Petition — Owens-Illinois, Inc. v. Schultz

Supreme Court, U. 3,

FILED

Noy 16 \9TT

IN THE

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1977

Nol v4 - 7 4 5

OWENS-ILLINOIS, INC.,

Petitioner,

V

JOHN SCHULTZ, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

To the United States Court of Appeals

for the Seventh Circuit

THOMAS M. HANNA

Suite 1153, Pierre Laclede Building

7701 Forsyth Boulevard

St. Louis, Missouri

LLOYD SUTTER

P. 0. Box 1035

Toledo, Ohio

Attorneys for Petitioner

Of Counsel

McMAHON, BERGER, BRECKENRIDGE,

HANNA, LINIHAN & CODY

Suite 1153, Pierre Laclede Building

7701 Forsyth Boulevard

St. Louis, Missouri 63105

Telephone 314/863-0355

a CS AEE

St. Louls Law Printing Co.. Inc., 812 Olive Street 63101 314-231-4477

al

TABLE OF CONTENTS

Page

Pe Eh cbdecccsccvncecccdvcensex This Page

Citations to Opinions Below .......... 06. c cee l

PD: bnew c AUER ACh b ce dclceccbewes ot ous 2

Constitutional Provisions, Statutes and Rules Involved .. . 2

Wee GRD SUNN ki h o.o't onc bcpuddcadeeasecs 2

Ee aly «ite dais VeeNndeh ds «0.0 bnendnnle wimedb é 2-3

i ek Crdwer es ear anche hbwn we ates 46-040 Senk een 3

PEED ik obi cidele sve cccwrencenaness 3

Reasons for Granting the Writ... 0.000. cee 7

A. The Authority of Bargaining Unit Members to Inter-

SUE TD GE oc cick ebeeseccccnaccsensees 7

B. Contract Interpretation Before Trial/Arbitration ... 12

CII «0.0.0. h0b 6060000 en edneces os veseuses reese 17

Appendix A—Memorandum and Order .............. A-1

Appendix B—Memorandum and Order Concerning Motion

to Amend, Modify and Reverse ..... 0.0.6... ce uus A-4

PT Ga GD cc ccc ccc cccctcnescccccces A-6

EEN ons ck uwwes beaks dbs ees ca cnceuss dea cm A-18

Table of Authorities

Cases

Brown v. Sterling Aluminum Products Corporation, 365 F.

Pe Se Pee eet 9

Buffalo Forge Co. v. United Steelworkers of America, 428

OE Fe Geen cn cdiwcadabeetiassdetate ch tes. 14

Ford Motor Company v. Huffman, 345 U.S. 330

SE he bb. 4 66s bive.c dees dee bheeVipengns 4% 9, 11, 16

Hines v. Anchor Motor Freight, Inc., 424 U.S. 554

CRPPED scccéccdsconcibbnessmeastiwete oe¥ 3, 7, 8, 15

Humphrey v. Moore, 375 U.S. 335 (1964) .......... 7,9, 15

Lewis v. Benedict Coal Corp., 361 U.S. 459 .......... 13

May Department Stores Co. v. NLRB, 326 U.S. 376 (1945) 9

Motor Coach Employees v. Lockridge, 403 U.S. 274

GRPWED 0 Ch eh ees vce cei amneebors Chass cédueces 15

NLRB vy. Allis-Chalmers Mfg. Co., 388 U.S. 175 (1967)... 11

Refinery Employees Union v. Continental Oil Company,

S68 F. 26 447 (SR Co. IDSR) occ cscccccvvcccees 11

Smith v. Evening News Association, 371 U.S, 195 (1962). 7,9

Stecle v. L. & N.R. Co., 323 U.S, 192 2.0... ccc cccceeee 10

Steelworkers v. American Mfg. Co., 363 U.S. 564 (1960). 14, 15

United Steel Workers v. Enterprise Corp., 363 U.S. 593

CHOGED cicccucscccccccccebeeaneccscccececntes 15

Vaca v. Sipes, 386 U.S. 186 (1967) ............. 12, 13, 15

—

Statutes

SD GA, GREED ccccccccccneus cvcccccccsess 2, A-18

SP Ue SED sccc ck ccdsetbsrceccces 2, 3, 6, 8, A-18

Authorities

17A C.I.S. Sec. 295, p. 48

IN THE

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1977

OWENS-ILLINOIS, INC.,

Petitioner,

v

JOHN SCHULTZ, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

To the United States Court of Appeals

for the Seventh Circuit

Petitioners pray that a Writ of Certiorari issue to review the

judgment of the United States Court of Appeals for the Sev-

enth Circuit entered on August 19, 1977.

CITATION TO OPINION BELOW

The Opinion of the District Court for the Southern District

of Illinois sustaining Petitioner's Motion to Dismiss is printed

in Appendix A hereto, and the District Court's Memorandum

Order concerning Motion to Amend, Modify and Reverse is

=

printed in Appendix B hereto. The Opinion of the United States

Court of Appeals for the Seventh Circuit which reversed the

judgment of the District Court is printed in Appendix C hereto

and is reported in the official reports at 560 F.2d 849.

JURISDICTION

The judgment of the Court of Appeals printed in Appendix

C hereto was entered on August 19, 1977. On September 20,

1977 the Court of Appeals denied Petitioner's Motion for Re-

hearing En Banc, and on October 14, 1977 the Court of Ap-

peals refused to Stay its Mandate pending the filing of the

Petition for Writ of Certiorari and a final determination thereon

by this Court.

The jurisdiction of this Court is invoked under 28 U.S.C.

$1254(1).

CONSTITUTIONAL PROVISIONS, STATUTES

AND RULES INVOLVED

The Constitutional provisions involved are the Due Process

Clause of the Fifth Amendment to the United States Consti-

tution. The statute involved is the Labor Management Rela-

tions Act, as amended, 29 U.S.C. §185(a). These provisions

are printed in Appendix D hereto.

THE QUESTIONS PRESENTED

Whether or not an apprenticeship program incorporated by

reference into a collective bargaining agreement creates rights

which are so “uniquely personal” to employees within the

_

meaning of Hines v. Anchor Motor Freight, Inc., 424 U.S. 554,

as to vest individual employees with a right of action against

their Employer and labor organization pursuant to §301 of

the Labor Management Relations Act, as amended, 29 U.S.C.

$185?

Whether or not the Court of Appeals may interpret provi-

sions of the collective bargaining agreement and determine that

individual employees covered by said agreement were the ob-

ject of arbitrary or invidious discrimination or otherwise the

object of fraud and deceit where there exists a dispute as to

the application and interpretation of such contract and where

no evidence has been adduced either in arbitration proceedings

or in trial before District Court?

