkers of America, AFL-CIO (Gteel-

workers), is a labor Union with its headquarters in Pittsburgh,

Pennsylvania. Defendants further admit Local Union No. 2550

was an affiliated Local Union, located in Jefferson County, Ala-

bama. Except as herein admitted, all other allegations contained

in paragraph 4 are denied.

5. Defendants admit each and every allegation con-

tained in paragraphs 5, 6 and 7 of the Complaint.

6. For answer to paragraphs 8, 9, 10 and its subparts,

11 and 12 of the Complaint, Defendants deny each and every

allegation contained therein.

G-3

7. For answer to paragraph 13 of the Complaint,

Defendants admit Connors was engaged in the production of steel

and its related products in Birmingham, Alabama, and at some-

time in Huntington, West Virginia, as alleged in paragraph 13 of

the Complaint. Defendants are without sufficient knowledge or

information to either admit or deny the remaining allegations

contained in paragraph 13 of the Complaint, and therefore said

allegations are denied with strict proof thereof demanded.

8. For answer to paragraph 14 of the Complaint,

Defendants admit the Steelworkers was the exclusive bargaining

representative of certain employees of Connors in Birmingham,

Alabama, and that the Steelworkers and its affiliated Local Union

No. 2250 represented said employees with respect to wages, terms

and conditions of employment. Defendants further admit that

Defendant, Tom Kimbrell, and Defendant, James E. Norman, were

the respective President and Vice-President of Local Union No.

2250 since their election in May, 1982. Defendants further admit

that Defendant, Carl L. Statum, is a Sub-District Director for the

Steelworkers working out of District 36 of the Steelworkers and

was the Steelworkers representative assigned to service Local

Union No. 2250. Defendants admit the Steelworkers was the

exclusive bargaining representative for certain employees of

Connors at Huntington, West Virginia. Except as herein admitted,

all other allegations contained in paragraph 14 are denied.

2. Defendants admit the allegations contained in

paragraph 15 of the Complaint.

10. For answer to paragraph 16 of the Complaint,

Defendants admit Connors and the Steelworkers entered into an

Insurance Agreement covering health benefits. Said Agreement

G-4

became effective on or about January 1, 1981, with a duration

through December 31, 1983. Except as herein admitted, all other

allegations contained in paragraph 16 are denied.

11. For answer to paragraph 17 of the Complaint, said

allegations are directed to Defendants Porter and Connors and

allege certain metal operations relative to those Defendants. No

answer is required from answering Defendants. Defendants are

without sufficient knowledge or information to either admit or

deny the allegations contained in paragraph 17 of the Complaint.

12. For answer to paragraph 18 of the Complaint,

Defendants admit the Steelworkers negotiated with Porter and

Connors in West Virginia and reached certain agreements. Defen-

dants further admit the Connors West Virginia facility closed.

Except as herein admitted, all other allegations contained in para-

graph 18 are denied.

13. For answer to paragraph 19 of the Complaint,

Defendants admit in 1982 the Defendant Connors notified Cari

Statum and officers of Local Union No. 2250 that Connors’ Bir-

mingham operation was suffering financial loss as alleged in

paragraph 19 of the Complaint. Defendants further admit Con-

nors requested negotiations over the Birmingham operation.

Defendants are without sufficient knowledge or information to

either admit or deny any scheme or mental operation attributable

to Porter and Connors. Except as herein admitted, all other

allegations contained in paragraph 19 are denied.

14. For answer to paragraph 20 of the Compiaint,

Defendants admit that following the Connors’ request for negotia-

tions, representatives of the Steelworkers including Statum,

Kimbrell and Norman entered into negotiations with Connors as

G-5

alleged in paragraph 20 of the Complaint. Defendants further

admit said negotiations resulted in an agreement between repre-

sentatives and that said agreement was ratified by secret ballot

mailing to the membership of Local Union No. 2250. Except as

herein admitted, all other allegations contained in paragraph 20

are denied.

15. For answer to paragraph 21 of the Complaint,

Defendants are without sufficient knowledge or information to

either admit or deny the mental operations attributable to Connors

and Porter. Except as herein admitted, all other allegations con-

tained in paragraph 21 are denied.

16. For answer to paragraph 22 of the Complaint,

Defendants admit that on or about July 1, 1982, Connors and the

Steelworkers on behalf of Local Union No. 2250 entered into an

Emergency Agreement as alleged in paragraph 22 of the Com-

plaint with said Agreement to expire on August 28, 1983. Defen-

dants admit the reduction of wages and suspension of benefits as

alleged in paragraph 22 are correct, except Defendants state said

Agreement speaks for itself. Except as herein admitted, all other

allegations contained in paragraph 22 are denied.

17. For answer to paragraph 23 of the Complaint,

Defendants are without sufficient knowledge or information to

either admit or deny mental operations attributable to Porter and

Connors. Defendants admit the closure of the Huntington, West

Virginia, facility. Except as herein admitted, all other allegations

contained in paragraph 23 are denied.

