Appendix — Peltzman v. Federal Maritime Commission

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CiRCUIT

No. 81-2026 September Term, 1981

ARCHIE PELTZMAN,

Petitioner

V.

Federal Maritime Commission,

Respondent

Maritime Service Committee, et al.,

Central Gulf Lines,

Pacific Maritime Association,

American Maritime Association,

National Maritime Union of America,

Intervenors

BEFORE :

Tamm*, Ginsburg and Bork, Circuit Judges

ORDER

Upon consideration of respondent's

motion for summary affirmance, and of the

responses thereto, it is

Ordered by the Court that the motion

for summary affirmance is granted. The

Federal Maritime Commission has no juris-

diction under section 15 of the Shipping

Wircult Judge Tamm did not participate in

this order.

la

2a

Act, 46, U.S.C. Sec. 814, over the union

security clause in collective bargaining

agreements, as such clauses fall within

the nenstatutory labor exemption to

section 15 jurisdiction. See United

Stevedore Corp. X. Boston Shipping Ass'n.,

16 FMC 7 (1962). Petitioner's complaint

further failed to state a cause of action

under sections 16 and 17 of the Shipping

Act, 46 U.S.C. sections 816 and 816.

Per Curiam

UNITED STATES COURT OF APPEALS

for the District of Columbia Circuit

FILED MAR.29, 1982

GEORGE A. FISHER

CLERK

APPENDIX B

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

©. 81-2026 September Term, 1981

xrchie Peltzman,

Petitioner

V.

*ederal Maritime Commission,

Respondent

4faritime Service Committee, et al.,

Sentral Gulf Lines,

Pacific Maritime Association,

American Maritime Association,

National Maritime Union of America,

Intervenors

BEFORE: Ginsburg and Bork, Circuit Judges

ORDER

On consideration of petitioner's petit-

ion for rehearing, filed April 19, 1982,

it is

petition is deried.

Per Curiam

Filed: FOR THE COURT:

May 19, 1982 GEORGE A. FISHER,

Clerk

ORDERED by the Court that the aforesaid

BY: S/Robert A. Bonner

Robert A. Bonner

Chief Deputy Clerk

3a

APPENDIX C_

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

No. 81-2026 September Term, 1981

Archie Peltzman,

Petitioner

V.

Federal Maritime Commission,

Respondent

Maritime Service Committee, et al.,

Central Gulf Lines,

Pacific Maritime Association,

American Maritime Association,

National Maritime Union of America,

Intervenors

BEFORE: Robinson, Chief Judge, Wright,

Tamm, MacKinnon, Robb, Wilkey,

Wald, Mikva, Edwards, Ginsburg

and Bork, Circuit Judges

ORDER

Petitioner's suggestion for rehearing

en banc has been circulated to the full

Court ad no member of the Court has re-

quested the taking of a vote thereon. On

consideration of the foregoing, it is

ORDERED by the Court en banc that the

aforesaid suggestion is denied.

Per Curiam

FOR :

George A. Fisher, clerk

BY: S/Robert A. Bonner

Filed: Robert A. Bonner

May 19, 1982 Chief Deputy Clerk

4a

a ee. Se ee

{ MARCH 13, 1961 }

(FEDERAL MARITIME COMMISSION)

FEDERAL MARITIME COMMISSION

WASHINGTON, D. C.

March 10, 1981

ARCHIE PELTZMAN

V.

AMERICAN MARITIME ASSOCIATION, ET AL.

DISMISSAL OF COMPLAINT

Complainant, Archie Peltzman, a “Marine Radio Officer," charges some

185 entities with depriving him of employment on certain vessels through

“monopolistic and illegal exclusive preferential hiring hall bargaining

agreements negotiated by the American Maritime Association, and the

Pacific Maritime Association.” Some of the respondents are named in the

body of the complaint while the remainder are designated in four appendices

to the complaint.

respondents and they are:

The American Maritime Association (AMA) and the Pacific Maritime Associ-

ation (PMA) which are “the employers collective bargaining representatives,

Those named in the complaint appear to be the principal

n

negotiating on behalf of che employers with the American Radic Association,

‘and the Radio Officers Union and with other senen s unions in the saritine

industry for wages, pensions, and other benefits to be paid seamen employed

on the vessels listed in Annex A, B, c“ to the complaint.

The American Radio Association (ARA) and the Radio Officers Union

(ROU) are both unions, which together represent “over ninety percent of the

Marine Radio Officers in the maritime industry thereby controlling the

entrance and continuity of employment in the trade by the restrictive

hiring hall agreements negotiated with AMA and PMA." According to

Mr. felt, all “Radio Officers are hired through union hiring halls

and continuity of employment is controlled by the restrictive ‘closed shop’

agreements with AMA and PMA.”

The “American Federation of Labor-CIO (AFL-CIO) which is an associ-

ation which has unions in the maritime field... ."

The remaining respondents are according to Mr. reiten “common

carriers by water" subject to the Shipping Act “which have bergeining agree-

ments with the unions and associations already named or with others named

in appendix D to the complaint.”

Mr. Pelteman states that the case “arises under section 15 of the

Shipping Act, 1916, as amended” and recites the events leading up to the

filing of the complaint as follows:

“From 1948 to 1977 AMA and PMA did not file with the Commission the

agreements negotiated by ARA and ROU and did not file the agreements

The numbers preceding ©). paragraphs in the complaint have been

omitted. Wo other edi.ocrial changes have been made.

negotiated with the other maritime unions affiliated with the American

Federation of Labor-Cl0.

“In 1978 PMA filed en agreement with ARA which the Commission on

August 18, 1978, granted « temporary exemption, which the complainant

by telegram on November 30, 1978, and later by « letter giving reasons

for such protest. PMA sought either approval pursuant to section 15 of

the Act or exemption therefron.

“AMA and PMA control and determine the amount to be assessed te each

shipping company for the various funds of the unions, for the benefit of

the individual shipping company employees as provided under the collective

bargeining agreement with the unions in the maritime industry.

