# Amicus Curiae Brief — Air Line Pilots Ass'n v. O'Neill

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 1991
- **Citation:** 499 U.S. 65

## Text

QUESTION PRESENTED

Whether petitioner breached its duty of fair representation by
Negotiating a back 10-work agreement that ended a sinke by pilots
against Continental Air Lines and allocated positions between
returning strikers and pilots who worked during the strike.

TABLE OF CONTENTS

Page
ELE IESE LI EOI ED l
en. ccc cccccccccccoeecs 6
EE LEE 17
TABLE OF AUTHORITIES
Cases:

ALPA v. United Air Lines, Inc., 614 F. Supp. 1020

(N.D. Ill. 1985), aff'd, 802 F.2d 886 (7th Cir.
1986), cert. denied, 480 U.S. 946 (1987) ..... 5, 14

Alvey v. General Eiectric Co., 622 F.2d 1279 (7th
ec ccc cero cccccces y

American Postal Workers Union, Local 6885 v.
American Postal Workers Union, 665 F.2d 1096
ee 9

Anderson v. Creighton, 483 U.S. 635 (1987) .. 9, 10, 14

Barthelemy v. ALPA, 897 F.2d 999 (9th Cir.

DUG Caaascbbscccccccocceccocecce 10
Barton Brands, Lid. v. NLRB, $29 F.2d 793 (7th Cir.

EE 9
Bernard v. ALPA, 873 F.2d 213 (%h Cir.

EE ESS 10
Berrigan v. Greyhound Lines, Inc., 782 F.2d 295 (ist

ke ck coc ebéoves - 1!
Bowman v. Tennessee Valley Authority, 744 F.2d
1207 (6th Cir. 1984), cert. denied, 470 U.S. 1084

EEE EES EE 9, 10
Breininger v. Sheet Metal Workers, 110 S. Ct. 424
EE 7
Brotherhood of Railroad Trainmen v. Jacksonville
Terminal Co., 394 U.S. 369 (1969) .......... 16
Burkevich v. ALPA, 894 F.2d 346 (%h Cir.
en occu cecceseeccoce 10
Chauffeurs Local No. 139. Terry, 110 S. Ct. 1339
EEE 7
Chicago & N.W. Ry. v. United Transportation
Union, 402 U.S. $70 (1971) ................ . 16

(III)

IV

Cases — Continued: Page
Communications Workers v. Beck, 487 U.S. 735
Saat ein eee nd abeendia bee ant 7
Conley v. Gibson, 355 U.S. 41 (1957) ......... 7
Dement v. Richmond, F. & P. R.R., 845 F.2d 451
Gale Gs wh eed dodde dddenedbdcwoccecs. 9
Detroit & Toledo Shore Line R.R. v. United
Transportation Union, 396 U.S. 142 (1969) ... 16
Ford Motor Co. v. Huffman, 345 U.S. 330
RT cuenntesnabesnbelndsaueeunssiaeuds 8, 15, 16
Galindo v. Stoody Co., 793 F.2d ‘1502 (%h Cir.
i nie¢6ndeusaneueenadunvenegnensaanes: 10
Haerum v. ALPA, 892 F.2d 216 (2d Cir.
yer ey eee 9
Harlow v. Fitzgerald, 457 U.S. 800 (1982) ..... 14
Hendricks v. ALPA, 696 F.2d 673 (%h Cir.
SD df cdde cut doeddberatedeceasonassece 9
Hines v. Anchor Motor Freight, Inc., 424 U.S. 554
N° 4.46 Penk be hanced bens deh bbteees coe 7
Humphrey v. Moore, 375 U.S. 335 (1964) ...... 7
Independent Fed. of Flight Attendants v. Trans
World Airlines, Inc., 819 F.2d 839 (8th Cir. 1987),
rev'd in part, 109 S. Ct. 1225 (1989) ......... 5
International Ass'n of Machinists v. Street, 367 U.S.
Ey er Oe eee 16
International Brotherhood of Elec. Workers v.
Foust, 442 U.S. 42 (1979) .. 1... eee ees 7, 16
Jones v. Trans World Airlines, Inc., 495 F.2d 790
ee Gls CEE Sh cdéchdceueceeneveneessis 9
Masy v. New Jersey Transit Rail Operations, Inc.,
Lt, - | ff: i eee 7)
Moore v. Bechtel Power Corp. , 840 F.2d 634 (%h
Sy ee ee 10
Morgan v. St. Joseph Terminal R.R., 815 F.2d 1232
I, I eS i ur es 7)
NLRB vy. Fleetwood Trailer Co., 3#9 U.S. 375
Dt ahead Ghbbbasetdesenncediecuaetoss ts 13

Cases — Continued:

NLRB v. Local 299, Int'l Brotherhood of Teamsters,
782 F.2d 46 (6th Cir. 1986) .................
NLRB v. Mackay Radio & Telegraph Co., 304
RE Ce ee
Olsen v. United Parcel Service, Inc. , 892 F.2d 1290
inet ne bn neen cnr annaneceé
Parker v. Connors Steel Co., 855 F.2d 1510 (11th
Cir. 1988), cert. denied, 109 S. Ct. 2066
Dt iinet andi epnbeebeeendabucnsakionnns
Peterson v. Kennedy, 771 F.2d 1244 (9th Cir.
Sieh dc ti nt aoe densnendennseces
Ratkovsky v. United Transportation Union, 843 F.2d
ee Se SE a vo cecodcececonescecece:
Schultz v. Owens-Illinois Inc., 696 F.2d 505 (7th Cir.
PE eS ee ee ee ee
Steele v. Nashville R.R., 323 U.S. 192 (1944) ...
Street, Elec. Ry. & Motor Coach Employees v.
Lockridge, 403 U.S. 274 (1971) .............
Tedford v. Peabody Coal Co., 533 F.2d 952 (Sth Cir.
SE nhbbbebbb60 bKbedcdoccvcccvetessecece
Thomas v. Bakery Workers Union, 826 F.2d 755 (8th
ae
Thomas v. United Parcel Service, Inc. , 890 F.2d 909
EE ee
Trans World Airlines, Inc. v. Independent Fed. of
Flight Attendants, 109 S. Ct. 1225 (1989) ....
United Indep. Flight Officers, Inc. v. United Air
Lines, Inc., 756 F.2d 1274 (7th Cir. 1985) ...
United Steelworkers v. Rawson, 110 S. Ct. 1904

SE WaWbbbdesedetecocbesceusesessceeees :

Statutes:

Labor-Management Reporting and Disclosure Act
of 1959, § 101(a), 29 U.S.C. 41Maywl) .......

16

~

Vi

Statutes — Continued:

National Labor Relations Act, 29 U.S.C. 151 ef

BE cckccctbdcducbeGbeces bensecenewecnces
Railway Labor Act, 45 U.S.C. 152 ............

Miscellaneous:

Harper & Lupu, Fair Representation as Equal Pro-
tection, 98 Harv. L. Rev. 1212 (1985) .......
Leffler, Piercing the Duty of Fair Representation:
The Dichotomy Between Negotiations and
Grievance Handling, 1979 U. I. L.F. 35 ....
R. Stern, E. Gressman & S. Shapiro, Supreme Court
_ Practice Gt Ce ccondudespesgacnecess

Page

16
15

17

In the Supreme Court of the Gnited States

OCTOBER TERM, 1990

No. 89-1493
AIR LINE PILOTS ASSOCIATION INTERNATIONAL, PETITIONER
v.

JOSEPH E. O’Nent, ef at

ON PETITION FOR A WRIT OF CERTIORARI TO
THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT

BRIEF FOR THE UNITED STATES AS AMICUS CURIAE

This brief is submitted in response to the Court's order inviting
the Solicitor General to express the views of the United States.

STATEMENT

1. Since the 1940s, petitioner has represented Continental Air
Lines pilots in collective bargaining with the airline. In 1983, after
filing a petition under Chapter 11 of the Bankruptcy Code, Con-
tinental repudiated its collective bargaining agreements with peti-
tioner and other employee unions and unilaterally imposed
“emergency work rules” that cut pilots’ salaries by more than fifty
percent. In response, petitioner initiated a strike against Con-
tinental. Pet. App. B2.'

' There are four separately paginated appendices to the petition, numbered
| through 4. To simplify citations, we will cite to them as though they bad
been denominated A through D.

2

For the next two years, Continental employed permanent
replacements and cross-over strikers as pilots. During thai period,
the bankruptcy court upheld the airline’s rejection of its collec-
live bargaining agreement with petitioner and ordered the parties
to engage in collective bargaining. No new agreement was reached,
and, by August 1985, working pilots outnumbered strikers by
1,600 to 1,000. At that point, Continental gave notice that it
would no longer recognize petitioner as the pilots’ bargaining
representative. Pet. App. B2-B3.

On September 9, 1985, Continental posted its Supplementary
Base Vacancy Bid 1985-5 (85-5 bid) covering some 441 anticipated
vacancies for captains and first officers and an undetermined
number of second officer vacancies. Pilots interested in those
vacancies were invited to submit bids by September 18 specify-
ing their preferred position, base of operations, and aircraft.
Vacancies were then to be awarded on the basis of seniority. In
order to allow for necessary training, the 85-5 bid was posted
substantially in advance of the date when pilots were expected
actually to assume the positions covered by the bid. After the
date for submitting bids had passed, Continental “awarded” the
positions covered by the 85-5 bid to working pilots. Pet. App.
B3-B4; see Pet. 4; Br. in Opp. 3.?

In late September 1985, the Continental Master Executive
Council (MEC) — a committee that served, subject to the authority
of petitioner's executive board and board of directors, as the coor-
dinating council for Continental pilots — voted not to return to
work, but also authorized its officers and a negotiator to pursue
a settlement with Continental. Pet. App. B4. See Pet. C.A. Br.
8; Resp. C.A. Br. 9. During October 1985, representatives of peti-
tioner and Continental agreed to terms for the termination of
the strike and the resolution of litigation involving Continental,
petitioner, and individual pilots. On October 31, 1985, the
bankrupicy court entered an order and award embodying the

* Bids for 85-5 positions were submited not only by working pilots, but
also by some strikers. Contenental mimiated litigation to uy alidate the strikers’
bids. See Pet. App. B3-B4

3

parties’ agreement. Pet. App. D.’ Petitioner consented to the entry
of the order and award without providing notice to the striking
pilots or the MEC or submitting the agreement for ratification.