18. For answer to paragraph 24 of the Complaint,

Defendants admit the Steelworkers, Statum and the negotiating

committee of Local Union No. 2250 negotiated a Deferred Com-

G-6

pensation Plan for restoration of wages and benefits reduced

under the Emergency Agreement. Defendants state the allega-

tions contained in paragraph 24 relating to the formula for resto-

ration is substantially correct, but Defendants state said Deferred

Compensation Plan speaks for itself. As to the last sentence of

paragraph 24, Defendants are without sufficient knowledge or

information to either admit or deny mental operations attributable

to Porter and Connors. Except as herein admitted, all other

allegations contained in paragraph 24 are denied.

| 19. Defendants admit the allegations contained in

paragraph 25 of the Complaint.

20. Defendants admit the allegations contained in

paragraph 26 of the Complaint, and Defendants further state the

bargaining team by secret ballot mailings provided for member-

ship ratification.

21. For answer to paragraph 27 of the Complaint,

Defendants are without sufficient knowledge or information to

either admit or deny the mental operations attributable to Porter

and Connors. Defendants deny each and every allegation con-

tained in paragraph 27 of the Complaint.

22. For answer to paragraph 28 of the Complaint,

Defendants admit that on or about March 1, 1983, Connors, the

Steelworkers and Local Union No. 2250 entered into the Memo-

randum of 1983 Emergency Agreement as alleged in paragraph 28

of the Complaint. Said Agreement provided for a further reduc-

tion of wages and suspension of benefits, and said Agreement

speaks for itself. Defendants further admit the parties agreed to a

restoration of said wage reductions and benefit suspensions.

Defendants are without sufficient knowledge or information to

G-7

either admit or deny the mental operations attributable to Porter

and Connors. Except as herein admitted, all other allegations

contained in paragraph 28 are denied.

23. For answer to paragraph 29 of the Complaint,

Defendants are unable to respond to the allegations pertaining to

negotiations in violation of 29 U.S.C. Section 159. For further

answer to paragraph 29, Defendants state that Connors may have

urged bargaining unit employees to vote favorably for the 1983

Emergency Agreement. For further answer, Defendants are with-

out sufficient knowledge or information to either admit or deny

the mental operations attributable to Connors. Except as herein

admitted, all other allegations contained in paragraph 29 are

denied.

24. Defendants admit negotiations between Connors,

the Steelworkers, Statum and the Local Union No. 2250 bargaining

team commenced in the summer of 1983. Defendants admit

Connors informed Defendants that the financial situation of

Connors had improved but that the improvements were not

sufficient. Defendants admit Connors proposed that members of

Local Union No. 2250 accept a new three (3) year agreement that

essentially incorporated the wage and benefit reductions of the

1982 and 1983 Emergency Agreements and which incorporated a

back pay plan similar to the one contained in the 1983 Memoran-

dum of Emergency Agreement, and which authorized Connors to

terminate the Labor, Insurance and Pension Agreements upon

thirty (30) days notice. Defendants are without sufficient knowl-

edge or information to either admit or deny the mental operations

attributable to Porter and Connors as alleged in paragraph 30.

Except as herein admitted, all other allegations contained in para-

G-8

graph 30 are denied.

25. For answer to paragraph 31 of the Complaint,

Defendants admit that said proposed proposal by Connors re-

ferred to in paragraph 30 was rejected on two (2) occasions by a

majority of the members of the Local and that the Connors’ plant

facility in Birmingham, Alabama, was closed on September 1,

1983. Defendants are without sufficient knowledge or informa-

tion to either admit or deny the mental operations attributable to

Connors and Porter. Except as herein admitted, all other allega-

tions contained in paragraph 31 are denied.

26. Defendants deny each and every allegation con-

tained in paragraph 32 of the Complaint.

27. For answer to paragraph 33 of the Complaint,

Defendants admit that seven (7) grievances were filed on behalf of

members of Local Union No. 2250, but Defendants deny each and

every other allegation contained in paragraph 33 of the Complaint.

Defendants further state that contractual arbitration is pending

against Connors with respect to many of the claims set forth in the

seven (7) grievances.

28. Defendants deny each and every allegation con-

tained in paragraph 34 of the Complaint, except Defendants admit

there have been no monthly meetings of Local Union No. 2250

since September, 1983.

29. For answer to paragraph 35 of the Complaint,

Defendants incorporate by reference each and every answer to the

preceding paragraph allegations of the Complaint herein.

30. Defendants deny each and every allegation con-

tained in paragraph 36 of the Complaint.

31. Defendants deny the Plaintiffs are entitled to any

G-9

relief or judgment as prayed for in the First Cause of Action herein.

32. Defendants incorporate by reference each and every

answer to the preceding paragraph allegations of the Complaint

herein.

33. For answer to paragraph 38 of the Complaint,

Defendants state the Steelworkers have a contractual arbitration

pending in which the Steelworkers have alleged Connors has

violated certain terms of the July 1, 1980, Collective Bargaining

Agreement and other Agreements. Except as herein admitted, all

other allegations contained in paragraph 38 are denied.

34. Defendants deny each and every allegation con-

tained in paragraph 39.

35. Defendants deny each and every allegation con-

tained in paragraph 40.

36. Defendants deny each and every allegation con-

tained in paragraph 41.

37. Defendants deny the Plaintiffs are entitled to any

relief or judgment as prayed for in the Second Cause of Action

herein.