“Pursuant to the terme of the bargaining agreement relating to exclusive

restrictive hiring referral practices and tenure of employment for ‘union

members’ only, the complainant and other seamen similarly situated have

been subjected to prejudice and disadvantage in violation of Section 16 of

the Act, (B) constituted unjust and unreasonable regulations and practices

in violation of section 17 of the Act, and (c) cause the agreement to be

unjustly diecriminatory and unfair as between ‘members’ of the unions and

‘permit card members,’ 211 to the detriment of the commerce of the United

States, and to be contrary to the public interest in violation of section 15

of the Act, and te the public policy of the Government as expressed in the

Taft-Hartley Act, Landrum-Griffin Act, and the Norris Leguardia Act.

Similarly the statutes enacted for the protection of sermen in Title 46

have been nullified by the bargaining agreement.

“This complaint is not directed to the amounts of wages or benefits

which are agreed to be paid seamen under the agreement. This complaint is

7a

directed solely te the unlewful and discriminatory pre-hire exciusive hiring

hall agreements, and ‘union’ membership requirement in the agreement which

is placed on seamen who wish to enter the service of shipping companies,

and who wish to retain those jobs without being forced to ‘join’ « union

or be diecharged from employment if they do sot ‘join’ « union which has

an exclusive preferential hiring hall agreement, commonly called « pre-hire,

or closed shop agreement, requiring membership as « condition of employment

or referral by « union es « condition of employment.

“AMA and PMA are controlled by the shipping companies listed in Annex

A, , c. When raises and other benefits are negotiated the Meritine Adsin-

ietretion pays the shipping companies « subsidy to cover these raises in

pay and other benefits. This is done by the Goverment in order to strengthen

and keep the Merchent Marine ready for any emergency, and to provide this

country with commercial carriers to compete in world trade with foreign

vessels, and to have « sufficient supply of seamen to man those vessels.

“AMA and PMA and some independent shipping companies heave caused the

nen who are sot ‘union’ sambers to be deprived of the benefits negotiated

en their behalf, and thereby treated those seamen discriminatorily by dis-

charging ‘non-union’ employees, and offering only temporary employsent to

‘non-union’ employees.

“Seamen employed by the bargeining agreement are employed on an industry

wide basis, and the benefits of the agreement in respect to entry in the

trade, continuity of employment, health welfare, vacation, and pension bene-

fits ere restricted to ‘union sembers' to the detriment of the complainant

and those similarly situated vho ere not ‘union sembers.'

“By way of illustration complainant was discharged from his employment

as « Redio Officer on « Central Gulf Lines vessel, because of « lack of

";hearance’ from the American Radio Association, thereby violating not

only his ‘permanent’ assignment to the vessel but depriving him of health,

welfare, vacation and pension benefits chat he bad sccumuleted in three

cad exo tant gneve 8 employmert in the trade.

— Motes ond Radio Officers of the American Export Lines

were discharged because non-membership in the unions that Farrell Lines

had u bargaining agreement with when Farrell Lines bought the American

Export Line vessels.

“Radio Officers of the Prudential Steamship Company lost their jobs

when Farrell Lines bought those ships and required those American Radio

Association members to join the Radio Officere Union or be discharged.

“Unlicensed seamen on National Maritime Union and Seafarers Union

contract ships have been discharged end refused referral from the exclusive

preferential hiring hells of these unions. Likewise seamen heve been

prevented from entering the trade because of the closed shop, pre-hire

agreements in the maritime industry.

“Respondents and the Au end ROU unions have received subsidy peynents

from the Maritime Administration and have been unjustly enriched to the

detriment of complainant and other seamen similarly situated in violation

of the Shipping Act and seamen's statutes protecting seamen in their employ-

ment and entrance into the trade."

On the basis of the foregoing, Mr. Peltzman prays thet the Coumission

(1) “declare that the bergaining agreements ich were not filed until 1978

were illegal and could not be enforced against complainant and other seamen

Similary situated before the agreement was filed and approved,” (2) award

reperations “retroective from the date of discharge of complainant from the

Central Gulf Lines vessel to the present, and continuing until rehired by

Central Gulf Lines or triple damages because of the violation of the anti-

trust lews relating to monopoly in employment, . . ." and (3) determine

“thet insofer as the agreements call for an exclusive pre-hire preferential

hiring hell referral systen,” and “ union sembership” as « condition of

employment, the agreements, unless modified sre unlewful and may not be

approved. Finally Mr. Peltzman preys “that the Commission investigate the

illegel hiring hall and training fecilities in the maritime industry which

are subsidized by the Msritime Administration, and order that the agreements

be modified so as to conform to the requirements of sections 15, 16 and 17

of the Act.”

Before dealing with the serits of the various motions now before me,

a eummary of what one respondent has called Mr. Peltzman's “legal odyssey”

fs necessary to % understanding of the complaint in this case. The facts

ect forth below are taken from an unchallenged affidevit of Mr. C. 6. Lersen,

Vice President, Merine Division, Central Gulf Lines, and verious decisions

and orders of the National Lebor Relations Board, the New York Stete courts

and Federal courts. Official notice is taken of those decisions and orders

pursuant to Rule 226 of the Commission's Rules of Practice and Procedure.

The effidevit, orders end decisions can be found in the Appendix to Central

Gulf's Motion to Dismiss Compleint.

10a

Mr. Pelteman was first employed by Central Gulf in May 1970 as « radio

operator on the SS Green Ridge and completed three voyages aboard the vessel.

Then and since, Central Gulf employed radio operstors on its vessels under

agreements with the Americen Radio Association, « union of radio operators.

All of these agreements contained a “union security clause” which provides:

(b) The Company agrees, as a condition of employment, that 211

employees in the bargaining unit shall become end remsin senbers

of the Union thirty (30) days after date of hiring.

In May 1971, the Association advised Central Gulf that Mr. Peltzmen had not

paid his union initiation fees and on May 28, 1971, Central Gulf told

Mr. felt en that because of its agreement with the Association, he would

“not be able to rejoin the vessel without prior clearance from the union.”

