Respondents Brief — Air Line Pilots v. Miller
Supreme Court brief1998
Ask Donna
What actually matters in this document.
Text
Bupreme Sourt, US.
FIULUED
Supreme Court of the United States
OCTOBER TERM, 1997
AIR LINE PILOTS ASSOCIATION,
Petitioner,
Vv.
ROBERT A. MILLER, ef ai.,
Respondents.
On Writ of Certiorari to the
United States Court of Appeals
for the District of Columbia Circuit
BRIEF FOR RESPONDENTS
RAYMOND J. LAJEUNESSE, JR.
Counsel of Record
National Right to Work Legal
Defense Foundation, Inc.
8001 Braddock Road, Suite 600
Springfield, VA 22160
(703) 321-8510
PHILIP F. HUDOCK
P.O. Box 3796
Reston, VA 20195
(703) 757-9577
ATTORNEYS FOR RESPONDENTS
February 6, 1998
BEST AVAILABLE COPY!
COUNTERSTATEMENT OF
QUESTION PRESENTED
Must nonmembers exhaust nonconsensual “arbitration”
procedures adopted by a union before they can obtain a judicial
determination of the lawfulness of the amount of the “agency
fee” they must, under federal law, pay the union to keep their
jobs?
TABLE OF CONTENTS
Page
COUNTERSTATEMENT OF QUESTION
PRESENTED ...cccccavesccosbedvedvssaeeeanenae i
TABLE OF AUTHORITIES ......ccscscsesccccccess iv
CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED ...........50 eee eeeeeeeee |
COUNTERSTATEMENT OF THE CASE ...........++- |
SUMMARY OF ARGUMENT .......-.-0- esse eeeeees 8
ARGUMENT ...cccvccscvcdeccecseshes daneumeuens 12
I. This Court’s Hudson Decision Does Not Require Non-
members to Exhaust Union Agency-Fee “Arbitration
Schemes, But Merely Requires Unions Exercising
Their Statutory Privilege of Collecting Coerced Fees to
Make Available an Expeditious, Fair Alternative to
Litigation ........csceeccecssecrecusesesccoess
Il. Exhaustion Cannot Be Required Here, Because There
Is No Agreement to Arbitrate, and Mandatory Exhaus-
tion Would Be Inconsistent with Congress’ Intent That
Unfair Representation and Constitutional Claims Are
Uniquely Within the Federal Courts’ Jurisdiction ....
ll. Even If It Is Assumed Arguendo That Policy
Considerations Are Relevant, They Suggest That
Exhaustion Should Not Be Required in Agency-Fee
Cages ...cccccccteseeeesebauues isan
A. Exhaustion Will Not Relieve the Courts of
Having to “Micromanage” Agency-Fee Cases ...
19
27
B. The Purported Burden of Simultaneous Arbi-
tration and Litigation Is Improbable and
MCCS UeC sine ee yhbleeeoscececees. 29
C. Exhaustion Is Unlikely to Resolve Many
EE Oe a ae 30
D. Exhaustion Is Unlikely to Simplify Many
EE Ene Se 33
E. Exhaustion Will Unduly Prejudice Nonmem-
ee 39
IV. Because the Impartial Lecisionmaker Procedure Is a
Review Procedure, Requiring Its Use Is an Exhaustion
Requirement. Moreover, It Is One That Would Unlaw-
fully Infringe Nonmembers’ Right Not to Associate .. 42
EES 47
APPENDIX
United States Constitution, Article II] ............. la
Railway Labor Act, §§ 2, Fourth and Fifth ......... la
_'*
TABLE OF AUTHORITIES
Cases Page
Abood v. Detroit Bd. of Educ., 431 U.S. 209 (1977) .. passim
Abrams v. Communications Workers, 59 F.3d 1373
(D.C. Cir. 1995) 0... cece cece cece eee crereeeee 15, 47
Alexander v. Gardner-Denver Co., 415 U.S. 36
C7) ee 28, 36-37
Andrews v. Cheshire Educ. Ass'n, 829 F.2d 335
(2d Cir. 1987) 0.62. cece cece eee cece ee eerereceees 30
Associated Plumbing & Mech. Contractors v.
Plumbers Local 447, 811 F.2d 480 (9th Cir. 1987) ..... 32
AT&T Technologies, Inc. v. Communications Workers,
475 U.S. 643 (1986) .. 6-2 eee eee eee renee 20
Bagnall v. ALPA, 626 F.2d 336 (4th Cir. 1980),
cert. denied, 449 U.S. 1125 (1981) ...----- eee eee 20-21
Beckett v. ALPA, 59 F.3d 1276 (D.C. Cir. 1995) ....----> 30
Blum v. Yaretsky, 457 U.S. 991 (1982) ....----00+++e: 14
Bowen v. United States Postal Serv., 459 U.S. 212
iC. <) eee 25
Branti v. Finkel, 445 U.S. 507 (1980) .....-----52eee5 41
Breininger v. Sheet Metal Workers Local 6,
493 U.S. 67 (1989) .. 0... cece eee cece e ee ereees 25, 38
Brisentine v. Stone & Webster Eng'g Corp., 117 F.3d
$19 (Lith Cir. 1997) ..... 6c cece eee e eee e reer eneee 37
-V-
TABLE OF AUTHORITIES (CONT.)
Page
Bromley v. Michigan Educ. Ass'n, 82 F
. " .3d 686 (6th
Cir. 1996), cert. denied, 117 S. Ct. 682 1997) peer passim
Er rg v. State Bar, 906 P.2d 1242
. Pek sebuictadels HIN. 660%: 15, 17, 26, 42
California Saw & Knife Works, 320 N.L
’ LRB.
224 (1995), enforced, 157 L.R.R.M. (BNA)
2287 (7th Cir. Jan. 14,1998) ............... 25
“ne v. Auto Workers, 451 U.S. 679
FE eS eee Ca EON reat 20, 28, 33, 41
Coit Independence Joint Venture v. FSLI
489 U.S. 561 (1989) ........ vines Pe re 39
Colorado River Water Conservation Dist. v.
United States, 424 U.S. 800 (1976) ................ 22
Commodity Futures Trading C ‘
478 U.S. 833 (1986) ...... pares tn eng 22
Communications Workers v. Bec
OD circa: vie hue bate passim
Cox v. New Hampshire, 312 U.S. 569 (1941) ........... 44
Dayton Bd. of Educ. v. Brinkman, 433 U.S. 406 (1977) ... 32
DelCostello v Teamsters, 462 U.S. 151 (1983)
Ellis v. Railway Clerks, 466 U.S. 435 (1984) ....... passim
Elrod v. Burns, 427 U.S. 347 (1976) .................. 41
- vi -
TABLE OF AUTHORITIES (CONT.)
Page
Felder v. Casey, 487 U.S. 131 (1988) .......--++++- 25-26
First Options of Chicago, Inc. v. Kaplan, 514 U.S.