38. Defendants incorporate by reference eachand every

answer to the preceding paragraph allegations herein.

39. For answer to paragraph 43 of the Complaint, said

allegations are directed against Defendants Porter and Connors,

and no answer is required by Defendants Steelworkers and indi-

viduals. For further answer, Defendants are without sufficient

knowledge or information to either admit or deny the mental

operations of Defendants Porter and Connors as alleged in para-

graph 43.

40 For answer to paragraph 44 of the Complaint,

G-10

Defendants are not required to respond to conclusory allegations

of Law. For further answer, Defendants are without sufficient

knowledge or information to either admit or deny the mental

operations of Porter and Connors as alleged in paragraph 44 of the

Complaint. Except as herein admitted, all other allegations con-

tained in paragraph 44 are denied.

41. Defendants deny the Plaintiffs are entitled to any

relief or judgment as prayed for in the Third Cause of Action

herein.

42. Defendants incorporate by reference each and every

answer to the preceding paragraph allegations herein.

43. For answer to paragraph 46 of the Complaint,

Defendants are without sufficient knowledge or information to

either admit or deny the mental operations attributable to Connors

and Porter. Except as herein admitted, all other allegations con-

tained in paragraph 46 are denied.

44. Defendants deny the Plaintiffs are entitled to any

relief or judgment as prayed for in the Fourth Cause of Action

herein.

NOW having answered each and every allegation con-

tained in Plaintiffs’ First Amended Complaint, Defendants, United

Steelworkers of America, AFL-CIO, Carl L. Statum, Tom Kimbrell

James E. Norman, set forth affirmatively the following defenses:

FIRST DEFENSE

The Complaint fails to state a claim upon which relief can

be granted.

G-11

SECOND DEFENSE

The Plaintiffs cannot satisfy any prerequisite set forth in

Rule 23 of the Federal Rule of Civil Procedure for the maintenance

of this action as a class action

THIRD DEFENSE

All or some of the claims set forth in the Complaint, are

barred by the applic able statute of limitations and/or laches

FOURTH DEFENSE

All or some of the claims raised in the First Amended

Complaint are subject to the primary and exclusive jurisdiction of

the National Labor Relations Board

FIFTH DEFENSE

Ji<

All or some of said claims are subject to dismissal by virtue

of the doctrine of preemption

SIXTH DEFENSE

The Plaintiffs, and the class Plaintiffs purport to represent,

have failed to exhaust their contractual remedies. All or some of

the claims raised by the First Amended Complaint are subject to

final and binding contractual arbitration which is currently pend-

ing. The First Amended Complaint fails to set forth any facts

which show futility in exhaustion of the exclusive remedy set forth

in the Collective Bargaining Agreement

SEVENTH DEFENSE

The Plaintiffs’ First Amended C€ omplaint fails to set forth

G-12

any factual matters which would tend to indicate Defendants

failed to represent the members of Local Union No. 2250. The

allegations of the First Amended Complaint in this regard are

merely conclusory and should be stricken.

EIGHTH DEFENSE

The Plaintiffs are not entitled to punitive damages as

against these Defendants

NINTH DEFENSE

The Plaintiffs are not entitled to trial by jury in this

action.

TENTH DEFENSE

The First Amended Complaint faiis to state a claim against

individual Defendants

WHEREFORE, Defendants, United Steelworkers of Amer-

ica, AFL-CIO, Carl L. Statum, Tom Kimbrell and James E. Norman,

respectfully pray this action be dismissed as against them with an

award of costs and attorney’s fees in their favor.

Respectfully submitted,

COOPER, MITCHELL

& CRAWFORD

By: /Ls./ Robert H. Stropp, Jr

Robert H. Stropp, Jr

409 North 21st Street

Birmingham, Alabama 352

(205) 328-9576

CERTIFICATE OF SERVICE

I do hereby certify that acopy of the foregoing Answer has

been served on W. Eugene Rutledge, Esquire, Rutledge & Associ-

ates, 1300 Brown Marx Tower, Birmingham, Alabama 35203,

attorney for Plaintiffs; and on Harrv L Hopkins, Esquire, and lohn

B. Tally, Jr., Esquire, Lange, Simpson, Robinson & Somerville, 1700

First Alabama Bank Building, Birmingham, Alabama 35203, attor-

neys for Defendant Companies, by placing same in the United

States Mail, postage prepaid and properly addressed, on this, the

13th day nuarv, 1984

H-1

APPENDIX H

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

CALVIN L. PARKER, et al.,

Plaintiffs,

VS. CIVIL ACTION NO.

CONNORS STEEL COMPANY,

et al.,

CV 84-L-0030-S

ee ee

Defendants.

ANSWER OF DEFENDANT CONNORS STEEL COMPANY

AND H. K. PORTER COMPANY, INC.

TO FIRST AMENDED COMPLAINT

Defendants Connors Steel Company (herein “Connors”)

and H. K. Porter Company, Inc. (herein “Porter”’) answer the first

amended complaint as follows:

FIRST DEFENSE

The complaint and each count thereof fails to state a claim

upon which relief can be granted against Connors or Porter.

