Petition — United Steelworkers of America, Afl-Cio-Clc v. Edward Sadlowski and Ray Marshall, Secretary of Labor

Supreme Court brief1978

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Text

i! FILED

wr 64 3 NOV 2% 1977

IN THE neg

SUPREME COURT OF THE

UNITED STATES

October Term, 1977

we Re ee: as + ite ~camervatice _

UNITED STEELWORKERS OF AMERICA, AFL-CIO-CLC,

Petitioner,

Vv.

EDWARD SADLOWSKI

AND

RAY MARSHALL, Secretary of Labor.

Petition for a Writ of Certiorari to the

United States Court of Appeals for the Third Circuit

BERNARD KLEIMAN MICHAEL H. GOTTESMAN

1 East Wacker Drive ROBERT M. WEINBERG

Suite 1910 Bredhoff, Gottesman, Cohen

Chicago, Illinois 60601 & Weinberg

1000 Connecticut Avenue, N.W.

Washington, D.C. 20036

JAMES D. ENGLISH

CARL B. FRANKEL

Five Gateway Center

Pittsburgh, PA 15222

- Attorneys for Petitioner

TABLE OF CONTENTS

Page

ORG Ieee GRAF SIS aS Oe ek wtas owiswe ds 0a |

DESDE IE, dite 6:46 bc dis ep4.hnele F405 $0 ce esicas 2

QUESTIONS PRESENTED ..........cccccsccees 2

STATUTORY PROVISIONS INVOLVED ........ 3

STATEMENT OF THE CASE .....iccccccscccecs 5

REASONS FOR GRANTING THE WRIT ........ 12

I. The Statutory Preclusion Issue ............... 14

II. The “Common Benefit” Issue ..............-% 28

(1) Equitable Assessment ...............000: 32

C2) QR UID oc in cccccccccescesede 38

CONCLUSION

Appendices:

A. Opinion of the Court of Appeals, dated April 20,

SUE. babs cbacadons ab baSssccnsdesescasebene te la

B. Order of the Court of Appeals, dated June 3, 1977. 53a

C. Memorandum and Order of the District Court,

Gnas Benes EL, TEI oc cccccccccccisccccces 55a

D. Magistrate’s Report and Recommendations, dated

DURE Bly SOF, wadwedegeccccddsbuvesiccescetes 60a

E. Order of the Court of Appeals “Sur Petition for

Rehearing,” dated July 5, 1977 .............6.- 74a

F. Order Extending Time To File Petition For Writ

of Certiorari, dated September 23, 1977 ........ 76a

TABLE OF AUTHORITIES

Cases:

Page

Alyeska Pipeline Co. v. Wildnerness Society, 421 U.S.

ed | a Oe 12, 13, 28-33, 38-40

Calhoon v. Harvey, 379 U.S. 134 (1964) ........ 15, 36

City of Detroit v. Grinnell Corp., 495 F.2d 448 (2nd

Cae. OOPS). onccbedaseccpccsecssissnsstuseones 8, 25

Dunlop v. Bachowski, 421 U.S. 560 (1975) .......... 15

F. D. Rich Co. v. Industrial Lumber Co., 417 U.S. 116

(1978) ol ddhdbndwlch coves tr cadasediadedeieeds 24

Fleischmann v. Maier Brewing, 386 U.S. 714 (1967). 14,

17, 19-20

Hall v. Cole, 412 U.S. 1 (1973) ...... 14, 16, 17, 19-22,

32-35, 38

Hodgson v. Steelworkers, 403 U.S. 333 (1971) ....... 21

Lindy Brothers Builders, Inc. of Philadelphia v. Ameri-

can Radiator and Standard Sanitary Corp., 487. F.2d

at fo | PeerPrrriTrriririe: 7-8, 25

Lindy Brothers Builders, Inc. v. American Radiator and

Standard Sanitary Corp., 540 F.2d 102 (3rd Cir.

| Pee TOPTUTTCCTENT ETE Tee TTT Tre 24

McDonald v. Oliver, 525 F.2d 1217 (5th Cir. 1976) .. 14,

39-40

Merola v. Atlantic Richfield Co., 515 F.2d 165 (3rd Cir.

SOTRD vcvecnndhbussenacesevescdssaunpebeeenin 24

Mills v. Electric Auto-Lite Co., 396 U.S. 375 (1973).. 17,

19, 38

Trbovich v. United Mine Workers, 404 U.S. 528 (1972) 2,

10, 13, 15, 17-19, 22-23, 27-28, 31, 33, 38

ill

Page

Usery v. Local 639, International Brotherhood of Team-

sters, Etc., 543 F.2d 369 (D.C. Cir. 1976), cert. denied

sub nom., local Union No. 639 v. Marshall, U.S.

, 97 S. Ct. 1159, 51 L.Ed 2nd 573 (1977) .. 13, 17,

19, 22

Wirtz v. Bottle Blowers Assn., 389 U.S. 463 (1968) .... 15

Wirtz v. Laborers’ Union, 389 U.S. 477 (1968) ....... 21

Statutory Provisions

United States Code:

Judiciary Code, 28 U.S.C. § 1254(1) ............... 2

Labor Management Reporting and Disclosure Act of 1959:

DORE Dees Or WN OEE oc ccecccsscccescs 21, 32

pecteam BGR, TD WIA BEES cc cccccsccccstccs 16, 20

Section 201(c), 29 U.S.C. § 431(c) .............. 16

Section 304(a), 29 U.S.C. § 464(a) .............. 16

Section 402, 29 U.S.C. § 482 ............ 3-5, 14, 15

Section 403, 29 U.S.C. § 483 .............. 5, 14, 15

Section 501(b), 29 U.S.C. §501(b) .............. 16

0 EEE

SUPREME COURT OF THE

UNITED STATES

No.

UNITED STEELWORKERS OF AMERICA, AFL-CIO-CLC,

Petitioner,

Vv.

EDWARD SADLOWSKI

AND

RAY MARSHALL, Secretary of Labor.

Petition for a Writ of Certiorari to the

United States Court of Appeals for the Third Circuit

Petitioner United Steelworkers of America, AFL-

CIO-CLC (hereinafter “petitioner” or “USWA”) re-

spectfully prays that a writ of certiorari issue to re-

view the judgment of the United States Court of

Appeals for the Third Circuit entered in this case on

April 20, 1977.

OPINIONS BELOW

The opinion of the court of appeals is reported at

554 F.2d 586 and is reprinted as Appendix A. A sup-

plementary opinion by that court, issued in conjunction

with the denial of petitioner’s motion for leave to file a

petition for rehearing in excess of fifteen pages, is

unreported and appears as Appendix B. The opinion of

the district court, and the opinion of the magistrate

which was adopted by the district court, are unreported

and appear as Appendices C and D respectively.

JURISDICTION

The Court of Appeals’ opinion issued on April 20,

1977. A timely petition for rehearing was denied on

July 5, 1977 (Appendix E). On September 23, 1977,

' Mr. Justice Brennan extended the time for filing a

petition for a writ of certiorari to and including No-

vember 2, 1977 (Appendix F). The jurisdiction of this

Court is invoked pursuant to 28 U.S.C. § 1254(1).

QUESTIONS PRESENTED

1. Whether a losing candidate in a union election

who intervenes (in the limited fashion permitted by

Trbovich v. United Mine Workers) in an action brought

by the Secretary of Labor challenging that election

under Title IV of the LMRDA, may secure a “common

benefit” attorneys’ fee award against the union’s treas-

ury, or whether such an award is inconsistent with,

and therefore precluded by, the enforcement scheme of

Title IV.

2. Whether a court of appeals, believing that private

enforcement is integral to a statute’s effectiveness,

may, in the absence of statutory authority to award

fees, utilize the “common benefit” theory to stimulate

private enforcement, despite the courts’ acknowledge-

ment that most of the persons to be charged with the

fee have not received a benefit of similar nature or

value to that received by the intervenor and by a small

minority of those to be charged, and despite the fact

that those to be charged with the fee have not unjustly

been enriched by the intervenor’s efforts. Specifically,

in this case:

Sea etied

a. In a Title IV action challenging an election in

a union district containing 9% of the union’s mem-

bers, where the only allegations of misconduct in

the Secretary’s complaint concern actions of persons —

within that district, and the only relief obtained is

a re-run of the challenged election in that district,

did the court of appeals err in holding that the

“common benefit” exception could justify an attor-

neys’ fee award to an intervening candidate against

all the union’s members throughout the United

States and Canada? :

b. Where Congress has entrusted to the Secretary

the exclusive responsibility for representing the in-

terests of all union members in Title IV actions, can

a benefit conferred upon those members by an in-

tervenor in such an action constitute “wnjust en-

richment” of those members as would be required

for a “common benefit” award against them?

STATUTORY PROVISIONS INVOLVED

Section 402 of the LMRDA, 29 U.S.C. § 482, provides:

(a) A member of a labor organization—

(1) who has exhausted the remedies available

under the constitution and bylaws of such organiza-

tion and of any parent body, or

(2) who has invoked such available remedies

without obtaining a final decision within three cal-

endar months after their invocation, may file a com-

plaint with the Secretary within one calendar month

thereafter alleging the violation of any provision of

section 401 of this title (including violation of the

constitution and bylaws of the labor organization

pertaining to the election and removal of officers).

The challenged election shall be presumed valid pend-

ing a final decision thereon (as hereinafter pro-

vided) and in the interim the affairs of the organi-

zation shall be conducted by the officers elected or in

such other manner as its constitution and bylaws

may provide. —

(b) The Secretary shall investigate such complaint

and, if he finds probable cause to believe that a viola-

tion of this subchapter has occurred and has not been

remedied, he shall, within sixty days after the filing of

such complaint, bring a civil action against the labor

organization as an entity in the district court of the

United States in which such labor organization main-

tains its principal office to set aside the invalid election,

if any, and to direct the conduct of an election or hear-

ing and vote upon the removal of officers under the

supervision of the Secretary and in accordance with the

provisions of this subchapter and such rules and regu-

lations as the Secretary may prescribe. The court shall

have power to take such action as it deems proper to

preserve the assets of the labor organization.

a trial upon the merits, the court finds—

(1) that an election has not been held within the

time prescribed by section 401 of this title, or

(2) that the violation of section 401 of this title

may have affected the outcome of an election,

the court shall declare the election, if any, to be void

and direct the conduct of a new election under super-

vision of the Secretary and, so far as lawful and prac-

ticable, in conformity with the constitution and bylaws

of the labor organization. The Secretary shall promptly

certify to the court the names of the persons elected,

and the court shall thereupon enter a decree declar-

ing such persons to be the officers of the labor organi-

zation. If the proceeding is for the removal of officers

pursuant to subsection (h) of section 401 of this title,

the Secretary shall certify the results of the vote and

the court shall enter a decree declaring whether such

persons have been removed as officers of the labor

organization.

(d) An order directing an election, dismissing

a complaint, or designating elected officers of a

labor organization shall be appealable in the same

manner as the final judgment in a civil action, but

an order directing an election shall not be stayed

pending appeal.

Section 403 of the LMRDA, 29 U.S.C. § 483, provides

in pertinent part:

* * * * The remedy provided by this subchapter

for challenging an election already conducted shall

be exclusive.

STATEMENT OF THE CASE

Under Title IV of the Labor-Management Reporting

and Disclosure Act of 1959 (hereinafter “LMRDA’’)

only the Secretary of Labor may bring a civil action to

set aside the results of an election of union officers. In

November of 1973, the Secretary brought such a suit

against petitioner (hereinafter “the union’’), alleging

certain improprieties in the conduct of an election for

District Director of the union’s District 31, which

spans portions of Illinois and Indiana. The Secretary’s

complaint alleged no improprieties by the union’s na-

tional officers; all alleged misconduct was stated to

have been committed by persons within District 31.

The complaint sought to have this District 31 election

declared null and void and to have the court direct “a

new election for District Director of District 31 under

the supervision of the [Secretary].”

Respondent Sadlowski, who had been the losing can-

didate in the District 31 election, intervened in the

suit, filing a complaint which, given the limitations

imposed by law on the role of an intervenor in a Title

IV case (see pp. 22-23, infra), added no substantive

allegations to those made in the Secretary’s complaint,

but which requested eight items of relief additional to

that requested by the Secretary.

This suit was ultimately concluded when a settle-

ment agreement was negotiated between the Secretary

and the union—neither Sadlowski nor his attorneys

participated in these negotiations. Indeed, Sadlowski

filed an opposition to the motion of the Secretary and

the union to have the settlement approved. Notwith-

standing this opposition, the district court, after a

hearing, approved the settlement agreement and en-

tered the order proposed by the Secretary and the

union.

The settlement agreement as approved by the district

court expressly stated that “neither the Secretary nor

the Union concedes the validity of the claims of the

other.” The court’s order contained no finding of lia-

bility. The order simply directed that a new election,

under the supervision of the Secretary, be held for the

office of Director of District 31; the order had no ap-

plication to any other election for any other office in

the union. The order included none of the additional

relief requested in Sadlowski’s complaint.

Pursuant to the order so entered, a new election was

run in District 31 under the supervision of the Secre-

tary, Sadlowski was elected and then installed as

Director of District 31. Thereafter, Sadlowski’s at-

torneys returned to the district court and filed an

application seeking attorneys fees approximating

$500,000. The application contained forty pages of fac-

tual allegations respecting the role Sadlowski’s four

attorneys had played in their asserted 1,785 hours of

attorneys’ time, and the claimed achievements from

such efforts. In essence, the major theme of the allega-

tions was that the Labor Department had performed

poorly in a number of respects and would not have ob-

tained a new election, much less a fair new election, in

ie re

District 31 but for the efforts and prodding of Sadlow-

ski’s attorneys. As District 31 does not have a treasury

of its own, there was no way for the attorneys to seek a

“common benefit” award payable only by members in

District 31. Accordingly, they claimed to have con-

ferred a benefit on all the members of the union and

sought a “common benefit” award from the union’s

treasury containing the dues of all the union’s members

throughout the United States and Canada.

The union, stating that it “does not concede the truth

of the factual assertions in the application.” filed a

motion to dismiss the application on its face for fail-

ure, as a matter of law to state a valid claim for attor-

neys’ fees. Two independent legal grounds were cited

as the basis for this motion: (1) an award of attor-

neys’ fees would be inconsistent with, and therefore is

precluded by, the exclusive remedial scheme of Title IV

of LMRDA, and (2) even assuming arguendo that the

award were not barred by statute, the assertions of

Sadlowski’s counsel did not state a proper claim against

the union’s treasury under the “common-benefit”

theory.

In its motion, USWA made clear that the applica-

tion with its forty pages of factual assertions raised

numerous factual issues which would require “massive

discovery and an evidentiary hearing,” and therefore

requested that discovery not be commenced pending

disposition of the motion. In an accompanying memo-

randum, USWA elaborated:

“Should the Court deny this motion to dismiss,

USWA wishes to make clear that it does not con-

cede the truth of the factual assertions in the ap-

plication. Denial of the instant motion would leave

extant factual issues requiring extensive discov-

ery and ultimately an evidentiary hearing. See,

Lindy Bros. Builders Inc. of Phila. v. American

Radiator & Standard Sanitary Corp., 487 F.2d

161-170 (3rd Cir. 1973) ; City of Detroit v. Grin-

nell Corp., 495 F.2d 448, 471-472 (2d Cir. 1974).

Accordingly, since resolution of this motion may

be dispositive, USWA suggests that discovery not

be commenced until the Court decides whether to

dismiss the application for attorneys’ fees on its

face.”

The Secretary also filed a response to the applica-

tion for attorneys’ fees in which, while taking no posi-

tion as to the legal availability of the relief sought by

the application, he replied to the application’s “express

and implied criticism of the Secretary’s role in the

conduct of the litigation and the supervision of the en-

suing election. . . .” The Secretary’s response stated,

inter alia, the following:

“Without attempting to detract from the efforts

of counsel for intervenor, it must be pointed out

that it is quite cusiomary for the Department’s

investigators to receive assistance from the com-

plainant in the conduct of their investigation of

an election, even when the complainant is not rep-

resented by an attorney. Indeed it is self-evident

that the major part of the leads pursued by the

investigators in such an investigation derive from

the complainant’s allegations. However, the De-

partment pursues its own investigation to obtain

evidence which may or may not substantiate those

allegations. In this case, the Department spent

approximately 3,600 man hours in the investiga-

tion of Sadlowski’s complaint.

“After the filing of the suit, the government’s

attorneys promptly instituted discovery and

moved for expedition of the proceedings. The gov-

ernment was prepared to proceed to trial without

the additional evidence sought by counsel for in-

tervenor through his depositions. The Stipulation

of Settlement was negotiated by the government

and approved in accordance with the agreement of

the principal parties.

“The supervision of the election was the respon-

sibility of the Department of Labor. The Depart-

ment utilized the expertise gained through the

supervision of hundreds of elections during the

fifteen years of the Act’s existence. The Depart-

ment expended approximately 25,000 man hours

- in connection with its supervisory role.

“In short, the Department of Labor has con-

scientiously fulfilled its responsibilities with re-

spect to the investigation of Sadlowski’s complaint,

the successful prosecution of the litigation, and

the supervisior of the ensuing election in such a

manner as to insure the free operation of the dem-

ocratic process.”