Under the order and award, each striker was entitled to select
one of three options. Strikers electing Option |, the most im-
portant for present purposes, waived claims against Continen-
tal and obtained the right to be reinstated, based upon seniori-
ty, m certain positions. The agreement allocated the first 100
captain positions in the 85-5 bid to working pilots. The next 70
captain positions (the remainder covered by the 85-5 bid) were
earmarked for returning strikers; however, unlike working pilots,
strikers were obligated to accept the base and aircraft type as-
signed by Continental. The agreement further provided that unti!
October 1, 1988, subsequent vacancies for captain positions would
be allocated between working pilots and returning stiikers on a
one-to-one ratio. Again, whereas working pilots could bid for
the base and aircraft type they preferred, returning strikers were
required to accept management's choice of base and aircraft.‘
The issue of how vacancies occurring after October 1, 1988, were
(0 be allocated among working pilots and returning strikers was
submitted to binding arbitration. /d. at B4-BS, D6-D8.*

The effect of these provisions was to allocate to returning
strikers some of the 85-5 bid positions that, according to Con-

. There has been a dispute between the parties as to whether the bankruptcy
court's approx al of the order and award 1s relevant to the merits of respondents’
law representation clawn. See Pet. App. B11. The court of appeals found that
petitioacr and Continental had agreed to the material terms of the order, and
the court analyzed was the equivalent of a negotiated agreement load Petr
troner has aot sought further review of that determination.

* We are advised that Continental abandoned its night (O assign returning
strtkers to positions of its choice in the Fall of 1987. See Motion to Intervene
tor Lumited Purpose and Pet. for Reh’g of Continental Airlines, Inc. at 7.

. Under Option 2, pilots « arving claims against Continental recenved specified
severance payments. Pilots choosing Opnon 3 retained their claims against Con-
tinental, Dut were to be remstated — based upon the chronological order of thew
ofters to return — only after all pilots choosing Option | had been reinstated
Pet. App. B4-B6.

4

tinental, had been awarded to working pilots. At the same time,
the agreement guaranteed working pilots more desirable positions
than they could have attained if all 85-5 bid positions and subse-
quent vacancies had been assigned to working pilots and return-
ing strikers on the basis of seniority alone. It was foreseeable that
the effects of placing working pilots in those positions would per-
sist, since (in the absence of a layoff) pilots cou.d not be displaced
from positions they occupied. See Pet. App. BS.°

2. Respondents have been certified as representatives of a
class of pilots who remained off the job until the end of the strike.
_ In their complaint, respondents alleged that petitioner breached
its duty of fair representation in negotiating and consenting to
the order and award. The complaint also asserted that petitioner’s
failure to submit the agreement for ratification was a violation
of Section 101(a) of the Labor-Management Reporting and
Disclosure Act of 1959, 29 U.S.C. 411(a)(1), and advanced two
additional causes of action. The district court granted summary
judgment in petitioner’s favor on all claims. See Pet. App. C.

3. The court of appeals reversed with respect to respondents”

fair representation claim. Quoting from this Court’s decision in
Vaca v. Sipes, 386 U.S. 171, 177, 190 (1967), the panel stated that
“{a] breach of the statutory duty of fair representation occurs only
when a union's conduct toward a member of the collective bargain-
ing unit is arbitrary, discriminatory, or in bad faith.” Pet. App.
B9. Because Vaca “recognizes three distinct standards of conduct,”
the court continued, “a breach of the duty of fair representation
does not require that a union’s conduct be taken in bad faith or
with hostile discrimination, but may rest upon the arbitrariness
or irrationality of the union’s acts.” /d. at B9-B10. Adhering to
standards it had announced in Tedford v. Peabody Coal Co. , 533
F.2d 952, 957 (Sth Cir. 1976), the court stated that a union’s deci-
sion could be considered arbitrary unless it was

(1) based upon relevant, permissible union factors which ex-
clude[ ] the possibility of it being based upon motivations

* With respect to matters other than their initial placement, returning strikers
were entitled to exercise their seniority upon being recalled to work. See Pet.
App. D9.

5

such as personal animosity or political favoritism; (2) a ra-
tional result of the consideration of these factors; and (3)
inclusive of a fair and impartial consideration of the interests
of all employees.

Pet. App. B10.

In this case, the court determined, a jury could find that peti-
tioner had acted arbitrarily by agreeing to an order and award
that “left the striking pilots worse off in a number of respects
than complete surrender to (Continental].” Pet. App. B11. The
court explained that returning strikers would have been legally
“entitled to reinstatement as vacancies occurred” (id. at B12), that
Continental “could not have changed its policy of assigning work
by seniority * * * unless it had a legitimate and substantial
business justification for doing so” (id. at B13), and that a trier
of fact could find that Continental “likely would have recognized
the returning strikers’ seniority rights and privileges if they had
unconditionally agreed to return to work” (id. at B14). The court
rejected petitioner’s contention that the agreeme x benefitted
returning strikers by giving them access to some of the positions
encompassed by the 85-5 bid, ruling that, “under ordinary seniori-
ty rules,” returning strikers would have been “entitled to fill the
vacancies announced in the 85-5 bid.” /bid.’ The court concluded
(ibid.):

A factfinder could infer that had [petitioner] unconditionally
offered to return the pilots to work, the strikers would have
been recalled in seniority order, and would have been able
successfully to bid for [85-5 bid] vacancies and also preserve
their litigation rights against [Continental].