SECOND DEFENSE

With regard to the second cause of action, Connors and

< H-2

Porter claim that the alleged violations of the September 1, 1980,

July 1, 1982, and February 24, 1983 collective bargaining agree-

ments are:

(a) barred by the applicable six-month statute of limi-

tations;

(b) to the extent that the claimed violations are not now

set for arbitration barred by the plaintiffs’ failure to exhaust their

contractual remedies under the final and binding grievance and

arbitration provisions of said agreements;

(c) barred by pending arbitration being prosecuted by

the United Steelworkers of America, AFL-CIO (herein “Steel-

workers”), covering these alleged violations;

(d) barred by the doctrine of federal preemption since

the conduct in question is subject to Section 8 and 9 of the National

Labor Relations Act , particularly Section 8(a)(5), Section 8(d) and

Section 9(a).

THIRD DEFENSE

With regard to the third cause of action, Connors and

Porter assert the following:

(a) The action is barred by the doctrine of federal

preemption since the conduct in question is subject to Section 8 of

the National Labor Relations Act.

(b) Theaction is barred by the applicable federal and

state statutes of limitations.

(c) The third cause of action in the first amended

complaint fails to state a claim upon which relief can be granted

against these defendants by failing to comply with Rule 9(b),

Federal Rules of Civil Procedure.

H-3

FOURTH DEFENSE

With regard to the fourth cause of action, Connors and

Porter assert the following:

(a) The action is barred by the doctrine of federal

preemption since the conduct in question is subject to Section 8 of

the National Labor Relations Act, particularly Section 8(a)(5) and

Section 8(d), and subject to the exclusivity principle embodied in

Section 9(a) of the National Labor Relations Act.

(b) The action is barred by the applicable six-months

statute of limitations.

Defendants Connors and Porter further answer the allega-

tions of plaintiffs’ first amended complaint as follows:

l.

In answer to the allegations contained in paragraph 1 of the

first amended complaint, Connors and Porter admit that the

named plaintiffs were employees of Connors during the period

from June 1, 19832 - August 31, 1983. Except as specifically

admitted, Connors and Porter deny the remaining allegations in

paragraph 1 of the first amended complaint.

2.

Connors and Porter admit the allegations contained in

paragraph 2 of the first amended complaint.

3.

In answer to the allegations contained in paragraph 3 of the

first amended complaint, defendants admit that Porter is a corpo-

ration under the laws of the State of Delaware and that it is

qualified to do business in the State of Alabama. Except as

specifically admitted, Connors and Porter deny the remaining

H-4

allegations in paragraph 3 of the first amended complaint.

4.

In answer to the allegations contained in paragraph 4 of the

first amended complaint, Connors and Porter admit that Steel-

workers is a labor organization with headquarters in Pittsburgh,

Pennsylvania, and that Local Union No. 2250, located in Jefferson

County, Alabama, is affiliated with the Steelworkers. Except as

specifically admitted, Connors and Porter deny the remaining

allegations contained in paragraph 4 of the first amended com-

plaint.

5.

Connors and Porter admit the allegations contained in

paragraph 5 of the first amended complaint.

6.

Connors and Porter admit the allegations contained in

paragraph 6 of the first amended complaint.

r;

Connors and Porter admit the allegations contained in

paragraph 7 of the first amended complaint.

8-12.

Paragraphs 8 through 12 of the first amended complaint do

not allege any facts, but instead contain conclusory statements

allegedly supporting class actionclaims. Connors and Porter deny

that the prerequisites to a class action exist in this case and further

deny that a class action is maintainable in this case.

13.

In answer to the allegations contained in paragraph 13 of

the first amended complaint, Connors and Porter admit that

Connors is a wholly-owned subsidiary of Porter and that Connors

H-5

had steel facilities at both Birmingham, Alabama and Huntington,

West Virginia. Except as specifically admitted, Connors and

Porter deny the remaining allegations contained in paragraph 13

of the first amended complaint.

14.

In answer to the allegations contained in paragraph 14 of

the first amended complaint, Connors and Porter admit that

Steelworkers is and has been during times material hereto the

exclusive bargaining representative of certain of Connors’ Bir-

mingham, Alabama employees in the bargaining unit described in

the September 1, 1980 collective bargaining agreement between

Connors and Steelworkers. Connors and Porter also admit that

Local Union No. 2250 is a local union chartered by the Steelwork-

ers, that Tom Kimbrell and James E. Norman are, or were, the

respective President and Vice President of Local Union No. 2250,

and that Carl L. Statum is Sub-District Director of District No. 36.

Connors and Porter further admit that the Steelworkers were the

exclusive bargaining representative of certain bargaining unit

employees at Connors’ Huntington, West Virginia plant. Except

as specifically admitted, Connors and Porter deny the remaining

allegations contained in paragraph 14 of the first amended com-

plaint.

15.

Connors and Porter admit the allegations contained in

paragraph 15 of the first amended complaint.

16.

Connors and Porter admit the allegations contained in paragraph

16 of the first amended complaint.

H-6

17.

Connors and Porter admit the allegations contained in paragraph

17 of the first amended complaint.

18.

Connors and Porter admit the allegations contained in paragraph

18 of the first amended complaint.

19.

Connors and Porter admit the allegations contained in paragraph

19 of the first amended complaint.