The district court referred the union’s motion to

dismiss to a United States Magistrate who issued a

Report and Recommendation finding as a matter of law

(1) that the award sought contravened the purposes

of, and thus was precluded by, the statutory scheme of

Title IV, and (2) that, in any case, the application did

not make out a proper claim for attorneys’ fees under

the common benefit doctrine, for 91% of the fee would

be paid by members who had no stake in the District

31 election. Therefore, the magistrate recommended

that the union’s motion to dismiss be granted, and that

the application for attorneys’ fees be denied as a mat-

ter of law. (App. D). The district court issued a

memorandum in which, inter alia, it adopted the

Report and Recommendation of the magistrate. (App.

C). The application for attorneys’ fees was thus denied

by the district court.

On appeal to the Third Circuit, a divided panel re-

versed the decision of the district court. The panel

majority ruled that the district court had been wrong

on both legal grounds. As to the issue whether the

scheme of Title VII precludes a common-benefit fee

award from the defendant union’s treasury to an inter-

vening candidate, the majority reasoned, in essence,

as follows: the Supreme Court in Trbovich v. United

Mine Workers, 404 U.S. 528 (1972), reconstructed the

enforcement scheme of Title IV to create a role for a

private intervenor in Title IV actions as the only true

“adversary to the union in developing the facts and the

legal issues”; to hold that the statute precludes an

award of fees to such an intervenor would mean that

the “Supreme Court intended to create” an “empty

... role”; and, “courts and legislatures do not ordi-

narily create roles—strong roles—and then deny their

existence by refusing to recognize the existence of the

means to fulfill them effectively.” (App. 20a-21a).

As to the issue whether the prerequisites of the ‘‘com-

mon-benefit” exception could be satisfied here, the ma-

jority found that, even though the Secretary’s com-

plaint had alleged no misconduct by the union’s national

officers or by anyone outside of District 31, the mem-

bership of the union outside of District 31 benefited

from Sadlowski’s attorneys’ alleged achievements in

the lawsuit because “it would be naive to assume that

similar election ‘irregularities’ have not or would not

spread to other districts and locals... .” (App. 33a).

[The court did not explain how the disposition of the

instant case—a rerun of the District 31 election, with

no injunctive effect elsewhere—furthered the interests

of members outside District 31 even on its ‘non-naive’

assumption that violations would occur’ elsewhere].

Further, the court noted that one of a district direc-

tor’s functions, albeit not the “main function,” is to

serve on the union’s International Executive Board.

Since this Board is charged with certain functions to

be performed on the behalf of the entire membership

of the union, “{i]nterference with the election of the

District 31 director cannot be said to have a merely

localized impact on the union membership.” (App.

34a). The majority conceded that these asserted bene-

fits to members outside of District 31 are not as “great”

as the benefit to those within the District, but went on

to explain why nevertheless the “common-benefit” ex-

ception must be found applicable (App. 35a-36a) :

“The position that the USWA treasury is an

improper fund from which to make an award,

since the primary benefit was to District 31, fails

. . » While it cannot be denied that the greatest

benefit was conferred upon Union members in that

district, we note that suit was brought against the

USWA, rather than District 31, precisely because

districts are not labor organizations within the

meaning of 29 U.S.C. § 402(i), and the parent

union is the suable entity. There is, moreover, no

- district treasury, since all dues and fees are con-

tributed directly to the USWA and later some

funds are dispersed to the districts. To hold that

attorney’s fees must be recovered from a fund

created by those who received the greatest bene-

fit, rather than from a fund created by those who

received a legally sufficient and significant benefit,

would be tantamount to denial of that recovery.

But more than that, such a holding ‘would effec-

tively allow unions to insulate themselves from

union members’ attempts to prosecute Title IV vio-

lations. By creating an internal structure that co-

‘mingles funds and denies their identifiability to

an individual unit, unions could preclude recovery

of attorney’s fees. Such action would thwart the

process of complaint and productive’ intervention

by union members, and deny effect to the policies .

enunciated by the LMRDA and Trbovich.” '

Judge Aldisert dissented from the ruling of the ma-

jority on both legal issues, declaring that (1) common

benefit awards are precluded by the enforcement

scheme of Title IV and (2) an award against all the

union’s members does not fit the “common benefit”

rationale as set forth in Alyeska Pipeline Service v.

Wilderness Society, 412 U.S. 240 (1975) (App. 44a-

52a).’

REASONS FOR GRANTING THE WRIT

As we show herein, the majority of the court below

has determined two issues of broad importance in a

1 Because the district court granted the union’s motion to dis-

miss as a matter of law, the factual assertions in the applica-

tion for attorneys’ fees have never been litigated. Nevertheless,

portions of the majority’s opinion read as though said allega-

tions had been proven and found as fact by a trier of fact. As

the dissent put it (App. 50a),

“Although such rhetoric is usually associated with parti-

san politics, these are not excerpts from political campaign

literature. These are statements from an opinion of this

court. But they do not derive from the findings of any trial

court. They are conclusions drawn by the majority on the

basis of certain averments set forth in an application for

attorneys’ fees. . . . That such facts are assumed for the

purpose of testing a legal issue does not permit a court to

draw from them, as did the majority, additional non-

factual conclusions, e.g., ‘vindication of democratic process

in USWA elections,’ ‘the particularly egregious abuses of

the electoral process in this case,’ and ‘union democracy

would have been a hollow promise without Sadlowski’s

involvement.’ As a member of this court, I am constrained

to specifically disassociate myself from this extravagant

language and from any resulting inferences which tend to

impugn the integrity of the International President and

seme of the Executive Board of the Steelworkers’

nion.”

The majority’s opinion begins with a statement that it is

assuming the truth of the allegations only for the purpose of

adjudicating the propriety of the granting of a motion to dis-

miss (App. 2a), and it reiterated this statement in a prelimi-

nary ruling on the petition for rehearing (App. 54a, n. 1).

manner directly inconsistent with controlling decisions

of this Court.

First, in Trbovich v. United Mine Workers, supra,

this Court, in order to secure the integrity of the en- ©

forcement scheme of Title IV of the LMRDA, set forth

with great care the limitations on the role an intervenor

may play in a Title IV action. As we show in part I, the

majority below— ironically founding its analysis upon

Trbovich—has expanded the role of a Title IV inter-

venor beyond those limitations and brought into jeop-

ardy the congressional purposes that the Trbovich

Court sought to protect. The District of Columbia Cir-

cuit reached the same result in Usery v. Local 639 In-

ternational Brotherhood of Teamsters, Etc. 543 F.2d

369 (D.C. Cir. 1976) (hereinafter “Local 639’’), cert.

denied sub nom., Local Union No. 639 v. Marshall, —

U.S. —, 97 S. Ct. 1159, 51 L.Ed 2nd 573 (1977). If

the instant case is left to stand without further review,

it will, together with Local 639, become the operative

precedent in this important statutory area in deroga-

tion of the principles this Court sought to establish in

Trbovich.

Second, in Alyeska Pipeline Service v. Wilderness

Society, supra, the Court, in setting forth the general

rule in this country against fee shifting, gave precise

definition to the “common benefit” exception to that

rule to assure that the exception would not overwhelm

the rule. As we show in part II, the majority below, by

loosing the common benefit exception from its logic,

has in effect merely approved under another name the

“private attorney general” exception rejected in

Alyeska. Again, if the decision below goes unreviewed,

an important precedent will have been established in

contravention of the principles articulated in Alyeska.

As we further show in part II, in a critical respect this

aspect of the court’s decision is in apparent conflict

Nn OOOO ———

with the decision of the Fifth Circuit in McDonald v.

Oliver, 525 F.2d 1217, 1228 (5th Cir. 1976).

I. The Statutory Preclusion Issue

This Court has repeatedly held that the “common

benefit” exception may not be applied in a statutory

cause of action where an award of attorneys’ fees

would not be consistent with the remedial scheme estab-

lished by Congress, Fleischmann v. Maier Brewing,

386 U.S. 714, 719-721 (1967) ; Hall v. Cole, 412 U.S. 1,

9-19 (1973). In Fleischmann, the standard was stated

as follows:

“The recognized exceptions to the general rule

were not, however, developed in the context of

statutory causes of action for which the legisla-

ture had prescribed intricate remedies. Trademark

actions under the Lanham Act do occur in such a

setting. For, in the Lanham Act, Congress meticu-

lously detailed the remedies available to a plain-

tiff who proves that his valid trademark has been

infringed. . . . When a cause of action has been

created by a statute which expressly provides the

remedies for vindication of the cause, other reme-

dies should not readily be implied. . . . We there-

fore must conclude that Congress intended § 35 of

the Lanham Act to mark the boundaries of the

power to award monetary relief in cases arising

under the Act. A judicially created compensatory

remedy in addition to the express statutory reme-

dies is inappropriate in this context.”

386 U.S. at 719-721.

The post-election remedial scheme established by

Title IV is comprehensive, and Congress has declared

it to be “exclusive.” Pursuant to that scheme only the

Secretary has the power to bring a post-election chal-

lenge suit. 29 U.S.C. § 482, 483. By design, Congress

prohibited private litigants from initiating a lawsuit

to challenge a completed election.*? That prohibition re-

sulted from a congressional concern that, otherwise,

courts could be used, particularly by defeated candi-

dates, to meddle in the internal affairs of union gov-

ernment, and unions would be vulnerable to the harass-

ment and expense incident to defending against such

private litigation. Trbovich v. United Mine Workers of

America, supra, 404 U.S. at 530-537; Dunlop v. Ba-

chowski, 421 U.S. 560, 568-570 (1975) ; Wirtz v. Bot-

tle Blowers Assn., 389 U.S. 463, 470-472 (1968);

Calhoon v. Harvey, 379 U.S. 134, 140 (1964).

Further, Congress specified precisely the relief that

may be obtained from a Title IV post-election suit

brought by the Secretary (29 U.S.C. § 482(c)):

“The court shall declare the election, if any, to

be void and direct the conduct of a new election

under supervision of the Secretary and, so far as

lawful and practicable, in conformity with the

constitution and bylaws of the labor organization.

The Secretary shall promptly certify to the court

the names of the persons elected, and the court

shall thereupon enter a decree declaring such per-

sons to be the officers of the labor organization.”

This statutory remedy is comprehensive in its terms.

The remedy is public in nature; no private or indi-

vidual relief is provided. And, in 29 U.S.C. § 483, Con-

gress declared that “[t]he remedy provided by this sub-

chapter for challenging an election already conducted

shall be exclusive.”

Lest there be any doubt that Congress meant what it

said in Title IV, it should be observed that the remedial

2 As the court below acknowledged (App. 6a) :

“ * * * Congress rejected a bill, H.R. 8342, 86th Cong.,

Ist Sess § 402(a) (1959), which provided for union

members suits under IV, and authorized the award

of appropriate relief, including attorney’s fees.”

provisions of that Title stand in marked contrast to

those of the other titles of the LMRDA. Thus, all titles

of the LMRDA except Title IV reflect a congressional

determination to rely upon individual union members

to bring private suits to enforce substantive rights in-

tended not only to benefit the actual litigant but also

for the protection of the general union membership.

Further, all titles of the LMDRA except Title IV either

expressly authorize an award of attorneys’ fees or,

with the language “such relief (including injunctions)

as may be appropriate,” give courts a “broad man-

date” to exercise general equitable powers, thereby

permitting an award of attorneys’ fees justified by an

equitable exception such as the common-benefit doc-

trine. See, Hall v. Cole, supra, 412 U.S. at 11.

In the face of this statutory scheme, which manifests

a clear congressional intent to preclude private suits

and private remedies in the post-election enforcement

processes of Title IV, the majority below nevertheless

found that Congress did not intend to preclude a pri-

8 In Title I (bill of rights of union members), Congress relied

for enforcement upon civil suits brought by individual union

members “for such relief (including injunctions) as may be

appropriate.” 29 U.S.C. § 412. In Title II (reporting), Con-

gress also relied upon union members for enforcement, and

expressly provided that: “The court in such action may, in

its discretion, in addition to any judgment awarded to the

plaintiff or plaintiffs, allow a reasonable attorneys fee to be

paid by the defendant, and costs of the action.” 29 U.S.C.

§ 431(c). In Title III (union trusteeships), Congress again

created for individual union members a civil cause of action

“for such relief (including injunctions) as may be appropri-

ate.” 29 U.S.C. § 464(a). In Title V (fiduciary responsibility

of union officers), Congress not only gave union members a

right to bring suit, after exhaustion of internal union remedies,

for “damages . . . an accounting or other appropriate relief,”

but in addition specified that attorneys fees and expenses may

be allotted as part of that relief, 29 U.S.C. § 501(b). When it

came to Title IV, Congress expressly rejected proposals that

would have established a private enforcement mechanism with

attorneys’ fees available. See note 2, supra.

vate intervenor from obtaining an award of attor-

neys’ fees in a Title IV action. The analysis by which

the court below reached that result—and the analysis

by which the District of Columbia Circuit in Local 639

reached the same result—is in two steps. First, the

court found that the Fleischmann standard, quoted

above, is no longer applicable: “the analytical method

embraced by Fleischmann was substantially undercut

by later Supreme Court decisions.” (App 7a). Rather,

the court concluded, in more recent cases—Hall v. Cole,

supra and Mills v. Electric Auto-Lite Co., 396 U.S. 375

(1973)—the Supreme Court has “enunciated a pre-

sumption against preclusion” (id). Second, applying

this presumption, the court below looked not to the lan-

guage or the legislative history of Title IV, where it

could find no comfort, but to what it called Supreme

Court “supplement[s]” to and “expansion” of the

structure of Title IV. (App. 9a-10a). Thus, the major-

ity stated (App. 10a) :

“The fact that the Supreme Court has found it

necessary to supplement the structure of Title IV

on two occasions suggests that the guidelines of

Hall... have been met by the facts of this case.”

In this regard, the majority relied primarily on

Trbovich, finding that this Court would not have

“created” the “strong role” of an intervenor in Title IV

actions and then “deny [its] existence by refusing to

recognize the existence of the means [attorneys’ fees]

to fulfill [it] effectively.” (App. 21a). Indeed, the

majority read Trbovich as transforming the statutory

scheme so that the primary adversary role in a Title IV

action is now to be played by the private intervenor and

not the Secretary (App. 20a-21a) :

“The Department of Labor performs a quasi-

judicial, rather than a-purely adversarial role in

Title IV cases. Its duty is to the public, its own

policies, the union interest, and the individual. In

deciding whether to institute suit, what to com-

plain of, and what to settle for, the Secretary must

constantly weigh competing interests and duties.

Before the T'rbovich-intervenor existed, the statu-

tory scheme involved only one party truly com-

porting itself in an adversarial posture: the union.

But since T'rbovich the “union interest” is defined

by two parties with adverse viewpoints—even if

their interest in the union remains a common

denominator. The Secretary, in this circumstance,

occupies a more tenable position since he has not

only his own expertise in the field, but, in addi-

tion, the benefit of the crystallization and pres-

entation of issues and viewpoints we associate

with the adversary process. The intervenor’s role

created by Trbovich is thus that of an adversary

to the union in developing the facts and the legal

issues. What the issue of statutory preclusion of

the exercise of equitable powers boils down to in

this context is the question of how empty a role the

Supreme Court intended to create. Considering

the complexities of internal union remedies, com-

plaint to the Secretary, and recourse to the courts,

and the penalties for lack of legal or technical

sophistication, we cannot believe that intervenors

were intended to proceed pro se. To have antici-

pated the depth and quality of involvement, exper-

tise, ana enterprise shown by Despres, Rauh,

Yablonski and Schneider for a fee which the

USWA would have the courts find themseives

powerless to award would be to deny T'rbovich all

effect. While we do not consider the propriety of

an award of attorney’s fees for union member

assistance in pursuing Title IV violations where

suit is not brought or the complainant does not

intervene, we note that courts and legislatures do

not ordinarily create roles—strong roles—and

then deny their existence by refusing to recognize

the existence of the means to fulfill them effec-

tively.” |

Thus, the majority read Trbovich to have recon-

stituted Title ITV, making its enforcement scheme

nearly of the same character as the other titles of

LMRDA—save for the bothersome detail that only the

Secretary can bring a Title IV suit—and therefore

making a private award of attorneys’ fees appropriate

in a Title IV action. In the words of the Local 639

court, quoted by the majority below, App. 10a,

“notwithstanding the absence of a broad relief

provision in section 402, the court in a Title IV

action faces the same task as if it were adjudicat-

ing a union member suit under the other titles—

to grant relief according to the necessities of the

case, i.e. to fashion ‘appropriate’ relief.”

As to the first step in the majority’s analysis, we

doubt that the Court in Mills or Hall intended to change

the standard enunciated in Fleishmann.* But whether

* The Supreme Court in Fleishmann stated, “[w]hen a cause

of action has been created by a statute which expressly pro-

vides the remedies for vindication of the cause, other remedies

should not readily be implied.” 386 U.S. at 720. Neither Mills

nor Hall expressly repudiates this proposition. Rather, in each

case, the Court purports to apply the Fleischmann analysis to

the facts before it. We see no evidence of a “presumption

against preclusion” in either case, but instead an inquiry as to

whether importation of the remedy of attorneys’ fees is

consistent with the applicable statutory scheme—the inquiry

which we understand Fleischmann to mandate. The majority

below predicates its analysis on bits and pieces of language

taken out of context from Hall, which it reads to suggest a

departure from Fleishmann. A more pertinent reference to the

language'of Hell is at the point: where the Supreme: Court

states the holding on this issue; .....