In September of 1971, Mr. Peltzman filed charges with the National Labor

Relations Board (NLRB) slleging that the union's refusal to clear his for

employment on a central Gulf vessel and Central Gulf's subsequent refusal

to employ him were unfair labor practices in violation of the National

Labor Relations Act. He aleo charged the union with violating the National

Labor Relations Act beceuse of the Union's refusal to enroll him in “the

industry school,” which refusal wes sllegedly based solely on the fact thet

Mr. Peltzman was not « union member.

On October 26, 1971, the M's Region 2 found Mr. Pelteman's charges

to be without merit saying:

2/ The current agreement between Central Gulf and the Association became

effective June 16, 1978, end expires June 15, 1981. There heave been

and there are now no other agreements between Central Gulf and anyone

else concerning the employment of radio operators.

lla

Insofar ae the charge alleges that you were not enrolled in

the industry school because of your lack of seubership in

0

you failed to qualify fer sdmission to for

sought enrollment and edmission to the school is not limited to

Union members. (Central Gulf Appendix, page 8.)

The findings of Region 2 were confirmed by the WLRB's General Counsel and

Mr. Pelteman's appeals from those decisions vere unsuccessful. (Peltamm v.

LAB, 24 Cir., t. No. 70-1091, unreported orders of dismissal end rehesring

contained in Centrs1 Gulf Appendix pages 15 end 16; certiorari denied, 409

U.S. 887; rehearing denied, 409 U.S. 1050.)

It appears that et the same time Mr. Peltsmen was seeking relief fre

the NLRB, he was pursuing other remedies in the courts of New York State

where he sought to enjoin the union and collect damages for the termination

of his employment on Central Gulf vessels. These actions were disuissed

because the subject matter wae within the exclusive jurisdiction of the Mn.

Peltaman v. American Radio Association, 69 Misc. 2nd 17, 327 . 1. Supp. 24

303 (1971); affirmed, 40 A.D. 24 631 (N.Y. Supp. Ct. App. Division 1971),

335 K. 1. Supp. 2d 998 (1971); Certiorari denied, 411 U.S. 916; rehearing

denied, 411 U.S. 977 (1973).

Waving been turned down by the MLAB and the New York courts, Mr. Peltames

then filed suit against Central Gulf in the United States District Court fer

the Southern District of Wew York but n the result wes the seme with the

12a

*

Supreme Court denying rehearing in 1976. The grevemen of Mr. Peltzman's

action in the District Court was described by the Court of Appeals as con-

sisting of ". . . a myriad of claims ... based on maritime law, the New

York and federal constitutions, the antitrust laws, and the collective

bargeining agreement. . . ." The Court disposed cf the claims saying:

Most of Peltzman's arguments can be dealt with summarily.

Nothing in maritime law renders illegal a discharge that is

authorized under a legitimate union security clause. There is

no colorable basis for an antitrust claim. The security clause

here is not subject to attack under the federal or New York

constitutions . . And any claim that the company committed

an unfair labor practice in discharging him would plainly be

subject to the exclusive jurisdiction of the NLRB.

The record does not disclose what other actions, if any, Mr. Peltzman

might have taken during the period from 1976 when the Supreme Court last

denied rehearing to October of last year when he filed this complaint with

the Commission. Motions to dismiss Mr. Peltzman's complaint have been filed

by or on behalf of virtually every respondent in the case. The arguments for

dismissal run from the complaint being berred through lack of jurisdiction

over some of the respondents to failure to state a cause of action.

Before getting to the merits of the various substantive grounds for

dismissal a word or two should be said about « procedural ground which has

3/ Peltaman v. Central Gulf Lines, Inc., 86LRRM2127, . Supp. __

(SDNY 1974); affirmed in part and remanded for a single fact deter-

* 497 F 24 332 (2d Cir. 1974) decision on S8LRRM2924,

(SDNY 1974), not officially reported; affirmed,

72 24 96 (ind Cir. 1975) certiorari denied, 423 U.S. 1974; rehear-

ing denied, 424 U.S. 979 (1976). These decisions can be found in the

Central Gulf Appendix pages 17-26.

13a

been argued by a number of respondents, i.e. that the complaint fails to

meet the requirements of Rule 62 of the Commission's Rules of Practice and

Procedure. That rule requires that complaints contain, (1) a concise de-

ment of the cause of action, (2) «a request for relief or other affirmative

action sought, and (3) identification of ports of origin and destination

and other particulars of shipments when reparations are sought. The sain

thrust of the procedural argument is that the complaint utterly fails to

concisely state the cause of action--the complaint is so confusingly drafted

that respondents are virtually reduced to divination to find what violations

they are charged with.

Mr. Pelczman, who is appearing withowt counsel, has, it must be admitted,

been somewhat less than lucid in stating his grievance. However, the various

aotions to dismiss demonstrate that the respondents have little doubt as to

the precise nature of Mr Peltzman's charges. Moreover, were the complaint

defective for its lack of clarity, the appropriate remedy would not be dis-

miesal but leave to amend.

Two statements in the complaint provide the key to the nature of

Mr. Peltzman's grievance. First Mr. Peltzman describes himself as a "Marine

Radio Officer . . . who has been deprived of employment on (certain) vessels

+» « « Gwe to the monopolistic and illegal exclusive preferential hiring heli

bargeining agreements negotiated by the American Maritime Association, and the

Pacific Maritime Asen. with the American Radio Association, and the Radio

Officers Union.” And later in the complaint Mr. Peltzman states, “This con-

plaint is directed solely to the unlewful and discriminatory pre-hire

exclusive hiring hall arrangements, and union membership requirement ia the

14a

8

agreement which is placed on seamen who to enter the service of shipping

companies, and who wish to retain chose jobs without being forced to join

a wnion or be discharged from employment if they do not join a union which

has en exclusive preferential hiring hell agreement, commonly called «

prehire or closed shop agreement. . . ."