GBB (199S) 0... c cence eee e cee erecnecceceeeees 19
Food & Commercial Workers Local 951 v. Mulder,
31 F.3d 365 (6th Cir. 1994), cert. denied, 513
U.S. 1148 (1995)... 2. ccc we cece ccccccvnces 15, 18, 21
Ford Motor Co. v. Huffman, 345 U.S. 330 (1953) ....... 13
Gateway Coal Co. v. Mine Workers, 414 U.S. 368
MODE... .cuenticasedo0uh dusaedeUarwas valete vee. 20
Gibney v. Toledo Bd. of Educ., 532 N.E.2d 1300
(Ohio 1988)... 6... ee eee eee eee eee e teen eeee 15, 26
Gibson v. Berryhill, 411 U.S. 564 (1973) ....-----++55: 41
Gilmer v. Interstate/Johnson Lane Corp., 500
U.S. 20 (1991)... 2. c cc cee eee eee eeeeeeeees 20, 36-37
Granfinanciera, S.A. v. Nordberg, 492 U.S. 33 (1989) ..... 23
Hohe v. Casey, 956 F.2d 399 (3d Cir. 1992) ......--. passim
Hohe v. Casey, 135 L.R.R.M. 3026, final judgment,
136 L.R.R.M (BNA) 2198 (M.D. Pa. 1990), aff'd in
part, rev'd in part, 956 F.2d 399 (3d ~~ > Fees 16
Hudson v. Teachers Local 1, 922 F.2d 1306
(7th Cir.), cert. denied, 501 U.S. 1230 (1991) ....------ 16
Se ma
- Vii -
TABLE OF AUTHORITIES (CONT.)
Page
In re Bituminous Coal Operators’ Ass'n, 949
aa... he 22
Joseph Burstyn, Inc. v. Wilson, 343 U.S. 495 ee 45
Keller v. State Bar, 496 U.S. 1(1990).................. 30
Keller v. State Bar, 767 P.2d 1020 (Cal. 1989
rev'd, 496 U.S. 1 (1990) ....... ey er : ety sila 30
Knight v. Kenai Peninsula Borough Sch. Dist
131 F.3d 807 (9th Cir. 1997)............ “|. . 15, 18-19, 25
La Buy v. Howes Leather Co., 352 U.S. 249 (1957) ....... 22
Lancaster v. ALPA, 76 F.3d 1509 (10th Cir. 1996) .. 15, 39-40
Lehnert v. Ferris Faculty Ass'n, 500 U.S. 507 (1991) . passim
Livadas v. Bradshaw, 512 U.S. 107 (1994) .............. 37
Lowary v. Lexington Local Bd. of Educ., 903 F.2d
422 (6th Cir.), cert. denied, 498 U.S. 958 (1990) ........ 30
Lugar v. Edmondson Oil Co., 457 U.S. 922 (1982)........ 14
Machinists v. Street, 367 U.S. 740 (1961) ............ 12,14
McCarthy v. Madigan, 503 U.S. 140 (1992) ......... passim
McDonald v. City of West Branch, 466 U.S. 284
DRM dda cod dwn edwhid oueces oo sks ai passim
Mitsubishi Motors Corp. v. Soler Chrysler-
Plymouth, Inc., 473 U.S. 614 (1985) ................. 36
- Vili -
TABLE OF AUTHORITIES (CONT.)
Page
Neal v. System Bd. of Adjustment, 348 F.2d 722
(Oth Cle. 1906S)... cc cccvccreeessvecevesecesees 20, 47
Nielsen v. Machinists Local 2596, 94 F.3d 1107
(7th Cir. 1996), cert. denied, 117 S. Ct. 1426 (1997) ..... 40
NLRB v. Maddox, 415 U.S. 322 (1974) .. 6... eee es 21
Pacemaker Diagnostic Clinic v. Instromedix, Inc., 725
F.2d $37 (9th Cir.), cert. denied, 469 U.S. 824 (1984)... . 22
Patsy v. Board of Regents, 457 U.S. 496 (1982) ...... passim
Pattern Makers’ League v. NLRB, 473 U.S. 95 (1985) ..... 46
Poulos v. New Hampshire, 345 U.S. 395 (1953) .......--. 44
Railway Clerks v. Allen, 373 U.S. 113 (1963) ......--. 16, 46
Railway Employes’ Dep't v. Hanson, 351 U.S. 225
(RDO. cnvcvecveccnvescccscedvessceneususs 13-14, 46
Republic Steel Corp. v. Maddox, 379 U.S. 650
See 20, 23
Roth v. United States, 354 U.S. 476 (1957) ... 66... eee ees 45
Seay v. McDonnell Douglas Corp., 427 F.2d 996
(Oth Cir. 1970)... 6. cece eee eee eee e eee teen ee reee 41
Soto Segarra v. Sea-Land Serv., Inc., 581 F.2d 291
tt 28 Oe .) ce 20
Steele v. Louisville & Nashville R.R., 323 U.S.
192 (1944)... . cc cece eee eee e eee eeeeeeeeeeees passim
- ix -
TABLE OF AUTHORITIES (CONT.)
Page
Steelworkers v. Warrior & Guif Navigation Co.,
oP oP ee rr ee 19
Taylor v. Freeland & Kronz, 503 U.S. 638 (1992) ........ 13
Teachers Local | v. Hudson, 475 U.S. 292 (1986) .... passim
Thomas v. Union Carbide Agric. Prods. Co.,
ne 22-23
Tierney v. City of Toledo, 917 F.2d 927 - Cir.
DC UNMER MEINERS ceheeccoud< woh. Ge” 15, 26, 35
Tierney v. City of Toledo, 824 F.2d 1497 (6th Cir.
Ea ee AT Ot 30
Times Film Corp. v. City of Chicago, 365 U.S. 43
EE ape ee rr ences sh AE 45
Vaca v. Sipes, 386 U.S. 171 (1967) .................... 25
Weaver v. University of Cincinnati, 942 F.2d 1039
aS EN OEE PD 45
Williamson Cty. Regional Planning Comm'n
v. Hamilton Bank, 473 U.S. 172 (1985) ............ 42-44
Constitutional, Statutory and Rules Provisions
a REIGN a SS Ce a 22
EI ale ee eee ee ee conn passim
8 pinnae ile sive gh ini anes passim
“X%-
TABLE OF AUTHORITIES (CONT.)