’ In support of this conclusion, the court cited ALPA v. United Air Lines,
Inc., 614 F. Supp. 1020 (N.D. Il. 1985), aff'd in part, 802 F.2d 886 (7th Cir.
1986), cert. denied, 480 U.S. 946 (1987). The district court's decision in United
Air Lines was entered on August 8, 1985, and that case was pending on appeal
at the time petitioner agreed to the entry of the order and award in the bank-
ruptcy court. The court of appeals also included a “see also” citation to /n-
dependent Fed. of Flight Attendants (IFF A) . Trans World Airlines, Inc. , 819
F.2d 839 (8th Cir. 1987), rev'd in part, 109 S. Ct. 1225 (1989). The /FFA deci-
sion was issued after the entry of the order and award.

6

In addition, the court of appeals held that respondents had
raised a material issue of fact as to whether the order and award
unjustifiably discriminated against returning strikers. “Depend-
ing upon the explanation offered by [petitioner],” the court con-
cluded, “a factfinder might infer that the negotiated division of
pilots into strikers and nonstrikers and the subsequent unfavorable
discriminatory treatment of returning strikers constituted a breach
of the union’s duty of fair representation.” Pet. App. B15."

DISCUSSION

The courts of appeals have taken varying positions on the ques-
tion whether fair representation claims are subject to different
legal standards depending on whether they arise from a union's
actions in contract negotiations or in contract administration.
In our view, the resulting uncertainty warrants this Court’s at-
tention. If the Court does grant review and decides — as we believe
it should —that a fair representation claim arising in the context
of contract negotiations may be based on arbitrary union con-
duct, this case provides an excellent opportunity to clarify what
conduct may properly be characterized as arbitrary. These are
important questions. The scope of the duty of fair representa-
tion determines the extent to which employees are protected
against abuses of statutory authority conferred on unions and
also, to a significant degree, conti ols the ability of unions to act
as effective bargaining agents for employees with divergent
interests.

l. a. In Vaca v. sipes, 386 U.S. at 177, this Court sum-
marized the origins and scope of the fair representation doctrine.
The Court noted that a union has a statutory duty to bargaining
unit employees “both in its collective bargaining” and “in its en-
forcement of the resulting collective bargaining agreement.”
“Under [the fair representation] doctrine,” the Court continued,
“the exclusive agent’s statutory authority to represent all members
of a designated unit includes a statutory obligation to serve the

* The court of appeals affirmed the dismissal of respondents’ LMRDA claim.
Pet. App. B1S-B19. Respondents have not sought further review of that
question.

~

—

7

interests of all members without hostility or discrimination toward
any, to exercise its discretion with complete good faith and hones-
ty, and to avoid arbitrary conduct.” /bid.

Nothing in Vaca suggested that any part of the Court’s defini-
tion of a union’s duty of fair representation was limited to con-
tract administration. Indeed, the Court noted that the duty is
derived from the union’s authority to act as the exclusive represen-
tative of a bargaining unit’s employees, and the statutes confer-
ring that authority suggest no distinction based upon the nature
of the action taken on employees’ behalf.* The logic underlying
the rule that a union may not act arbitrarily in its capacity as
the exclusive representative of bargaining unit employees is no
less applicable to collective bargaining than it is to the administra-
tion of negotiated agreements. Cf. Conley v. Gibson, 355 U.S.
41, 46 (1957) (obligation to avoid unlawful discrimination ap-
plies equally in both contexts).

The Court has never been squarely presented with the ques-
tion whether Vaca’s three-part standard — which prohibits con-
duct that ‘is arbitrary, unjustifiably discriminatory, or in bad
faith — applies to the negotiation of a collective bargaining agree-
ment. However, the Court has often described the duty in terms
that suggest no essential difference in the standards applicable
to negotiating and administering collective agreements. United
Steelworkers v. Rawson, 110 S. Ct. 1904, 1911 (1990); Chau/-
feurs Local No. 139 v. Terry, 110 S. Ct. 1339, 1344 (1990); Brein-
inger v. Sheet Metal Workers, 110 S. Ct. 424, 429 (1989); Inter-
national Brotherhood of Elec. Workers v. Foust, 442 U.S. 42,
46-47 (1979). See also Communications Workers v. Beck, 487
U.S. 735, 743 (1988); Hines v. Anchor Motor Freight, Inc., 424
U.S. 554, 563-564 (1976); Street, Elec. Ry. & Motor Coach
Employees v. Lockridge, 403 U.S. 274, 299 (1971); Humphrey
v. Moore, 375 U.S. 335, 342, 350 (1964).'°

* See, e.g., Steele v. Nashville R.R., 323 U.S. 192, 198-207 (1944) (Railway
Labor Act); Ford Motor Co. .v. Huffman, 345 U.S. 330, 337 (1953) (extending
doctriné to National Labor Relations Act).

'© The discussion in Terry is representative. Immediately after quoting Vaca's
three-part standard for the duty of fair : presentation, the Court stated

8

Contrary to petitioner’s contention (Pet. 19), the Court’s deci-
sion in Ford Motor Co. v. Huffman, 345 U.S. 230, 337-338
(1953), does not foreclose liability for arbitrary conduct in col-
lective bargaining negotiations. In Huffman, while explaining why
a union enjoys broad authority to negotiate on behalf of bargain-
ing unit employees, the Court observed (345 U.S. at 338):

A wide range of reasonableness must be allowed a statutory
bargaining representative in serving the unit it represents,
subject always to complete good faith and honesty of pur-
pose in the exercise of its discretion.