From this it is clear that the real grievance of Mr. Peltzman is the

requirement that he join a union before he can be employed as „ radio

officer on the vessels of those shipping companies which have union con-

tracts containing closed shop or union security clauses. It is equally

clear that Mr. Peltzman feels that the Commission's jurisdiction over this

grievance is to be found in section 15 of the Shipping poe Mr. Peltzman

is aso aware that since 1968, the Commission has exercised jurisdiction,

albeit expressly limited, over aome provisions of collective bargaining

agreements for in a reply to the sotions to dismiss he cites Volkswagen-

werk Aktiengesellechaft v. F. u. C., 390 U.S. 261 cases) Thus the question

becomes does or can whatever jurisdiction the Commission has or had over

labor-management agreements extend to provisions which establish union

membership as « condition precedent to employment as a radio officer in

the U. S. Merchant Marine. While it is unnecessary to review the complete

history of the Commission's involvement in labor agreements, some

4/ Ila paragraph 9 of his complaint Mr. Peltzman states, “This proceeding

arises under Section 15 of the Shipping Act, 1916, as amended, 46 USC

Sec. 814."

nur. Peltzman cites Volkswagen, supra, solely for the propositicn that

the public interest is violated by this type of agreement,” i.e. closed

shop.

15a

consideration of the leading cases is necessary to shov just why

Mr. Peltzman's complaint is without the Commission’: jurisdiction.

In 1965 the Commission issued its decision in Volkswagernmerk Akiten-

gesellschaft v. Marine Terminale, 9 F.M.C. 77. Volkswagen's complaint

in that case charged that the agreement between members of the Pacific

Maritime Association (PMA) establishing the method of assessing cargoes for

contributions to pay their obligations under an agreement with the Inter-

national Longshoremen's and Warehousemen's Union (ILWU) violated section 15

of the Shipping Act.

In 1960 the ILWU agreed to the introduction of labor saving devices

and the elimination of certain restrictive work practices. In return the

PMA agreed to create « $29,000,000 "Mechanization and Modernization Fund”

to be used to mitigate the impact upon employees of technolegical unemploy-

ment. The agreement specifically reserved to the PMA alone the right to

determine how to raise the Fund from its members. PMA decided to reise

the money for the fund by an assessment on each revenue ton of cargo handled.

Volkswagen in its action before the Commission charged that the sethod

of allocating the assessment was discriminatory as applied to its automobiles

and chat the agreement itself was unenforceable because it had not been filed

with or approved by the Commission under section 15 of the Shipping Act. The

6/ PMA is an employer orgenization of some 120 principal common carriers

by water, stevedoring contractors and marine terminal operators repre-

senting the Pacific Coast shipping industry. The prey function of

PMA is to negotiate and administer collective bargaining agreements

with unions representing its sember's employees of which the ILWU is one.

l6a

Commission dismissed the complaint concluding it was not the kind that

required filing under section 15. The Court of Appeais affireed the c.

mission and the case then went to the Supreme Court. The Supreme Court

reversed the Commission finding that the agreement did fall within the

ambit of section 15 and after reaching their conclusion the Court went on

to say:

It is to be emphasized that the only agreement involved in

this case is the one among members of the

allocating the impact of the Mech We ar

here with the agreement creating the Association or with the col-

lective bargaining agreement between the Association and the ILWU.

No claim has been made in this case of

ments was subject to the filing requirements of section 15. Those

agreements reflecting the national labor policy of free collective

bargaining by respresentatives of the parties own unfettered choice,

fall in an ares of concern to the National Laber Relations Board,

and nothing we have said in this opinion is to

questioning their continuing validity. But in negotiation with

the ILWU, the Association insisted that its members were to have

the exclusive right to determine how the Mech Fund was to

assessed, and a clause to that effect was included in the col-

lective bargaining agreement. That assesement arrangement affect-

ing only relationships among Association members and their

customers, is all that there is before us in this case.

Several points are clear from the Court's decision: (1) the agreement in

question was between persons subject to the Act, (2) the agreement has «

direct impact upon persons protected by the Act, i.e. shippers, and (3) the

agreement vas not a collective bargaining agreement reflecting the national

labor pol iz which is the exclusive concern of the NLRB. The Supreme

Court's decision in Volkewagen faced the Commission with the problem of

“reconciling or accommodating Shipping Act policies with labor act poli-

cies.” The Commission dealt vith the problem in United Stevedoring Corp.

v. Boston Shipping Assoc., 16 F. u. c. 7 (1972). In that case, the Com

mission decided to apply the so-called “labor exemption” to certain agree-

ments which might otherwise fall under section 15.

17a

The labor exemption was created as « means of accommodating the

national policies embodied in the antitrust laws and the labor lews. The

labor exemption rendered “pure” collective bargaining agreements immune

from attack under the antitrust lews. The Commission found the analogy to

@ labor exemption from the shipping lews “obvious,” and after « review of

the leading case on the labor exemption from the antitrust laws, the Co-

mission developed the following criteria to be used in granting “labor

related" agreements a labor exemption from the “shipping laws":

1. The collective barga agreement which gives rise to

the activity in question must be good faith. Other expressions

used to characterize this element sre “arms-length" or “eyeball to

eyeball.”

2. The matter is a mandatory subject of bargaining, e.g.

wages, hours or working conditions. The matter gust be « proper

subject of union concern, i.e., it is intimately related or

primarily and commonly associated with a bona fide labor purpose.

J. The result of the collective bargaining does not impose

terms on entities outside of the collective bargaining group.

4. The union is not acting at the behest of or in com-

bination with nonlebor groups, i.e., there is no conspiracy with

management. (16 F.M.C. 13).

Application of these criteria to the agreements Mr. Peltmman says violate

the Shipping Act clearly demonstrates that the agreements come under the

?

labor exemption and thus are immune from challenge under the Shipping act

2/ Mr. Peltzman refers to only two agreements with anything approaching

specificity--"From 1948 to 1977 AMA and PMA did not file with the

Commission the agreements negotiated by ARA end ROU. . . ." There

are a number of unclear references tc other

18a

First, there is no allegation that the agreements vere not the product

of “arms length” or “eyeball to eyeball” bargaining.