Page
SB UBC. 6 UTE CRBS ccc cicccevcpasacsoes s geeens 23
2B UBL. & LSI CREP in occ cncies ccccevesiavscnns 23
National Labor Relations Act,
29 U.S.C. $§ 151-G9 (19BB) ... 1. ccc eee eens 15, 46
Section 9(a), 29 U.S.C. § 159(a) (1988) ...... 6.66.66 ee 13
DDUBL. BUTI oo cc cc ces cceccssccencsevess 23
29 U.S.C. § 41 1(a ES) (IDES) .. wc cece cere eve ecvens 20
42 U.S.C. § 1963 (1SGE) ... nc nscccccccsseeccceses passim
Railway Labor Act, 45 U.S.C. §§ 151-88 (1988) ..... passim
Section 2, Fourth, 45 U.S.C. § 152, Fourth (1988) ..... 1,12
Section 2, Fifth, 45 U.S.C. § 152, Fifth (1988) ....... 1,12
Section 2, Eleventh, 45 U.S.C. § 152, Eleventh
POGUE osc knee ccacess0cesannnmen tacts <s 1, 12
Sup. Ct. R. 14.1(a) 0... cc cece ccccccecccersersecenees 32
PUR eG We ED na ko cdcucideuceevescveess secon? 6
Other Authorities
Frank Elkouri & Edna A. Elkouri, How Arbitration
Worles (40h OB. TOES) ooo ccc ccsceccccnccccccecces 32
Owen Fairweather, Practice and Procedure in Labor
Arbitration (26 @6. IDES)... cc cece ce mes ccccccenss 32
Thomas R. Haggard, Union Security in the
Context of Labor Arbitration, 1994 Nat’! Acad.
f 4 SS Serer rrrorrererri ce re 31
-Xil-
TABLE OF AUTHORITIES (CONT.)
Page
Martin H. Malin, Arbitrating Statuto
nH. ry Employment
Claims in the Aftermath of Gilmer, 40 St. Louis
PRM CU fas kddbns ciceaesuduulirnes. 32-33
Henry P. Monaghan, First Amendment “Due Pr .
83 Harv. L. Rev. 518 (1970) .............. at a
Webster's New Collegiate Dictionary RE died Pinca swe 18
IN THE
Supreme Court of the United States
OCTOBER TERM, 1997
No. 97-428
AIR LINE PILOTS ASSOCIATION,
Petitioner,
Vv.
ROBERT A. MILLER, ef ai.,
. Respondents.
On Writ of Certiorari
to the United States Court of Appeals
for the District of Columbia Circuit
BRIEF FOR RESPONDENTS
CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED
Besides the provisions the Brief for Petitioner (““ALPA’s
Br.”) at 2-3 quotes, this case involves Article III of the Constitu-
tion of the United States and sections 2, Fourth and Fifth of the
Railway Labor Act (“RLA”), 45 U.S.C. §§ 152, Fourth and Fifth
(1988). Their pertinent text is set out in the Appendix, injra, la.
COUNTERSTATEMENT OF THE CASE
This is an action for declaratory, injunctive, and monetary
relief concerning collective-bargaining agreement provisions
that, under section 2, Eleventh of the RLA, 45 U.S.C. § 152,
Eleventh (1988), compel nonunion pilots to pay “agency shop”
charges to Petitioner Air Line Pilots Association (““ALPA”) for
its costs of statutory exclusive representation.
a
ALPA is a labor organization and exclusive bargaining
representative for the pilots employed by Delta Airlines, Inc.
(“Delta”). Respondents are 153 nonunion Delta pilots (“the
pilots” or “the nonmembers”). (Pet. App. at 1a-2a.)' On Novem-
ber 1, 1991, ALPA and Delta entered into an agency-shop
agreement requiring “as a condition of continued employment
that, beginning January 1, 1992, each pilot not a member of
ALPA must pay the union “a service charge as a contribution for
the administration of [the collective-bargaining] Agreement and
the representation of such employee.” The agreement specifies
that the “service charge shall be an amount equal to the
Association’s regular and usual dues.” (J.A. at 30-31, 35.)
The pilots filed their Complaint in the United States District
Court for the District of Columbia on December 12, 1991, with
a motion for a preliminary injunction against implementation of
the agreement. The court denied this motion, and ALPA began
collecting agency fees in January 1992. (See id. at 1.)
ALPA charged objecting nonmembers fees that were about
8% less than dues from January | through June 30, and about
17% less from July 1 through December 31, 1992, based,
respectively, on its 1990 and 1991 expenditures. (Pet. App. at
2a.) Under its “Policies and Procedures Applicable to Agency
Fees,” ALPA did not escrow the full amount of objectors’ fees,
but only “an amount equal to 1.5 times ALPA’s estimate of its
total agency fee rebate obligation for that year.” (J.A. at 67-68.)
' Three Respondents, Robert A. Miller, Kenneth Shackelford, and
Robert V. Ziminsky, were named Plaintiffs in the original Complaint. (J.A.
at 10.) The other 150 were permitted to intervene later by the district court,
(id. at 115-33), after ALPA opposed and the court denied class certification,
(R. 46; R. 59) (“R.” refers to docket numbers on the district court’s docket
sheet). One Respondent is the personal representative of a deceased
Intervenor. (J.A. at 7.) ;
aie
Two counts of the Complaint are pertinent here. The Sixth
Count alleges that “ALPA’s agency fee procedure is not in
compliance with the procedures required by the decisions of the
United States Courts.” (/d. at 25.) The Seventh alleges that
ALPA unlawfully “collect[s] from non-union pilots . . . monies
for certain activities not germaine [sic] to collective bargaining.”
(/d. at 26-27.) ALPA’s Answer admits that some of ALPA’s
“activities and expenditures are not germane to collective
bargaining.” (/d. at 38.) However, it denies that either ALPA’s
agency-fee procedure or the amount collected is unlawful. (See
id. at 42-43.)
The pilots requested production of the files ALPA used in
determining its germane and nongermane expenses for the fees
charged in 1992, documents identifying its expenditure catego-
ries used in that determination and the activities under each
category, and any guidelines used in establishing those catego-
ries and allocating expenses to them. ALPA objected to these
requests. The Magistrate overseeing discovery denied the pilots’
motion to compel production, because it was filed after a
discovery deadline set earlier by the district court. (R. 40; R. 52.)
The pilots timely objected to the Magistrate’s order and moved
to reopen discovery. (R. 53; R. 55.)
On August 2, 1993, the court granted ALPA summary
judgment on four claims not relevant here. The court otherwise
denied the parties’ cross-motions for summary judgment
“without prejudice to renewal.” (Pet. App. at 62a-70a.) Simulta-
neously, it permitted the pilots to amend their Complaint to more
specifically allege that ALPA’s agency-fee procedures and
amounts are unlawful and a claim for refund, with interest, of all
monies collected unlawfully. (J.A. at 45-48.) The court also
reopened discovery. (R. 58.) HoweVér, it never ruled on the
objections to the Magistrate’s order denying the pilots’ Motion
to Compel Production of Documents.
Meanwhile, on about July 23, 1993, ALPA sent the pilots its
“1992 Statement of Germane and Nongermane Expenditures”
we
(“SGNE”). (Pet. App. at 118a-57a; J.A. at 63, 4 2.) According
to the SGNE, ALPA determined that 19% of its actual 1992
expenses was nongermane. (Pet. App. at 120a.) Under ALPA’s
“Policies and Procedures Applicable to Agency Fees,” nonmem-
ber pilots who submitted objections to their 1992 fees then
received an additional credit or rebate to bring their total
reductions or rebates for the year to 19%. (See J.A. at 68-69.)