STATEMENT OF THE CASE

Respondents' brought this action pursuant to Section 301 of

the Labor Management Relations Act, as amended, 29 U.S.C.

§ 185(a) alleging, inter alia, that no employee had been

permitted to enter a contractually established apprenticeship pro-

gram for some year and one-half because of an alleged agree-

ment between Petitioner Owens-Illinois and District 9, Inter-

national Association of Machinists and Aerospace Workers’ to

eliminate said program (R 3-4).* Plaintiffs also alleged that its

members had grieved over the failure to enroll them as ap-

prentices and further that the grievance was not processed

through arbitration because District 9 engaged in conduct which

! Hereinafter referred to as the “Plaintiffs”.

* Hereinafter referred to as “Owens-Illinois” and “District 9” re-

spectively.

* This designation is to the Appendix before the Court of Appeals.

— ye

was both “spurious” and in “bad faith” (R 3-4). Also averred

was a claim that the grievance was not pursued because of an

“informal agreement” between Owens-Illinois and District 9

which eliminated the grounds upon which said grievance could

have been otherwise brought (R 3-4). This “informal agree-

ment” obviously occurred during the 1971 contract talks inas-

much as the current collective bargaining agreement spans the

period October 1, 1974 through March 31, 1977 and the

Complaint allegations concerning the “informal agreement”

clearly refer to the 1971 negotiations, making obvious refer-

ence to a preceding contract (R 4, Para. 10).

The current collective bargaining agreement contains the fol-

lowing provisions which the court relied upon to reach its de-

cision:*

* * * > * . .

ARTICLE 20

Apprentices

“Section |. It is agreed that the terms and the conditions

of the Apprenticeship standards for machinists as de-

veloped by the International Association of Machinists, and

Aerospace Workers, District No. 9, shall remain in effect

for the life of this contract. By agreement of the Union and

the Company, the Apprenticeship Program in the Machine

Manufacturing Shop has recognized and continues to recog-

nize the practice of a restricted pool, that is, the selection

of Apprentices from personnel within the Shop in conjunc-

tion with the District No. 9 Joint Apprenticeship Com-

mittee.

Section 2. The normal ratio of apprentices shall be one

(1) apprentice to every eight (8) Master Machinists in the

department. Apprentices shall serve for a period of 8,000

* Appendix C.

— eo

= =

hours in accordance with the Federal Apprenticeship Stand-

ard Agreement.”

No evidence was before the Court relating to collective bar-

gaining for the 1971 and 1974 contracts reflecting the intent

and agreement oi the parties, the egregious surplus of journey-

men machinists from 1971 to present, and the full! discussions

between the employees and union at the time of ratification other

than the “Summary of Changes” (Sup. App. 49).° Further no

evidence was before the court hearing upon the alleged “spuri-

ous” and “bad faith” nature of the alleged “informal agreement”.

Finally no evidence was before the Court reiating to any arbi-

trary or invidious discrimination practiced against the com-

plaining employees.

On December 3, 1976, the District Court sustained Peti-

tioner’s Motion to Dismiss for the reason that pursuant to §

301 the union is ordinarily the proper party to seek enforcement

of a collective bargaining agreement except where “uniquely

personal” rights of employees were concerned and that the ap-

prenticeship program was not “uniquely personal” to Pilain-

tiffs. Thereafter, Respondents made a Motion to Amend, Mod-

ify and Reverse the District Court's Order of December 3, 1976,

and on January 3, 1977, the Court denied the Motion reiterat-

ing its previous opinion that the apprenticeship program was

not “uniquely personal” to the employees and that before an

individual employee may bring an action the rights asserted must

be vested in him at time of suit.

On August 19, 1977, the United States Court of Appeals

for the Seventh Circuit held that Plaintiffs had sufficiently al-

leged a factual predicate establishing the vesting of their entitle-

ment to participate in the apprenticeship program and it was

therefore appropriate for them to sue Petitioner pursuant to §

* Filed by District 9 before the Court of Appeals.

—

301. The Court also held that the employees were entitled to

sue their labor organization by reason of their allegations that

the union breached its duty of fair representation. Lastly, the

Court of Appeals in remanding the case to District Court, held

that Article 20 of the collective bargaining agreement established

a “mandatory apprenticeship program” which precluded the

union from defending its failure to process Respondent's griev-

ance on the grounds that it was without merit.

REASONS FOR GRANTING THE WRIT

A. The Authority of Bargaining Unit Members to Interpret

the Contract.

This case is concerned with efforts to further define the term

“uniquely personal” as used by this Court in Smith v. Evening

News Association, 371 U.S. 195 (1962); and Hines v. Anchor

Motor Freight, Inc., 424 U.S. 554 (1976) and to delineate

those benefits established by a collective bargaining agreement

which are susceptible of enforcement by an individual employee-

union member notwithstanding the union’s contrary interpreta-

tion and application of the labor contract. Also important to

the orderly development of federal labor policy is a determina-

tion as to the propriety of the Court of Appeals decision wherein

it interpreted the contract provision in question, Article 20 re-

lating to apprenticeship, in a manner binding upon the parties

before any evidence whatever was produced relating to the

actual agreement of the parties.

The contract itself plainly reflects that the apprenticeship pro-

gram is not designed to benefit any specific individual but to

enhance the well being of the bargaining unit as a whole and

as such it is the union and not its individual member which is

responsible for enforcement. The first decision to sharply de-

fine the right of an individual employee to bring suit for an

alleged violation of a union contract was that of Smith v. Eve-

ning News Association, 371 U.S. 195 (1962). There this Court

held that employees had the right to sue their employer for re-

fusing to assign them work because “the rights of individual

employees concerning rates of pay and conditions of employ-

ment are a major focus of . . . collective bargaining agreements”.

Since that time the individual's right to sue over matters such

as seniority standing has been recognized. Humphrey v. Moore,

375 U.S. 335 (1964), and in Hines v. Anchor Motor Freight,

—

Inc., 424 U.S. 554, 96 S. Ct. 1048 at 1055 (1976), the indi-

vidual’s right to sue was defined as:

“Section 301 contemplates suits by and against individual

employees as well as between unions and employers; and

contrary to earlier indications §301 suits encompass those

seeking to vindicate ‘uniquely personal’ rights of employ-

ees such as wages, hours, overtime pay, and wrongful dis-

charge.” (Emphasis added).