This passage does not suggest that arbitrary conduct is insuffi-
cient tO sustain a fair representation claim —or that “good faith
and honesty of purpose” is invariably a complete defense. In
stating that a “wide range of reasonableness” was required for
effective bargaining, the Court surely did not imply that unions
should be immune from liability for arbitrary decisions. And,
contrary to petitioner’s suggestion, there is no essential conflict
between Vaca and Huffman. Vaca’s requirement of non-
arbitrariness, properly applied, provides unions with the “wide
range of reasonableness” they require for effective negotiations
while at the same time protecting employees from arbitrary ac-
tion. We agree with the court of appeals, therefore, that Vaca
provides the proper standard for this case and that a union can
be held to have violated its duty of fair representation in con-
tract negotiations by acting arbitrarily.

b. Nevertheless, the courts of appeals have expressed a variety
of views on this issue. A large number of decisions have applied
Vaca’s three-part test, including its requirement of non-arbitrary

that “[a] union must discharge its duty both in bargaining with the employer
and in its enforcement of the resulting collective bargaining agreement.” 110
S. Ct. at 1344. The plain implication was that the three-part obligation described
in Vaca applies in both contexts. Compare Pet. 19 1.9 (suggesting that Vaca
“unplicitly recognized * * * two different standards”). To be surg. since Terry
did not present the question whether arbitrary conduct would suffice to establish
a breach of the duty of fair representation, the Court's description of the duty
was not a holding. Compare Br. in Opp. 8-9.

9

action, to the negotiation of collective bargaining agreements.''
But in a substantial number of decisions, the courts have sug-
gested that there is a difference in kind — warranting a distinc-
tion in applicable fair representation standards — between
negotiating an agreement on behalf of bargaining unit employees
and administering the agreement.

Thus, the Seventh Circuit has stated that “[t}here is one stand-
ard for appraising a union’s conduct when a claim arises out of
union action in negotiating agreements with an employer and a
different standard when the claim arises from a union's ad-
ministration of the collective bargaining agr . especially in
the context of processing grievances.” Schultz v. Owens-Illinois
Inc., 696 F.2d 505, 514 (1982).'? Recently, extended dicta in two
Seventh Circuit decisions have elaboratéd upon the distinction
Schultz drew between negotiations and other actions undertaken
by a union in its capacity as exclusive representative.'’ A decision

'' E.g., Haerum v. ALPA, 892 F.2d 216, 221 (2d Cir. 1989); Jones v. Trans
World Airlines, Inc., 495 F.2d 790, 798 (2d Cir. 1974); Masy v. New Jersey
Transit Rail Operations, Inc., 790 F.2d 322, 327-328 (3d Cir. 1986); Dement
v. Richmond, F. & P. R.R., 845 F.2d 451, 458 (4th Cir. 1988); Anderson v.
Ideal Basic Industries, 804 F.2d 950, 952 (6th Cir. 1986); Bowman v. Tennessee
Valley Authority, 744 F.2d 1207, 1213-1214 (6th Cir. 1984), cert. denied, 470
U.S. 1084 (1985); Barton Brands, Lid. v. NLRB, 529 F.2d 793, 799 (7th Cir.
1976); Thomas v. Bakery Workers Union, 826 F.2d 755, 758-759 (8th Cir. 1987);
Morgan v. St. Joseph Terminal R.R., 815 F.2d 1232, 1234 (8th Cir. 1987);
Bernard v. ALPA, 873 F.2d 213, 216 (9th Cir. 1989); Hendricks v. ALPA,
696 F.2d 673, 677 (9th Cir. 1983); American Postal Workers Union, Local 6885
v. American Postal Workers Union, 665 F.2d 1096, 1105-1107 (D.C. Cir. 1981).

'2 Schultz appears to be inconsistent with the standards articulated in the
Seventh Circuit’s decision in Barton Brands, Lid. v. NLRB, $29 F.2d 793, 19
(1976). Further, after explaining that different standards were applicable in
contract negotiations and contract administration, Schultz went on to analyze
whether a reinterpretation of a contract that the court considered analogous
to the negotiation of a contract was “patently unreasonable” or “arbitrary.
696 F.2d at 515-516. See also Alvey v. General Electric Co., 622 F.2d 1279,
1287-1289 (7th Cir. 1980).

') Thomas v. United Parcel Service, Inc., 890 F.2d 909, 916-919 (7th Cir.
1989); Olsen v. United Parcel Service, Inc., 892 F.2d 1290, 1293-1294 (7th Cir.
1990). See also United Indep. Flight Officers, Inc. v. United Air Lines, Inc.,

10

from the Sixth Circuit suggests that “[bjad faith or intentional
misconduct by the union must be shown” to establish a breach
of the duty of fair representation in “collective bargaining
decisions.” '* In a line of cases, the Ninth Circuit has distinguished
“procedural and ministerial” acts, which will be held to violate
the duty of fair representation if arbitrary, from acts involving
“a union’s judgment,” which will be held to breach the duty only
if discriminatory or in bad faith.'* The Eleventh Circuit has ar-
ticulated different standards for fair representation claims aris-
ing from collective bargaining and claims arising from grievance
processing, although both standards impose liability when a union
has acted arbitrarily, and there seems to be little difference

756 F.2d 1274, 1281-1283 (7th Cir. 1985). The cited passages in Thomas and
Olsen were dicta because the cases involved grievance processing and did not
present the question, which Thomas and Olsen discussed at length, whether
Vaca applied outside that context. In addition, in Olsen, the court stated that
a union, when acting as the employees’ representative in negotiations, “meets
its duty of fair representation * * * by exercising its judgment in a manner that
is not patently unreasonable. [Parker v. Connors Steel Co., 855 F.2d 1510,
1519 (1ith Cir. 1988)} (a union breaches us duty in the negotiation of an agree-
ment if its conduct is ‘arbitrary, irrational, or undertaken in bad faith’).” We
perceive no significant difference in substance between these standards and those
articulated in Vaca.