Second, the challenged provisions are mandatory bargaining subjects.

WLRB v. General Motors, 373 U.S. 734 (1963); Onieta Knitting Mills v. NLRB,

375 F2d 385 (4th Cir. 1967). "Closed shop” or union security clauses are

proper union concerns and are primarily and commonly assowisted with a bona

fide labor purpose.

Third, the result of the challenged clause in the collective bargaining

agreements does not impose terms on entities outside the bargaining group

which are protected by or subject to the provisions of the Shipping Act.

Fourth, there is no allegation that the unions were or are acting at

the behest or in combination with nonlabor groups, i.e. there is no conspiracy

with menagement. Even if a conspiracy were alleged it would of necessity deal

with matters which are the exclusive concern of the NLRB and beyond the juris-

diction of the Federal Maritime Commission.

Thus, since at least 1972, the allegedly unlewful agreements have or

would if challenged, been exempt from and therefore immune to any attack

under section 15 of the Shipping Act, 1916. In other words, since at least

1972, the laber exemption has applied to agreements of the kind challenged

by Mr. Peltaman and the Commission since then has lacked jurisdiction over

the subject matter of those agreements.

Mr. Peltzman also alleges that the agreements violate section 16 and 17

of the aig Section 16 First provides:

it must be assumed that Mr. Peltzman is relying on section 16 First

since no other section is even remotely applicable to the complaint.

19a

It shell be unlewful for any commop cartier by water, or

other person subject to this Act, either alone or in conjunction

with any other person, directly or indirectly:

To make or give any undue or unreasonable preference or

advantage to any particular person, locality or description of

treffic in any respect whatscever, or to subject any perticuler

person, locality, or description of traffic to any undue or

unreasonable prejudice or disadvantage in any respect whatsoever.

(46 U.S.C. 815).

Though broadly worded, section 16 is clearly directed to the obligetions

of common cerriers end other persons subject to the set to users of their

services, i.e., the shipping public. See e.g. Armstrong Cork Co. v. American

Hawaiian SS co., 1 U. s. u. c. 719 (1938); Huber Mfg. Co. v. J. v. Stoomvart

“Nederland,” 4 . M. 3. 343, 347 (1953); Afghan-Amertcan Trading Co. v.

Iebrandteen Co., 3 . M. 3. 622, 623 (1951); Port of New York Authority v.

AB Svenska, 4 . M. 3. 202, 205 (1953); and Pitteton Stevedoring Corp. v.

New Haven Terminal Inc., 13 F. M. c. 33, 35 (1969). Mr. Pelteman’s charge

ie thet he has been subjected to “prejudice and disadvantage in viclation

of section 16” because of the terms of the bargaining agreement relating to

exclusive restrictive hiring referral practices and tenure of employment

for ‘union members’ only. . . It would be patently absurd to, on the

one hand, create a lebor exemption to reconcile the conflicting labor and

shipping policies and on the other nullify the reconciliation through an

assumption of jurisdiction under section 16 First--a section which was not

intended to deal with offenses alleged.

Mr. Pelteman alleges thet closed shop or union security cleuses in

bargaining egreements “constitute unjust and unreasonable regulations and

practices in violation of Section 17 of the Act, and cause the agreement to

20a

be unjustly discriminatory as between ‘members’ of the union and ‘permit

care members’. . . A simple reading of che language of section 17 shows

that it has no applicability to the grievances of Mr. Peltzman.

The regulations and practices which section 17 requires to be just and

reasonable are those “relating to or connected with the receiving, handling,

storing or delivery of property.” They clearly do not apply to the terms

and conditions under which « common carrier will employ « “radio officer.”

The unjust discrimination forbidden by section 17 is discrimination in rates

between shippers and ports. Again « condition not even remotely concerned

with the employment of radio officers.

Pinally, the complaint is time-barred by the two-year period of limite-

tion in section 22 of the Act. The single allegation of hare is contained

in paragraph 21 of the complaint where Mr. Peltzman says:

+ « »« Complainant ves discharged from his employwent as « Radic

Officer on « Central Gulf Line vessel, because of lack of “clear-

ance” from the American Radio Association, thereby violating not

only his “permanent” assignment to the vessel but depriving hia

of health, welfare, vacation and pension benefits that he

accumulated in his three and one half years of e=mploysent in

the trade.

The record demonstrates that the discharge Mr. Peltmman is referring to took

9/

place in 1971. Mr. Pelteman's cause of action, if he had one, rose with

his “discharge from employment” in May of 1971 when Central Gulf terminated

Q/ See affidavit of C. 8. Larsen and the decisions in Peltanm v. Central

Gulf Lines Inc., 497 ¥24 332 (CA2, 1974); Peltaman v. , 609 U.S.

877, reh. denied, 409 U.S. 1050; Felten v. American Radic Assoc.,

327 N.Y. Supp. 24 505 (1971), affirmed 40 A.D. 24 631 (n. 1. Sup. Ce.

App. Div. 1971); 335 . . Supp. 24 998 (1971) (App 35); cere. dented

441 U.S. 916 (1973), rel. den. 411 U.S. 977(1973).

2la

his employment because of Peltzman's refusal to pay his union initiation

fees. Additionally in « letter reply to some of the motions to dismiss

Mr. Peltzman argued that the motions “do not reach the thrist or substantive

allegetions in the complaint which allege in essence:

1. Illegal bargaining egreements not filed by the defendants

is violation of the Shipping Act from 1948 to 1977.

Agein this alleged violation is time-barred by section 22 of the Act.

The compleint of Mr. Archie Pelteman fails to state a casue of action

upon which relief can be granted end is time berred. The complaint is

dismissed.

22a

AMERICAN MARITIME ASSOCIATION, Er AL.