The line must be drawn somewhere to distinguish between

those things personal and those which impact upon all union

members for there to be a distinction with a difference. This is

so for a very important reason either overlooked or ignored by

the Appellate Court and never reached by the trial court, viz:

Both journeymen and apprentices can perform skilled work and

the Company retains, by contract, the right to determine its

total skilled workforce headcount, a mandatory journeyman-

apprentice ratio will result in each unnecessary apprentice dis-

placing journeymen where more journeymen are employed than

are needed. Therefore, here the union has an obligation to recon-

cile the job protection interests of current journeymen with the

job aspiration interests of plaintiffs during this economic period

when additional apprenticeships are unwarranted due to the ex-

cess supply of journeymen. What plaintiffs (now with the aid

of the Appellate Court) seek under §301 is a requirement that

the union champion plaintiffs’ aspirations at the expense of cur-

rent journeymen’s jobs—a result at war with the real purpose of

the “fair representation” principle that the union do what is best

for the bargaining unit as a whole, rather than advocate the in-

terests of one minority against another.

Insofar as counsel is aware no court of appeals has ever de-

termined the subject matter of apprenticeship to be a “uniquely

personal” right and submits that it cannot be such until an em-

ployee actually enters the apprenticeship program. This Court

has recognized not every dissident group of employees holds the

aides

right to controvert every employer-union agreement by urging

his own interpretation thereof because the union, as the ex-

clusive representative of all employees in the bargaining unit,

must be allowed “[a] wide range of reasonableness . . . in serv-

ing the unit it represents”. Ford Motor Company v. Huffman,

345 U.S. 330, at 338 (1953). This theory prevails even if the

union’s decision should cause some of its members to lose their

employment or other contractual benefits, e.g., Humphrey v.

Moore, supra. Thus the act of bargaining over broad policy

issues is the exclusive province of the union and vested solely

in that agency, who must exercise that right for the benefit of all

members. May Department Stores Co. v. NLRB, 326 U.S. 376

(1945). As was noted by the Court in Brown vy. Sterling Alu-

minum Products Corporation, 365 F. 2d 651 (8th Cir. 1966),

cert. denied, 386 U.S. 957:

“We believe, however, that for an individual to bring an

action under §301 he must be seeking to enforce a right

that is personal to him and vested in him at the time of

the suit. Humphrey v. Moore, 375 U.S. 335, 55 LRRM

2031 (1964). Therefore individual suits to compel arbitra-

tion of individual grievances are permissible as are indi-

vidual suits to enforce an arbitration award in which the

individual has a personal interest. Smith v. Evening News

Association, supra. However, whenever the right sought to

be enforced is not uniquely personal to the individual but

is a right possessed by the bargaining unit as a whole, only

the Union as the sole representative of that unit would

normally have the standing to enforce that right. Thus the

individual would have no standing to compel discussion

of broad collective bargaining principles such as the re-

negotiation of a new contract or the re-location of a plant,

even if such discussion were required by the existing col-

lective bargaining agreement. Section 159(a) of the Act

designates the representatives selected by a majority of the

employees in a unit, which in most cases would be a Union,

—

to ‘be the exclusive elected representatives of all the em-

ployees in that unit for the purpose of collective bargain-

ing.’ It is the Union alone that has the right to bargain with

management on these broad policy issues.”

The Court of Appeals sought to bring its decision within the

purview of these cases by engaging in a judicial determination

that the contract mandated a continuous, ongoing, apprentice-

ship program and, therefore, the right to enter such program

was sufficiently “vested” to sustain the individual's right to bring

suit. This decision ignored the obvious fact, pleaded in the

Complaint, that the union and Petitioner had made a contrary

interpretation of the same contract clause for five years, almost

two full contract terms. The question presented is therefore

more subtle than a mere issue as to vesting, it embraces the very

right of the union to negotiate, apply and enforce the contract

for the benefit of the entire bargaining unit as opposed to the

interests of a few who desire apprenticeship. Thus, it has been

held that a union retains the power to apply the contract for the

best interests of all members:

“National labor policy has been built on the premise that

by pooling their economic strength and acting through a

labor organization freely chosen by the majority, the em-

ployees of an appropriate unit have the most effective

means of bargaining for improvements in wages, hours, and

working conditions. The policy therefore extinguishes the

individual employee's power to order his own relations

with his employer and creates a power vested in the chosen

representative to act in the interests of all employees.

‘Congress has seen fit to clothe the bargaining representa-

tive with powers comparable to those possessed by a legis-

lative body both to create and restrict the rights of those

whom he represents . . .’ Steele v. L & N.R. Co., 323

U.S. 192, 202. Thus only the union may contract the em-

ployee’s terms and conditions of employment and provisions

for processing his grievances; the union may even bargain

—

away his right to strike during the contract term, and his

right to refuse to cross a lawful picket line. The employee

may disagree with many of the union decisions but is bound

by them. “The majority-rule concept is today unquestion-

ably at the center of our federal labor policy.’ ‘The com-

plete satisfaction of all who are represented is hardly to be

expected. A wide range of reasonableness must be allowed

a statutory representative in serving the unit it represents,

subject always to complete good faith and honesty of pur-

pose in the exercise of its discretion.’ Ford Motor Co. v.

Huffman, 345 U.S. 330, 338." NLRB v. Allis-Chalmers

Mfg. Co., 388 U.S. 175, at 180 (1967).

Here too, District 9 has no less a right and an obligation to

interpret and apply the fruits of its negotiations. Without that

right there can be no central policy established by a labor agree-

ment which is directed toward a given goal for the benefit of all

parties. In its stead will be a contract whose verbage is subject

to the contrary interpretation of those who had nothing to do

with its creation and who are unencumbered by knowledge as

to the intent of the parties who made the agreement. By inter-

preting the contract as “vesting” a right in the employee the

Court of Appeals has ignored the basic premise of contract

interpretation that a court must ascertain and give effect to the

common intention of the parties. /7A C.J.S. Sec. 295, p. 48.

In sum:

“There is not much of a contract between the parties and

there is not much stability of the Company-Union relation-

ship, if an important term may be made in the operation

of a plant because a dispute is traceable to its genesis in

an individual grievance.'' Refinery Employees Union v.

Continental Oil Company, 268 F. 2d 447 (Sth Cir. 1959),

cert. denied 361 U.S. 896.

To permit the employees to collaterally interpret a collective

bargaining agreement and to bring suit whenever their inter-

=

pretation differs from that of their union undercuts the very

stability of labor-management relations which federal labor

policy seeks to stabilize. Thus:

“If the individual employee could compel arbitration of his

grievance regardless of its merit, the settlement machinery

provided by the contract would be substantially undermined,

thus destroying the employer's confidence in the uniou’s

authority and returning the individual grievant to the va-

garies of independent and unsystematic negotiations.” Vaca

v. Sipes, 386 U.S. 171 at 191.

No less logic here applies, parties deprived of certainty and sub-

ject to the actions of intermeddlers, however well intentioned,

cannot create an enduring relationship based upon understand-

ing and reason, but will be forced to assume the most rigid of

postures prescribed by counsellors and advisors in order to stave

off interference. Labor peace will become labor strife all too

often, and for altogether unnecessary reasons.