The “Policies and Procedures” provide that “[a]ny pilot who
believes that ALPA has made an error in its appliction to
him/her of the[{se] policies and procedures . . . may request that
his/her complaint be submitted to an independent arbitrator for
hearing and decision.” When a nonmember submits such a
request, ALPA places “in escrow, pending the outcome of the
arbitration, the portion of the pilot’s agency fee that ALPA
determines to be reasonably in dispute,” not the entire disputed
fee. (/d. at 69.)
A request for “arbitration” concerning ALPA’s determina-
tion of the final 1992 reduction had to be sent to ALPA within
thirty days of the SGNE’s mailing, plus “a reasonable additional
time for receipt.” (/d. at 69, 79.) One hundred and seventy-four
nonunion pilots, including the original Plaintiffs, submitted what
ALPA considered requests for “arbitration” under its procedures.
However, the Plaintiffs’ letters objected to the “arbitration
procedure” and “denial of Court review.” They also stated that
they were “sent to preserve my rights and without waiver of
benefits I may have from” this litigation. (/d. at 71-78.)
Under ALPA’s “Policies and Procedures,” the American
Arbitration Association (“AAA”) appointed Louis Aronin as
“arbitrator.” (/d. at 69, 82.) The pilots’ attorney asked the AAA
not to proceed, because the matter was in litigation. (/d. at 95-
97, 100-02.) Aronin rejected this request. (/d. at 105-06.) When
the court subsequently denied the pilots’ Motion for Preliminary
Injunction against the “arbitration,” (id. at 111-14), their counsel
participated in the “arbitration” for the Plaintiffs and other pilots
= @
who by that time had moved to intervene in this action. How-
ever, he entered only a “conditional appearance.” (/d. at 134-35.)
The “arbitration” was conducted under the AAA's “Rules
for Impartial Determination of Union Fees.” (/d. at 69, 82.)
Those rules “apply subject to . . . the internal procedures of the
union.” (/d. at 88, | 1.) Under those rules, the AAA appoints “an
arbitrator from a special panel of arbitrators experienced in
employment relations.” (/d., § 3.) Challengers cannot perempto-
rily disqualify that “arbitrator.” (See id. at 89, 4 4.)
Moreover, “[c]onformity to legal rules of evidence [is] not
.. . necessary.” (/d. at 90, J 14.) Challengers have no right to
discovery, or to compel the testimony of union witnesses or
production of union documents, but must ask the “arbitrator” to
exercise his discretion to require the union to “produce such
additional evidence as the arbitrator may deem necessary.” (See
id. at 88-94, particularly at 90, 4 14.). Before the hearing began,
the pilots’ counsel asked Aronin to permit discovery and require
ALPA to identify its witnesses and exhibits in advance. Aronin
denied discovery and advance identification. (/d. at 136.)
The “arbitration” hearing took three days, each a month
apart. (Pet. App. at 71a.) The only witnesses were three ALPA
employees. (R. 99, AAA Tr. at 3, 27, 179, 251, 481, 614.) Their
testimony consisted of self-serving, general explanations of
ALPA’s activities, bookkeeping system, and preparation of the
SGNE. (See R. 99, AAA Tr., passim.) All documents ALPA
introduced concerning its calculation of chargeable expenses
? Only ALPA’s Director of Finance testified about ALPA’s calculation
of chargeable expenses. He admitted that neither he nor anyone else
canvassed individual employees, or even supervisors to determine whether
employees correctly charged time to the 1200 “project codes” used in
identifying and calculating germane expenses. (R. 99, AAA Tr. at 377-79 )
He also admitted he was “not in a position to give . . . breakdown details of
the expenditures of any particular project code.” (/d. at $17.)
=
were summaries or blank forms. (See Pet. App. at | 18a-57a; R.
104, Ross Decl. at 7-11; R. 99, Exs. 8-9, 11-13A-E.) ALPA
introduced no completed internal vouchers, requisition forms,
expense statements, weekly time reports, or “New Project
Request Forms.”
Aronin issued his final decision on September 30, 1994.
(Pet. App. at 7la-115a, 158a-61a.) He found that 158 pilots,
including ninety-one Plaintiffs and Intervenors, were proper
parties to the “arbitration.” Thus, more than sixty Intervenor-
Plaintiffs were mot parties to the “arbitration.” (/d. at 3a.) On the
merits, Aronin ruled that ALPA’s computation of germane 1992
expenses was “supported by the evidence and applicable Court
decisions,” with minor exceptions. He ordered ALPA to modify
the agency fee by reallocating as nonchargeable a small number
of expenses. (/d. at 114a-15a.) The recalculation reduced the
chargeable percentage from 81% to 79.51%. (/d. at 16la.)
Aronin upheld ALPA’s treatment of its “input into” federal air-
safety regulations as chargeable. (/d. at 108a.)
After ALPA filed the AAA decision with the district court,
(J.A. at 4), the pilots served another request for production,
asking for all documents identifying the nature of the activity
and expenses in each “project code” ALPA used in allocating
1992 expenses as germane or nongermane, and the nature of
expenses not included in those codes. ALPA refused to produce
these documents, serving objections. (R. 89, Ex. 1.) The pilots
moved to compel the requested production. (R. 89.)
On February 22, 1995, ALPA filed a second Motion for
Summary Judgment, based on the “arbitration” record. (R. 98.)
Besides opposing this motion on the merits, the pilots contended,
with supporting declarations, that summary judgment could not
be granted under Federal Rule of Civil Procedure 56(f), because
ALPA refused discovery essential to their opposition. (R. 104.)
On April 18, 1995, the Magistrate granted in part the pilots’
pending Motion to Compel Production. He required ALPA to
-7-
expenses included in twenty “project codes,” and “New Project
Request Forms” for fifty other codes, the pilots to select the
codes from those ALPA treated as germane. (R. 109.) ALPA
objected to this Order on April 27, 1995. (R. 114.) The court
never ruled on these objections, and ALPA never produced the
_ On April 28, 1995, the court granted ALPA summary
judgment on all remaining claims, except the pilots’ —
that portions of the agency fees “were used for
germane to collective bargaining.” (Pet. App. ee ada 600.)
Additional briefing was ordered “on the issue of the impact of
the arbitration on” those allegations. (/d. at 44a, 58a-60a.)
__ After further briefing, the court granted ALPA summary
judgment “on the one remaining count.” (/d. at 40a.) The court
conceded that the pilots “never agreed by contract to be bound
by a duty to arbitrate,” and that “the RLA itself does not require
the exhaustion of arbitration remedies.” Nonetheless, it ruled that
the pilots were required to exhaust ALPA’s procedure “as a
matter of judicial discretion,” because it viewed exhaustion as
necessary to “give effect to the procedures established by the
Supreme Court in [7eachers Local | v.| Hudson,” 475 U.S. 292
(1986). (/d. at 29a-32a.) The court also decided to defer to the
arbitrator's findings on disputed factual issues, unless “clearly
erroneous,” and only “review de novo the arbitrator's legal
conclusions.” (/d. at 22a, 31a.) On the merits, the court
all of Aronin’s factual findings and upheld all of his legal
rulings. (/d. at 32a-39a_)
The United States Court of Appeals for the District of
Columbia Circuit reversed in several respects. Most pertinent,
the court of appeals held “that an employee who wishes to bring
an action in federal court is not obliged to proceed first to
arbitration, at the union’s option,” to challenge its calculation of
lawfully chargeable expenses. The court concluded that there is
“no /egal basis for forcing into arbitration a party who never
agreed to put his dispute over federal law to such a process,” and
that there is nothing “in the Hudson majority opinion that even
suggests that the Court thought it was putting protesting agency
shop employees in that position.” (/d. at | la.)