20.

Connors and Porter deny the allegations contained in

paragraph 20 of the first amended complaint except they admit

that Connors and the Steelworkers through collective bargaining

reached a Memorandum of Emergency Agreement to be effective

July 1, 1982.

21.

Connors and Porter deny the allegations contained in

paragraph 21 of the first amended complaint to the extent that

same call for an answer by these defendants.

22.

In answer to the allegations contained in paragraph 22 of

the first amended complaint, Connors and Porter admit that the

July 1, 1982 Memorandum of Emergency Agreement was entered

into by Connors and the Steelworkers. Connors and Porter deny

the remaining allegations contained in paragraph 22 of the first

amended complaint on the basis that the July 1, 1982 Memoran-

dum of Emergency Agreement speaks for itself.

H-7

23.

Except to admit that Connors closed its Huntington, West

Virginia facility on or about July 1, 1982, Connors and Porter deny

the allegations contained in paragraph 23 of the first amended

complaint.

24.

Except to admit that Connors and Steelworkers entered

into a deferred compensation plan on January 21, 1983 through

collective bargaining, which deferred compensation plan speaks

for itself, Connors and Porter deny the allegations contained in

paragraph 24 of the first amended complaint.

25.

In answer to the allegations contained in paragraph 25 of

the first amended complaint, Connors and Porter admit that

Connors sought further concessions from the bargaining repre-

sentative of its Birmingham Works employees in an effort to keep

the facility open. Except as specifically admitted, Connors and

Porter deny the remaining allegations in paragraph 25 of the first

amended complaint.

26.

In answer to the allegations contained in paragraph 26 of

the first amended complaint, Connors and Porter admit that

Connors commenced collective bargaining negotiations with the

Steelworkers in February and that said collective bargaining re-

sulted in a Memorandum of 1983 Emergency Agreement which

became effective on February 24, 1983. Except as specifically

admitted, Connors and Porter deny the remaining allegations

contained in paragraph 26 of the first amended complaint.

H-8

27.

Connors and Porter deny the allegations contained in

paragraph 27 of the first amended complaint.

28.

In answer to the allegations contained in paragraph 28 of

the first amended complaint, Connors and Porter admit that

Connors, as aforesaid, and the Steelworkers negotiated the Febru-

ary 24, 1983 Memorandum of 1983 Emergency Agreement. Con-

nors and Porter deny the remaining allegations in paragraph 28 of

the amended complaint.

29.

Connors and Porter deny the allegations contained in

paragraph 29 of the first amended complaint.

30.

Connors and Porter deny the allegations contained in

paragraph 30 of the first amended complaint.

31.

In answer to the allegations contained in paragraph 31 of

the first amended complaint, Connors and Porter admit that

Connors’ Birmingham facility was closed on or about September

1, 1983 and that the closure occurred after the bargaining unit

members twice rejected a proposed renewal collective bargaining

agreement. Except as specifically admitted, Connors and Porter

deny the remaining allegations contained in paragraph 31 of the

first amended complaint.

32.

Connors and Porter deny the allegations contained in

paragraph 32 of the first amended complaint.

H-9

33.

In answer to the allegations contained in paragraph 33 of

the first amended complaint, Connors and Porter admit that there

are pending grievances, but state affirmatively that all pending

grievances are scheduled for arbitration. Except as specifically

admitted, Connors and Porter deny the remaining allegations in

paragraph 33 of the first amended complaint to the extent an

answer is required of these defendants.

34.

Except as admitted in paragraph 33 above, and to the

extent an answer is required of these defendants, Connors and

Porter deny the allegations contained in paragraph 34 of the first

amended complaint.

35.

Connors and Porter incorporate their answers to para-

graph 1 through 34 as their answer to paragraph 35 of the first

amended complaint.

36.

The allegations in paragraph 36 of the first amended

complaint do not appear to relate to or require an answer from

Connors or Porter.

37.

Connors and Porter incorporate their answers to para-

graphs 1 through 34 as their answer to paragraph 37 of the first

amended complaint.

38.

Connors and Porter deny the allegations contained in

paragraph 38 of the first amended complaint

H-10

39.

Connors and Porter deny the allegations contained in

paragraph 39 of the first amended complaint.

40.

Connors and Porter deny the allegations contained in

paragraph 40 of the first amended complaint.

41.

Connors and Porter deny the allegations contained in

paragraph 41 of the first amended complaint.

42.

Connors and Porter incorporate their answers to para-

graph 1 through 34 as their answer to paragraph 42 of the first

amended complaint.

43.

Connors and Porter deny the allegations contained in

paragraph 43(a)(b)(c)(d)(e)(f(g)(h) and (i) of the first amended

complaint.

44.

Connors and Porter deny the allegations contained in

paragraph 44 of the first amended complaint.

45.

Connors and Porter deny the allegations contained in

paragraph 45 of the first amended complaint

46.

Connors and Porter deny the allegations contained in

paragraph 46 of the first amended complaint.

WHEREFORE, defendants Connors and Porter pray that

H-11

the first amended complaint be dismissed and the costs and a

reasonable attorney's fee be assessed against the plaintiffs

/\.s./ Harry L. Hopkins

HARRY L. HOPKINS

JOHN B. TALLY, JR.