ORDER ADOPTING DISMISSAL OF COMPLAINT

This proceeding was initiated as a result of a Complaint

filed by Archie Peltzman against the American Moritize

Association (AMA), the Pacific Maritime Association (PMA), and

the individual members of these Associations who are common

carriers by water or “other persons subject to the Act" within

the meaning of section 1, Shipping Act, 1916 (46 U.S.C. 801)

(the act).2/ Also named in the Complaint are several unions

es well as a number of independent shipping companies. In ali,

the Complaint names some 185 entities alleged to have violated

sections 15, 16 and 17 of the Act (46 U.S.C. 814, 815, 816), as

well as the antitrust lers and numerous labor statutes. These

violations are said to have resulted from the “union security

Clauses" of certain unspecified collective bargaining

egreements which were allegedly neither filed with, nor

l/ This proceeding was initiated prior to the effective date

of the Maritime Labor Agreements Act of 1980, p. L. 96-325,

94 Stat. 1021, which modified the Commission's jurisdiction

over activities flowing from collective bargaining

agreements.

23a

approved by, the Commission and which allegedly deprived

Complainant of employment as a radio operator on Respondents’

vessels (Complaint, paragraphs 13, 14, le, 17 and 21).

Complainant requests that the Commission declare the agreements

unlawful and seeks reparation under the Act or treble damages

under the antitrust laws. Complainant also urges the

Commission to investigate the hiring hall and maritime training

facilities that are subsidized by the United States Maritime

Administration.

This proceeding is now before the Commission upon Petition

for Reconsideration filed by Complainant to the ruling of Chief

Administrative Law Judge John E. Cograve dismissing the

Complaint .2/ Replies to the Petition have been filed by or

on behalf of most of the Respondents in the proceeding.

DISCUSSION

In his Order dismissing the Complaint, the Presiding

Officer concluded that Complainant had failed to state a cause

of action upon which relief could be granted and that, in any

event, the Complaint is barred by the two-year statute of

limitations in section 22 of the Act (46 U.S.C. 621). The

Presiding Officer first fourd that the agreements complained

2/ Mr. reiten is appearing pro se. His Petition, though

captioned as one for “reconsideration,” is being treated as

an appeal pursuant to Rule 227(b) of the Commission's Rules

of Practice and Procedure (46 C. r. R. 502.227(b)). This Rule

Permits a party to seek Commission review of an administra-

tive lew j s grant of a motion to dismiss a proceeding

in whole or in part.

24a

of, at least as they extend “to provisions which establish

union membership as a condition precedent to employment as &

radio operator in the U.S. Merchant Marine,” are labor-exempt

under the criteria establisied in United Stevedoring

Corporation v. Boston Shipping Association, 16 r. u. c. (1972)

(BSA), and “thus are immune from challenge under the Shipping

det“ (Order at 11 6 14).2/

Purther, the Presiding Officer determined that section is

of the Act is not intended to address the Complainant's

@llegation regarding “unlawful and discriminatory pre-iire

exclusive hiring hell arrangements, and ‘union’ membership

requirexent in the agreements which is placed on seamen who

wish to enter the service of shipping companies” (Order at 4

and 16; Complaint paragraph 17). The Presiding Officer

explained that although section 16 is broadly worded, it is

"clearly directed to the obligaticons of common carriers and

other persons subject to the Act to users of their services,

i.e. the shipping public* rather than to en employee's

grievance against an employer and the union. de also noted

thet it would be "absurd" to recognize a “labor ezemption"

under BSA to reconcile conflicting labor and shipping policies

on the one hand and to undermine that exemption by taking

3/ It was unnecessary for the Presiding Officer to have

considered other provisions of the collective Largaining

Recordingly, the Commission will not adopt that portion of

ssion w that tion o

the Order which implies that the Agreenents are exempt in

their entirety (see Discussion, Nr

25a

jurisdiction under section 16 - “# section which was not

intended to deal with offenses alleged" (Order at 16) on the

other.

Section 17 of the Act was likewise found to be inapplicable

to the charges advanced in the Complaint. The Presiding

Officer ruled that the regulations and practices which section

17 requires to be reasonable relate to receiving and handling

Property and not to the terms and conditions of a radic

officer's employment by a common carrier by water (Order at 17).

In concluding that the Complaint is, in any event, darred

by the two-year statute of limitations, the Presiding Officer

relied on the affidavit of c. 8. Larsen, Vice President, Marine

Division, Central Gulf Lines, and various decisions and orders

of the National Labor Relations Board, the New York State

courts and Federal Courts. The Presiding Officer found that

Mr. Peltzman's cause of action, if any, arose from his

"discharge from employment" in May of 1971 when Central Gulf

terminated his employment because of a refusal to pay union

initiation fees (Order at 17).

Complainant appeals from the Presiding Officer's dismissal

on essentially five grounds:

(1) the Presiding Officer applied an erroneous

— een the alleged violations of the

(2) the Presiding Officer committed procedural errors;

(3) the Presiding Officer committed factual errors;

(4) the Presiding Officer failed to consider all of

the Respondents’ pleadings and arguments; and

(5) the Presiding Officer erred in finding that the

Complaint is time-barred.

26a

The Complainant algues that the “union security” provisions

of the agreements complained of are illegal restraints of trade

and are therefore contrary to the public interest and must be

investigated by the Commission. Complainant maintains that the

purpose of the Shipping Act, 1916, and related statutes is not

only to assure a strong merchant marine but also to protect

merchant seamen. He further submits that the Commission may

not approve an agreement under the public interest standard of

section 15 if it violates either labor statutes or the

antitrust laws.

Complainant also argues that the Presiding Officer erred in

failing to convene a prehearing conference or any hearings in

this proceeding, in dismissing the Complaint prior te the

receipt of all the Respondents’ answers thereto, and in not

specifically considering and addressing all of his pleadings

and arguments.

Mr. Peltzman further contends that the Presiding Officer's

finding that the Larsen affidavit went unchallenged is

erroneous. This affidavit was allegedly rebutted in

Complainant's December 5, 1980 Reply to the Motions to

Dismiss. The Presiding Officer also sllegedly erred in stating

that Complainant had cited Volkswagenwerk Aktiengeselischaft v.