B. Contract Interpretation Before Trial/ Arbitration.

The Court of Appeals also erred when it decided that the

apprenticeship program was mandatory under the terms of the

present contract. In the first instance the court had only the

Complaint and the arguments of counsel before it. No evidence

was before the Court relating to collective bargaining for the

1971 and 1974 contracts reflecting the intent and agreement of

the parties, the egregious surplus of juorneymen machinists from

1971 to present, and the full discussions between the employees

and union at the time of ratification other than the “Summary

of Changes” (Sup. App. 49). Further no evidence was before

the court hearing upon the alleged “spurious” and “bad faith”

nature of the alleged “informal agreement”. Finally no evidence

am {3

was before the Court relating to any arbitrary or invidious dis-

crimination practiced against the complaining employees.

It is quite apparent that the apprenticeship program was

dormant for at least five years preceding this action as the

Complaint clearly alleges that the so-called “informal agree-

ment” between Petitioner and District 9 was consummated dur-

ing the 1971 contract negotiations and not in 1974 as the Court

of Appeals decision subsumes. Moreover, the presence of some

twenty-five (25) Plaintiffs militates strongly against any claim

that they were singled out for arbitrary or invidious discrimina-

tion within the meaning of Vaca v. Sipes, 386 U.S. 171 (1964).

Petitioner submits that it was wholly erroneous for the court

below to engage in a judicial interpretation of the contract

withowt benefit of evidence. In the first instance, if Plaintiffs

were entitled to maintain a grievance as claimed, the appropriate

remedy would be to compel arbitration. In an arbitration case

an arbitrator, not a judicial body, is the proper party to interpret

and apply a contract in the first instance. The established federal

labor policy places emphasis upon the “context” in which labor

contracts are negotiated and the agreed upon method of re-

solving disputes as to meaning and interpretation:

“In our role of developing a meaningful body of law to

govern the interpretation and enforcement of collective

bargaining agreements, we think special heed should be

given to the context in which collective bargaining agree-

ments are negotiated and the purpose which they are in-

tended to serve. See Lewis v. Benedict Coal Corp., 361

U.S. 459, 468. The function of the court is very limited

when the parties have agreed to submit all questions of

contract interpretation to the arbitrator. It is then con-

fined to ascertaining whether the party seeking arbitration

is making a claim which on its face is governed by the

contract. Whether the moving party is right or wrong is

—*

a question of contract interpretation for the arbitrator. In

these circumstances the moving party should not be de-

prived of the arbitrator's judgment, when it was his judg-

ment and all that it connotes that was bargained for.

The courts therefore have no business weighing the merits

of the grievance, considering whether there is equity in

a particular claim, or determining whether there is par-

ticular language in the written instrument which will sup-

port the claim.” Steelworkers v. American Mfg. Co., 363

U.S. 564, at 567-568.

In the recent decisions of Buffalo Forge Co. v. Steelworkers of

America, 428 U.S. 397 (1976), this Court called attention to

the harm which naturally follows a judicial intrusion into the

realm of arbitration

. this [judicial fact finding] would still involve hear-

ings, findings and judicial interpretations of collective-bar-

gaining contracts. It is incredible to believe that the courts

would always view the facts and the contract as the arbi-

trator would;” Buffalo Forge v. USW, supra, 96 S.Ct. at

3149.

Earlier this Court had said:

“Collective-bargaining contracts, however, generally

contain procedures for the settlement of disputes through

mutual discussion and arbitration. These provisions are

among those which are to be enforced under § 301. Fur-

thermore, Congress has specified in § 203(d), 61 Stat. 153,

29 U.S.C. § 173 (d) that ‘[f]inal adjustment by a method

agreed upon by the parties is declared to be the desirable

method for settlement of grievance disputes . . .’ This

congressional policy ‘can be effectuated only if the means

chosen by the parties for settlement of their differences

under a collective-bargaining agreement is given full play.’

=

United Steel Workers v. American Mfg. Co., 363 U.S. 564,

566 (1960). Courts are not to usurp those functions which

collective-bargaining contracts have properly ‘entrusted to

the arbitration tribunal.’ Id., at 569. They should not under-

take to review the merits of arbitration awards but should

defer to the tribunal chosen by the parties finally to settle

their disputes. Otherwise ‘plenary review by a court of the

merits would make meaningless the provisions that the

arbitrator's decision is final, for in reality it would almost

never be final.’ United Steel Workers v. Enterprise Corp.,

363 U.S. 593, 599 (1960)”. Hines v. Anchor Motor

Freight, Inc., 424 U.S. 554, 96 S. Ct. 1048 at 1055-1056.

The only exceptions recognized have been those instances

where the arbitrators exceeded their powers, or their existed a

fraud or breach of duty. Humphrey v. Moore, 375 U.S. 335,

351 (1964); Vaca v. Sipes, supra, 386 U.S. at 186; and in such

instances it is clear that there must be a showing that the contract

was breached, and that there existed a breach of duty by the

union that exceeded “mere errors in judgment.” Hines v. Anchor,

supra, 96 §.Ct. at 1060. The Court of Appeals apparently again

subsumed as fact that there existed some fraud or breach of duty,

but that it cannot do because there is, as a matter of federal

labor law:

“|. the need to adduce substantial evidence of discrim-

ination that is intentional, severe and unrelated to legitimate

union objectives . . ." Motor Coach Employees v. Lock-

ridge, 403 U.S. 274, at 299 (1971).

This case falls short of the Vaca, Humphrey v. Moore, and

Lockridge, decisions. It involves not discipline, but contract in-

terpreation. The dispute is not the traditional one between labor

and management, but between employees and their union and

as such belongs not in the realm of arbitrary and invidious dis-

= =

crimination but within the ambit of Ford Motor v. Huffman,

345 U.S. 330, 338 where this Court affirmed:

“A wide range of reasonableness must be allowed a bar-

gaining representative in serving the unit it represents... .”

Consequently, if this Court disagrees with Petitioner and deter-

mines that the apprenticeship program is an individual right en-

titling the employees themselves to bring suit, it nevertheless re-

mains necessary to require the Court of Appeals to follow

established precedent and remand the case for trial to determine

whether or not there was a bad faith refusal to represent and, if

not, to determine whether or not arbitration should be ordered

of the grievances.

ities

CONCLUSION

For the reasons set forth above, the decision of the Court of

Appeals for the Seventh Circuit should be reversed and re-

manded with instructions to sustain the dismissal of the District

Court. In the alternative, the Court of Appeals decision should

be reversed and remanded with respect to its interpretation of

the terms of the collective bargaining agreement with instruc-

tions to allow all questions to be determined, after trial, at the

District Court level.