'* Ratkovsky v. United Transportation Union, 843 F.2d 869, 876 (6th Cir.
1988). See also NLRB v. Local 299, Int'l Brotherhood of Teamsters, 782 F.2d
46, 50-52 (6th Cir. 1986) (requiring that there have been discrimination against
a subgroup of bargaining unit employees). In this respect, Ratkovsky appears
to be inconsistent with the Sixth Circuit's decisions in Bowman v Tennessee
Valley Authority, 744 F.2d 1207, 1213-1214 (1984), cert. denied, 470 U.S. 1084
(1985), and Anderson v. Ideal Basic Industries, 804 F.2d 950, 952 (1986). Fur-
ther, at one point, Rafovsky states that “ijt is well established that a claim
of fair representation requires a showing of bad faith, discrimination, or ar-
bitrary conduct on the part of the union.” 843 F.2d at 876 (citing Vaca).

'? Burkevich v. ALPA, 894 F.2d 346, 349 (9th Cir. 1990); Moore v. Bechtel
Power Corp, 840 F.2d 634, 636 (9h Cir. 1988); Galindo v. Sitoody Co., 793
F.2d 1502, 1513-1514 (9th Cir. 1986); Peterson v. Kennedy, 771 F.2d 1244,
1254 (9h Cir. 1985). These decisions seem to be in conflict with Barthelemy
v. ALPA, 897 F.2d 999, 1005-1006 (9th Cir. 1990), and Bernard v. ALPA,
873 F.2d 213, 216 (9th Cir. 1989).

between the two.'* The First Circuit took note of a contention
that fair representation claims are subject to “bifurcated stand-
ards,” but found it unnecessary to decide whether separate stand-
ards should be recognized.'’ Commentators have also discussed
the possibility of different standards in negotiation and grievance
processing.'®

Many of the statements recognizing different standards for con-
tract negotiations and contract administration have been dicta.
Moreover, in preceding footnotes, we have alluded to cir-
cumstances that tend to undercut the authoritativeness of those

‘atements — and thus perhaps to mitigate the need for this Court’s

view. Nevertheless, when this body of case law is examined as
. whole, it displays a significant division of opinion on the ques-
tion whether the standards of conduct to which unions must
adhere in negotiating agreements are different from those ap-
plicable to contract administration. In our view, the uncertainty
in this area is sufficient to call for this Court’s attention.

2. If the Court grants review and concludes that a showing
of arbitrary conduct is sufficient to establish a breach of the duty
of fair representation, this case also provides an excellent oppor-
tunity to clarify the standards for determining whether a union
has acted arbitrarily. The court of appeals indicated that ar-
bitrariness could be found in a case in which a union has relin-
quished an established right of bargaining unit employees without
receiving anything of value on their behalf. We would agree if
it could be shown that the right of the employees was clearly

‘© Parker v. Connors Steel Co., 855 F.2d 1510, 1519-1520 (Lith Cir.), cert.
denied, 109 S. Ct. 2066 (1989). Parker stated that “in the context of negotia-
tions,” a violation of duty is established if the union's conduct “is arbitrary,
irrational, or in bad faith.” /d. at 1520. “In the context of grievance process-
ing,” the court continued, “the employee must show that the union's handling
of the grievance was either arbitrary, discriminatory, or done in bad faith.” /bid.

'” Berrigan vy. Greyhound Lines, Inc. , 782 F.2d 295, 297-299 (1st Cir. 1986).

'* See, e.g., Leffler, Piercing the Duty of Fair Representation: The Dichotomy
Between Negotiations and Grievance Handling, 1979 U. Il. L.F. 35; Harper
& Lupu, Fair Representation as Equal Protection, 98 Harv. L. Rev. 1212,
1259-1266 (1985).

12
established at the time of the union's decision and if it was also
clear at that time that nothing of value was received in exchange.
But we disagree with the court of appeals’ determination that a
finding of arbitrariness could be made in this case. In our view,
the court failed to take sufficient account of the legal and prac-
tical uncertainties confronting the union at the time of the set-
tlement. Thus, the court’s approach could pose severe problems
for future efforts to achieve negotiated solutions of labor disputes.

The court of appeals concluded that “a jury could find that
the order and award left the striking pilots worse off in a number
of respects than complete surrender to [Continental].” Pet. App.
B11. Most importantly, according to the court, the order and
award deprived returning strikers of the right they would have
had to compete with working pilots (many of whom had less
seniority) for all positions encompassed by the 85-5 bid as well
as later vacancies. /d. at B12, B14. However, when the union
agreed to entry of the award and order, Continental was taking
the position that it had definitively awarded the positions in the
85-5 bid to working pilots. In fact, the airline had initiated an
action to invalidate bids for those positions that had been sub-
mitted by strikers. In this situation, the union faced a choice be-
tween, on the one hand, pursuing litigation to establish the
strikers’ rights to all of the contested positions and, on the other,
accepting a compromise providing returning strikers with access
to some 85-5 bid positions.