The court of appeals also held, contrary to the “arbitrator,”
that ALPA may not lawfully charge the pilots for ALPA's
“contacts with government agencies and Congress concerning
the union’s views as to appropriate federal regulation of airline
safety.” (/d. at 13a-15a.) The court also effectively reversed the
district court’s deference to the factual findings of the “arbitra-
tor,” because, even as to pilots who participated in ALPA's
procedure, it reversed and remanded for discovery and “inde-
pendent factual findings” on chargeability and accounting issues
not decided by the court of appeals as a matter of law. (/d. at
1Sa, 17a-20a.) These “air safety” and deference issues were
excluded from this Court's grant of certiorari. (Compare Pet. at
i with Order Granting Cert.)
SUMMARY OF ARGUMENT
1. In Hudson, this Court held that to collect agency fees a
union must provide objecting nonmembers with a prompt
opportunity to challenge the amount of the fee before an
“impartial decisionmaker.” That holding applies under the RLA,
because the exaction of agency fees for nonbargaining purposes
breaches the statutory duty of fair representation, and Hudson
was grounded on both the First Amendment and basic considera-
tions of fairness. Hudson also applies under the RLA because
agency-shop agreements authorized by the RLA significantly
impinge on First-Amendment rights.
Hudson did not -xpressly decide whether or not a nonmem-
ber must exhaust such a procedure before bringing a civil action
challenging the agency fee if the “impartial decisionmaker” is
privately appointed. Nothing in the Hudson majority opinion
even hints that the Court intended that nonmembers could be
forced to use a union-created nonjudicial procedure. The Court
-9.-
did not even require unions to adopt arbitration to satisfy the
requirement, but recognized that they could satisfy it by making
expeditious judicial review possible. On the other hand, the
Court did imply that exhaustion is not required by presuming
that ordinary judicial remedies always remain available to
objecting nonmembers. Moreover, an exhaustion requirement is
inconsistent with the Court’s concern that nonmembers obtain
speedy resolution of their claims, since it delays judicial review
of the union’s calculation of the fee.
Il. None of the ordinary circumstances under which
exhaustion can be required exists here. The RLA does not
mandate exhaustion, as ALPA concedes. The pilots have not
agreed to submit their dispute with the union to its “arbitration”
procedure, as ALPA also concedes, either explicitly, through a
specific agreement, or implicitly, through the union-membership
contract or the collective-bargaining agreement. And, ALPA’s
status as exclusive bargaining agent does not bind the pilots to
its choice of forum, because ALPA is not an agent for nonmem-
bers vis-a-vis itself.
Exhaustion cannot be required as a matter of judicial
discretion unless exhaustion is consistent with congressional
intent. Where Congress has indicated an intent that claims be
judicially determined, a judicially imposed exhaustion require-
ment, based solely upon policy considerations, would violate
Article III, section | of the Constitution.
ALPA and its amici identify no congressional intent that
RLA agency-fee disputes should be submitted to any union-
created remedy. However, Congress Aas indicated an intent that
such cases be determined by the federal courts. Beginning with
the seminal case of Steele v. Louisville & Nashville R.R., 323
U.S. 192, 207 (1944), this Court has held repeatedly that the
federal labor statutes “contemplate{] resort to the usual judicial
remedies of injunction and award of damages” for breach of the
duty of fair representation. Thus, as in Patsy v. Board of
Regents, 457 U.S. 496 (1982), with regard to similar constitu-
-10-
tional claims brought under 42 U.S.C. § 1983 (1988), the Court
need not weigh policy considerations to determine that exhaus-
tion cannot be required.
Ill. Even if it is assumed for the sake of argument that
policy considerations can be weighed here, they are heavily
weighted against exhaustion.
A. Exhaustion will not relieve the courts of having to
determine agency-fee cases de novo, because Hudson held that
an arbitrator's decision would not receive preclusive effect in
any subsequent federal court action. Moreover, even if only
limited judicial review were available where arbitration proce-
dures are adequate and fair, that would merely require the courts
to determine a different, but no less difficult, set of issues, i.¢.,
whether the particular proceeding was adequate and fair and
whether the arbitrator’s findings were clearly erroneous.
B. Unions are unlikely to face the “burden” of simulta-
neous arbitration and litigation, unless they fail to provide the
prompt review that Hudson requires. Moreover, as the court of
appeals recognized, unions can avoid arbitration completely
simply by agreeing to class treatment of judicial claims and
expediting discovery and other pre-trial proceedings. In any
event, the costs of providing constitutional due process are not
a permissible ground for failing to provide it.
C. Exhaustion is unlikely to resolve many cases for
three reasons: (1) the many open questions as to how this
Court’s broad standards of chargeability should be applied;
(2) the many difficult procedural questions that the courts will
have to answer concerning the exhaustion requirement, and,
(3) the understandable reluctance of nonmembers to accept the
results of a so-called “arbitration” scheme in which they have no
say in the selection of the decisionmaker and no right to discov-
ery, despite the fact that all potential evidence is in their
opponent's hands. The only sense in which exhaustion might
resolve some cases is that nonmembers’ resources might be
exhausted, but that result is contrary to federal policy.
D. Exhaustion is unlikely to simplify many cases,
because a proceeding that lacks of rules of evidence, discovery
as a matter of righ’, and compulsory process is not truly adver-
sary. It, thus, neither reduces the need for discovery in a subse-
quent court action nor creates the type of record needed to
decide these complex cases. Moreover, because labor arbitrators
are unlikely to have the necessary expertise in deciding First-
Amendment questions, their decisions under ALPA’s scheme are
unlikely to assist the courts.
E. An exhaustion requirement will unduly prejudice
nonmembers, because: there is no definite time limit on proceed-
ings under ALPA’s procedure; the short filing deadline creates
a high risk of forfeiture of claims; ALPA’s scheme does not
completely avoid the risk that challengers’ monies will be spent
unlawfully and deprives them of use of their monies for a
substantial time; and, the “arbitrator” does not have authority to
provide prospective injunctive relief.
I'v. The “impartial decisionmaker” reviews the lawfulness
of the union’s final decision as to the amount of the fee that it
takes from objecting nonmembers. Therefore, there is no merit
to ALPA’s and its amici’s argument that this is not an exhaus-
tion case, but one in which the pilots’ claim is not ripe until the
“arbitrator” frees ALPA to spend money over their objection.
Moreover, ALPA’s contention that the pilots must use its
procedure is not only an exhaustion requirement. It is a require-
ment that would unlawfully invade the nonmembers’ statutory
and constitutional right not to associate with the union beyond
payment of the costs of collective bargaining, because it would
impose on them an additional aspect of union membership as a
condition of their exercise of their right not to pay more.