Respectfully submitted,

THOMAS M. HANNA

Suite 1153

Pierre Laclede Building

7701 Forsyth Boulevard

St. Louis, Missouri 63105

Telephone: 314/863-0355

LLOYD SUTTER

P.O. Box 1035

Toledo, Ohio 43666

Telephone: 419/247-5000

Attorneys for Petitioner

Of Counsel:

McMAHON, BERGER, BRECKENRIDGE,

HANNA, LINIHAN & CODY

Suite 1153 Pierre Laclede Building

7701 Forsyth Boulevard

St. Louis, Missouri 63105

Telephone: 314/863-0355

:

?

,

:

;

~ es cece be ee

—_ > po

APPENDIX “A”

Memorandum Order

This case is before me on defendants’ motion to dismiss

the complaint for failure to state a claim upon which relief

may be granted. In this connection I have considered the briefs

and authorities submitted by counsel as well as the oral argu-

ments presented on December 2, 1976. At the oral argument

defendants submitted Defendants’ Exhibit 2 which is or pur-

ports to be a “summary of change between Owens-Illinois Ad-

ministrative Division Machine Manufacturing, Godfrey, Illinois,

and the International Association of Machinists and Aerospace

Workers, District #9” and plaintiff specifically abandoned its

position that the hearing was called without sufficient notice

as stated in its pleading filed herein on November 24, 1976.

The defendant Owens-Illinois, Inc., entered into a collective

bargaining agreement with defendant District No. 9, Interna-

tional Association of Machinists and Aerospace Workers. Sec-

tion 20 of the agreement provides:

ARTICLE 20

Apprentices

Section 1. It is agreed that the terms and the conditions

of the Apprenticeship standards for machinists as de-

veloped by the International Association of Machinists,

and Aerospace Workers District No. 9, shall remain in

effect for the life of this contract. By agreement of the

Union and the Company, the Apprenticeship Program in

the Machine Manufacturing Shop has recognized and con-

tinues to recognize the practice of a restricted pool, that is,

the selection of Apprentices from personnel within the

shop in conjunction with the District No. 9 Joint Appren-

ticeship Committee.

—_ tp

Section 2. The normal ratio of apprentices shall be one (1)

apprentice to every eight (8) Master Machinist in the de-

partment. Apprentices shall serve for a period of 8,000

hours in accordance with the Federal Apprenticeship Stand-

ard Agreement.

Section 3. Apprentice Rates

Percent of Job

Job No. No. U-11 Master Machinist

U-63 Apprentice—8th Period 94%

U-65 Apprentice—7th Period 88%

U-67 Apprentice—6th Period 83%

U-69 Apprentice—Sth Period 718%

U-71 Apprentice—4th Period 73%

U-73 Apprentice—3rd Period 68%

U-75 Apprentice—2nd Period 63%

U-77 Apprentice—Ist Period 58%

Apprentice rates shall be increased effective the first day

of a new period following each 1,000 hours of employment.

Section 4. Normally apprentices shall not be used to in-

struct or train other apprentices. Instructing and training

shall normally be done by Master Machinist or qualified

operators.

The standing of individual union members to sue their em-

ployers as authorized by Section 301 of the Labor Management

Sanctions (sic) Act, 29 U.S.C. § 185, is presented as a threshold

question. Plaintiffs are individual union members who bring this

suit claiming that the company’s failure to provide an apprentice-

ship program violates their rights under the contract.

~

Som

Ordinarily the union under Section 301 is the proper party

to enforce the collective bargaining agreement. An exception

to this rule is where the right sought to be vindicated is “uniquely

personal” and rights of employees such as wages, hours, over-

time pay and wrongful discharge. In this type of situation the

individual may maintain suit under 301.

In my opinion the question of the duty of the company to

maintain an apprenticeship program under the collective bar-

gaining agreement is not “uniquely personal” to plaintiffs. From

that conclusion it follows that plaintiffs lack standing to main-

tain this suit.

Although it is not necessary to reach the other points raised

by defendants, I, nevertheless, agree that those points are well

taken and require that the complaint herein be dismissed.

Based on the authorities cited I have no alternative but to

dismiss the complaint for failure to state a claim on which re-

lief can be granted.

So ordered.

Enter this 3 day of December, 1976.

J. WALDO ACKERMAN

United States District Judge

—_ YS

APPENDIX “B”

Memorandum Order Concerning Motion to

Amend, Modify and Reverse

Plaintiffs bring these motions concerning the Memorandum

Order entered by this Court on December 3, 1976. Plaintiffs

first seek pursuant to Federal Rule of Civil Procedure 52(b)

to have this Court amend, modify and reverse its Order of

December 3 dismissing plaintiffs’ action for failure to state a

claim on which relief could be granted.

That decision was premised on the conclusion that plaintiffs

lacked standing to sue under Section 301 of the Labor Manage-

ment Relations Act of 1947 (29 U.S.C. § 185) because the

rights they sought to enforce under the collective bargaining

agreement were not “uniquely personal” to plaintiffs. Plaintiffs

contend that even if the rights sought to be enforced are not

uniquely personal but rather flow to employees in general a

§ 301 action will lie if the petition alleges a breach of the duty

of fair representation on the part of the union. I do not believe

this to be the current state of the law.

It is clear that individuals may bring suit under § 301 to

enforce the provisions of a collective bargaining agreement under

certain circumstances. Hines v. Anchor Motor Freight, Inc.,

424 U.S. 555, 562; Smith v. Evening News Ass'n, 371 U.S. 195

(1962). An allegation that the union involved breached its duty

of fair representation will allow an individual to press his claims

in the district court in spite of a defense that the employee

failed to exhaust his contractual remedies, Vaca v. Sipes, 386

U.S. 171, 186 (1967) or in spite of the fact that the normally

final decision of an arbitrator has been rendered against the

individuals pressing the suit. Hines v. Anchor Motor Freight,

Inc., supra.

— *

However, I believe that a threshold question before reaching

any question of any breach of the duty of fair representation is

whether the rights sought to be enforced are uniquely personal

to the plaintiffs or whether they flow to the employees in general.

It is clear that before an individual may bring an action pursu-

ant to § 301 the rights asserted must be personal to him and

vested in him at the time of the suit. Brown v. Sterling Alumi-

num Products Corp., 365 F.2d 651, 657 (8th Cir. 1966) cert.

den. 386 U.S. 957 reh. den. 386 U.S. 1027 (1967).

Plaintiffs have cited no case which either dissuades me from

this reasoning or would compel me to depart from my original

conclusion that the duty of the company to maintain an appren-

ticeship program does not involve any rights uniquely personal

to plaintiffs. Therefore, plaintiffs’ motion to amend, modify

and reverse shall be denied.