“We therefore hold that the.allowance of counsel fees to

the successful plaintiff in a suit brought under § 102 of

the LMRDA is consistent with . . . the Act. ..

ee NTT

or not the Fleischmann standard has been altered, if

412 U.S. at 4 (emphasis added). In any event, more important

than the language chosen is the analysis actually applied. In

this regard, it is important to note that the factors on which the

Hall Court relied to find no statutory bar to a fee award in a

Title I action are not present here.

First, the Hall Court looked to the remedial language of

Title I which, rather than precluding judicial flexibility as to

remedy, authorizes courts to grant “such relief . . . as may be

appropriate.” 29 U.S.C. § 412. This language was critical to

the Court’s decision :

“Unlike § 35 of the Lanham Act, which specifically

‘provided not only for injunctive relief, but also for

compensatory recovery measured by the profits that

accrued to the defendant by virtue of his infringement,

the costs of the action, and damages which may be

trebled,’ § 102 of the LMRDA broadly authorizes the

courts to grant ‘such relief (including injunctions) as

may be appropriate.’ 29 U.S.C. § 412. Thus, § 102 does

not ‘meticulously detail the remedies available to a plain-

tiff,’ and we cannot fairly infer from the language of that

provision an intent to deny to the courts the traditional

equitable power to grant counsel fees in ‘appropriate’

situations.

“ .. § 102 [29 U.S.C. § 412] was premised upon the

fact that Title I litigation necessarily demands that

remedies ‘be tailored to fit facts and circumstances admit-

ting of almost infinite variety,’ and § 102 was therefore

cast as a broad mandate to the courts to fashion ‘appropri-

ate’ relief. Indeed, any attempt on the part of Congress to

spell out all of the remedies available under § 102 would

create the ‘danger that those [remedies] not listed might

be proscribed with the result that the courts would be

fettered in their efforts to “grant relief according to the

necessities of the case.” ’ ”

412 U.S. at 10-11. As we have seen, there is no such “broad

mandate” in the post-election remedial provisions of Title IV;

indeed, the contrary congressional intent is evidenced by the

fact that Congress did “spell out all of the remedies available”

under the post-election challenge provisions of Title IV.

Second, the Court in Hall was careful to show that the avail-

ability of an award of attorneys’ fees was consistent with the

enforcement scheme of Title I, which depends on lawsuits

brought by private litigants:

the language and history of Title IV are properly

“. . . [T]he award of attorneys’ fees under § 102 is

clearly consonant with Congress’ express desire to adopt

‘legislation that will afford necessary protection of the

rights and interests of employees and the public gen-

erally... .’ 29 U.S.C. § 401(b). As the Court of Appeals

recognized :

‘Not to award counsel fees in cases such as this

would be tantamount to repealing the Act itself by

frustrating its basic purpose. It is difficult for indi-

vidual members of labor unions to stand up and fight

those who are in charge. The latter have the treasury

of the union at their command and the paid union

counsel at their beck and call while the member is on

his own. . . . An individual union member could not

carry such a heavy financial burden. Without counsel

fees the grant of federal jurisdiction is but a gesture

for few union members could avail themselves of it.’

462 F.2d, at 780-781.

“Thus, it is simply ‘untenable to assert that in establish-

ing the bill of rights under the Act Congress intended to

have those rights diminished by the unescapable fact that

an aggrieved union member would be unable to finance

litigation. ...’”

412 U.S. at 13-14. The post-election enforcement scheme of

Title IV does not depend on the ability of individuals “to

finance litigation.” The statute in fact does not permit indi-

viduals to bring such litigation. Congress has vested in the

Secretary of Labor the exclusive authority to bring litigation

to upset the results of a union election. All a defeated candidate

has to do is to get his “layman’s” complaint to the Secretary.

This Court has repeatedly assumed that union members

would be performing the tasks necessary for submission of a

complaint to the Secretary without the assistance of counsel,

and has tailored the interpretation of procedural requirements

accordingly. See, Hodgson v. Steelworkers, 403 U.S. 333, 340-

341 (1971) ; Wirtz v. Laborers’ Union, 389 U.S. 477, 482-483

(1968) ; compare the decision of the majority below App. 12a,

21a. Attorneys’ fees are thus not related to proper enforcement

of Title IV; and, as shown in the text, infra, the availability of

an award of attorneys’ fees would not be consonant with the

intent of Congress to structure post-election challenge litiga-

tion so as to minimize the burden on unions.

understood, the result in this case should not be affected.

We submit that, under the words which the majority

quotes from Hall as the appropriate standard, the

remedy provided in Title IV is “ ‘meticulously detailed’

to ‘mark the boundaries of power to award monetary

relief’ ”’ and the statutory history and scheme present

a “ ‘definite and absolute setting of the Congressional

face against’”’ permitting judicial imposition of a

private award of attorneys’ fees in a Title IV action.

In concluding otherwise, the court below misunder-

stood Trbovich. That decision did not work a basic

change in the nature of Title IV litigation; to the con-

trary, it accommodated the congressional purposes

behind the Title IV enforcement scheme by defin-

ing a limited role for a private intervenor which cannot

jeopardize those purposes. The ruling below, by ex-

panding that intervention role without heed to the

limitations established by T'rbovich, does jeopardize the

very congressional objectives that Trbovich recognized

and sought to protect.

Both the court below and the Local 639 court mis-

read the sentence in T'rbovich which states that adop-

tion by the House and the Conference Committee of the

Senate’s public enforcement provisions “can in no sense

be read as a rejection of all forms of private participa-

tion in enforcement litigation, since the House at no

time considered the possibility that union members

might assist the Secretary rather than displace him.”

404 U.S. at 536. Acting as if that sentence authorized

“all forms of private participation” in a Title IV action,

the court below and the Local 639 court leapt to the con-

clusion that therefore Trbovich approves private reme-

dies to intervenors in Title IV actions. But it does not

require a careful reading of Trbovich to discover that

the decision itself rules out all forms of private partici-

pation except those which “might assist the Secretary

rather than displace him.” The T'rbovich Court circum-

scribed the role of a Title IV intervenor in this manner

to assure that unions would receive the protection

against the burdens of private plaintiff litigation that

Congress intended them to have. Those burdens are of

particular concern in the post-election challenge con-

text where defeated candidates have a motivation to

use the legal process to achieve political ends.

Therefore, the T’rbovich Court permitted private in-

tervention only to the extent it would subject “the union

to relatively little additional burden.” 404 U.S. at 536.

The permissible scope of an intervenor’s participation

was defined as follows: “Thus, at least insofar as [an

intervenor] seeks only to present evidence and argu-

ment in support of the Secretary’s complaint, there is

nothing in the language or the history of the LMRDA

to prevent such intervention.” Jd. at 536-537 (emphasis

added). But beyond support of the Secretary’s com-

plaint, the Trbovich Court refused to permit an inter-

venor to assert additional grounds for setting aside a

union election (Jd. at 537) :

“We recognize that it is less burdensome for the

union to respond to new claims in the context of

the pending suit than it would be to respond to a

new and independent complaint. Nevertheless, we

think Congress intended to insulate the union from

any complaint that did not appear meritorious to

both a complaining member and the Secretary.

Accordingly, we hold that in a post-election en-

forcement suit, Title IV imposes no bar to inter-

vention by a union member, so long as that inter-

vention is limited to the claims of illegality pre-

sented by the Secretary’s complaint.”

It is at least anomalous to say that an intervenor,

who is disabled from asserting a single new ground for

setting aside an election, may nevertheless in the con-

text of a Title IV action present a whole new claim for

a private remedy. But more important, to permit such

a claim would subject unions to litigation burdens far

in excess of those held impermissible in Trbovich. In a

case such as the instant one, as we show below, litiga-

tion over fee claims would likely dwarf the litigation

on the merits. Further, as we also show below, in the

circumstances of the case here, litigation of the attor-

neys’ fee claim would require resolution both of sub-

stantive allegations which the Secretary had made but

which because of the settlement were not litigated and

of additional substantive allegations which the inter-

venor was prohibited from raising on the merits but

which he has asserted in (and which are necessary to)

his fee application.

1. This Court has recognized “the time, expense, and

difficulties of proof inherent in litigating the question

of what constitutes reasonable attorneys’ fees” as a

reason weighing against abandonment of the American

rule. F. D. Rich Co. v. Industrial Lumber Co., supra,

417 U.S. 116, 129 (1974). In particular, litigation of

“eommon-benefit” claims can be massive,* and, because

of the nature of the theory, litigation of a ‘‘common-

benefit” claim in a Title IV case would likely be more ex-

tensive than elsewhere. The “common-benefit” theory,

based as it is on a concept akin to quantum merutt, re-

quires a showing by the applicant that he conferred a

benefit upon those against whom the fee would be

® See e.g., Lindy Bros. Builders, Inc. v. Am. Radiator, etc., 540

F.2d 102 (3rd Cir. 1976); Merola v. Atlantic Richfield Co.,

515 F.2d 165 (3rd Cir. 1975).

charged ; if the purported beneficiaries would have re-

ceived the asserted benefit anyway—e.g., if in the in-

stant case, the Secretary would have secured the same

result alone—no fee would be justified. Thus, litigation

of the fee application in Title IV actions would require

resolution of the following categories of factual issues:

(1) did intervenor’s counsel perform the numerous

services alleged in the application; (2) if so, did they

confer benefits on union members that would not have

been conferred in any event by the work of the Secre-

tary; (3) if so, how many hours were spent on activ-

ities conferring such a non-duplicative benefit ; and (4)

what is the reasonable value of the services for those

hours. See, Lindy Brothers Builders, Inc., of Philadel-

phia v. American Radiator and Standard Sanitary

Corp., 487 F.2d 161, 169-170 (3rd Cir. 1973) ; City of

Detroit v. Grinnel Corp., 495 F.2d 448, 471-472 (2nd

Cir. 1974). Issues in the second category would put the

union in the anomalous position of having to prove the

effectiveness of counsel for the Secretary during the

period those counsel were in an adversarial relationship

to the union. Putting aside the problems of privilege

that would plague such litigation, the accumulation

of pertinent evidence would be massive and complex.

The application for attorneys’ fees here contains forty

pages of factual allegations as to the services per-

formed by counsel for intervenors—in 1,785 hours of

attorneys’ time—and the achievements said to have

resulted therefrom. The application also makes numer-

ous allegations as to failures of the Secretary properly

to perform his duties. The Secretary, on the other

hand, has submitted a statement to the district court

in which he states that the Labor Department spent

over 28,000 man hours achieving the very results for

which intervenor’s counsel claim credit. It is thus under-

statement to say that litigation of the attorneys’ fees

claim here—that intervenor’s counsel conferred a

common-benefit that would not otherwise have been

conferred by the work of the Secretary—would be a

major undertaking.

2. The burdens just described are multiplied when,

as here, (i) the challenged election involved a simail

percentage of the union’s members; (ii) the Secretary’s

suit is settled without an admission or finding of lia-

bility; and (iii) the court order that flows from the

settlement has no application to the vast majority of the

union’s members. Were the award here sought merely

from the union members within District 31, it would

be of no consequence that the case on the merits was

resolved by settlement instead of by trial. The benefit

of the suit (although not necessarily the benefit of in-

tervenor’s attorneys’ efforts) was the new election, and

that benefit is no less real when achieved through a

settlement. But the settlement of the suit achieved

nothing in and of ‘tself for union members outside of

District 31; the court order contained neither declara-

tory nor injunctive relief that had any application out-

side of that District. Indeed, the court below conceived

that the “benefit” conferrzd upon members outside of

District 31 was not the relief provided in the settle-

ment, but rather the expectation that “union leader-

ship” would be deterred from engaging in misconduct

in other districts. (App. 33a.) Assuming this expecta-

tion were a valid predicate for a “common-benefit”

award (we suggest otherwise in part II, infra), it

would require vastly expanded fee litigation:

(a) The rationale is inapplicable unless there was

wrongdoing; if there was none, there is no repetition

to deter. Thus, establishing that violations occurred is

a prerequisite to the award. Where, as here, the Secre-

tary and the union settle without a finding or admis-

sion of violation, the merits would have to be tried

simply to determine whether the predicate for a fee

award exists. Apart from the burdens this would im-

pose upon the union, it would reduce the incentives for

settlement and frustrate Congress’ hope that the Sec-

retary would settle Title IV cases expeditiously.’

(b) The rationale depends upon finding further that

the violations were committed by persons who have the

capacity to commit them elsewhere, in elections involv-

ing members outside District 31. As the decision below

recognized (App. 33a), the award requires a finding

that the “union leadership” was responsible for the mis-

conduct. Here, the Secretary’s complaint alleged only

wrongdoing by District 31 members. Intervenor’s fee

application, however, alleges culpability on the part of

the union’s national officers as well. The fee litigation

thus would require adjudication of a substantive claim

never advanced by the Se..etary—whether the “union

leadership” violated Title IV—in direct contravention

of Trbovich.

As the fee application in this case reveals, the oppor-

tunity for a defeated candidate to litigate whether he

has conferred a “common-benefit” can be as. subject to

the abuse of political motivation as the opportunity to

litigate that the election was unfair. The vulnerability

of the union to burdensome, unfounded, and harassing

litigation is as great in either instance. Congress’ en-

* 2422°90 g.c69)!

" Calhoon 'v. Harvey, 879:U.S. 134, 140 (1964).

forcement scheme, found in Trbovich to require “limit-

ing” intervention to “insulate the union” from the

“burden” of defending even a single additional sub-

stantive ground advanced by an intervenor, leaves no

room for subjecting unions to litigation in Title IV

suits over a private award of fees for an intervenor.

The decision below to the contrary should not go

unreviewed.

II. The “Common Benefit” Issue

This case presents the first opportunity for this

Court to demarcate the line between the “historic”

common benefit principle recognized in Alyeska and the

“expanded” common benefit theory rejected therein.

The decision below, while paying lip-service to Alyeska,

in fact disregarded the principles established in that

decision. The majority below, invoking the label “‘com-

mon-benefit” where it does not rightfully apply, in fact

authorized an award of attorneys’ fees for the acknowl-

edged purpose of encouraging private enforcement of

a statute in which Congress had not authorized fee-

shifting. Such misuse of the “common-benefit” excep-

tion presents a significant threat that this Court’s hold-

ing in Alyeska will be undermined.

In Alyeska, this Court rejected the argument that

federal courts have eyuitable power to award fees on

a “private attorney general’ theory in the absence of

congressional authorization. Declaring that the “Amer-

ican rule” is that “the prevailing litigant is ordinarily

not entitled to collect a reasonable attorneys’ fee from

the loser,” 421 U.S. at 247, this«Geurt concluded that

it was for Congress, not the Judiciary, to determine

under which statutes, and on what terms, fee-shifting

should be allowed:

“Nor has [Congress] extended any roving au-

thority to the Judiciary to allow counsel fees as

costs or otherwise whenever the courts might deem

them warranted. What Congress has done, how-

ever, while fully recognizing and accepting the

general rule, is to make specific and explicit pro-

visions for the allowance of attorneys’ fees under

selected statutes granting or protecting various

federal rights. These statutory allowances are now

available in a variety of circumstances, but they

also differ considerably among themselves... .

Under the scheme of things, it is apparent that

the circumstances under which attorneys’ fees are

to be awarded and the range of discretion of the

courts in making those awards are matters for

Congress to determine.

“... [C]ongressional utilization of the private-

attorney general concept can in no sense be con-

strued as a grant of authority to the Judiciary to

jettison the traditional rule against nonstatutory

allowances to the prevailing party and to award

attorneys’ fees whenever t« courts deem the pub-

lic policy furthered by a particular statute import-

ant enough to warrant the award.

“Congress itself presumably has the power and

judgment to pick and choose among its statutes

and to allow attorneys’ fee under some, but not

others. But it would be difficult, indeed, for the

courts, without legislative guidance, to consider

some statutes important and others unimportant

and to allow attorneys’ fees only in connection

with the former.” 421 U.S. at 260-264 (footnotes

omitted).

This Court recognized, of course, that “in limited

circumstances” there have been found “exceptions”—

“assertions of inherent power in the courts to allow at-

torneys’ fee in particular situations, unless forbidden

by Congress,” id. at 257, 259. One of these exceptions

is the “common-benefit” rule, id. at 257-258, whose

availability this Court defined as follows:

“In this Court’s common-fund and common-

benefit decisions, the classes of beneficiaries were

small in number and easily identifiable. The bene-

fits could be traced with some accuracy, and there

was reason for confidence that the costs could in-

deed be shifted with some exactitude to those bene-

fiting.” Id. at 265, n. 39.

But the Court in Alyeska rejected any “expanded ver-

sion of the common-fund approach” which would effec-

tively nullify the American rule by making fees gen-

erally available, id. at 265-266, n. 39, declaring that the

“courts are not free to fashion drastic new rules with

respect to the allowance of attorneys’ fees” lest they

“make major inroads on a policy matter that Congress

has reserved for itself,” id. at 269.