Attorney for Defendants

Connors Steel Company and

H. K. Porter Company, Inc

OF COUNSEL:

LANGE, SIMPSON, ROBINSON & SOMERVILLE

1700 First Alabama Bank Building

Birmingham, Alabama 35203

Telephone: (205) 250-5000

CERTIFICATE OF SERVICE

| hereby certify that the foregoing Answer of Defendants

Connors Steel Company and H. K. Porter Company, Inc. to First

Amended Complaint has been served upon all counsel of record

in this action by placing a copy of same in the United States Mail,

postage prepaid, and properly addressed, this the 27th day of

the Januarv, 1984

‘lLs./ H Hopkins

Of Counsel

l-]

‘

APPENDIX I

IN THE UNITED STATES DISTRICT COURT FOR THE

NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION FILED

87 Aug-5 PM40

US. DISTRICT COURT

CALVIN L. PARKER, et al N.D. OF ALABAMA

C.T. CLIVER, CLERK

Plaintiffs, CASE NO

}

V 84-1 2030-5

CONNORS STEEL COMPANY,

et al,

Defendants

MOTION TO ALTER, VACATE OR AMEND

THE JUDGMENT

Come now the plaintiffs and move this Honorable Court to

amend, alter or vacate the final judgment entered in this case on

July 31, 1987 and as grounds therefor show unto the Court as

follows

’

|. The judgment is contrary to the facts and the law in the

Case

’ 2. Summary judgment is not due to be granted as there are

a number of genuine issues as to a number of material facts in the

Casi

3. The judgment is against the great weight of the evidence

and « ntrary to the law applicable to the case

1-2

4. The judgment should be vacated and set aside and the

Court should disqualify itself under the requirements of 28 U.S.C.

Section 455 and return this case to the clerk for reassignment to

another judge. The judgment, opinion and order are, based on the

admission of the Court as stated

in the Memorandum of Opinion in the footnote on page 5, princi-

pally the result of the work of the Court’s law clerk, William G.

Somerville, II]. William G. Somerville, III, is the son of William G.

Somerville, Jr. who is one of the principal partners in the Birming-

ham, Alabama law firm of Lange, Simpson, Robinson & Somer-

ville, which firm is the lead counsel for the defendants, Connors

Steel Company and H. K. Porter Company, Inc. (See affidavit of W.

Eugene Rutledge attached.) W. Eugene Rutledge, the lead attor-

ney for the plaintiffs was not aware that the Court’s law clerk was

the sone of said William G. Somerville, Jr.,a principal partner inthe

Lange, Simpson, Robinson & Somerville, or of the role the said law

clerk had been assigned by the Court and had actually played in

the formulation of the judgment, opinion and order until the

publication of the Court’s opinion which contained the following,

above-referenced, footnote:

“More than two years ago the Court

announced its tentative opinion that defendants

were entitled to summary judgment but deferred

to the request of plaintiffs’ counsel that action be

withheld pending the completion of discovery,

which proved to be wide-sweeping. For the

formulation of this opinion, the Court is in-

debted to its Law Clerk, William G. Somerville,

III, for his careful analysis of the massive dis-

covery materials and his countless discussions

with the Court as to how the law should be

I-3

applied to the material facts as to which there is

no genuine issue.” (Memorandum of Opinion p.

5)[Emphasis Supplied]

The above footnote makes clear the extensive participation and

substantive contributions of the law clerk to the decision of the

Court as well as the formulation of the opinion. The participation

was Critical in that the judgment, opinion and order of the Court

disposes of the case on summary judgment and it was the law clerk

who reviewed the thousands of pages of deposition testimony and

reviewed the hundreds of documents which are before the Court

in this case. Moreover, the Court has clearly indicated in the above

footnote that it was influenced by the opinions of the law clerk as

to the applicable law as expressed in discussions with the Court as

to the proper application of the law to the facts as determined by

the law clerk from his review of the great mass of evidence in this

case. Moreover, counsel for all parties met with the said law clerk

at the request of the law clerk who stated he was carrying out

desires of the Court to discuss the issues in the case. (See affidavit

of Clyde E. Riley attached.) Any report of such discussions to the

Court was made solely by the law clerk. It is, therefore, clear that

the law clerk to the Court, William G. Somerville, III, played a very

substantive role and was actually the only conduit through which

the Court was aware of the substantive aspects of the evidence in

the case and the opinions and views of counsel as expressed to the

law clerk in interviews with the law clerk separate from the Court.

The father and son relationship between one of the principal

partners of the firm representing two of the three principal defen-

dants in this case and the said law clerk, William G. Somerville, III,

clearly requires the application of 28 U.S.C. Section 455 (a) which

]-4

reads as follows:

Any justice, judge, magistrate, or referee in bank-

ruptcy of the United States shall disqualify him-

self in any proceeding in which his impartiality

might reasonably be questioned.

In Hall v. Small Business Administration, 695 F. 2d 175 (5th Cir.