Plaintiffs’ second motion to reduce security bond required of

appellant, however, in light of defendants’ acquiescence, and

the reasoning presented in plaintiffs’ motion, will be granted.

Plaintiffs’ motion to amend, modify and reverse is denied.

Bond for costs on appeal shall be fixed at fifty dollars ($50.00).

Enter this 3 day of January, 1977.

/s/ (Ilegible)

United States District Judge

—_—

APPENDIX “C”

In the

United States Court of Appeals

For the Seventh Circuit

No. 77-1078

John Schultz, et al., Plaintiffs-Appellants,

v.

Owens-Illinois, Inc., and District No. 9, International Associa-

tion of Machinists and Aerospace Workers,

Defendants-Appellees.

Appeal from the United States District Court for the

Southern District of Illinois, Southern Division

No. A-Civ-76-0080—J. Waldo Ackerman, Judge

Heard May 24, 1977—Decided August 19, 1977

Before Swygert and Cummings, Circuit Judges, and Markey,

Chief Judge of U. S. Court of Customs and Patent Appeals.*

Cummings, Circuit Judge. Plaintiffs are 25 employees at

the Godfrey, Illinois, machine manufacturing shop operated by

defendant Owens-Illinois, Inc., an Ohio corporation. They are

* The Honorable Howard Thomas Markey, Chief Judge of the

United States Court of Customs and Patent Appeals, is sitting by

designation.

—_ ~~

members of co-defendant union.' Plaintiffs filed this complaint

under Section 301 of the Labor-Management Relations Act

(29 U.S.C. § 185).

According to the complaint, the Union represents plaintiffs

and other employees at the Godfrey plant. On December 16,

1974, Owens-Illinois and the Union entered into a collective

bargaining agreement expiring on March 31, 1977. Plaintiffs

charge that this agreement was entered into by defendants for

the benefit of the employee union members, so that each plain-

tiff is “entitled to the benefit of said agreement and to enforce

the provisions thereof” (Complaint 45).

Article 20 of the agreement provided:

Apprentices

“Section 1. It is agreed that the terms and the condi-

tions of the Apprenticeship standards for machinists as

developed by the International Association of Machin-

ists, and Aerospace Workers, District No. 9, shall remain

in effect for the life of this contract. By agreement of

the Union and the Company, the Apprenticeship Program

in the Machine Manufacturing Shop has recognized and

continues to recognize the practice of a restricted pool,

that is, the selection of Apprentices from personnel within

the Shop in conjunction with the District No. 9 Joint

Apprenticeship Committee.

“Section 2. The normal ratio of apprentices shall be

one (1) apprentice to every eight (8) Master Machinists in

the department. Apprentices shall serve for a period of

8,000 hours in accordance with the Federal Apprentice-

ship Standard Agreement.

1 District No. 9, International Association of Machinists and

Aerospace Workers.

—*

“Section 3. Apprentice Rates

Percent of Job

No. U-11

Job No. Master Machinists

U-63 Apprentice—8th Period 94%

U-65 Apprentice—7th Period 88%

U-67 Apprentice—6th Period 83%

U-69 Apprentice—Sth Period 78%

U-71 Apprentice—4th Period 73%

U-73 Apprentice—3rd Period 68 %

U-75 Apprentice—2nd Period 63%

U-77 Apprentice—Ist Period 58%

“Apprentice rates shall be increased effective the first

day of a new period following each 1,000 hours of employ-

ment.

“Section 4. Normally apprentices shall not be used to

instruct or train other apprentices. Instructing and training

shall normally be done by Master Machinists or qualified

operators.” (Italic emphasis supplied; bold face emphasis

in original).

Supposedly in breach of Article 20, no employee of defend-

ant Company has been classified as an apprentice since May

22, 1975, nor allowed to enter the Apprentice Program well

before then. This failure of defendant Company to place eligible

employees into ah apprenticeship program has allegedly de-

prived plaintiffs of an opportunity to increase their skills and

training and improve their wages.

Plaintiff Schultz protested the absence of an apprentice pro-

gram to his Union, and it filed a grievance on his behalf in

April 1976. This grievance was processed pursuant to the

_—

grievance procedure of Section | of Article 21 of the contract

and rejected by defendant Company. Defendant Union refused

to submit the grievance to arbitration under Section 2 of that

Article. According to plaintiffs, the defendants conspired to

defeat plaintiff Schultz’ grievance, for in 1971 they had secretly

agreed to eliminate the apprenticeship program in breach of

the Union's duty of fair representation under 29 U.S.C. § 141.

As a result of the Company's failure to carry out its Article

20 apprenticeship program and the Union's breach of its duty

of fair representation, plaintiffs assertedly lost the earnings dif-

ference between their current rate of pay and the higher rate of

pay that they would have earned as Master Machinists. More-

over, because of the maximum age limit for apprentices, some

plaintiffs, including plaintiff John Schultz, were permanently de-

prived of the opportunity of becoming apprentices, thus de-

priving them of Master Machinists’ wages for the remainder of

their working lives.

Plaintiffs sought a declaratory judgment that defendant Com-

pany violated Apprenticeship Article 20 of the agreement and

that the defendant Union breached its duty of fair representation

of plaintiffs. They also aught compensatory damages of $500,-

000 and exemplary or punitive damages of $500,000, and an

order compelling the Company to abide by Apprenticeship Ar-

tice 20 of the collective bargaining agreement by reinstating the

apprenticeship program.

On September 21, 1976, defendant Union filed a motion

to dismiss, asserting that the collective bargaining agreement was

governed by the “Standards of Apprenticeshjp”* which sup-

posedly did not require defendant company to continue an ap-

prentice program when it “did not have sufficient available

2 These standards were those incorporated by reference in Sec-

tion | of Article 20 and are reproduced in the Supplemental Ap-

pendix to the Union's brief.

— A-10 —

work to continue said program or full employment with its pres-

ent journeymen employees.” The motion also stated that the

grievance procedure in Article 21 of the collective bargaining

agreement did not require the Union to arbitrate plaintiff

Schultz’ grievance because it was “totally without merit.” The

other ground of the motion to dismiss was that the complaint

failed to state a cause of action under 29 U.S.C. § 414 ef seq.,

the sections of Labor-Management Relations Act plaintiffs mis-

takenly had relied on with regard to the Union's alleged failure

of fair representation before their September 24, 1976, amend-

ment charging a breach of 29 U.S.C. § 141 et seq. The Company

also filed a motion to dismiss, asserting that the complaint failed

to state a claim.