In the instant case, the court below half-heartedly

(and erroneously, as we will show in a moment) under-

took to define certain “benefits” which all members of

the union would derive from intervenor’s efforts. But

it was ultimately forced to acknowledge that even on

its reasoning an award against the union’s treasury

would not shift the costs “with some exactitude to those

benefiting.” It acknowledged that the members within

District 31 received a greater benefit than those with-

out the District, yet each member, whether within or

without the District, would be charged equally for the

fee (App. 32a-36a). At this point in the opinion, how-

ever, the court disclosed its true concern: because Dis-

trict 31 does not have a treasury, the only vehicle

available for fee-shifting is the union’s international

treasury, and if a fee could not be assessed against the

entire union membership, “the process of complaint

and productive intervention by union members” would

be “thwart[ed],” and “the policies enunciated by the

LMRDA and Trbovich would be “den[ied] effect”

(App. 36a). The court was here repeating the conclu-

sions it had earlier reached in its “statutory preclu-

sion” analysis: to deny fee awards “would be to deny

Trbovich all effect” (id. 21a) ; “courts and legislatures

do not ordinarily create roles—strong roles—and then

deny their existence by refusing to recognize the exist-

ence of the means to fulfill them effectively” (ibid).

This language is, surely, that of the “private attor-

ney general” theory, which this Court declared in

Alyeska was not available to the Judiciary absent con-

gressional authorization. And lest there by any doubt

that this is what the court below intended, it went on to

make the point even clearer. It is more appropriate that

the wrongdoing union pay the fees than “to penalize

the intervenor who performed his function correctly

and well” (id. 35a). Never mind that the members of

the union might not appreciate a fee being charged to

them for an attentuated “benefit” they could not pos-

sible perceive: “If the rank and file is dissatisfied, their

recourse lies with the Union leaders who were respons-

ible” (ibid). This “punch-line” of the decision below is

the antithesis of “common-benefit”—it sounds more of

“common detriment” : all members should share equally

in paying for the union’s sins. That is not, we think,

one of the “historic” exceptions recognized in Alyeska.

Of course, as we have noted, the court below at-

tempted to find “benefits” accruing to all the union’s

members. But evaluated apart from the court’s ac-

knowledged “private attorney general” purpose, its

“common-benefit” analysis falls woefully short of meet-

ing the standards enunciated by this Court. Those

standards are two-fold: (1) that the costs be assessed

proportionately among those benefiting, and (2) that

absent such assessment the beneficiaries would be en-

riched unjustly at the claimant’s expense. As we show,

neither standard is met here.

(1) Equitable Assessment

As this Court stated in Alyeska, a common-benefit

award is only permissible where the “benefits [can] be

traced with some accuracy, and there [is] reason for

confidence that the costs could indeed be shifted with

some exactitude to those benefiting.” 421 U.S. at 265,

n. 39. Proper application of the exception requires that

it “will . . . operate to spread the costs of litigation

proportionately among [the] beneficiaries . . .” ibid.

The award sought here lacks the indispensible ingre-

dient of a common-benefit award: it would not spread

the costs proportionately among those who receive the

benefit.

At the threshold, it is not accurate here, as it was

in Hall v. Cole, supra,’ to say that intervenor shares the

8 The plaintiff in Hall v. Cole had been expelled from the union

for “introducing a set of resolutions alleging various instances

of undemocratic actions and shortsighted policies on the part

of union officers.” 412 U.S. at 2. His lawsuit secured a judicial

determination that the Union’s officers, by attempting to stifle

criticism of their conduct, were violating Section 101(a) (2) of

the LMRDA—the “free speech” provision of Title I. In up-

holding an award of attorneys fees under the “common benefit”

rationale, the Court explained (/d. at 8-9) :

“[T] here can be no doubt that, by vindicating his own

right to free speech guaranteed by §101(a) (2) of Title I

Le pene eee anes omen

benefits of this lawsuit in “common” with other union

members. The very reason he was permitted to inter-

vene was because he had a special, personal interest

distinct from the interest of the rest of the membership,

Trbovich, supra, 404 U.S. at 538-539: his political in-

terest in securing the $35,000 per year job of Director

of District 31. As a result of the litigation, he received

that benefit, no other union member did. At best, the

other members of the USWA secured a benefit of a dif-

ferent rank, and significantly less tangible.°

To spread the costs among all members would thus

confer a windfall upon intervenor: all members—in-

cluding the 20,000 who voted against him in the reruni,

the majority in District 31 who did not care enough to

vote at all in the rerun, and the nearly 1,300,000 who

were not even eligible to vote therein—would be forced

of the LMRDA, respondent necessarily rendered a sub-

stantial service to his union as an institution and to all of

its members. When a union member is disciplined for the

exercise of any of the rights protected by Title I, the

rights of all members of the union are threatened. And, by

vindicating his own right, the successful litigant dispels

the ‘chill’ case upon the rights of others. . . . Thus, as in

Mills [a corporate shareholder case], reimbursement of

respondent’s attorneys fees out of the union treasury

simply shifts the costs of litigation to ‘the class that has

benefitted from them and that would have had to pay them

had it brought the suit.’” (emphasis added).

® Justice Marshall’s dissenting opinion in Alyeska saw the

“common benefit” cases as one instance of a more general

equitable power to award fees where three conditions are

present, the second of which he stated as follows: “(2) the

plaintiff’s pecuniary interest in the outcome, if any, would not

normally justify incurring the cost of counsel,” 421 U.S. at

285, a condition which he believed met in Alyeska because the

plaintiffs’ involvement “was largely altruistic” and their tangi-

ble gains from litigation were “truly dwarfed by the demands

of litigation,” id. at 286. Even measured by this “expanded”

definition which the Court rejected in Alyeska, id. at 265, n. 39,

intervenor herein would not have qualified.

to finance his quest for union office through this litiga-

tion. By contrast, the plaintiff in Hall v. Cole, supra,

was an ordinary union member who secured from his

lawsuit a status and protection no different from that

which the suit assured to all other members. The rule

that a common-benefit award is permissible only where

there is “reason for confidence that the costs could be

shifted with some exactitude to those benefiting” was

met in Hall but not here.

Further, the award that appellant seeks would

come from the union’s treasury, which consists of dues

paid by 1,400,000 members throughout the United

States and Canada; and only 9% of those members are

within District 31." Thus 91% of any fee award here

would be paid from the dues of members in other dis-

tricts. Yet, the only election violations alleged in this

lawsuit were alleged to have been committed by persons

within District 31. And the consent order in the court

below merely directed a rerun of the District 31 elec-

tion. Members outside District 31 have no substantial

interest in District 31’s elections, as is evidenced by the

fact that they are not entitled to vote in those elections.

The majority below acknowledged that those within

District 31 received a “greater” benefit than those

without (App. 36a), but professed nonetheless to find

that those without “received a legally sufficient and

significant benefit” (id.). That benefit was said to come

in two parts.

First, the effect of intervenor’s actions “was vindica-

tion of democratic process in USWA elections, and his

actions redound to the common benefit of the whole

Union” (App. 33a). This i is so because

10 District 31 is an administrative sub-division of the aan

which does not have a treasury of its own. Accordingly, :the

only treasury against which intervenor could claim a fee.is

that of the union.

“Sadlowski was not merely opposed by a mem-

ber of the USWA ‘official family,’ Union officers

and agents actively campaigned against him...

Union leadership having exerted such effort to

oppose the candidacy of a single insurgent, it

would be naive to assume that similar election

‘irregularities’ have not or would not spread to

other districts and locals where a member of the

‘official family’ ran opposed. Had such tactics been

successful in District 31, there appears to be little

doubt that they would have been employed again,

and again.” (App. 33a).

This analysis is riddled with non sequiturs:

(i) As we have noted, there has been no finding in

this case that any election “irregularities” occurred;

the case was settled without an admission or finding of

liability. Before it can be assumed, even by the non-

“naive,” that irregularities “would have been employed

again, and again,” it must be found that they were

employed in the first place. (Contrast Hall v. Cole,

where there were litigated findings of illegal behav-

ior). Thus, as we have noted in Part I above, this case

would have to be tried on the merits to determine

whether this starting point for a fee award exis

(ii) As we have further noted, the only “irregulari-

ties” alleged by the Secretary were said to be com-

mitted by persons within District 31, who have no

capacity to employ them “again, and again” in other

districts. Thus even if the Secretary’s allegations had

11 Where a settlement confers benefits directly upon a class of

beneficiaries, it is unimportant whether that settlement was

predicated upon violations. But here, the settlement does not

confer any benefits directly upon members outside District 31,

and the’ benefit is said to consist of the stifling of potential

repetitions of misconduct. In that context, a determination

that there was misconduct would be critical.

ee ee

been proven and found, they would not furnish a predi-

cate for a fee award outside District 31. The majority

below thought it significant that the national officers

had campaigned for intervenor’s opponent, but to jump

from the innocent fact of campaign support to a con-

clusion that the national officers were responsible for

the local misconduct and would repeat it “again, and

again” in other districts is not only a non sequitur, as

the dissent noted (App. 50a-51a), it is contrary to the

Secretary of Labor’s determination—which Congress

intended would be conclusive*—that the sources of

wrongdoing were local. Intervenor’s attorneys pro-

posed to bridge this gap by undertaking to prove what

the Secretary did not allege—that the national officers

were responsible for the alleged violations. But as we

have explained in Part I, the congressional plan would

be undermined were intervenors allowed to prosecute

allegations against national officers—allegations not

deemed meritorious by the Secretary—solely to ration-

alize a fee award which otherwise does not fit the

common benefit rationale.

(iii) Moreover, even if such litigation were allowed,

and such violations were found, the majority below

does not explain what “benefit” would have been con-

ferred on members outside District 31 by the settle-

ment here. There is no injunction against future mis-

conduct: if misconduct occurred in a later election in

another district, the Title IV process would have to

begin all over just as if this case had never arisen. If

the court’s unstated premise is that the outcome of

this case will have educational value, teaching “union

leaders” that defective elections will have to be rerun,

it is doubly fallacious: (1) Title IV on its face teaches

that; (2) it would equally justify an award against

12 Calhoon v. Harvey, 379 U.S. 134, 140 (1964).

the treasuries of other unions, whose leaders will have

received the same education from the resolution of this

case. The court acknowledged that it would be extend-

ing the common ‘yenefit doctrine “to ludicrous dimen-.

sions” to assess an award against a large group simply

because “every union member, and every individual

might be said to benefit from vindication of union

democracy” (App. 35a).

Apart from the “vindication of union democracy”

rationale, the other “benefit” which the court below

thought inured to members outside District 31 consists

in the fact that while the “main function of a district

director” is to administer his district, each director

also serves on the union’s Executive Board (34a). But

as members in other districts have no voice in selecting

the director of District 31, a new election can “benefit”

them only if the victor happens to take voting positions

on the Board more to their liking. As this is a matter

of personal predilection, and not all would likely favor

a change, it cannot be the basis for assessing a fee

against all. Moreover, even if all members were thought

to “benefit” in this manner, the benefit is of a much

smaller order than that conferred upon members in

District 31—who allegedly have been provided an op-

portunity for democratic expression theretofore denied

them, and who are selecting the officer who will ad-

minister their day-to-day union affairs. The interest

of members outside District 31 here is less than that

of a Vermont citizen in a congressional race in Missis-

sippi (where the winner devotes a much larger propor-

tion of his time to national affairs). The logic of the

decision below thus would dictate—questions of sove-

reign immunity aside—a fee award against the United

States treasury whenever a candidate successfully

challenged election misconduct in a single congres-

sional race.

(2) Unjust Enrichment

Apart from its failure to meet Alyeska’s require-

ment of proportionate fee-shifting, the decision below

founders on a separate point: there is not here the

element of “unjust enrichment” which is the under-

lying predicate for any common benefit award.

As this Court explained is Hall v. Cole, supra:

“*Fee shifting’ is justified in these cases, not

because of any ‘bad faith’ of the defendant but,

rather, because ‘[t]o allow the others to obtain full

benefit from the plaintiff’s efforts without con-

tributing equally to the litigation expenses would

be to enrich the others unjustly at the plaintiff's

expense.’

. « e r

“Thus, as in Mills, reimbursement of respond-

dent’s attorneys’ fees out of the union treasury

simply shifts the costs of litigation to the class

that has benefited from them and that would have

had to pay them had it brought the suit.”

412 U.S. at 5-6, 8-9 (footnote omitted, emphasis added).

Critical to this concept is that the beneficiaries

would otherwise have had to pay the costs themselves

to get the benefit. But the enforcement scheme of Title

IV renders this concept inapplicable.

Neither intervenor nor any other USWA member

had the power to bring the lawsuit which conferred

the benefits here. Only the Secretary had the power to

bring that suit. When he did so, he acted, in effect, as

the attorney for all the union members affected by the

election. Trbovich, supra, 404 U.S. at 539. It is doubt-

ful that any of the members other than intervenor

would have had standing to intervene with their own

attorneys; but even if they could have, there is not a

shred of evidence to suggest that they were dissatisfied

with the lawyer which Congress provided them free of

charge. Intervenor, on the other hand, solely because of

the special personal stake he had in the lawsuit, had a

right, if he wished, to reject the Secretary’s free rep-

resentation and to intervene with his own legal coun-

sel. Ibid. He adopted that course. His intervention was

permitted only for the purpose of protecting his per-

sonal, political interests in the outcome; it in no way

diminished the exclusive role of the Secretary as pro-

tector of the general interests of the union members.

Now, the Secretary having successfully settled the suit

other intervenor’s objections, intervenor asks the entire

membership of USWA to chip in to pay the fees of his

personal lawyer—and to pay for the litigation neces-

sary to determine what those fees should be.

The concern for “unjust enrichment” underpinning

the common benefit exception to the “American rule”

does not fit this situation. Here, Congress conferred

upon all union members a complete way to vindicate

their interests in union democracy without cost: reli-

ance upon the representation of the Secretary. To have

so relied cannot be said to be “unjust.” To be saddled

with the fees for intervenor’s personal attorneys can

be said to be “unjust.”

We have dwelt at length upon the infirmities of the

decision below because we think it a dangerous pre-

cedent in two respects:

(1) In the particular instance of suits against

unions, it threatens to discard the principles of Alyeska

altogether, and to make international unions the “deep

pocket” victims of fee awards whenever subsidiary

union bodies commit violations of law. The rationale

articulated by the majority below has no stopping point

short of that result. At least one Circuit has rejected

that rationale, declaring that to assess fees against the

international for a suit which corrected violations af-

fecting a single local would be a “punitive award” not

justified by the common benefit exception. McDonald v.

Oliver, 525 F:2d 1217, 1228 (5th Cir. 1976).

(2) More importantly, the decision below maps out

an approach to undermining the principles of Alyeska

which, if not checked, would usurp from Congress the

prerogatives which Alyeska declared to reside in that

body. If courts may so blatantly enforce their “private

attorney general” precepts in the absence of statutory

authorization, with so flimsy and facile lip service to

the requirement of proportionate benefit which has

historically marked the common benefit exception,

there will be many cases in which judicial ingenuity

would be equal to the task.

CONCLUSION

For the reasons set forth hereinabove, certiorari

should be granted.

Respectfully submitted,

BERNARD KLEIMAN MICHAEL H. GOTTESMAN

1 East Wacker Drive ROBERT M. WEINBERG

Suite 1910 Bredhoff, Gottesman, Cohen

Chicago, Illinois 60601 & Weinberg

1000 Connecticut Ave., N.W.

Washington, D.C. 20036

JAMES D. ENGLISH

CARL B. FRANKEL

Five Gateway Center

Pittsburgh, PA 15222

Attorneys for Petitioner

APPENDIX

APPENDIX A

Before VAN DUSEN and ALDISERT, Circuit Judges,

and BROTMAN, District Judge.*

OPINION OF THE COURT

VAN DUSEN, Circuit Judge.

This is an appeal from a district court order, arising out

of an action brought by the Secretary of Labor (Secretary)

under Title IV of the Labor-Management Reporting and

Disclosure Act of 1959 (LMRDA), 29 U.S.C. § 481 et seq.,**

to set aside an election for district director of District 31

of the United Steelworkers of America (USWA or Union).

In this election, Edward Sadlowski, the intervenor-plaintiff,

was narrowly defeated allegedly due to voting irregularities

which violated LMRDA. After settlement was reached, a

new election was held, which Sadlowski won by a substantial

margin. The present appeal concerns the district court

denial of intervenor-plaintiff’s application for attorneys’

fees and expenses incurred in the process of protesting and

assisting the Secretary in attagking LMRDA violations.

This appeal presents important problems in the adminis-

tration of Title IV of the LMRDA. The district court held

that a defeated candidate for union office who intervenes

in an action brought by the Secretary of Labor to void

an election is precluded by the statute from recovering an

award of attorneys’ fees against the union, and that even

if there is no statutory preclusion such an intervenor may

not recover attorneys’ fees under the ‘‘common benefit”’’

doctrine for his actions in complaining to the Secretary,

participating in litigation, shaping a settlement, and helping

* Honorable Stanley S. Brotman, United States District

Judge for the District of New Jersey, sitting by designation.

** See Appendix for the most pertinent provisions of Title

IV (29 U.S.C. § 481 et seq.).

to police a rerun election.’ The Secretary takes no position

on the district court denial of attorneys’ fees.