1983) the Court held that a magistrate’s disqualification was re-

quired under 28 U.S.C. Section 455 where the magistrate’s law

clerk was to be employed in the future by counsel representing one

of the parties in a proceeding before the magistrate unless the

magistrate isolated the law clerk from all knowledge of and

participation in the case immediately after employment inter-

views began. The plaintiffs are of the opinion that the rationale of

the disqualification cases under Section 455, for example, Hall v.

Small Business Administration applies to this case in which the

law clerk is the son of one of the principal partners of the counsel

for two of the parties in the case.

5. Contemporaneously with the filing of this motion to

alter, vacate or amend the Court’s July 31, 1987 judgment, the

plaintiffs are filing with the Court a motion for the Court to recuse

itself from this matter. The plaintiffs incorporate herein the

matters raised by the recusal motion as if fully set out herein.

WHEREFORE, THE PREMISES CONSIDERED, the plain-

tiffs respectfully request that the judgment, opinion and order

filed on July 3i, 1987, be withdrawn and that the Court disqualify

itself and return this case to the clerk for reassignment to another

judge for decision and order.

I-5

RESPECTFULLY SUBMITTED,

/\.s/ W. E. Rutledge

W. Eugene Rutledge, Attorney for

Plaintiffs

OF COUNSEL:

RUTLEDGE & KELLY, P.C.

1300 Brown Marx Tower

Birmingham, Alabama 35203

Telephone: (205) 322-8761

CERTIFICATE OF SERVICE

I do hereby certify that I have mailed a copy of the

foregoing to Harry L. Hopkins, Esq., LANGE, SIMPSON, ROBIN-

SON & SOMERVILLE, 1700 First Alabama Bank Building, Bir-

mingham, Alabama 35203 and Jerome A. Cooper, COOPER,

MITCH & CRAWFORD, Suite 201, 409 N. 2Ist Street, Birmingham,

Alabama 35203 on this the 5th day of August, 1987.

/1.s./ W. Eugene Rutledge

Of Counsel

I-6

IN THE UNITED STATES DISTRICT COURT FOR THE

NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

CALVIN L. PARKER, et al,

Plaintiffs, CASE NO.

84-L-0030-S

V.

CONNORS STEEL COMPANY,

et al,

i ed

Defendants.

AFFIDAVIT OF W. EUGENE RUTLEDGE

STATE OF ALABAMA )

JEFFERSON COUNTY )

Personally appeared before me, the undersigned notary

public in and for the state of Alabama at large, W. Eugene Rut-

ledge, who is known to me, and upon oath deposes and says as

follows:

My name is W. Eugene Rutledge and I am an attorney at

law practicing in Birmingham, Alabama. I am the lead counsel for

the plaintiffs in this case.

On August 3, 1987 I received in the mail a copy of the

judgment, order and Memorandum of Opinion signed by United

States District Court Judge Seybourn H. Lynne in this case, a copy

1-7

of which is attached hereto. I read the Memorandum of Opinion,

including the footnote located on page 5 of the Memorandum of

Opinion which reads as follows:

“More than two years ago the Court

announced its tentative opinion that defendants

were entitled to summary judgment but deferred

to the request of plaintiffs’ counsel that action be

withheld pending the completion of discovery,

which proved to be wide-sweeping. For the

formulation of this opinion, the Court is in-

debted to its Law Clerk, William G. Somerville,

III, for his careful analysis of the massive dis-

covery materials and his countless discussions

with the Court as to how the law should be

applied to the material facts as to which there is

no genuine issue.” (Memorandum of Opinion p.

5)[Emphasis Supplied]

I noticed the name of the law clerk to Judge Lynne to be

similar to that of Bill Somerville, one of the principal partners of the

firm of Lange, Simpson, Robinson & Somerville. I checked the

Martindale-Hubbeil law directory and determined that Bill Som-

erville’s name was in fact William G. Somerville, Jr. On Tuesday,

August 4, 1987, I telephoned Mr. Harry Hopkins, the lead counsel

for the defendants Connors Steel Company and H. K. Porter

Company, Inc. who is also a partner in the law firm of Lange,

Simpson, Robinson & Somerville. I inquired about William G.

Somerville, III, being the son of William G. Somerville, Jr., and Mr.

Hopkins confirmed that this was so. Mr. Hopkins stated that he

had been aware forsome time that Mr. Somerville, II] was working

on this case and that he was aware that William G. Somerville, I]

had requested counsel for all parties to meet with him privately

I-8

with regard to their positions in this case. Mr. Hopkins stated that,

being aware that William G. Somerville, III was the son of his

partner, William G. Somerville, Jr., he declined to participate in

those discussions, though he did attend some discussions with Mr.

Somerville, III, at which all parties were present by counsel, but

merely sat and listened in silence to what was said. I informed Mr.

Hopkins at that time that it would be necessary for me to file a

motion for relief to set aside the judgment, order and opinion and

to move to recuse Judge Seybourn H. Lynne from the case under

the provisions of 28 U.S.C. Section 455.

/\.s./ W. E. Rutledge

W. Eugene Rutledge

Sworn to and subscribed before me this the 5th day of

August, 1987.

/\.s./ Dawn C. Holloway

NOTARY PUBLIC

COMMISSION EXPIRES: 3/90

OF COUNSEL:

RUTLEDGE & KELLY, P.C.