In December 1976, the district court handed down a memo-

randum order dismissing the complaint for failure to state a

claim. The court held that plaintiffs could not maintain a suit

under Section 301 of the Labor-Management Relations Act

because “the question of the duty of the company to maintain an

apprenticeship program under the collective bargaining agree-

ment is not ‘uniquely personal’ to plaintiffs.”

A month later, the district court handed down another memo-

randum order refusing to modify its previous order. Plaintiffs

maintained that even if the rights sought to be enforced were

not uniquely personal, a § 301 action will lie because of the

allegation of the breach by the Union of its duty of fair repre-

sentation. The court reiterated that “before an individual may

bring an[y] action pursuant to § 301, the rights asserted must

be personal and vested in him at the time of the suit,” citing

Brown v. Sterling Aluminum Products Corp., 365 F.2d 651,

657 (8th Cir. 1966), certiorari denied, 386 U.S. 957. We

reverse,

Ever since Smith v. Evening News Ass'n, 371 U.S. 195, 198-

200, it is clear that Section 391 permits suits by employees

— A-ll —

against their employer and union when they are seeking to vindi-

cate uniquely personal rights granted them by the collective

bargaining agreement. Hines v. Anchor Motor Freight, 424

U.S. 554, 562; Vaca v. Sipes, 386 U.S. 171.* Both defendants

urge this Court to affirm on the ground that plaintiffs do not have

any “uniquely personal” rights to be trained as apprentices, so

that Section 301 of the Labor-Management Relations Act affords

them no remedy. We disagree.

To determine whether the rights plaintiffs seek to vindicate

are “uniquely personal” rather than rights possessed by the bar-

gaining unit as a whole, it is necessary to refer to Article 20,

supra, of the collective bargaining agreement that was in effect

until March 31, 1977. All four sections of the Article are in

mandatory terms. The key section here is Section 2 providing

that the normal ratio of apprentices shall be one to every eight

Master Machinists. Defendants seek comfort in the Standards

of Apprenticeship referred to in Section 1 of Article 20. How-

ever, Article 18 of those Standards, entitled “Ratio of Appren-

tices to Journeymen,” provides:

“Ration of apprentices to journeymen shall be in con-

formity with present or subsequent bargaining agreements

between the employer and District 9” (Sup. App. 40).

As seen, that mandatory ratio is one apprentice to eight Master

Machinists. *

* Although defendant Company relies on Emporium Ca, well

Co. v. Western Addition Community Organization, 420 U.S. 50,

there the Supreme Court pointed out that a part of the national labor

icy Congress has assured that minority employee voices should

heard and that a union must represent the interests of minorities

within the unit fairly and in good faith. 420 U.S. at 64.

_ Sees 6 Oh mente, pevtinn te Arie - Soe

ith Article 20 of the ining agreement, four ntary

ln Fgh Mt, am Bm ~~ 5, and 18

of the Standards of Apprenticeship relating to employer's pre-

rogatives vis-a-vis any particular apprenticeship applicant are irrele-

vant and do not transform this apprenticeship program into a

voluntary one.

— A-12 —

Defendants also contend that a September 30, 1974, “Sum-

mary of Changes Between Owens-Illinois Administrative Di-

vision Machine Manufacturing—Godfrey, Illinois and the Inter-

national Association ot Machinists and Aerospace Workers—

District No. 9” modified the apprenticeship program from a

mandatory to a voluntary cne. On the contrary, that Summary

of Changes was referring to the changes that the December 16,

1974, collective bargaining agreement was making in the previ-

ous collective bargaining agreement, and Article 8 of the Sum-

mary, the only article of the Summary referring to apprentices,

States that the provisions of the earlier collective bargaining

agreement “Remain as written” (Sup. App. 49). The clause

in the Summary upon which defendants rely states “The Com-

pany will provide training for present employees when it deems it

necessary.” But this clause only governs changes in job classi-

fications reflected in the new Appendix “A” to the December 16,

1974, collective bargaining agreement (Sup. App. 22-23, 62)

and in no way concerns Article 20. Nothing in the Standards

of Apprenticeship or in the Summary relieves defendants from

the compulsory apprenticeship program established by Article

20 of the collective bargaining agreement.

These plaintiffs are not seeking to represent the entire work

force of 366 employees (Union Br. 2). According to their

counsel at oral argument, plaintiffs are the 25 most senior em-

ployees on a list maintained by the company of employees who

are qualified to become apprentices. Various preliminary tests

must be met in order to be eligible for apprenticeship in the first

instance and, of this initial eligibility group, further tests and

classes conducted outside the plant are required in order to be

placed on the list. Traditionally, the list-qualified employee

with the highest seniority would take the next available spot in

the apprenticeship program assuming that individual was below

the absolute age limit for beginning apprentices. Plaintiffs are

asserted to be the very large majority of the list-qualified em-

ployees.

— A-13 —

Defendants rightly point out that none of these specific were

alleged in the complaint or appear anywhere in the record. How-

ever, in a hearing before Judge Ackerman, plaintiffs’ counsel

conclusorily claimed each named plaintiff would, with certainty,

become an apprentice if the program was in effect. This hearing

was not transcribed and an authorized summary pursuant to

F.R.A.P. 10(c) was not entered because the district judge’s recol-

lection of the hearing was not precise enough to settle the dispute

between the plaintiffs and the defendants concerning what was

said therein. However, the district court did include the parties’

differing versions of the hearing in the record on appeal. The

defendants’ version does not dispute the plaintiffs’ statement con-

cerning the certainty that the plaintiffs would be granted ap-

prenticeships if anyone was granted one.

Overtime and discharge and other rights which have been

deemed to be “uniquely personal” possess two unifying themes.

Smith v. Evening News Ass'n, 371 U.S. 195, 199-200. First.

the employment benefit is mandatory under the collective bar-

gaining agreement if certain circumstances have occurred. Sec-

ond, a factual predicate which is unique and personal to a

particular employee establishes these necessary and sufficient

circumstances. For example, in order to obtain overtime, a

given employee must work a period longer than his normal

shift, but perhaps a limit on the amount of overtime which can

be worked in a given period is also set. Under this example,

given mandatory overtime rights in the contract, a particular

employee who works overtime still must show he meets the

maximum hours criterion before he is actually entitled to over-

time pay.

Applying these themes to the plaintiffs, we have demonstrated

that the apprenticeship program was mandatory under the col-

lective bargaining agreement which was in effect at the time the

plaintiffs filed suit. Also, either under the plaintiffs’ counsel's

representations at oral argument or the versions of the hearing

—_<’

in the record, plaintiffs have alleged a factual predicate which

establishes the necessary and sufficient circumstances precedent

to the actual vesting of the employment entitlement. Therefore,

it was entirely appropriate for them to sue their employer and

the Union under Section 301. National Labor Relations Board

v. Local 485, International Union of Electrical, Radio and Ma-

chine Workers, 454 F.2d 17, 21 (2d Cir. 1972); Emmanuel

v. Omaha Carpenters District Council, 535 F.2d 420, 423 (Sth

Cir. 1976).