Disagreeing with the district court as to both statutory

preclusion and ‘‘common benefit,’’ we will reverse this

district court order and remand for further consideration

of this record in the light of the applicable legal principles

and for further proceedings consistent with this opinion.

I. HISTORY OF THE CASE

As noted below at pages [5a, 25a, 30a—31la], this appeal

is before the court on a motion to dismiss in which defendant

requests that the application for attorneys’ fees ‘‘be dis-

missed on its face (see page [30a—31a] below), without regard

to the actual truth of (1) the allegations in this application,

and (2) the statements in the other record documents, such

as depositions. We emphasize that we are not passing on

the truth of the statements in the record or on the character

of the intervening plaintiffs, as opposed to that of the high-

ranking officers of the union, but we are required, under the

posture of the case as it existed at the time of the district

court order from which the appeal was taken, to take all

well-pleaded allegations in the record as true for purposes

of this appeal and to construe them in the light most favor-

! The district court concluded :

“. .. I find no support in fact or in law for the grant of

counsel fees in a suit brought under the general provisions

of Title IV of the L.M.R.D.A., 29 U.S.C. §§ 481-483.

* * * * a

... The exception . . . recognized by the Third Circuit .. .

{is} . . . (2) the conferring of a common benefit for the

recovery of a fund or property; .

* od ae

“Counsel for the intervenor has failed to demonstrate the

existence of . . . a basis in law or a recognized exception

to the general American rule which recognizes an award of

attorneys’ fees.”

Brennan v. United Steelworkers for America, Civil Action

No. 73-957 (W.D.Pa. December 11, 1975), reproduced in

appendix at 20la—206a.

We disagree with the above-quoted conclusion of the Wistrict

court as applied to this record.

able to the plaintiffs (see page [30a—3la]). These record

facts are important in the determination of whether the

district court was justified in rejecting the application for

attorneys’ fees as a matter of law, rather than making its.

decision as a matter of discretion in the = of the record

facts before it.

On February 13, 1973, the USWA held an election for

the position of district director of its District 31. That unit,

with approximately 300 locals and 130,000 members in

Illinois and Indiana, is the largest district in the Union.

This election for district director was the first to be con-

tested in nearly twenty-five years.

The candidates were Edward Sadlowski and Samuel

Evett, the personally chosen successor to the district’s long-

time director, who was retiring after thirty years in office.

Evett, in the words of then USWA President I. W. Abel,

was the candidate of the Union’s ‘‘official family.’’*? Abel

explained that the ‘‘ official family’’ was composed of incum-

bent district directors and the officers of the International

Union. The benefits of ‘‘official family’’ membership in-

cluded automatic support—financial and otherwise—in their

election efforts.*

Early election returns gave Sadlowski a lead, but a com-

plete tabulation took nearly three days. During that period

Sadlowski received reports of widespread violations of

LMRDA, such as ballot fraud, illegal electioneering, depri-

vation of secret ballot, and interference with observers. The

final tabulations published by the USWA International

Tellers were: Evett 23,394, and Sadlowski 21,606. In view of

the reports of massive irregularities, Sadlowski immedi-

ately sought legal assistance to aid him in protesting the

election in accordance with the requirements of the USWA

constitution.‘ Such ‘a challenge was mandated by the

LMRDA requirement that international union remedies be

Perici ms of I. W. Abel at 5-7, Document No. 62B in

Brennan v. U workers of America, Civil Action No.

7309678 (W.D.Pa., Filed August 22, 19%).

. Id at 6-16.

*See next page

exhausted as a prerequisite to filing a complaint about an

election with the Secretary of Labor.

Sadlowski’s protest was submitted to the USWA Inter-

national Tellers on February 23, 1973, and a hearing was

held on March 23, 1973. In late April 1973 the Tellers issued

a report upholding the election of Evett. By letter dated

May 1, 1973, Sadlowski appealed that decision to the USWA

International Executive Board, again in accordance with

the Union constitution. On May 31, 1973, with President

I. W. Abel presiding, the Board considered Sadlowski’s

complaint. On that same day the report of the Tellers was

sustained.

Sadlowski then filed a timely complaint with the Secre-

tary, pursuant to Title IV of the LMRDA, 29 U.S.C. §

482(a). The Department of Labor completed its Report of

Investigation in August 1973, and on November 8, 1973,

the Secretary instituted suit in the Western District of

Pennsylvania seeking to void the District 31 election. Sad-

lowski’s motion to intervene as a plaintiff was granted by

the district court in January 1974.

After extensive pretrial proceedings, in which Sadlow-

ski’s counsel played an active role, the district court ap-

proved a settlement agreement, on August 23, 1974. It

directed that a new election for district director be held on

November 19, 1974. In this new election, Sadlowski was

elected director of District 31 with 39,637 votes to 20,158

* Article V of the Constitution of the International Union

of the United Steelworkers of America (AFL-CIO, CLC,

adopted at Las Vegas, Nevada, September 21, 1972) provides

in relevant part:

“Sec. 18. All contests in connection with the votes of any

Local Union must be filed with the International tellers not

later than ten (10) days after the date of election, by a

member of the Local Union whose vote is contested.

* + -_ = =

“Sec. 21. All contests growing out of the report of the

International Tellers shall be filed with the International

Executive Board, not later than ten (10) days following

the mailing of the report to the Local Unions and candidates.

The International Executive Board shall decide all such

contests prior to June 1, of the election year.”

ee ——

for Evett. An order and decree, based upon the Secretary’s

certification of the election resu/ts, was entered on December

2, 1974. |

On January 31, 1975, counsel for Sadlowski submitted.

a Verified Application for Attorneys’ Fees and a support-

ing memorandum. The district court referred the applica-

tion to a magistrate. After briefing and argument, the mag-

istrate recommended that the request be denied. Sadlowski

filed exceptions to the magistrate’s recommendation, and

after a hearing the district judge overruled the exceptions

and adopted the Magistrate’s Report and Recommendation,

making the sweeping legal conclusion set forth in note 1

above. This appeal followed.

Il ISSUE OF STATUTORY PRECLUSION

The threshold question in this case is whether an

award of attorney’s fees to an intervenor-plaintiff such as

Sadlowski is precluded by Title IV of the LMRDA.®

5 This issue has apparently been considered only once before

on the appellate level, by the District of Columbia Circuit in

Usery v. Local Union 639 International Brotherhood of Team-

sters, Chauffeurs, Warehousemen and Helpers of America,

Ind., 543 F.2d 369 (D.C.Cir.1976) (hereinafter Local 639),

cert, denied sub nom. Local Union No. 639 v. Marshall, ——

US. ——, 97 S.Ct. 1159, 51 L.Ed.2d 573 (1977). We are

greatly aided by the analysis of Judge Leventhal, and reach

similar conclusions on very similar reasoning.

Local 689 differs from the instant case in that there the

court granted summary judgment for the Secretary and inter-

venors, holding certain conduct to have been violative of Title

IV; here a settlement agreement was reached whereby the

USWA agreed to conduct a new election. As the Local 639

opinion noted, and as we find, the difference is not significant.

Ultimate success in the form of a judgment has not been re-

quired in other contexts, Mills v. Electric Auto-Lite Co., 396

U.S. 375, 396, 90 S.Ct. 616, 24 L.Ed.2d 593 (1970) ; Yablonski

v. United Mine Workers, 151 U.S.App.D.C. 258, 466 F.2d 424,

431 (1972), cert. denied, 412 U.S. 918, 98 S.Ct. 272, 37 L.Ed.2d

144 (1978) ; cf. Kaham v. Rosenstiel, 424 F.2d 161 (3d Cir.),

cert. denied sub nom. Glen Alden Corp v. Kaham, 398 U.S. 950,

90 S.Ct. 1870, 26 L.Ed.2d 290 (1970), and Sadlowski’s efforts

and success are undiminished by the method used to achieve

The Union advances two reasons for finding preclusion,

both of which fall under the rubric of the nature and com-

prehensiveness of the remedial scheme: (1) the absence of

specific authorization to award attorney’s fees under Title

IV, and (2) the fact that the primary enforcement respon-

sibility for Title IV rests with the Secretary of Labor rather

than with private litigants. We disagree, because we have

concluded that the district court had the right, in its discre-

tion, to award attorneys’ fees on the record in this case.

We hold that the district court did not have the power to

reject the claim for attorneys’ fees on the basis of the legal

conclusions stated in note 1 above, which we reject.

A. Absence of Specific Authorization for an Award

The Union urges that an award of attorney’s fees under

Title IV of the LMRDA is precluded by the absence of any

specific provision for such an award in Title IV, in view of

specific provision for either attorney’s fees or appropriate

relief in Titles I, II, III and V.° It buttresses this contention

by noting that Congress rejected a bill, H.R. 8342, 86th

Con., Ist Sess. § 402(a) (1959), which provided for union

member suits under Title IV, and authorized the award of

appropriate relief, inclding attorney’s fees.

USWA primarily relies upon Fleischmann Distilling

Corp. v. Maier Brewing Co., 386 U.S. 714, 87 S.Ct. 1404,

18 L.Ed.2d 475 (1967) for the proposition that an explicit,

comprehensive, and exclusive remedial scheme may bar the

recovery of attorney’s fees. In Fleischmann, the Supreme

Court held that, because the remedial provision of the Lan-

* Title I, the bill of rights of union members, relies upon

private enforcement and provides for “such relief ... as may

be appropriate,” 29 U.S.C. § 412. Title II, reporting provisions,

also relies upon private enforcement, but expressly provides

for the discretionary award of attorney’s fees, 29 U.S.C. §

431(c). Title III, union trusteeships, provides for private en-

forcement, and, like Title I, approves relief as may be appro-

priate, 29 U.S.C. § 464(a). Title V, fiduciary responsibility

of union officers, gives union members the right to sue, and

specifically indicates that attorney’s fees are part of the

“appropriate relief” recoverable, 29 U.S.C. § 501(b).

ham Act specifically ‘‘provided not only for injunctive

relief, but also for compensatory recovery measured by the

profits that accrued to the defendant by virtue of his in-

fringement, the costs of the action, and damages which may

be trebled in appropriate circumstances,’’ (386 U.S. at 719,

87 S.Ct. at 1408), such precise specification of remedies,

encompassing authority which could as a practical matter

be used to relieve the burden of counsel fees, presented a

strong case against further judicial relief. Although we

agree that a truly comprehensive remedial scheme may bar

such an award in certain circumstances, we believe that the

analytical method embraced by Fleischmann was substan-

tially undercut by later Supreme Court decisions, thus cast-

ing considerable doubt upon the interpretation urged by

the USWA.’ m

In Fleischmann, the Court was willing to find preclusion

in Congress’ selective provision of attorney’s fees in other

statutes and unsuccessful efforts to enact a similar measure

into the Lanham Act. But in Mills v. Electric Auto-Lite Co.,

396 U.S. 375, 90 S.Ct. 616, 24 L.Ed.2d 593 (1970) and Hall v.

Cole, 412 U.S. 1, 93 S.Ct. 1943, 36 L.Ed.2d 702 (1973), the

Supreme Court enunciated a presumption against preclu-

sion and sanctioned ‘‘common benefit’’ awards in the con-

text of statutory causes of action despite the provision for

attorney’s fees in other sections of the same statute. Mills,

396 U.S. at 390-91, 90 S.Ct. 616; Hall, 412 U.S. at 10-11,

93 S.Ct. 1943.

In Hall, the Supreme Court held that a plaintiff in a suit

instituted under Title I of the LMRDA could recover attor-

ney’s fees even though Title I does not specifically authorize

such an award. It stated that unless remedies are ‘‘ ‘meticu-

lously detailed,’ ’’ to ‘‘ ‘mark the boundaries of power to

award monetary relief,’ ’’ 412 U.S. at 9, 93 S.Ct. at 1948,

or the legislative history presents an unmistakably *‘ ‘de-

finite and absolute setting of the Congressional face against

the giving of such incidental relief by the courts where

* See Comment, The Allocation of Attorney’s Fees After

Mills v, Electric Auto-Lite Co., 38 U.Chi. L.Rev. 316, 321-25

(1971).

8a .

compatible with established equitable principles,’ ’’ td. at

12, 93 S.Ct. at 1950, it will not be inferred that Congress

desired to deny to the courts the traditional power to grant

equitable relief in the form of counsel fees in appropriate

cases.

At oral argument the Union’s counsel contended

that the rejection by Congress of a version of Title IV that

provided for direct private enforcement and attorney’s fees

was conclusive evidence of an intent to limit the courts’

exercise of their equitable powers in suits under Title IV.

Such intent cannot, in our view, be drawn from the legis-

lative record. As the Supreme Court’s review of this legis-

lative history in Trbovich v. United Mine Workers, 404 U.S.

528, 532-36, 92 S.Ct. 630, 30 L.Ed.2d 686 (1972) makes clear,

congressional debate centered upon the relative merits of

enforcement actions by union members and by the Secretary

of Labor—not upon the propriety or the possiblity of

equitable awards. Local 639 pointed out:

‘‘The Conference Committee and the House ultimately

adopted the public enforcement scheme of the Kennedy-

Ervin bill, S. 1555, presumably because they agreed with

the Senate that the Secretary should screen frivolous

complaints and consolidate meritorious ones.” This leg-

51 The Conference Report simply states that the Senate bill’s

administrative enforcement scheme prevailed over the House

bill’s private suit provision, without tendering any explana-

tion for the outcome. H.R.Rep.No.1147, 86th Cong., Ist Sess.

35 (1959).

islative history, as Trbovich holds, ‘can in no sense be

read as a rejection of all forms of private participation

in enforcement litigation,’ because Congress never fo-

cused on ‘the possibility that union members might assist

the Secretary rather than displace him.’ Jd. at 536, 92

S.Ct. 630. Similarly, while Congress adopted a particular

mode of enforcement, it failed to address with any detail

the scope of relief, or what the court’s role would be at

the remedial stage. [One footnote omitted.]”’

543 F.2d at 387. In no sense can this legislative history be

said to offer the affirmative guidance the Union asserts that

it does. As Professor Archibald Cox, a principal consultant

to the draftsmen of the LMRDA, has suggested:

‘*because much of the bill was written on the floor of

the Senate or House of Representatives and because so

many sections contain calculated ambiguities or political

compromises . . ., the courts would be well advised to

seek out the underlying rationale without placing great

emphasis on close construction of the words.’’

Internal Affairs of Labor Unions Under the Labor Reform

Act of 1959, 58 Mich.L.Rev. 819, 852 (1960). To hold that

the undisenssed, unexplained adoption of an alternative

enforceraent scheme satisfies the ‘‘definite and absolute’’

standara promulgated by Hall would, in this case, be

incorrect.

Nor do we believe that the remedial scheme created by

Title IV approaches the meticulous detail of the provision

involved in Fleischmann—or the detail necessary for a find-

ing of preclusion of equitable powers and remedies. Since

its enactment, the LMRDA, and Title IV, enforcement

scheme has been filled out by the court with many details.

In Hall v. Cole, which dealt with preclusion of the exercise

of equitable powers and the award of attorney’s fees under

Title I of the LMRDA, the petitioners argued that Congress

intended to preclude any such award under Title I since

it only provided for ‘‘such relief (including injunctions)

as may be appropriate,’’ while §§ 201(¢c) (29 U.S.C. § 431

(c)) and 501(b) (29 U.S.C. § 501(b)), expressly provided

for attorney’s fees. In response, the Supreme Court stated

that:

‘‘Confronted with a virtually identical situation in

Mills, we explained that the inclusion in certain sections

of the Securities Exchange Act of 1934 of express provi-

sions for recovery of attorney’s fees ‘should not be read

as denying to the courts the power to award counsel fees

in suits under other sections of the Act when circum-

stances make such an award appropriate. . . .’ 396 U.S.,

at 390-91, 90 S.Ct. [616], at 625.”

412 U.S. at 11, 93 S.Ct. at 1949.

Title IV itself has been the subject of considerable judicial

a i i a i a a

10a

elaboration and expansion. In Trbovich, supra, the Supreme

Court held that union member intervention in suits brought

by the Secretary for violation of Title IV was not precluded

by the fact that actions by the Secretary are the exclusive

post-election remedy provided for by the statute. T'rbovich

was extended in Dunlop v. Bachowski, 421 U.S. 560, 95 S.Ct.

1851, 44 L.Ed.2d 377 (1975), which held that union members

are entitled to a statement of supporting reasons where

the Secretary decides not to pursue the union member’s

complaint.

The fact that the Supreme Court has found it necessary

to supplement the structure of Title [IV on two occasions

suggests that the guidelines of Hall (see page [7a—8a]

above) have been met by the facts of this case. Also, Trbo-

vich and Bachowski go much further toward supporting the

view that:

‘‘notwithstanding the absence of a broad relief provi-

sion in section 402, the court in a Title IV action faces the

same task as if it were adjudicating a union member suit

under the other titles—to grant relief according to the

necessities of the case, «.e., to fashion ‘appropriate’

relief.’’

Local 639, 543 F.2d at 388. The question is not whether a

union member is entitled to recover attorney’s fees under

the statute alone, where the role prescribed for him is com-

plaint to the Secretary after exhaustion of internal union

procedures. The question is what relief a union member

is entitled to after having intervened in and participated

in the prosecution of an action brought by the Secretary

under Title IV in the manner anticipated by the Supreme

Court in Trbovich.