1300 Brown Marx Tower

Birmingham, Alabama 35203

Telephone: (205) 322-8761

CERTIFICATE OF SERVICE

I do hereby certify that I have mailed a copy of the forego-

ing to Harry L. Hopkins, Esq., LANGE, SIMPSON, ROBINSON &

SOMERVILLE, 1700 First Alabama Bank Building, Birmingham,

I-9

Alabama 35203 and Jerome A. Cooper, COOPER, MITCH &

CRAWFORD, Suite 201, 409 N. 2ist Street, Birmingham, Alabama

35203 on this the 5th day of August, 1987.

/1.s./ W. E. Rutledge

Of Counsel

C: 2028

I-10

IN THE UNITED STATES DISTRICT COURT FOR THE

NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

CALVIN L. PARKER. et al,

Plaintiffs, CASE NO.

84-L-0030-S

Vv.

CONNORS STEEL COMPANY,

et al,

— — — — ed

Defendants

AFFIDAVIT OF CLYDE E. RILEY

STATE OF ALABAMA )

JEFFERSON COUNTY )

Personally appeared before me, the undersigned notary

public in and for the state of Alabama at large, Clyde E. Riley, who

is known to me, and upon oath deposes and says as follows:

l. My name is Clyde E. Riley. 1am a lawyer practicing in

Birmingham, Alabama. I was licensed in 1983. Iam an associate of

the firm of Rutledge & Kelly, P.C. For approximately the last three

and one-half years I have been an attorney for the plaintiffs in the

case of Calvin Parker, et al v. Connors Steel Coiapany, et al, Case

No. 84L-0030-S.

2. During the last weeks of May or first weeks of June |

received a telephone call from an individual who identified him-

self as Judge Lynne’s law clerk, Will Somerville. The law clerk

I-11

stated that he was reviewing the briefs and submissions of the

parties with respect to the defendants’ motions for summary

judgment and that Judge Lynne had suggested that he, Mr. Som-

erville, contact the parties’ attorneys independently and sepa-

rately discuss with them their views and positions on the case. I

questioned the prudence of independent, ex parte conversations

concerning the case and I told Mr. Somerville that the case had

been under submission for more than a year and that in any event

I would have to review the file before I would be prepared to

discuss the case. I requested that Mr. Somerville not conduct ex

parte counsel interviews and that, if any oral review as to the

parties’ positions was necessary, that the review be held with all

parties present. Mr. Somerville stated that he would seek approval

from Judge Lynne for such a change in the planned interviews and

call me back. Ata later date, Mr. Somerville advised that a joint

converence would be held and that he had four or five areas of

concern with respect to the plaintiffs’ case. Mr. Somerville identi-

fied these areas and requested that the plaintiffs be prepared to

address these areas at the conference.

3. I began some preliminary research on Mr. Somerville’s

areas of concern. I do not recall the initial date of the joint

conference but it was rescheduled once or twice due to counsel

conflicts. The date of the meeting was finally set for June 23, 1987.

Prior to that date I received several telephone calls from Mr.

Somerville regarding my progress on his areas of concern. The

telephone calls contained specific inquiries regarding specific

aspects of the plaintiffs’ claims. I have reviewed my file for my

notes regarding these conversations but I have not been able to

find my notes. I specifically recall a telephone call on the morning

I-12

of June 23, 1987 which was participated in by another associate of

this firm, J. Michael Cooper. During the course of that conversa-

tion Mr. Somerville addressed the issue of preemption and Mr.

Somerville identified several cases which he suggested plaintiffs’

counsel review prior to the afternoon conference.

4. On June 23, 1987 the counsel for the parties in this case,

Clyde E. Riley and J. Michael Cooper of Rutledge & Kelly, P.C.

[attorneys for plaintiffs], Harry Hopkins of Lange, Simpson,

Robinson & Somerville [H.K. Porter Company, Inc. and Connors

Steel Company] and Jerome Cooper of Cooper, Mitch & Crawford

[United Steelworkers of America] met with Will Somerville and

discussed the respective evidence and law of this case. During the

course of the conference, Mr. Somerville discussed with counsel

for all parties the facts of the case and the relative positions taken

by the parties.

5. A week or ten days following the June 23, 1987 confer-

ence I saw James Nolan, one of the attorneys for Connors Steel

Company and H. K. Porter Company, Inc., while walking down-

town to lunch. I informally inquired of Mr. Nolanas to his absence

from the conference. In this conversation Mr. Nolan and | dis-

cussed the fact that the motions for summary judgment had been

under submission to the Court since January of 1986 and we

discussed the June 23, 1987 conference with Mr. Somerville. Dur-

ing the course of this conversation Mr. Noland made a statement

in passing which caused me to associate the last name of Judge

Lynne’s law clerk, “Somerville”, to the Somerville name of Lange,

Simpson, Robinson & Somerville. However, I had no idea that

Will Somerville was William G. Somerville, II], son of William G

Somerville, Jr., partner in the firm of Lange, Simpson, Robinson &

I-13

Somerville. The firm is generally referred to as “Lange, Simpson”

and, frankly, I never dreamed the son of one of the partners of the

firm opposing us in th

This text is long and has been trimmed here. Open the source document for the complete record.