12-
ARGUMENT
I. This Court’s Hudson Decision Does Not Require Non-
members to Exhaust Union Agency-Fee “Arbitration”
Schemes, But Merely Requires Unions Exercising Their
Statutory Privilege of Collecting Coerced Fees to Make
Available an Expeditious, Fair Alternative to Litigation.
ALPA’s authority to require the pilots to pay an agency fee
derives from RLA section 2, Eleventh, 45 U.S.C. § 152,
Eleventh (1988). That section, however, is a “limited” exception
to “the policy of full freedom of choice [of employees to join or
not to join a union] embodied in” sections 2, Fourth and Fifth of
the original RLA, 45 U.S.C. §§ 152, Fourth and Fifth (1988).
Machinists v. Street, 367 U.S. 740, 750, 767 (1961).
Street and Ellis v. Railway Clerks, 466 U.S. 435, 448
(1984), construed section 2, Eleventh as limiting a union to
charging objecting nonmembers for expenditures “necessarily or
reasonably incurred for the purpose of performing the duties of
an exclusive representative of the employees in dealing with the
employer on labor-management issues.” That narrow construc-
tion was adopted “to avoid serious doubt” of the section’s
constitutionality under the First Amendment. Street, 367 U.S. at
749-50: accord Ellis, 466 U.S. at 444-45. As Ellis held, the
“First Amendment does limit the uses to which the union can put
funds obtained from dissenting employees.” 466 U.S. at 455
(citing Abood v. Detroit Bd. of Educ., 431 U.S. 209 (1977)).
Hudson prescribed procedural safeguards that are “the
constitutional requirements for the Union’s collection of agency
fees.” 475 U.S. at 310. Hudson was a public-sector case.
However, Hudson applies under the RLA for two reasons.
First, Communications Workers v. Beck held that “the
exaction of fees beyond those necessary to finance collective-
bargaining activities violates . . . the judicially created duty of
fair representation.” 487 U.S. 735, 742-44, 762-63 (1988).
<<" -
Insofar as agency shops are concerned, that duty is identical
under the RLA and section 9(a) of the National Labor Relations
Act (“NLRA”), 29 U.S.C. § 159(a) (1988). See Beck, 487 U.S.
at 745-47, 752; Ford Motor Co. v. Huffman, 345 U.S. 330, 337
(1953). Contrary to the suggestion of amicus American Federa-
tion of Labor and Congress of Industrial Organizations (“AFL-
CIO”), (AFL-CIO’s Br. at 3), Hudson grounded its entire
analysis on “/b/asic considerations of fairness, as well as
concern for the First Amendment rights at stake.” 475 U.S. at
306 (emphasis added); see id. at 302-04 & nn.11-13. Thus, as
the court of appeals held, there is “no reason why th[e] statutory
duty of fair representation owed to nonmember agency shop
employees carries any fewer procedural obligations than does
[the] constitutional duty” under Hudson. (Pet. App. at 10a.)
Second, as the court of appeals also explained, “the Hudson
requirements . . . obtain vis-a-vis unions who negotiate agency
shop agreements with private employers covered by the RLA,”
because this Court held in Railway Employes’ Department v.
Hanson, 351 U.S. 225, 232 (1956), that “agency shop agree-
ments under the RLA cart[y] the imprimatur of federal law.”
(Pet. App. at 8a.) In short, Hudson applies under the RLA,
because the agency shop authorized by the RLA is itself “a
significant impingement on First Amendment rights,” E/lis, 466
U.S. at 455; accord Hudson, 475 U.S. at 307 n.20°
> ALPA and the AFL-7IO argue that the Court “should no longer
follow” Hanson on the issue of governmental action, because the RLA “in
no way Coerces or encourages parties to enter into agency-shop agreements.”
(ALPA’s Br. at 16 n.7; see AFL-CIO’s Br. at 12 n.4.) The Court should
decline to consider this issue because it was not presented below, (see Pet.
App. at 8a), or in ALPA’s Petition for Certiorari, (see Pet. at 10 n.4). See
Taylor v. Freeland & Kronz, 503 U.S. 638, 645-46 (1992). The Court also
should refrain from considering this issue because it is not necessary to
decide the case, just as the Court declined to decide it for that reason in
Beck, 487 U.S. at 761-62. ALPA concedes that there is “*no reason why
(continued...)
-14-
One Hudson requirement is “a reasonably prompt opportu-
nity to challenge the amount of the fee before an impartial
decisionmaker.” 475 U.S. at 310. ALPA attempted to meet this
requirement by adopting an “arbitration” scheme. Its procedure
does not itself require exhaustion; it merely provides that a
nonmember “may” utilize it. (J.A. at 69.) Moreover, ALPA
concedes that the opinion of the Court “in Hudson did not
discuss the question of whether a fee payer must exhaust the
impartial-decisionmaker procedure before challenging an
agency-fee calculation in court,” because “[t]hat issue was not
raised on the facts presented.” (ALPA’s Br. at 16.)
Nonetheless, ALPA argues that exhaustion of its procedure
should be required solely “on the basis of judicial discretion,”
because Hudson “required [it] to provide that procedure whether
it wishes to do so or not.” (/d. at 19.) ALPA contends that “one
of the apparent purposes of Hudson is to establish an alternative
dispute resolution procedure to relieve the courts of having to
> (...continued)
[the] statutory duty of fair representation owed to nonmember agency shop
employees carries any fewer procedural obligations than does a constitu-
tional duty."” (ALPA’s Br. at 15-16 (quoting Pet. App. at 10a).)
Moreover, ALPA and the AFL-CIO are wrong. In the RLA cases and
Abood, the Court found that legislative authorization and potential judicial
enforcement of union decisions to use coerced fees for nonbargaining
purposes would (Hanson, Street, and Ellis) and did (Abood) constitute
“coercive power or . . . such significant encouragement . . . that the choice
must in law be deemed to be that of the State,” Blum v. Yaretsky, 457 U.S.
991, 1004 (1982). See Ellis, 466 U.S. at 455-56; Abood, 431 U.S. at 232-33,
Street, 367 U.S. at 746-50; Hanson, 351 U.S. at 232 & n.4. And, Congress’
choice (or omission) of procedures to protect against prohibited expenditures
also requires constitutional scrutiny: “While private misuse of a . . . statute
does not describe conduct that can be attributed to the State, the procedural
scheme created by the statute obviously is the product of state action,”
Lugar v. Edmondson Oil Co., 457 U.S. 922, 941 (1982). See Steele v.
Louisville & N.R.R., 323 U.S. 192, 198-99 (1944).
e
‘micromanage’ agency-fee calculations.” (/d. at 21.) Amicus
National Education Association (“NEA”) similarly argues that
“Hudson, fairly read, contemplates that all objectors will proceed
through the impartial decisionmaking process established by the
union.” (NEA Br. at 11.)