B. Intervenor’s Role in Administrative Enforcement

At the outset of this inquiry, it is.elear that the Sec-

retary has the exclusive power to bring post-election chal-

lenge suits, and that aggrieved candidates are permitted to

intervene solely to support the Secretary’s complaint and

may not add substantive claims. See Trbovich, 404 U.S. at

530-37, 92 S.Ct. 630. However, correct as those observations

are, they overlook the role of union members and interven-

lla

ors in prosecution of Title IV violations, and the relation-

ship between union members, intervenors, and the Depart-

ment of Labor under both the statute and the relevant

Supreme Court decisions. '

Even a sciut the gloss of case law, it is apparent that the

Congress intended to rely heavily upon the vigorous efforts

of union members in prosecuting Title IV violations. The

statutory framework embodies a critical role for union

members.

The initial burden of enforcement falls upon the individ-

ual member, and the Secretary’s role is defined by those

efforts. The first step in enforcement, under section 402(a),

is for a union member to challenge the election before the

union. Once remedies available under the union constitution

and by-laws have been exhausted, or have been invoked

without obtaining final decision within three calendar

months, the union member may, within one calendar

month thereafter, file a complaint with the Secretary alleg-

ing violation of any provision of Title IV.

Once the union member’s complaint has been filed with

the Secretary, section 402(b) directs the Secretary to inves-

tigate it. If he finds probable cause to believe that a viola-

tion has occurred and has not been remedied, he must, within

60 days after the filing of such a complaint, bring a civil

action in federal district court against the labor organiza-

tion to set aside the invalid election. If the court finds a

violation of Title IV it may declare the election void, and

direct the conduct of a new election under the Secretary’s

supervision.

As the Supreme Court’ 's review of the legislative history,

in Trbovich, 404 U.S. at 532-33, 92 S.Ct. at 633, indicates:

‘‘Congress made suit *by the Secretary the exclusive

post-election ‘remedy for two principal reasons: (1) to

-protect unions from frivolous litigation and unnecessary

judicial interference with their elections, and (2) to cen-

tralize in a single proceeding such litigation as might be

warranted with respect to a single election. Title IV as.

enacted serves these purposes by referring all complaints

to the Secretary so that he ean screen out frivolous ones,:

12a

and by consolidating all meritorious complaints in a single

proceeding, the Secretary’s suit in federal district court.

The alternative proposals were rejected simply because

they failed to accomplish these objectives. There is no

evidence whatever that Congress was opposed to partici-

pation by union members in the litigation, so long as that

participation did not interfere with the screening and

centralizing functions of the Secretary.”’

The addition of the exhaustion requirement, section 402(a)

(1), provides additional protection for the union, since

unions are thereby given the opportunity to resolve union

member complaints internally and may correct any election

irregularities themselves. Yet, as is undeniably apparent,

at the same time Congress sought to prevent frivolous liti-

gation it created a pivotal role for union members in the

enforcement process.

In fact, quick action and skillful advocacy are prob-

ably most important at the initial stages of the enforcement

scheme, when infractions must be identified, a bill of par-

ticulars formulated, the internal union procedures exhaust-

ed, and a complaint drafted for presentation to the Secre-

tary. Prompt, thorough, and proper action in the earliest

stages is essential to vindication of Title IV rights, since

preservation of all election defects is a prerequisite to gov-

ernment intervention. The Secretary may not seek to avoid

an election on bases not raised in ‘‘some discernible fash-

ion’’ by the complainant before the union, Hodgson v.

Local 6799, Steel Workers, 403 U.S. 333, 340-41, 91 S.Ct.

1841, 29 L.Ed.2d 510 (1971), or which the union did not

have a fair opportunity to consider and redress. Wirtz v.

Local 125, Laborers, 389 U.S. 477, 484, 88 S.Ct. 639, 19

L.Ed.2d 716 (1968). The clear effect of Title IV is to make

the Secretary dependent upon the diligence of the union

member. The Secretary’s very authority to sue derives from

the union member’s pursuit of Title IV remedies and sub-

sequent formal filing of a complaint with the Secretary.

Since Trbovich, union members play an even more signifi-

cant role in the prosecution of Title IV violations, as inter-

venors. As the United States Court of Appeals for the Dis-

13a

trict of Columbia Circuit noted in Local 639:

“It is not difficult to conceive of examples of material

assistance to the Secretary and the court in the vindica-

tion of the interest—of the public and the union rank and’

file—in union democracy... . [C]ounsel representing the

intervenor may unearth material and even elusive evi-

dence, or develop telling arguments in support of the

Secretary’s claims of illegality. ... [T]he Trbovich court

envisoned that intervenors would perform a role inde-

pendent of the Secretary in helping the court fashion a

suitable remedial order, and perhaps even assist the Sec-

retary in supervising the conduct of the rerun... .

[S]ound principle advises that error is more likely to be

exposed when intervenors are able to secure competent

counsel because of the prospect of recovering attorney’s

fees.’’ [Footnotes omitted. ]

543 F.2d at 384.

The notion of private participation in the prosecution

of Title IV violations, notwithstanding the involvement of

the Department of Labor, is fully consistent with the form

and purpose of this statute. Not only is the intervenor often

in a position to obtain information which might, for what-

ever reason, be difficult for the agency to marshall or pre-

serve, but his perspective and the intensity of his interest

allow him to contribute to the court’s total understanding.®

Sadlowski’s experiences and activities in protesting elec-

tion irregularities provide a vivid illustraton of obstacles

which complainants and intervenors face—and the insights

their involvement can render. They also offer a glimpse into

the actual operation of Title IV.

After suspiciously late returns from key locals, and re-

ports of Title IV violations during the February 13, 1973

election, Sadlowski decided to contest the reported results

and sought legal assistance. His need for counsel cannot be

doubted. From the time, three days after the election, that

Chicago attorney Leon Despres agreed to represent him,

® Shapiro, Some Thoughts on Intervention Before Courts,

Agencies, and Arbitrators, 81 Harv.L.Rev. 721, 746 (1968).

l4a

Sadlowski had only seven days to file an appeal with the

USWA International Tellers, under the terms of the Union

constitution. To appeal an election involving 300 locals with

130,000 members is no mean task under the most congenial

circumstances, and time constraints, combined with the ne-

cessity for aceurate, complete, and properly presented

claims firmly underscore the fact that Sadlowski’s decision

to seek legal assistance in the prosecution of the challenge

was neither gratuitous nor whimsical.

As noted above, Title IV of the LMRDA requires that the

complaining union member exhaust internal remedies before

complaining to the Secretary of Labor. But even after those

procedures have been pursued, the Secretary is dependent

upon the substance of the union member’s complaint to the

union.

During the seven-day period after he agreed to aid Sad-

lowski, Despres examined the USWA constitution and pro-

cedures, and the applicable legal authorities. He interviewed

Sadlowski and numerous witnesses, and assisted Sadlowski

in interviewing still other witnesses. He prepared affidavits

and statements, and gathered documents. Sadlowski sub-

mitted his protest of the election to the USWA Interna-

tional Tellers on February 23, 1973. During the month be-

tween submission of his protest and the date which had been

set for hearing, Despres continued to supervise efforts to

obtain evidence for the hearing, and prepared materials for

Sadlowski to utilize at the hearing (which Despres was not

permitted to attend).

When the International Tellers upheld the result of the

disputed election, and Sadlowski decided to contest their

decision, Despres aided him in exhausting internal union

remedies through assistance in his appeal to the Interna-

tional Executive Board. Sadlowski appeared before that

body, presided over by USWA President I. W. Abel (who

had previously campaigned for Evett). Despres was not

permitted to accompany Sadlowski at the Executive Board

hearing.

When the International Tellers report was upheld by the

Union leadership, Sadlowski resolved to complain to the

15a

Secretary pursuant to 29 U.S.C. § 482(a), requiring that a

complaint be filed within 30 days of exhaustion of union

remedies leading to denial of relief. In preparation, Despres

interviewed witnesses to obtain statements and conferred

with Sadlowski for the purpose of preparing materials to be

filed with the Department of Labor in order to induce the

Secretary to challenge the election. Despres assisted Sad-

lowski in the preparation of a brief and argument for the

Secretary of Labor, which accompanied the actual com-

plaint filed with the Secretary. The materials and complaint

presented to the Secretary totalled nearly 100 pages.

Under these circumstances, the Department of Labor

relied almost exclusively upon Sadlowski’s charges in con-

ducting its investigation. The compliance officer in charge

of the investigation noted that in making its inquiry the

Department concentrated upon those locals at whch Sad-

lowski alleged the most egregious violations to have oc-

curred. Sadlowski’s allegations were borne out by the De-

partment’s own investigation.

Nevertheless, the Department did not bring suit within

the 60 day period required by statute, and instead agreed

with the USWA in both July and August of 1973 to exten-

sions of time within which any action might be brought.

Sadlowski and Despres became understandably apprehen-

sive about the Department inaction, in view of findings by

Department investigators of wrong-doing. Concerned about

the prospect of further delay, they agreed that Sadlowski

should seek the assistance of a Washington, D.C. attorney,

Joseph Rauh, Jr., experienced in LMRDA proceedings.

Rauh agreed to assist Sadlowski and Despres. as

Shortly after Rauh was retained, the Department of La

bor agreed to the further extension of the time for bringing

any action until November 1973. Rauh immediately protest-

ed the extension to the Department, and no further exten-

sions were granted. Rauh familiarized himself with the elec-

tion and informed the Deputy Assistant Secretary of Labor

of the nature and degree of the violations which had oc-

curred. Rauh also indicated his intention to bring suit to

set aside the arbitrary inaction of the Secretary if suit were

16a

not instituted by November. Cf. Dunlop v. Bachowski, 421

U.S. 560, 95 S.Ct. 1851, 44 L.Ed.2d 377 (1975). The Secre-

tary did institute suit challenging the District 31 election, on

November 8, 1973. Sadlowski’s counsel thereupon assisted

him in intervening in the Secretary’s action and obtaining

the aid of local counsel from Washington, Pennsylvania,

Kenneth Yablonski. Upon the granting of intervention

Sadlowski and his counsel enlisted the aid of a younger

New York attorney, Judith Schneider, to assist in the con-

siderable task of gathering and presenting evidence.

Although the suit had been filed in November 1973, and

despite Congress’ apparent intention that such suits be

expec ted, the first significant step in prosecution of the

action occurred after Sadlowski’s intervention in January

1974, and a February 1974 meeting with Department of

Labor officials at which Sadlowski’s attorneys urged prompt

action in the case. The Department officials informed Sad-

lowski’s attorneys at the meeting that the latter could be

of valuable assistance to the Department in following up

leads and in providing information relevant to the prosecu-

tion of the case. The USWA finally filed its answer to the

complaints, and the Department, armed with information

provided by Sadiowski’s attorneys and at their urging, took

its first step toward discovery: the service on the USWA

of a request to produce documents. The Department also

filed a motion for expedited trial and to fix the discovery

calendar, which Sadlowski’s attorneys supported by an ex-

tensive memorandum urging a prompt resolution of the

case. In response, the USWA asserted that it would be

difficult to begin discovery until August 1974.

The district court conducted a hearing on the Depart-

ment’s motion on March 21, 1974, and was critical of the

delays both in the Department’s filing of the complaint, and

in the USWA’s filing of its answers. Counsel for both the

Department of Labor and the USWA indicated that they

had tentatively agreed that discovery could begin as late as

August of 1974. Sadlowski’s attorneys opposed such a

schedule and urged that discovery should begin immediately

and be completed as soon as possible. Accepting the recom-

17a

mendation of Sadlowski’s attorneys, the district court or-

dered that discovery be completed within 90 days.

Nevertheless, the only Department of Labor discovery

which took place within that 90-day period turned out to_

be the April 1974 service of interrogatories on the USWA.

Also in April, Sadlowski’s attorneys were advised that set-

tlement negotiations were taking place between the Depart-

ment and the USWA. A Department official informed Sad-

lowski’s counsel that the Department was considering

USWA proposals to divide District 31 into two parts (Illi-

nois and Indiana), and another proposal to conduct a new

election, but with a reopening of nominations. Sadlowski’s

attorneys strongly protested these proposals.’ The ultimate

settlement agreed to by the Department did not include

either proposal.

In early May 1974, Sadlowski’s attorneys were advised

by the Department of Labor Regional Solicitor in Chicago

that he believed continued efforts by Sadlowski would ma-

terially aid in securing USWA capitulation and agreement

to a new election. Also, a Department lawyer in Philadelphia

told Sadlowski’s lawyers that Department investigation

would proceed no further. Sadlowski’s counsel thereupon

continued their own investigation into the improprieties in

the original election, particularly into ballot frauds by local

union officials, and the use of union funds for Evett’s cam-

paign. Among other activities, Sadlowski’s attorneys took

the depositions of Evett, and his campaign manager. They

also noticed the depositions of presidents of local unions

within District 31 where considerable evidence of ballot

fraud was found; there were allegations of involvement by

Evett’s staff in those instances. In at least one local, the

membership had imposed fines and suspension upon its

president and tellers for vote fra d. An International Com-

mission of USWA officials later recommended that the fines

and suspensions be lifted. Sadlowski’s attorneys protested

18a

this action in a telegram to the International Executive

Board, which decided to reject the recommendation.

When the Department sought Sadlowski’s consent to the

proposed settlément agreement, in July 1974, Sadlowski’s

attorneys proposed changes in the settlement calculated to

assure a fair election. They moved for a hearing on the

Department/USWA motion for approval of the settlement,

at which the suggested amendments were presented to the

district court. But while urging the court to exercise its

power to assure fair terms for a new election, Sadlowski’s

attorneys indicated that any new election, however unfair,

would be preferable to further delays. Sadlowski’s attor-

neys were successful in achieving a stipulation that there

would be no changes in the boundaries of District 31, as

had previously been suggested by the Department and

USWA, and they convinced the court that the new election

should be held before November 19, 1974, as opposed to the

November 29 date proposed in the agreement—which fell on

Thanksgiving weekend and might well have resulted in a

small turnout for the new election. In addition, Sadlowski’s

attorneys argued their case against a mail ballot, the use

of which was ultimately abandoned by the Department.

At the same August 29, 1974 hearing the district court

also made it clear that it expected Sadlowski to forward a

plan for a fair election to the Department of Labor, and

his counsel did forward to the Secretary an extensive appli-

cation seeking orders which would insure a fair election.

The Department of Labor indicated, in October 1974, the

actions it had taken in response to Sadlowski’s requests,

and stated that it had gained the USWA’s agreement to

abandon the mail ballot in favor of on-site voting in the

new election. The Department also required that certain staff

contributions of time and money to union-backed candidates

be circumscribed and carefully controlled, and that records

of such contributions be maintained. In direct response to

Sadlowski’s request, the Department also agreed to issue

an order forbidding union staff members from campaigning

on union time or utilizing union facilities for campaigning.

The Department also decided to order the USWA ‘to pre-

19a

pare certain lists of information relating to the various

locals within District 31, and to provide such information

to all candidates, including Sadiowski. The record makes

clear that the impetus for many of these actions was Sad-

lowski’s urging.

As a result of further prodding, the Department of Labor

held a pre-election conference in Chicago. Sadlowski’s coun-

sel succeeded in proposing and embodying numerous pro-

visions in the rules for the upcoming election, including: a

provision for custody of ballots in and accrediting of elec-

tion observers by the Department of Labor; a provision

requiring that the election supervisor be given the identity

and addresses of various worksites (and that the same be

given to Sadlowski as well) ; a provision for record-keeping

as to contributions by staff representatives of the USWA to

candidates in the election. Sadlowski’s counsel later per-

suaded the Department to send a letter with the election

rules to the effect that campaigning on union time by union

staff employees was improper. : ;

The Department of Labor also agreed with the suggestion

of Sadlowski’s counsel that observers: be permitted at the

sites to assist the Department in monitoring the election,

and conceded that it alone could not enforce the election and

campaigning rules. The Departmeni therefore encouraged

the filing of compaints relating to election violations, and

Sadlowski’s attorneys undertook to assist the Department

in enforcing those rules and insuring a fair election. Sad-

lowski’s counsel were also active in widely dissemmating

the rules, and encouraging union members to report viola-

tions, and they pinpointed particularly problematic proce-

dures, and problem locals. At their urging, the Department

implemented systems designed to speed the checking of

voter eligibility and avoid voting card fraud and delays

from too few voting lines. The final Department of Labor

figures for the election were: Sadlowski 39,637 and Evett

20,158. By the time oi the election, Evett had held the dis-

puted position for over a year and. one-half. |

This detailed recapitulation of the actions under-

taken by Sadlowski’s attorneys is not in any sense intended

20a

to denigrate or detract from the enormous effort which the

Department of Labor devoted to the prosecution of the vio-

lations and the conduct of a fair election. The record makes

clear the mairy thousands of man-hours which the Depart-

ment spent on this case, and we do not suggest that they

were other than conscientiously and profitably expended.

However, we disagree with the district court characteriza-

tion of the efforts of intervenor Sadlowski’s counsel as

‘‘self-serving and at the most a mere fraction of and

duplicitous of the work entrusted to the Secretary by the

Congress.’’ Brennan v. United Steelworkers of America,

District 31, Sadlowski, Intervenor, Civil Action No. 73-957

(W.D.Pa. December 11, 1975), reproduced in appendix at

201a-207a. As the survey above suggests, an intervenor can

fulfill many functions, and the better the lawyers involved

the better this scheme will function. As Local 639 indicates:

‘“‘As the Secretary’s determination to take no position

on this issue [of the propriety of an award of attorney’s

fees] suggests, allowance of attorney’s fees for union

member efforts in aid of the Secretary’s action does not

undercut the exclusivity of the administrative remedy.