A. 390 U.S. 261 (1968), as an indication that Complainant was

cognizant of the Commission's jurisdiction over matters arising

out of collective bargaining agreements. Finally, Mr. Peltzman

contends that his Complaint is not time-barred because,

27a

although he was discharged in 1971, the “illegal closed sop

and restrictive hiring hall practices are still

continuing.*4/ (Petition at 9).

The several Respondents replying to Complainant's appeal

211 urge the Commission to deny the appeal and to affirm the

Presiding Officer's dismissal.

Complainant's appeal presents the Commission with no reason

for setting aside the Presiding Officer's ruling. Tue

Presiding Officer's ultimate conclusions are well-reasoned and

are supportable procedurally and in law and fact. The Order of

Dismissal is therefore adopted by the Commission, subject to

the modifications and clarifications discussed below. The

Commission shall, however, first dispose of certain procedural

challenges.

Rule 64 of the Commission's Rules of Practice and

Procedure, 46 C. T. A. 502.64, provides that answers to

complaints shall be filed within 20 days of the service of the

complaint, unless a motion to dismiss the complaint is filed.

This Rule further states that the answer to the complaint need

4/ The provisions or agreements at issue here have been

variously referred to by the parties as “closed shop" or

“union security" provisions. The various tribunals where

Mr. Peltzman has t relief have characterized the

provisions complai of as “union security” provisions

(see for example Peltzman ». Central Gulf Lines, Inc., 66

referred to in this Order.

28a

not be filed until such moticn has been denied. Complainant

did not request relief as provided for in Rule 64, has not

demonstrated how he was harmed by the failure of any Respondent

to timely answer his Complaint, nor has the Commission been

able to perceive any harm accruing from failure by any

Respondent to timely answer Mr. Peltzman's Complaint.2/ The

Commission therefore finds that if any such failure existed, it

constituted harmless error, particularly in light of the

Commission's ultimate disposition of the Complaint.

Similarly, Complainant has failed to establish how he was

prejudiced by the absence of a pre-hearing conference or

evidentiary hearings. The Commissior Rules provide the

Presiding Officer broad discretion in structuring the

proceeding (See Rule 94, 46 C. r. R. 502.94). The Commission

cannot find that the Presiding Officer abused that discretion.

The disposition of ais proceeding, on the basis of the Motions

filed, turned on questions of law, thus obviating any need for

evidentiary hearing procedures.

Finally, it is a well-settled principle that administrative

decisions need not recite or respond to each and every argument

or finding propounded by a party to a proceeding. 2/ The

3 The one Respondent alleged not to have filed an answer, the

eee International Union, filed its answer on November

5 319 „

S/ See Mediterranean Pools Investigation, 9 r. u. c. 264, 267

TIS66), err NORE V. Sts ke Center Warehouse and Cold

rr, RS tl eh v.

arpless cals, Inc., 209 F.24 645 (sth Cir. 15777

29a

Presiding Officer's ruling in this proceeding addresses all the

material matters raised by the Pleadings.2/ The arguments

that Complainant submits were not considered by the Presiding

Officer relate primarily to the merits of his Complaint rather

than the gravamen of the Motions to Dismiss, i.e., the lack of

Commission subject matter jurisdiction and the failure to state

a Claim upon which relief can be granted.

It is the absence of subject matter jurisdiccion and the

failure to state a claim upon which relief can o granted which

mandates the dismissal of the Complaint. The essence of the

Complaint is that certain collective bargaining agreements or

their provisions require membership in the union as a condition

to employment on Respondent's vessels. (Order at 11). Thee

"union security" agreements or provisions are at the heart of

the Complaint. Despite sweeping statements concerning the

unlawfulness of the collective bargaining agreements in their

entirety, the focus of the Complaint is:

3/ The facts relied upon by the Presiding Officer are

contained in the various decisions and orders of the

National Labor Relations Board, and the Federal and ke

York State courts, as well as Mr. Larsen's affidavit.

Commission Rule 220, 46 C. r. R. 502.226, permits the taking

of official notice of these decisions, thus mooting any

challenges to the Presiding Officer's consideration of mr.

Larsen's affidavit. In any event, the matters allegedly

rebutted by Mr. Peltzman's December 5, 1980 Reply were not

relied upon nor pertinent to the Presiding Officer's basis

for Gismissal. Similarly. the Commission perceives no bare

in the Presiding Officer's misreference to Der eg 5h

a, because he properly noted the propos

footnote (Order at 11). Moreover, it is irrelevant to

the matter at issue whether Complainant was in fact

previously were of the Commission's jurisdiction over

collective bargaining agreements (Id.).

30a

- « « Girected solely tc the unlawful and

Giscriminatory pre-hire exclusive hiring hall

arrangements .. placed on seamen who wish to enter

the service of shipping companies . . (Emphasis

supplied) (Complaint, paragraph 17).

Complainant's grievance therefore addresses pure erployer-

employee/union mattecs which are not cognizable under the

Shipping et. See New York Shipping Association, Inc. .

Federal Maritime Commission, 495 F. 2d 1215, 1220 (26 Cir.),

cert. den. 419 U.S. 964 (1974). CE. Federal Maritime

Commission v. Pacific Maritime Association (PMA) . 435 9.8. 40

(1978) .2/

This agency's jurisdiction attaches to the provision of

common carrier services in the domestic offshore and foreign

ocean trades of the United States.1°/ within the context of

this proceeding, it is concerned with the regulation of common

carriers subject to its jurisdiction, and not the

8/ Such matters appear to fall within the province of the

National Labor Relations Act.

/ In PMA, the Supreme Court recognized that collective

bargaining agreements could be subject to section 15 of the

Shipping Act and found such an agreement so subject when it

imposed terms celating to loyer competition in providing

transportation related services upon employers not members

of a multi-employer bargaining unit.

10/ “The FMC has no concern with so much of le collective

bargaining agreement) as provices what wages and other

benefits shall be paid to the longshoremen, grievance

procedures and similer matters." New York Suipping

Association, supre, at 1220.