However, as the court of appeals recognized, nothing “in the
Hudson majority opinion . . . even suggests that the Court
thought it was putting protesting agency shop employees in th{e]
position” of being forced to use a union-created nonjudicial
procedure for reasons of judicial econumy, or for any other
reason. (Pet. App. at 1 la.)* Hudson gave only one reason for
* All but one of the United States Courts of Appeals and state supreme
courts that have considered this issue agree with the D.C. Circuit that
Hudson does not require exhaustion of agency-fee arbitration procedures.
See Knight v. Kenai Peninsula Borough Sch. Dist., 131 F.3d 807, 816 (9th
Cir. 1997); Bromley v. Michigan Educ. Ass'n, 82 F.3d 686, 694 (6th Cir.
1996) (dictum), cert. denied, 117 S. Ct. 682 (1997), Abrams v. Communica-
tions Workers, 59 F.3d 1373, 1382 (D.C. Cir. 1995); Food & Commercial
Workers Local 951 v. Mulder, 31 F.3d 365, 367-68 (6th Cir. 1994), cert.
denied, 513 U.S. 1148 (195), Hohe v. Casey, 956 F.2d 399, 408-09 (3d Cir.
1992); Tierney v. City of Toledo, 917 F.2d 927, 939-40 (6th Cir. 1990);
Gibney v. Toledo Bd. of Educ., 532 N.E.2d 1300, 1303-05 (Ohio 1988); see
also Brosterhous v. State Bar, 906 P.2d 1242, 1251, 1255-58 (Cal. 1995) (no
exhaustion required of attorneys challenging the amount of compulsory Bar
dues); but see Lancaster v. ALPA, 76 F.3d 1509, 1521-22 (10th Cir. 1996).
These are not “all public-sector cases brought under 42 U.S.C. § 1983”
(1988), as ALPA’s Brief at 18 n.9, asserts. Abrams and Mulder were both
brought under the NLRA, 29 U.S.C. §§ 151-69 (1988).
Neither did Hohe hold that exhaustion “may be required as to
accounting disputes concerning the amount spent for any activity,” (ALPA’s
Br. at 18 n.9). Hohe held that a statutory exhaustion requirement was
“invalid in its entirety,” and that the district court erred in leaving to
arbitration in the first instance the nonmembers’ accounting “challenges to
(continued...)
-16-
holding that “the constitutional requirements for the Union’s
collection of agency fees include . . . a reasonably prompt
opportunity to challenge the amount of the fee before an
impartial decisionmaker,” 475 U.S. at 310. That reason was that
the “nonunion employee, whose First Amendment rights are
affected by the agency shop itself and who bears the burden of
objecting, is entitled to have his objections addressed in an
expeditious, fair, and objective manner.” /d. at 307.
That Hudson also requires a union to escrow objecting
nonmembers’ disputed fees “while such challenges are pending,”
id. at 310, does not imply that exhaustion of a union’s arbitration
procedure is necessary, as the NEA argues, (NEA’s Br. at 1 1-
12). The principle that a “forced exaction followed by a rebate
equal to the amount improperly expended is . . . not a permissi-
ble response to the nonunion employees’ objections,” Hudson,
475 U.S. at 305-06, applies regardless of the forum.’
* (...continued)
the amount of the chargeable fee.” 956 F.2d at 408-09, 416, rev 'g in
pertinent part 135 L.R.R.M. (BNA) 3026, 3028 (M.D. Pa. 1990). Nor did
Hudson v. Teachers Local |, 922 F.2d 1306 (7th Cir.), cert. denied, 501 U.S.
1230 (1991) (“Hudson IT’), “squarely” hold that exhaustion is required, as
ALPA and the AFL-CIO contend, (ALPA’s Br. at 17-18; accord AFL-CIO’s
Br. at 11 n.3). As the Sixth Circuit has recognized, the “exhaustion issue was
not before the [Hudson J] panel at all,” only the adequacy of the union's
notice, Hudson IJ was merely responding to a1. argument “that the correct-
ness of the amount had to be adjudicated in court before the fee could be
collected and escrowed in the first instance.” Bromley, 82 F.3d at 694, see
Hudson II, 922 F.2d at 1313-14.
* The Court's application of this principle in Hudson and Ellis, 466
U.S. at 443-44, implicitly overruled the earlier holding of Railway Clerks v.
Allen, 373 U.S. 113, 120 (1963), that “dissenting employees . . . can be
entitled to no relief until final judgment in their favor is entered.”
-17-
Nothing prevents a union sued for allegedly overcharging
agency fees from asking the court to require escrow of only that
part of the fees that “a certified public accountant’s verified
breakdown of expenditures” shows represents “categories that no
dissenter could reasonably challenge.” See id. at 310. Nothing
also prevents a union from expediting judicial proceedings “by
making pre-trial concessions regarding discovery and other time-
sensitive matters,” (Pet. App. at 124), and refraining from such
delaying tactics as pre-trial motions and resisting discovery.
Indeed, as the court of appeals noted, “Hudson . . . did not
require arbitration per se” to satisfy the impartial-decisionmaker
requirement. (/d.) Hudson merely said that “an expeditious
arbitration might satisfy the requirement.” 475 U.S. at 308 n.21
(emphasis added). Hudson also recognized that a court can be
the impartial decisionmaker: “[c]learly, . . . if a State chooses to
provide extraordinarily swift judicial review for these chal-
lenges, that review would satisfy the requirement of a reasonably
prompt decision by an impartial decisionmaker.” /d. at 308 n.20.
Thus, ALPA could avoid having both to provide arbitration and
defend litigation simply by providing for expedited federal court
review, instead of “arbitration,” in its procedure.°
° Hudson does not imply an exhaustion requirement because Justice
White’s concurring opinion, in dicta, said that a union providing for
arbitration “should be entitled to insist that the arbitration procedure be
exhausted before resorting to the courts.” 475 U.S. at 311 (White, J.,
concurring). The Hudson majority evidently deliberately chose not to adopt
that position. However, it specified that, if a nonmember uses arbitration, the
“arbitrator's decision would not receive preclusive effect in any subsequent
[civil] action,” id. at 308 n.21. The juxtaposition of the majority's failure to
state agreement with Justice White and its clarification that arbitration
would not be preclusive suggests that the majority assumed that nonmem-
bers are not required to exhaust arbitration remedies. See Brosterhous v.
State Bar, 906 P.2d 1242, 1251 (Cal. 1995); (Pet. App. at lla & n.1).
-18-
On the other hand, while nothing in Hudson suggests an
exhaustion requirement, Hudson does indicate that nonmembers
need not use arbitration if a union makes it available to satisfy
the impartial-decisionmaker prerequisite to collecting agency
fees. Hudson requires the union to provide an “opportunity to
challenge the amount of the fee before an impartial decision-
maker.”/d. at 310 (emphasis added). Self-evidently, one is not
compelled to use an “opportunity.” ALPA’s argument “confuses
the union’s presumed responsibility to provide a means of
dispute resolution with its ability to force non-union members to
use its selected method.” Food & Commercial Workers Local
951 v. Mulder, 31 F.3d 365, 367 (6th Cir. 1994), cert. denied,
513 U.S. 1148 (1995).
ALPA is correct that Hudson allows a union “to provide an
alternative, nonjudicial mechanism for dealing with .. . agency-
fee disputes.” (ALPA’s Br. at 15 (emphasis added).) However,
an “alternative” “offer{[s] or express[es] a choice.” Webster's
New Collegiate Dictionary 34 (1977). A choice presumes that a
second option exists, i.e., bypassing arbitration for litigation. See
Hohe v. Casey, 956 F.2d 399, 409 (3d Cir. 1992).