We believe that, at the time of the settlement, there was uncer-
tainty as to whether returning strikers were legally entitled to com-
pete for positions encompassed by the 85-5 bid. Under this Court’s
decisions, Continental was entitled to employ permanent
replacements and cross-over strikers to continue operations during
the strike and was not required to discharge those employees to
make room for returning strikers. NLRB v. MacKay Radio &
Telegraph Co., 304 U.S. 333, 345-346 (1938). On the other hand,
Continental would have been required to offer returning strikers
vacant positions equivalent to those the strikers had held before
going On strike (absent countervailing Icgitimate and substantial

13

business justifications for refusing to do so). NLRB v. Fleetwood
Trailer Co., 389 U.S. 375, 378 (1967). Unjustified refusals to
reinstate strikers who offer unconditionally to return to work
“discourage employees from exercising their rights to organize
and to strike.” /bid.

The issue left unsettled by this Court’s decisions is whether 85-5
positions “awarded” to working pilots would have been considered
“vacancies” available to returning strikers. Continental’s position,
as we understand it, has been that the bid procedure serves its
legitimate interest in designating particular employees for an-
ticipated vacancies in advance, so that the airline can begin at
once to provide necessary training and arrange to fill positions
vacated by pilots who have bid successfully for better jobs. Under
that position, refusing to rebid those vacancies to accommodate
returning strikers could not be characterized as an unjustifiable
infringement of the right to strike. The countervailing argument,
as we understand it, is that an award confers only a limited, con-
ditional expectancy of a position and that it would not have under-
cut Continental’s legitimate interests to place returning strikers
in positions that were not actually filled or for which training
had not commenced. If that view of the bidding process were
valid, a refusal to allow returning strikers equal access to posi-
tions available when they agreed to return might be viewed as
an unjustified infringement of the right to strike.'?

Regardless of how this dispute might be resolved on its merits,
we believe there is no basis on which a trier of fact could find
that a decision to opt for a compromise was arbitrary. A union
in petitioner's position could legitimately take account of the risks
and delay inherent in litigation in deciding whether to agree to

'* The fact that some strikers had submitted bids for positions covered by
the 85-5 bid gave rise to an additional complexity. We understand that Con-
tinental sought to invalidate all those bids on the ground that they were part
of a union ploy to place disloyal pilots in a position where they could disrupt
the airline’s operations. In view of that dispute, a litigated solution would have
required a court to resolve the competing claims of three groups of pilots: (1)
working pilots who bid for 85-5 positions, (2) striking pilots who submitted
contested bids for those positions, and (3) strikers who sought reinstatement
without having submitted timely bids.

14

a negotiated settlement. Further, the district court decision cited
in the court of appeals’ opinion, A .PA v. United Air Lines, Inc.,
614 F. Supp. 1020, 1045-1046 (D.C. Ill. 1985), aff'd in part, 802
F.2d 886 (7th Cir. 1986), cert. denied, 480 U.S. 946 (1987), did
not clearly establish the pilots’ entitlement to the 85-5 bid posi-
tions. When petitioner consented to the entry of the order and
award, the United Air Lines decision was on appeal; the outcome
of the appeal could not be known; and, especially in view of the
differences between the facts of the United and Continental
disputes, the Seventh Circuit’s decision might well not have been
followed in the circuit in which most litigation between petitioner
and Continental had been brought.?¢

A mistake in the assessment of the state of the law on this issue
at a particular time would not ordinarily call for this Court’s
review. However, the court of appeals’ decision in this case ap-
pears to involve a more fundamental problem. In its recitation
of the standards by which it determines whether a union has acted
arbitrarily, the court, quoting its opinion in Tedford, emphasized
that it was necessary to determine whether a decision challenged
in a fair representation case is “a rational result of the considera-
tion of [permissible union] factors.” Pet. App. B10. Judged by
its application in this case, that standard appears to permit
imposition of liability based upon a union’s failure to anticipate

© As petitioner has noted (Pet. 25-26), in United Air Lines, the carrier rebid
the entire airline in the early days of a strike, and the district court concluded
(in light of other facts) that the rebid was motivated by anti-union animus.
614 F. Supp. at 1046. The court of appeals affirmed on this basis. 802 F.2d
at 898-900. The availability of such a rationale in this case was — at the very
least — subject to doubt.

In considering the significance due the district court's decision in United Air
Lines, we believe that standards governing the availability of qualified immunity
to public officials provide a useful analogy. In determining whether an official
is immune from liability for an alleged violation of a plaintiff's constitutional
rights, his action is “assessed in light of the legal rules that were ‘clearly estab-
lished at the time it was taken.” Anderson v. Creighton, 483 U.S. 635, 639 (1987);
Harlow v. Fitzgerald, 457 U.S. 800, 818-819 (1982).