3la

individual seamen employed by those cart lets. A/ the

transportation activities of such carriers present Shipping Act

considerations; their employment relationships, standing alone,

do not.12/ t follows, therefore, that the Complaint does

mis proceeding presents a factual situation far removed

from the type of transportation practice growing out of

collective bargaining agreements whereby carriers refuse to

tender containers to certain classes of shippers or tender

them only subject to additional charges, or from situations

involving the imposition of charges by common carriers

against the users of their transportation services to fund

longshoremen's benefits, the usual situations in which our

jurisdiction has come into play. See e.g. Volk rk

v. „ 390 U.S. 261 (1968); New

„ Federal Maritime Comm

. “492 r. 20 617 r

* 571 F.2d 1221 0. C.

; uc, 628 . 20 253

(b. c. Cir. 1 md Service, Inc.,

424 F.Supp. Fed, S77 ¥.26

730 (Ird Circ. 1978) (table), cer °

(1979); South Atlantic and Caribbean Line * 12 r. u. c.

237 n and

7 ging

* 9. c. cir.

In mance v. Federal Power ee 425 u.S. 662 (1976),

the Supreme Court ru on cability of the public

interest standard of the Federal Power Act, 41 Stat. 1063,

and the Natural Gas Act, 52 Stat. 821, to employment

practices of the regulated industry. In rejecting the

contention that the public interest criterion authorized

the Federal Power Commission to “concern itself with

Giscriminatory ae ractices on the part of the

companies it regulates," Court explei

This Court's cases have consistently held that the use

of the words “public interest“ in a regulatery statute

is not a broad license to promote the genera)

welfare. Rather, the words take meaning from the

purpose of the regulatory legislation.

[Footnote continued on next page).

32a

not allege matters which, if true, would establish a violation

of the Shipping Act, 1916. The Complaint must accordingly de

dismissed as a matter of law.

The language of sections 16 and 17, even if broadly

construed, could not be interpreted to apply to Complainant's

grievance. The Commission will therefore adopt the Presiding

Officer's disposition of these alleg tions with the following

Clarification. After concluding that the Complaint does not

state a cause of action under section 16, the Presiding Officer

noted that:

It would be patently absurd to, on the one hand,

create @ labor exemption to reconcile the conflicting

labor and shipping policies and on the other nullify

the reconciliation through an assumption of

jurisdiction under section 16 First - a section which

was not intended to deal with the offenses alleged.

(Order at 16).

Notwithstanding the last modifying phrase, this statement could

suggest that once a particular agreement is determined to be

12/ [Footnote continued from preceding page.)

For example, in the case of the Interstate Commerce

Commission .. . the term “public interest“ . is

not a concept without ascertainable criteria but has a

direct rcletion to the adequacy of transportetion

service... lat 669, citations omitted).

The Court further stated:

{I]t could hardly be supposed that in directing the

Federal Power Commission to be guided by the “public

interest“ Congress thereby instructed it to take

original jurisdiction ove: the processing of charges

of unt ait labor practices on the part of its

regulatees. (at 671).

33a

“labor exempt" from the filing and approval requirements of

section 15, the activities contemplated by the sgreement are

3180 immune from other sections of the Shipping Act, 1916.

This result is inconsistent not only with the BSA decision

relied on by the Presiding Officer, but with court decisions

indicating that action which is “labor exempt" from the reac:

of section 15 may nevertheless be subject to section 16 of the

Act. See, , Pacific Maritime Ass'n v. FMC, 543 . 24 395,

410, 411, fn. 39 (D.C. Cir. 1976), reversed on other grounds

sub nom. FMC v. Pacific Maritime Ass'n, 435 U.S. 40 (1978); Puc

v. Pacific Maritime Ass'n, 435 U.S., supra, at 68, 74-75, /7

(dissent of Justice Powell). Accordingly, the Commission will

not adopt the sentence quoted above from page 16 of the Ord«r.

There is one final matter that warrants clarification. The

Presiding Officer concluded chat the Complaint is barred by the

two-year statute of limitations in section 22 of the Act. The

limitetion in section 22, however, applies only to claims for

reparation and does not act as 4 bar to requests for other

relief. This fact is not significant here, however, because

Ch. lainant has not otherwise stated s claim upon which relief

can be granted.

THEREFORE, IT IS ORDERED, Theat Complainant's Petition for

Reconsideration is denied.

34a

IT ES FURTHER ORDERED, That the Marcils 13, 1981 Order of

Dismissal in this proceeding is adopted by che Commission as

modified and clarified above.

By the Commission.*

Francis C. turney

Secretary

*Chairman Green did not participate.

35a

APPENDIX F

A. Section 15, Shipping Act, 1916

(29 U.S.C. Sec. 814)

“Every common carrier by water, or

other person subject to this chapter, shall

file immediately with the Commission a true

copy, or, if oral, a true and,complete memo-

randum, of every agreement with another

such carrier or other person subject to this

chapter, or modification or cancellation

thereof, to which it may be a party or con-

form in whole or in part, fixing or regulat-

ing transportation rates or fares; giving

or receiving special rates, accommodations,

or other special privileges or advantages;

controlling, regulating, preventing, or

destroying competition; pooling or apport-

ing earnings, losses, or traffic; allotting

ports or restricting or otherwise regulat-

ing the number and character of sailings

between ports; limiting or regulating in

any way the volume or character of freight

or passenger traffic to be carried; or in

36a

APPENDIX F_

any manner providing for an exclusive,

preferential, or cooperative working arrang-

ment. The term “agreement” in this sect-

ion includes understandings, conferences,

and other arrangements.

The Commission shall by order, after

notice and hearing, disapprove, cancel or

modify any agreement, or any modification

or cancdlation thereof, whether or not pre-

viously approved by it, that it finds to

be unjustly discriminatory or unfair as

between carriers, shippers, exporters, im-

porters, or ports, or between exporters

from the United States and their foreign

competitors, or to operate to the detriment

of the commerce of the United States, or to

be contrary to the public interest, or to

be in violation of this chapter, and shall

approve all other agreements, modifications

or cancellations. No such agreement shall

-be approved, nor shall continued approval

be permitted for any agreement (1) between

carriers not members of the same conference

or conferences of carriers serving different

37a