‘Congress, although committed to minimal intervention,

was obviously equally committed iv making that interven-

tion, once warranted, effective in carrying out the basic

aid of Title IV.’ Wirtz v. Local 153, Glass Bottle Blowers,

389, U.S. 463, 88 S.Ct. 643, 19 L.Ed.2d 705 (1968).

043 F.2d at 385-86. The agency and the intervenor perform

truly different roles, with, in our view, considerably less

overlap and waste than the district court found. The De-

partment of Labor performs a quasi-judicial, rather than a

purely adversarial role in Title IV cases. Its duty is to the

public, its own policies, the union interest, and the individ-

ual. In deciding whether to institute suit, what to complain

of, and what to settle for, the Secretary must constantly

weigh competing interests and duties. Before the Trbovich-

intervenor existed, the statutory scheme involved only one

party truly comporting itself in an adversarial posture:

the union. But since Trbovich the ‘‘union interest’”’ is de-

fined by two parties with adverse viewpoints—even if their

21a

interest in the union remains a common denominator. The

Secretary, in this circumstance, occupies a more tenable

position since he has not only his own expertise in the field,

but, in addition, the benefit of the crystallization and presen- .

tation of issues and viewpoints we associate with the adver-

sary process. The intervenor’s role created by Trbovich is

thus that of an adversary to the union in developing the

facts and the legal issues. What the issue of statutory pre-

clusion of the exercise of equitable powers boils down to in

this context is the question of how empty a role the Supreme

Court intended to create. Considering the complexities of

internal union remedies, complaint to the Secretary, and

recourse to the courts, and the penalties for lack of legal or

technical sophistication, we cannot believe that intervenors

were intended to proceed pro se. To have anticipated the

depth and quality of involvement, expertise, and enterprise

shown by Despres, Rauh, Yablonski and Schneider for a fee

which the USWA would have the courts find themselves

powerless to award would be to deny Trbovich all effect.

While we do not consider the propriety of an award of at-

torney’s fees for union member assistance in pursuing

Title IV violations where suit is not brought or the com-

plainant does not intervene, we note that courts and legisla-

tures do not ordinarily create roles—strong roles— and then

deny their existence by refusing to recognize the existence

of the means to fulfill them effectively. Nothing has been

suggested to us which indicates that the Secretary’s role

could be or has been threatened by Sadlowski’s attorneys,

and it is difficult to imagine more vigorous or skillful action.

Nothing in either the statute or the legislative history of the

LMRDA suggests to us the preclusion of the courts , tradi-

tional equitable power to provide complete relief in light

of the statutory purpose. it an

We hold that an award of equitable relief is wholly

consistent with Title IV of the LMRDA. Our consideration

of the basis for such an award in this case, ‘‘common bene-

fit,’’ follows.

22a

Ill. “COMMON BENEFIT”’

Although the traditional American rule disfavors

the award of attorney’s fees in the absence of statutory or

contractual authorization, the federal courts have the in-

herent power to fashion such equitable relief, payable by

those enjoying a common benefit, under certain circum-

stances, see, Hall v. Cole, 412 U.S. at 45, 93 S.Ct 1943;

Sprague v. Ticonic National Bank, 307 U.S. 161, 166, 59

S.Ct. 777, 83 L.Ed. 1184 (1939), and have not hesitated to

use this power where ‘‘overriding considerations indicate

the need for such a recovery,’’ Mills v. Electric Auto-Lite

Co., 396 U.S. 375, 391-92, 90 S.Ct. 616, 625, 24 L.Ed.2d 593

(1970) ; see Fleischmann, 386 U.S. at 718, 87 S.Ct. 1404. The

courts have been particularly sensitive to the need and de-

sirability of the allowance of attorney’s fees in cases where

a plaintiff’s prosecution of an action confers ‘‘a substantial

benefit on the members of an ascertainable class, and where

the court’s jurisdiction over the subject matter of the suit

makes possible an award that will operate to spread the

costs proportionately among them,’’ Mills, 396 U.S. at 393-

94, 90 S.Ct. at 626. In such cases, ‘‘fee-shifting’’ has been

deemed appropriate because ‘‘to allow the others to obtain

full benefit from the plaintiff’s efforts without contributing

equally to the litigation expenses would be to enrich the

others unjustly at the plaintiff’s expense.’’ Jd. at 392, 90

S.Ct. at 625; Hall v. Cole, 412 U.S. at 6, 93 S.Ct. 1943. The

vitality of this ‘‘common benefit’’ exception has been af-

firmed recently by the Supreme Court in Alyeska Pipeline

Co. v. Wilderness Society, 412" vm 240, 257-59, 95 S.Ct.

1612, 44 L.Ed.2d 141 (1975).” ii

As the Alyeska Court stated, the roots of this exception

lie in ‘‘the historic power of equity to permit the trustee

of a fund or property, or a party preserving or recovering

a fund for the benefit of others in addition to himself, to

recover his costs, including his attorney’s fees from the fund

or property itself or direetly from the other parties ‘enhjoy-

ing the benefit. That rule has been consistently followed.”

Id. at 257-58, 95 S.Ct. at 1621, citing Trustees v. Greenough,

105 U.S. 527, 26 L.Ed. 1157 (1882). As pointed out by Judge

Leventhal in Local 639, 543 F.2d at 382-83:

‘*This ‘historic power of equity,’ essentially an appli-

over a case to award complete relief so'as to prevent

unjust enrichment, has developed well beyond the ‘com-

mon fund’ limitation of Greenough. In Sprague v. Ticonic

Nat’l Bank,.307 U.S. 161, 166, 59 S.Ct. 777; 83 L.Ed. 1184

(1939), the Court recognized power in the district court

to reimburse a plaintiff’s litigation expenses even though

she sued for her own benefit and not for a class, because

her success would by operation of stare decisis entitle

others to recover out of the same assets. There is no pre-

requisite of pecuniary benefit, as was made clear by Mills

v. Electric Auto-Lite Co., 396 U.S. 375, 392-94, 90 S.Ct.

616, 24 L.Ed.2d 593 (1970), a case involving a judicially

implied right of action under the Securities Exchange

Act of 1934 to challenge materially false or misleading

proxy solicitation.” Hall v. Cole, |

2° Mills permits ‘depart{ures] further from the traditional

metes and bounds of the [common fund] doctrine’ where

‘litigation has conferred a substantial benefit on the mem-

bers of an ascertainable class, and where the court’s juris-,,

diction over the subject matter of the suit makes possible an

award that will operate to spread the costs amo them.’

396 U.S. at 393-94, 90 S.Ct. at 626. 7

Cole, 412 U.S. 1, 93 S.Ct. 1943, 36 L.Ed.2d 702 (1973),

extends Mills to an express statutory cause of action.

‘This development remains undisturbed after Alyseka

because, the ‘common benefit’ rational-was not involved in —

that case.” and the Court made clear that

80 See 421 U.S. at 245, 259-60, S.Ct. 1612, noting that

this court’s decision in Alyeska. Fecleined irelgnre on the

traditional equitable exceptions of ‘comm |

faith.’ Wilderness Society v. Morton, i, 161 US. S App.D, 446, :

449, 495 F.2d 1026, 1029 (en banc, 1974). ° |

‘Congress has not repudiated the judicially fashiotied

exceptions to the general rale against allowing substantial —

attorney fees.’ 421 U.S. at 259-60, 95 S.Ct. at 1623. See

also.F, D. Rich Co. v. Industrial Lumber Co., 417 U8. 116,

129-30 & n. 18, 94 S.Ct. 2157, 40 L.Ed2d 703 (1974).™

24a

8! For examples of post-Alyeska ‘common benefit’ deci-

sions, see National Treasury Employees v. Nixon, 172 U.S.

App.D.C. 217, 521 F.2d 317 (1975) (mandamus action to

require the President to grant pay adjustments required by

statute) ; Swanson v. American Consumer Indus., Inc., 517

F.2d 555 (7th Cir. 1975) (stockholder derivative suit and

class action) ; Harrison v. United Transp. Union, 580 F.2d

558 (4th Cir. 1975) (suit by railroad conductor against

union for breach of duty of fair representation).

‘*The issue here is whether the ‘common benefit’ ra-

tionale may be applied to the case of union member inter-

vention in a suit brought by the Secretary to enforce

electoral rights and maintain the integrity of a union

election. The appropriateness of ‘fee-shifting’ in the

union democracy context suggests an affirmative answer,

unless Congress can be said to have evidenced a purpose

to bar the award of such fees.’’

Mills, supra, makes clear that the ‘‘fact that this suit has

not yet produced, and may never produce, a monetary re-

covery from which the fees could be paid does not preclude

an award based on this [common benefit] rationale,’’ 396

U.S. at 392, 90 S.Ct. at 625—despite the fact that the early

cases based recovery upun the production or preservation of

a “‘common fund.’’ However, Mills involved a judicially

implied right of action under the Securities Exchange Act

of 1934 to challenge materia!!y false or misleading proxy

solicitation, and Hall v. Cole provides the connecting link

to this case, since it extended Mills to a statutorily created

cause of action under the LMRDA.

Alyeska has no effect on the development or application

of the ‘‘common benefit’’ exception, since it was not an

element of that case, and, as the Supreme Court stated:

‘“‘Congress has not repudiated the judicially fashioned ex-

ceptions to the general rule against allowing substantial

attorney’s fees,’’ 421 U.S. at 259-60. 95 S.Ct. at 1623.

As Judge Leventhal recognized in Local 639:

‘‘With respect to LMRDA, the courts have uniformly

applied a ‘common benefit’ analysis to award attorney’s

fees to private litigants. The Supreme Court in Hall v.

Cole, ... endorsing earlier decisions of the Third Circuit

25a

[Gartner v. Soloner, 384 F.2d 348 (3d Cir. 1967), cert.

denied, 390 U.S. 1040, 88 S.Ct. 1633, 20 L.Ed.2d 302 (1968) ]

and this court, held that attorney’s fees may be awarded

for suits brought to enforce the ‘Bill of Rights’ guarantees _

of Title I of LMRDA. This court’s decision permitted the

recovery of attorney’s fees for a suit under Title V, which

places union officials under federally defined fiduciary

obligations. Bakery & Confectionery Workers Int’l Union

v. Ratner, 118 U.S.App.D.C. 269, 335 F.2d 691 (1964).

Ratner was extended by this court to a suit brought under

section 401(c), the only privately enforceable provision

in Title IV. Yablonski v. United Mine Workers, 151 U.S.

App.D.C. 253, 466, F.2d 424 (1972), cert. denied, 412 U.S.

918, 93 S.Ct. 2729, 37 L.Ed.2d 144 (1937). And, recently,

the Fifth Cireuit applied the reasoning of these decisions

to a suit brought under Title III, which regulates union

trusteeships, a provision enforceable by either the Sec-

retary or union members directly. McDonald v. Oliver,

525 F.2d 1217 (5th Cir. 1976).

‘*Significantly, in none of these decisions was there a

statutory provision that expressly authorized the award

made. Rather, the governing rationale was that union

members by bringing suits against their union help vindi-

cate the statutory policy in favor of union democracy

which necessarily redounds to the benefit of the entire

membership.’’ [footnotes omitted. ]

543 F.2d 382-83. We have no doubt that this statute was

intended to provide union members with protection from

the type of attempts to thwart the wishes of union members

and impair union democracy which appear to have occurred

in this case. The dissent makes the remarkable statement

(page [50a]) that no proof is cited for the facts stated in this

opinion, in spite of repeated references in this opinion (see

pp. (5a, 25a-30a, 37a]) to the unchallenged and uncontra-

dicted Verified Application for Attorneys’ Fees (89a—146a).

We note that the Verified Application contained undenied

statements that Sadlowski’s opponent was supported by the

union leadership (see 90a, citing Abel Deposition at 5-7,

26a

and note 2 above);™ that union staff members were in-

* The transcript of the Deposition of I. W. Abel, President

of the USWA, Document No. 62B in Civil No. 73-0957B (W.D.

Pa), contains the following at 4, 5-7, 9-10, 31-838, 36-87:

“Q. [Mr. Rauh} So that the post of district director

of District 31 as the largest is a very important post in your

union?

A. [Mr. Abel] Yes, under our constitution, the officers

have an equal vote with the board member of the largest

district. [Emphasis supplied.

Q. Well, there did come a time prior to the February,

"73 election when you did decide to support Mr. Evett, did

you not?

A. Oh, yes: Yes. Maybe, to make it clear, maybe make it

so that you won’t have to ask a lot of questions, we have,

well, since—I was going to say since ’65, and that would be a

good figure, but pretty much from the beginning of the elec-

tion of officers of this union, the official family pretty much

supports each other, you know, and I think this has been

the case up until—well, as an example, when Phil died and I

became secretary-treasurer, the Board designated me as the

McDonald successor, and then almost without any indica-

tions, everybody went out and supported my candidacy and

supported Dave for president.

* * * * *

Q. Mr. Abel, would you sort of elaborate on official fa-

mily? Did you mean the three international officers plus

the district directors? |

A. District directors.

Q. That would be what you would consider?

A. Right.

* 7 * * *

A. Starting, again, in our campaign in ’65, we set up

our own little political organization, so to speak. We desig-

nated Joe Germano as our chairman, Alex Fuller as our sec-

retary and Tom Murray, who was then with us as assistant

to the secretary-treasurer, ‘as the treasurer of our group

and this organization was designed to raise funds and direct

the campaign.

Q. This would be the campaign of the official family, would

that be fair?

A. In’65, yes,...

27a

structed to contribute to the Evett campaign in specified

% (continued) aa

ie Yes. Well, then, when we came up this last time,

Murray had retired and Germano was retiring and so was

Joe Molony, so we made Germano and Molony as co-chair-

men. We made Harry Guenther, who succeeded Tom Murray,

as the treasurer and Alex Fuller continues to be the secre-

ow: hate again, they engaged the assistance and services

of people to run a campaign, and I assume that letter was

put together by them, and in this instance sent to the mem-

bership in District 31. foe

When there was a contest in other areas, I suppose a simi-

lar letter was sent out. I don’t know, but I assume that.

. * 2

A. Well, all that I have had anything to do with is in

the way of financial assistance, in line with what we have

eee ery

A. Wel, I made a contribution, as an example.

Q. tony made a contribution to Steelworkers for

Continued Leadership this year?

Right. Right. Yes. : *

. P ;

. That is since the new electi :

Oo Aed how uch was that?

much was that

A. Five hundred dollars by personal check.

Q. I think in addition to that you said you had talked

bout financial assistance for Mr. Evett. How was that to

procedure being followed at the present time, while I am

ot clear that it is, that each . :

tion, perhapé some won’t, I don’t know, but assume they will,

and assume that in most cases the directors will talk to their

staff people and others about making a contribution, too.

Q. Now, do you know of any place where that has al-

TA. “Well, 1 talked to Lynn Williams, our director from

District 6 in Canada, who was in the other day, and he told

me he was raising some money. | |

Now, he didn’t go into the amount or how. I’m told that

various of our directors have talked to their staff. In one

28a

amounts and campaigned for Evett on union time and

using union facilities, even to the point of neglecting union

duties (see 112a); that during the first election union offi-

cials refused:to inform Sadlowski of the locations of work

sites and polling places so that he was limited in placing

* (continued)

case, over in Youngstown, I believe it is, that the director

has given out a copy of a letter that Harry Guenther sent

out to the directors, recommending that contributions be

made and recommending, I think, in cases of directors a

$500 contribution, and in case of staff people, a solicitation

of $50, something like that.

os * .

= od

Q. ... Would you just tell me if you said the following:

Did you say you were supporting Evett?

A. I don’t think so, and I wouldn’t know that there would

be any need for it. They have known that from the last

election.

Q. Did you say that Mr. Sadlowski could win and the

staff should get out and hustle for Evett?

A. AsI say, I don’t recall, but I don’t listen to myself, as

I told you.

I would assume that anybody would say that Sadlowski

can win. Any candidate can win, as you and I know from

our political experiences.

Q. Well, I’m asking another question. Did you say that,

quote, the staff should get get out and hustle for Evett?

A. No. I think I said that the staff should assume their

responsibility of leadership. I stressed leadership in that

meeting that I am aware of, both at the convention as well

as the district level, and the importance of seeing to it that

their local unions not only participated in the election but

did it properly.”