15

the manner in which an unsettled issue of law will be resolved.?'
In our view, the imposition of liability on that basis would con-
tradict the principles recognized in Ford Motor Co. v. Huffman,
345 U.S. at 337-338. Thus, this case affords an opportunity for
this Court to consider whether, in its articulation and applica-
tion of the Tedford formulation, the Fifth Circuit has departed
from the correct standard for determining what conduct qualifies —
as arbitrary.??
3. The standards circumscribing a union’s duty of fair
representation are an important element of federal labor law.
Properly defined, the duty of fair representation provides signifi-
cant protection to employees and, at the same time, gives unions
needed leeway to pursue negotiated settlements. “The heart of
the Railway Labor Act is the duty, imposed by [45 U.S.C. 152,
First] upon management and labor, ‘to exert every reasonable
effort to make and maintain agreements concerning rates of pay,
rules, and working conditions, and to settle all disputes . . . in
order to avoid any interruption to commerce or to the operation
of any carrier growing out of any dispute between the carrier and

2! We note that, in the present case, the underlying issue of law is still in
dispute.

The court cited evidence suggesting that Continental had honored returning
strikers’ seniority in the past and could be expected to do so in the future. Pet.
App. B12-B14 & n.3. However, even if it would have been arbitrary for peti-
tioner to fail to act on the indications cited by the court, petitioner would still
have had to confront the question whether Continental would withdraw its
“awards” of 85-5 bid positions and permit returning strikers to compete for
them. That is, an assurance that strikers would have been returned on the basis
of seniority would have resolved just one of two questions facing petitioner
after the closing of the 85-5 bid; the other was whether Continental would be
required to return strikers to positions encompassed by that bid.

22 We note that respondents have also argued, inter alia, that petitioner's
leadership consented to the entry of the order and award based upon self-interest
and political motivations, concealed their actions from the rank-and-file and
their representatives, and falsely assured striking pilots that any agreement wquild
be submitted for ratification. See Pet. App. B7. The court of appeals did not
decide whether there were disputed issues of fact requiring a trial on those allega-
tions of bad faith. These theories of liability could be considered on remand
if the Court were to grant review and vacate the court of appeals’ judgment.

16

the employees thereof.’ ” Brotherhood of Railroad Trainmen v.
Jacksonville Terminal Co., 394 U.S. 369, 377-378 (1969). See
Chicago & N.W. Ry. Co. v. United Transportation Union, 402
U.S. 570, 574 (1971); International Ass’n of Machinists v. Street,
367 U.S. 740, 758-761 (1961). The statute’s objective is “to pre-
vent, if possible, wasteful strikes and interruptions of interstate
commerce.” Detroit & Toledo Shore Line R.R. v. United
Transportation Union, 396 U.S. 142, 148 (1969). Because of their
potential impact on national transportation systems, strikes in
transportation industries can have particularl; severe effects on
the national economy.

Recent years have seen a number of bitter labor disputes in
the interstate transportation industries. Uncertainty regarding the
extent to which settlements will expose unions to liability for a
breach of the duty of fair representation can only complicate the
efforts of management, unions, and federal mediators to achieve
negotiated resolutions of those disnutes. Cf. I/nternational
Brotherhood of Elec. Workers v. Foust, 442 U.S. at 51-52.
Because potential litigants in interstate transportation industries
often have a choice among forums in various circuits, national
uniformity in this area is particularly important. Finally, although
this case arises in the context of the Railway Labor Act, the duty
of fair representation also applies to employees represented by
unions under the National Labor Relations Act, 29 U.S.C. 151
et seq. See Ford Motor Co. v. Huffman, 345 U.S. at 337.

4. Petitioner suggests (Pet. 29) that it would be appropriate
for the Court to grant the petition, vacate the court of appeals’
judgment, and remand for reconsideration in light of the deci-
sion in Trans World Airlines, Inc. v. Independent Fed. of Flight
Attendants, 109 S. Ct. 1225 (1989). We disagree. In TWA, a deci-
sion rendered after the events at issue, the only question presented
was whether full-term strikers were entitled to displace cross-overs
who held positions at the conclusion of a strike. The Court did
not address the separate issue of when cross-overs (or, for that
matter, permanent replacements) acquire an interest in a posi-
tion sufficient to defeat the reinstatement rights of returning
full-term strikers. Nor did it address the questions of fair represen-

17

tation presented here. Under these circumstances, Court's deci-
sion in TWA does not justify summary disposition of this case.??

CONCLUSION

The petition for a writ of certiorari should be granted.
Respectfully submitted.

KENNETH W. STARR
Solicitor General

STUART M. GERSON

Assistant Attorney General
DAVID L. SHAPIRO

Deputy Solicitor General
STEPHEN L. NIGHTINGALE

Assistant to the Solicitor General

WILLIAM KANTER
DEBORAH RUTH KANT
Attorneys

AUGUST 1990

2) Respondents argue (Br. in Opp. 7) that review is not warranted because
the court below remanded the case for further proceedings and thus ifs deci-
sion is interlocutory. But the court of appeals has finally determined the ap-
plicable legal standard and concluded, erroneously in our view, that a trier of
fact could find the union's conduct to be arbitrary. The case is suitable for
review at this juncture, because there is an “important and clear-cut issue of
law that is fundamental to the further conduct of the case and that would other-
wise qualify as a basis for certiorari.” R. Stern, E. Gressman & S. Shapiro,
Supreme Court Practice 225 (6th ed. 1986); see id. at 225-226 and cases cited
therein.

’ US GOVERNMENT PRINTING OFFICE 1990-262 203/20057

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0737%3A05. Public record. Not legal advice.