Defendants rely almost exclusively on Brown v. Sterling Alu-

minum Products Corporation, supra. However, the Brown court

recognized that individuals may bring an action under Section

301 where, as here, they are seeking to enforce personal rights

vested in them at the time of the suit. As noted, these individ-

uals are not seeking a right possessed by the bargaining unit as

a whole” and are not seeking to compel any collective bargain-

ing. Only untrained employees are seeking controlled training

of a high quality in order to improve their earning power. This

factor sharpens the uniquely personal nature of the rights being

sought, for the union membership as a group and recognized

journeymen as well would receive no benefits from apprentice-

ships Article 20. Only the beneficiaries of rights under Article

20 have brought this suit, so that defendants and the court be-

low are mistaken in asserting that plaintiffs’ claim related to an

entire bargaining suit. Therefore, even the Brown court would

accord them standing to sue. See 365 F.2d at 657. Because

the Union will not enforce plaintiff's apprenticeship rights, a

* The Union contends that the complaint alleges “all employees”

have been denied access to the apprenticeship program, so that the

plaintiffs are not seeking to enforce any personal rights. However,

a reading of the whole complaint discloses that only 25 employees,

eligible as of the time of the complaint, are suing to enforce the ap-

prenticeship program. Of the 366 employees, 207 are journeymen

master mechanics and 159 are non-journeymen (Union Br. 2).

Plaintiffs’ counsel advised us at oral argument that his 25 clients

represent the “bulk” of those qualified to be apprentices.

— A-15 —

Section 301 suit is the appropriate remedy. Emmanuel, supra,

535 F.2d at 423.

Lastly, the Company relies on Article 1, the Management

Rights Article* contained in the December 16, 1974, collective

bargaining agreement, but it does not even refer to apprentice

training. Additionally, that article excepts from Management

Rights matters “expressly modified by the specific provisions of

this agreement.” Article 20, the Apprenticeship article, is such

a modification. Section 2 of Article 20 creates an affirmative

obligation to provide an apprenticeship program while control-

ling the numbers of apprentices per journeymen. Otherwise, it

would be virtually meaningless.

Plainly plaintiffs are seeking to protect rights afforded them

under the collective bargaining agreement in force when their

complaint was filed. Therefore, there is no occasion for us to

decide whether they have any rights under the succeeding col-

lective bargaining agreement whereby the apprenticeship pro-

gram has apparently been made discretionary with the Com-

pany.‘ Although the Company complains that if Article 20 is

enforced, there will be an impact of excessive costs upon the

6 Article 1 provides:

“MANAGEMENT RIGHTS

“It is agred that the Company is vested exclusively with the

management of the business, including the hiring and direction

of the working force; the right to establish, change or introduce

new or improved methods, job duties and crew sizes, standards

or facilities. Except as expressly modified by the specific pro-

visions of this Agreement, and subject to the grievance and ar-

bitration procedure provided herein, the Company has the right

to promote, suspend, demote, discipline, or my oo, Ben just

cause; and the right to relieve employees from duty use of

lack of work by plant seniority or for other legitimate reasons.”

(Sup. App. 3) (emphasis supplicd)

* This information was conveyed at oral argument but is not re-

flected in the record.

— A-16 —

Company (Br. 12), that situation was evidently overcome under

the new collective bargaining agreement. Only the named plain-

tiffs have any vindicatable rights under the 1974 collective bar-

gaining agreement since they are the only employees that filed

suit on this tract while it was still in force.

As restated in Motor Coach Employees v. Lockridge, 403

U.S. 274, 299, the union members may sue under Section 301

of the Labor-Management Relations Act to enforce rights con-

ferred on them by an employer's promises in the collective bar-

gaining agreement, and the union is a proper additional defend-

ant if, as here, plaintiffs allege that their union breached the

duty of fair representation. Humphrey v. Moore, 375 U.S. 335.

Paragraph 10 of the complaint is sufficient to state a claim

against the Union because it alleges that the negotiations be-

tween defendants with respect to Schultz’ grievance were spuri-

ous and carried on in bad faith because of the Union's prior

informal agreement with the Company to eliminate the appren-

ticeship program. If those allegations can be proved, it would

have been futile for the other plaintiffs to file similar grievances.

Vaca v. Sipes, 386 U.S. 171.

In remanding this case to the district court, we are not fore-

closing any legitimate defenses the defendants may have rela-

tive to whether which or any of the ostensibly eligible plaintiffs

would actually have been granted apprenticeship status. Nor do

we express any view respecting the remedy to be afforded any

ultimately prevailing plaintiff. We do hold that Article 20 of

the December 16, 1974, collective bargaining agreement estab-

lishes a mandatory apprenticeship program and that it was not

made voluntary by the Standards of Apprenticeship or by

the September 30, 1974, Summary of Changes. Since plaintiff

Schultz’ grievance was meritorious on its face, defendant Union

may not excuse its failure to process the grievance to arbitra-

tion on the ground that it was without merit.

— A-17 —

The orders of December 3, 1976, and January 3, 1977, are

reversed and the cause is remanded for further proceedings con-

sistent herewith.

A true Copy:

Teste:

Clerk of the United States Court of

Appeals for the Seventh Circuit

— A-18 —

APPENDIX “D”

28 U.S.C.

§ 1254. Courts of appeals; certiorari; appeal; certified

questions

Cases in the courts of appeals may be reviewed by the

Supreme Court by the following methods:

(1) By writ of certiorari granted upon the petition of any

party to any civil or criminal case, before or after rendi-

tion of judgment or decree;

29 U.S.C.

§ 185. Suits by and against labor organizations—Venue,

amount, and citizenship

(a) Suits for violation of contracts between an employer

and a labor organization representing employees in an in-

dustry affecting commerce as defined in this chapter, or be-

tween any such labor organizations, may be brought in

any district court of the United States having jurisdiction

of the parties, without respect to the amount in controversy

or without regard to the citizenship of the parties.

Fifth Amendment to the United States Constitution:

No person shall be held to answer for a capital or other-

wise infamous crime unless on a presentment or indictment

of a grand jury, except in cases arising in the land or naval

forces, or in the militia, when in actual service in time of

war or public danger; nor shall any person be subject for

the same offense to be twice put in jeopardy of life or limb;

nor shall be compelled in any criminal case to be a wit-

ness against himself, nor be deprived of life, liberty or

property without due process of law; nor shall private

property be taken for public use without just compensation.