* The Verified Application contains this language at 112a:

“Harry Guenther, Assistant to the International Secre-

tary-Treasurer, testifying that the official fund-raising arm

of the International Union was seeking money for Evett—

the ‘suggested’ amount was $500 per Executive Board mem-

ber and $50 from each staff representative and ‘a further

request might be necessary.’ The nature of this appeal, com-

municated to all District Directors is such that at least one

Director called a special meeting to distribute copies of the

‘suggestion’ in envelopes marked ‘confidential.’ ”

29a

observers at the polls (see 90a) ; that Department of Labor

investigators found the ‘‘very serious violation’’ of lack

of secrecy in the voting at many locals (see 95a) ; that Sad-

lowski received widespread reports of ballot frauds, illegal

electioneering, deprivation of secret ballot, interference

with observers, and other LMRDA violations (see 90a) ;

that the Secretary found basis for a charge in his complaint

that moneys received by way of dues, assessments or similar

levies were applied to promote the candidacy of Samuel

Evett (see 104a, including note 33; see also {| XIII of Com-

plaint filed on November 8, 1973, by the Secretary as Docu-

ment No. 1 in Civil Action No. 73-0957 (W.D.Pa.)) ; and

that in Local 1066 the tellers had been found guilty of vote

fraud.’ L. W. Abel, President of the USWA, testified as

10 See pages 17-19 (105a-107a) of the Verified Application

rneys’ Fees, where this language appears:

si “le June, 1974 Intervenor decided to take the depositions

of Stanley A. Lichon and Danny Cifalia. At the time of the

February 13, 1973 election they were presidents of locals in

which the Department of Labor had found considerable evi-

d-nce of ballot fraud.** There were allegations of Evett’s

;.aff involvement in both cases. In addition, in the case of

Cifalia’s local 1066, actions taken by the USWA had created

the inference that a cover-up of the involvement of em-

ployees of the International Union in massive ballot fraud

was in progress. The USWA made strenuous efforts to pre-

vent the questioning of Lichon and Cifalia. The official an-

nouncement of the Union’s capitulation came during the de-

layed taking of Lichon’s deposition on J uly 12, 1974 and

while Cifalia was still being kept from questioning. .

84 Lichon is the president of local 7610 and was the chie

teller in the contested election. In his complaint to the Inter-

national Tellers Sadlowski had charged fraud in 7610. He

had supplied the Tellers with the signed statements of 44

members of that local who said they voted for Sadlowski.

In the official tally Sadlowski received 22, Evett was credited

with 215.

was the president and chief teller of local 1066.

apap cee the contested election he was appointed a staff

representative. (He resigned after the local membership

found him guilty of vote fraud in the contested election).

In that election the official tally was Evett 935, Sadlowski

289. Admissions from the prepetrators of the fraud demon-

30a

follows in a deposition (Document No. 62B in Civil No. 73-

0957B (W.D.Pa.), at page 38) :

“Q. [Mr. Rauh]. And you feel, Mr. Sadlowski

shouldn’t have gone to the government even though there

was ballot box stuffing, Mr. Abel?

‘A. [Mr. Abel} Correct, Correct.’’

The Verified Application also alleges the following at

116a:

‘‘The USWA has not been a neutral party in these pro-

ceedings. Evett was the candidate of the ‘official family’—

the Administration of the USWA. Abel Deposition, pp.

5-7. During the pre-election conference the views of Evett

and the USWA never diverged.

> . o *

‘In the 1973 election there were numerous instances

of double shipments of ballots and unaccounted-for bal-

lots.’’

No counter-affidavit was filed by the USWA cha!-

lenging or contradicting the sworn allegations of the above

Verified Application for Attorneys’ Fees. The union filed a

Motion to Dismiss such application, stating, inter alia, at

147a-148a: |

‘‘As a matter of law, the aforementioned Application

fails to state a proper claim for attorneys’ fees and there-

strated that the names of 600-700 members had been forged

and the ballot box stuffed with Evett votes. Lehman Deposi-

tion pp. 79-93.

“The membership of local 1066 had imposed fines, includ-

ing restitution of $3,996.38 for election expense, and sus-

pensions, upon Cifalia and four other tellers found guilty of

vote fraud. bi: ia weal at 43

: tel : eS ee eG, eT eee

“Thus, by virtue of actions taken by Intervenor’s counsel,

the USWA Board meeting on July 9, 1974 was faced with a

substantiated charge of attempted cover-up of illegal activi-

ties and a demand for depesitions of two local union presi-

dents who, according to -Intervenor’s evidence, engaged in

unlawful conduct:under the prodding of USWA staff repre-

~ sentatives, as ‘well as substantiated charges of illegal use of

— funds:-At that meeting, the board decided to capit-

te.” . ;

3la

fore should be dismissed on its face. Since such a .dis-

missal would obviate the need for massive discovery and

an evidentiary hearing on said Application, USWA re-

spectfully suggests that discovery not be commenced

pending disposition of this Motion.’’

In Kahan v. Rosenstiel, 424 F.2d 161, 164 (3d Cir.), cert.

denied sub nom. Glen Alden Corp. v. Kahan, 398 U.S. 950,

90 S.Ct. 1870, 26 L.Ed.2d 290 (1970), this court said:

‘‘[b]ecause the District Court disposed of the matter on a

motion to dismiss, the facts alleged in plaintiff’s petition

for counsel fees and his amended complaint in the under-

lying suit must be accepted as true.’’'™ It is clear that the

USWA was in the best position to deny the above and other

allegations of the Verified Application for Attorneys’ Fees

and the depositions, if they could have done so. USWA

elected not to challenge the Verified Application and to file

its Motion to Dismiss. This Court has recently reaffirmed

the rule applicable to this situation:

‘‘Under such circumstances, we must take all of the

well pleaded allegations of the complaint as true, construe

the complaint in the light most favorable to the plaintiff,

and determine whether, under any circumstances, the

plaintiff might be entitled to any relief.‘

4 See, e. g., Conley v. Gibson, 355 U.S. 41, 78 S.Ct. 99,

2 L.Ed.2d 80 (1957) ; Polite v. Diehl, 507 F.2d 119, 124 n.2

(3d Cir. 1974) ; Quinones v. United States, 492 F.2d 1269,

1278 (3d Cir. 1974) ; Curtis v. Everette, 489 F.2d 516 (3d

Cir. 1978), cert. denied, 416 U.S. 995, 94 S.Ct. 2409, 40

L.Ed.2d 774 (1974) ; Melo-Sonics Corp. v. Cropp, 342 F.2d

856. (3d Cir. 1965).” |

Helstoski v. Goldstein;552 F.2d 564 at page 565 (3d Cir.

1977). In view of the facts in this record, the following

language in Local 639 is particularly applicable:

‘The statute.is expressly aimed at protecting union

a vectp snceenenaed snatitaatapibtesirmtnenntiies

that a must to | |

forth ert tiehen Dapontdinda, abe napoli, desta showing

that there is a genuine issue for trial. If:he does, not'so re-

spond, summary judgment, if appropriate,’ shalh be entered

against him.” otal

32a

members from the corruption and electoral unresponsive-

ness of their leadership. ‘Fee-shifting’ is particularly

appropriate because of the close match between the party

assessed and the beneficiary of the litigation. Indeed, the

benefited class, its contours shaped by the union’s self-

description and its finances based on per capita payments,

fits the paradigm for ‘common benefit’ cases.’’

543 F.2d at 383. And we hold that absent congressional

circumscription of the court’s power to award equitable

relief in the form of ‘‘fee-shifting,’’ the allowance of attor-

ney’s fees is justified under Title IV when a ‘‘common

benefit’? has been conferred.

The overriding considerations in evaluation of

‘‘common benefit’’ claims are: whether the benefits may be

traced with some accuracy; whether the class of benefi-

ciaries is readily identifiable; and whether there is a reson-

able basis for confidence that the costs may be shifted with

some precision to those benefiting.

The district court, adopting the Magistrate’s Re-

port,” held that even though the intervenor argued that his

actions vindicated the interests of all union members in

securing free elections, ‘‘it strains belief to conclude that a

benefit bestowed upon District 31, whose membership com-

prises approximately 9% of the entire union membership,

inures to the benefit of the steelworkers as a whole.’’ And

the Magistrate went on to say that even if the latter propo-

sition were true, ‘‘Congress has ascribed the task of insur-

ing the propriety of union elections to the Secretary. The

individual may only seek to vindicate his own limited per-

sonal interest.’? We have concluded that the district court

incorrectly found that no common benefit was conferred

upon the USWA as a whole, and improperly denied Sadlow-

ski’s application for assessment of attorney’s fees against

the Union treasury.

The Hall Court, after recognizing that Congress enacted

the LMRDA to insure minimum standards of democratic

process and stem abuses which included breach of trust,

1! But see pages [35a-37a] and note 13 infra.

33a

corruption, and disregard of the rights of individual em-

ployees, stated that by vindicating his own right to free

speech under Title I:

‘*the successful litigant dispels the ‘chill’ cast upon the

rights of others. Indeed, to the extent that such lawsuits

contribute to the preservation of union democracy, they

frequently prove beneficial ‘not only in the results

achieved but in their implications for the future conduct

of the union’s affairs.’ Yablonski v. United Mine Workers

of America, 151 U.S.App.D.C. 253, 466 F.2d 424, 431

(1972). Thus, as in Mills, reimbursement of respondent’s

attorney’s fees out of the union treasury simply shifts

the costs of litigation to ‘the class that has benefitted

from them and that would have to pay them had it

brought the suit.’ ’’ [Footnote omittted.]

412 U.S. at 8-9, 93 S.Ct. at 1948. Hall, then, makes clear that

to the extent that prosecution of LMRDA violations sup-

ports union democracy, such activity confers direct and

substantial benefit upon the entire union membership. In

our view, the entire thrust and effect of Sadlowski’s pro-

secution of these Title IV violations was vindication of

democratic process in USWA elections, and his actions re-

dounded to the common benefit of the whole Union. Title IV

is specifically aimed at remedying interferences with union

elections like those which occurred here. In this regard

we note the particularly egregious abuses of the electoral

process in this case. Sadlowski was not merely opposed

by a member of the USWA ‘“‘official family,’’ Union officers

and agents actively campaigned against him. The depth

of Sadlowski’s favor with the rank and file of District 31

is evident from the fact that when a fair election was finally

held, votes ran nearly two-to-one in his favor. Union leader-

ship having exerted such effort to oppose the candidacy of

a single insurgent, it would be naive to assume that similar

election ‘‘irregularities’’ have not or would not spread to

other districts and locals where a member of the ‘‘official

family’’ ran opposed. Had such tactics been successful in

District 31, there appears to be little doubt that they would

have been employed again, and again. The determination

34a

and vigor of this union member served to insure to all

union members the rights which Congress intended be

theirs, and in this instance union democracy would have

been a hollow promise without Sadlowski’s involvement.

The mere fact that Sadlowski himself benefited from his

prosecution of this action neither negates the benefit to the

union nor prejudices his right to claim attorney’s fees.

Hall, id.

Sadlowski’s contribution to the ‘‘common benefit’’ of the

USWA membership is not, however, limited to vindication

of union democracy. The directors of the various Union

districts serve on the International Executive Board: the

USWA’s governing body. Interference with the election of

the District 31 director cannot be said to have merely local-

ized impact on the union membership. Despite the fact that

the main function of a district director is to represent a dis-

trict, each director also plays a significant role in represent-

ing the interests of every union member. The International

Executive Board is charged with enforcing the Union con-

stitution, directing the affairs of the International, and over-

seeing the financial affairs of the Union. The International

Executive Board also plays an important internal political

function, since it decides when elections will be held, and

also establishes the territorial boundaries of the various

union districts.

The magistrate and the district court were, however,

concerned about other elements of the ‘‘common benefit’’

determination as well. The Alyeska Court did state that

in the Supreme Court’s ‘‘common-fund and common-benefit

decisions, the classes of beneficiaries were small in number.’’

421 U.S. at 265 n.39, 95 S.Ct. at 1625. The magistrate ap-

parently understood that language to mean absolute num-

bers, and indicated that a class of 1,400,000 was too large

to have been benefited. Like’ any other statement, that one

must be viewed in context. Given this context, mere size

does not support the contention that the class of USWA

members did not receive a common benefit from Sadlowski’s

activity. Mills, for example, involved a beneficiary class of

8,987, 403 F.2d 429, 432 (7th Cir. 1968). Hall v. Cole, supra,

35a

involved a class of approximately 85,000 union members,

and Yablonski v. United Mine Workers of America, supra,

involved a class of approximately 250,000. In our view,

the requirement of identifiability weighs heavily in this

determination, and USWA members, though numerous, are

readily identifiable as the benefited group. The Supreme

Court no doubt wished to clarify the notion that although

very much larger groups might be said to benefit from ‘the

prosecution of certain actions—just as every union member,

and every individual might be said to benefit from vindica-

tion of union democracy—the doctrine is not to be extended

to ludicrous dimensions.

The magistrate also erred in holding that attorney’s fees

would unfairly burden all Union members since, in its view,

the primary benefit fell to District 31, while the USWA

treasury supported by 1,400,000 members would be the

source of payment. This record requires the determination

that the entire Union membership benefited from Sadlow-

ski’s tenacious handling of this suit, and we note that the

benefit conferred in this case may well justify whatever

‘‘burden”’ is involved. But we would point out, again, that

in this case the so-called ‘‘burden,’’ and its size, were in

large part attributable to the USWA defense of a meritless

position. The very purpose of the exhaustion requirement

of Title IV is to give the union the opportunity to correct

irregularities. Where the union faithfully performs its obli-

gation to obey the LMRDA mandate, neither complainant

nor union would require much legal assistance. Here, im-

proper attempts to oppose Sadlowski directly created the

need for legal assistance, and the tenacity of this opposition

contributed directly to the size of ‘‘burden.’’ While we

fully agree that, in view of the extreme abuses which oc-

curred, almost all the expenses for legal services incurred

by all parties were wasteful and should never have been

necessary, there is no reason to penalize the intervenor

who performed his function correctly and well. If the rank

and file is dissastisfied, their recourse lies with the Union

leaders who were responsible. The position that the USWA

treasury is an improper fund from which to make an award,

36a

since the primary benefit was to District 31, fails for like

reasons.” While it cannot be denied that the greatest benefit

was conferred upon Union members in that district, we note

that suit was brought against the USWA, rather than Dis-

trict 31, precisely because districts are not labor organiza-

tions within the meaning of 29 U.S.C. § 402(i), and the

parent union is the suable entity. There is, moreover, no

district treasury, since all dues and fees are contributed

directly to the USWA and later some funds are dispersed

to the districts. To hold that attorney’s fees must be re-

covered from a fund created by those who received the

greatest benefit, rather than from a fund created by those

who received a legally sufficient and significant benefit,

would be tantameunt to denial of that recovery. But more

than that, such a holding would effectively allow unions

to insulate themselves from union member attempts to pro-

secute Title IV violations. By creating an interna: structure

that comingles funds and denies their identifiability to an

individual unit, unions could preclude recovery of attorney’s

fees. Such action would thwart the process of complaint and

productive intervention by union members, and deny effect

to the policies enunciated by the LMRDA and Trbovich.

We note that although the district court specifically

adopted the magistrate’s report, the sweeping conclusions

of law which are contained in its Memorandum (see note 1

above) appear to differ from the more completely reasoned

approach of the magistrate.’* Our particular concern in this

* The fact that the Secretary of Labor brought suit against

the local in Local 639, rather than the international, as here,

does not suggest that the District of Columbia Circuit would

have found differently had suit been brought against the entire

union, particularly in view of the union structure in this case,

discussed below.

‘S For example, where the magistrate recognized the concept

enunciated in Mills and Hall, that attorneys’ fees may be re-

coverable when a common benefit has been conferred, even

though no fund or property is recovered (176a), the district

court did not (206a and note 1 above) ; where the magistrate

felt that an award based upon the common benefit theory was

inappropriate on the facts of this case because of the greater

37a

case is the failure of the district court to make clear the

basis for its decision. Because of the inconsistencies between

the report of the magistrate and the Memorandum of the

district court, we are unable to determine the extent te

which it relied on the reasoning of the United States Magis-

trate in reaching its decision, as opposed to its reliance

on the sweeping legal conclusions quoted in note 1 above.

We have concluded that those legal conclusions of the

district court are an improper basis for decision on this

record.

We believe that a case involving public policy

considerations of the great importance of those concerned

here requires a reasoned statement by the district court

of the exact basis for its determinations on the specific

record before it. For example, we do not know whether

specific consideration was given by the district court to the

serious allegations of fraud in the elective process to which

we have referred at [26a—29a], note 10, or whether the hear-

ing judge considered that irrespective of outrageously fraud-

ulent and corrupt elective processes, a defeated candidate

benefit conferred upon District 31 and the burden such fees

would place on the union as a whole, the district court found

“no support in fact or in law for the grant of counsel fees in

a suit brought under the general provisions of Title IV”

(208a) ; and where the magistrate stated that “(t]he acts of

counsel for the intervenor in many respects duplicated the

Ssuuiusbepanbed tnneaiapethon whith ther sumevonienaalape

“any independent investigation

have undertaken was voluntary and self-serving and at the

saieudimunlentigeme tnediaeats™ tater) a cemeoant Couaracy

to the Secretary by Congress” (204a)—a statement contrary

even to the position taken by the Secretary in his Response

. . . to Application for Attorneys’ Fees, filed March 7, 1975.

See Doc.No. 78B in Civil Action eae th (W.D.Pa)

where the Secretary conceded, at pages 2-3, :

“Without attempting to detract from the efforts of counsel

for intervenor, it must be pointed out that it is quite cus-

tomary for the Departments investigators to receive assist-

ance from the complainant in the conduct of. their investiga-

tion of an election. . . . Indeed it is self-evident that the

major part of the leads pursued by the investigaters in such

an investigation derive from the complainant’s allegati

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