Hudson itself clearly suggests that nonmembers still have
a right to a judicial forum if a union provides a nonjudicial
review procedu 2 for objections. Hudson held that First-Amend-
ment due process mandates that the “union have a responsibility
to provide procedures . . . that facilitate a nonunion employee's
ability to protect his rights,” despite “the availability of ordinary
judicial remedies.” The Court “presume[d] that the courts
remain available as the ultimate protectors of constitutional
rights.” /d. at 307 n.20 (emphasis added).
Moreover, as the Ninth Circuit concluded in Knight v. Kenai
Peninsula Borough School District, the Court in Hudson
seemed most concerned with ensuring that nonmem-
bers be able to obtain a speedy resolution without
having to endure lengthy and protracted litigation in
.19-
court. To require nonmembers to exhaust arbitration
before being entitled to file a federal court action
would frustrate the intent of expediting the chargeabil-
ity calculation and refund process.
131 F.3d 807, 816 (9th Cir. 1997) (emphasis added).
In sum, Hudson provides no basis for requiring exhaustion
here and persuasively suggests that exhaustion is not required.
Il. Exhaustion Cannot Be Required Here, Because There Is
No Agreement to Arbitrate, and Mandatory Exhaustion
Would Be Inconsistent with Congress’ Intent That
Unfair Representation and Constitutional Claims Are
Uniquely Within the Federal Courts’ Jurisdiction.
Recognizing that “the majority opinion in Hudson did not
discuss” the exhaustion issue, because it “was not raised on the
facts presented,” ALPA relies primarily on general exhaustion
principles. (See ALPA’s Br. at 16, 19-25.) However, neither
ALPA nor either of its amici cites a single case in which this
Court has required exhaustion of a nonconsensual, nonstatutory,
nonjudicial procedure created by a private party to determine
statutory and constitutional rights of an adversary. And, none of
the ordinary circumstances under which exhaustion can be
required exists here.
Where Congress specifically mandates, exhaustion is
required.” McCarthy v. Madigan, 503 U.S. 140, 144 (1992).
However, ALPA and its amici do not contend that the RLA
specifically mandates exhaustion of union-created procedures for
agency-shop disputes. It does not. See 45 U.S.C. §§ 151-88
(1988).
Absent a statutory mandate, “a party cannot be required to
submit to arbitration any dispute which he has not agreed so to
submit.” Steelworkers v. Warrior & Gulf Navigation Co., 363
U.S. 574, 582 (1960); accord, e.g., First Options of Chicago,
-20-
Inc. v. Kaplan, 514 U.S. 938, 944 (1995), AT&T Technologies,
Inc. v. Communications Workers, 475 U.S. 643, 648-49 (1986),
Gateway Coal Co. v. Mine Workers, 414 U.S. 368, 374 (1974).
The agreement can be individual, e.g, in a securities registration
application, see Gilmer v. Interstate/Johnson Lane Corp., 500
U.S. 20, 23 (1991), or in the unic::-a tmber contract, see Neal
v. System Bd. of Adjustment, 348 F id /22, 726 (8th Cir. 1965).’
It also can be part of a collective-bargaining agreement, negoti-
ated by a union as the employees’ agent, to arbitrate employee-
employer disputes under that agreement. See Repudlic Steel
Corp. v. Maddox, 379 U.S. 650, 652-53 (1965).
However, ALPA does not claim that there is amy agreement
to arbitrate here. There is none. Nor does ALPA claim that its
agency-fee “arbitration” is part of the collective-bargaining
agreement with Delta) ALPA alone has instituted and now
attempts to enforce its “arbitration scheme,” with no input,
approval or acquiescence from the pilots. Quite the contrary:
Some of the pilots participated in ALPA’s “arbitration” only
under protest, after the district court denied an injunction to stop
it. Others refused to participate at all. (Pet. App. at 2a-3a.)
Moreover, the pilots are nonmembers of ALPA. (/d. at 2a.)
As such, they are “not bound by contract with the union to
exhaust any formal internal union appeals before resorting to a
judicial forum.” Soto Segarra v. Sea-Land Serv., Inc., 581 F.2d
291, 295 (ist Cir. 1978); see Bagnall v. ALPA, 626 F.2d 336,
341 (4th Cir. 1980), cert. denied, 449 U.S. 1125 (1981). Also,
neither ALPA’s status as the pilots’ exclusive bargaining agent,
nor a collective-bargaining agreement, could require the pilots,
as nonmembers, to arbitrate their statutory and constitutional
disputes with itself, as opposed to disputes with their employer.
“ALPA is the agent for the nonmembers only vis-a-vis the
” However, requirements that union members exhaust internal union
remedies are limited both by statute and this Court's decisions. See 29
U.S.C. § 41 1(a)(4) (1988), Clayton v. Auto Workers, 451 U.S. 679 (1981).
x
employer, it is not an agent for the nonmembers vis-a-vis itself.”
(Pet. App. at 163a (Silberman, J., concurring in denial of
reh'g)), see Mulder, 3\ F.3d at 368-69, Bagnall, 626 F.2d at
341-42; see also NLRB v. Maddox, 415 U.S. 322, 324-26 (1974)
(a union could not contractually waive employees’ individual
statutory rights where it had an adverse self-interest).
ALPA argues that, although there is neither a statutory
mandate nor an agreement for arbitration, “whether administra-
tive remedies must be exhausted is a matter committed to ‘sound
judicial discretion."” (ALPA’s Br. at 19 (quoting McCarthy, 503
U.S. at 144).) ALPA also contends that there are “two separate
and independent reasons that can support a requirement of
exhaustion—one being ‘protecting administrative agency
authority’ and the other being ‘promoting judicial efficiency.’”
(/d. at 20 (quoting McCarthy, 503 U.S. at 145).) The first of
these considerations clearly does not apply here, since neither
ALPA nor the AAA is an administrative agency. ALPA argues
that exhaustion should be required solely because of policy
considerations of judicial efficiency. (See id. at 20-25.)
ALPA ignores the primary principle of the exhaustion
doctrine. “Of ‘paramount importance’ to any exhaustion inquiry
is congressional intent.” McCarthy, 503 US. at 144 (quoting
Patsy v. Board of Regents, 457 U.S. 496, 501 (1982)). Even “in
th{e] field of judicial discretion, appropriate deference to
Congress’ power to prescribe the basic procedural scheme under
which a claim may be heard in a federal court requires fashion-
ing of exhaustion principles in a manner consistent with congres-
sional intent and any applicable statutory scheme.” /d.
Therefore, contrary to ALPA’s assumption, “policy
considerations alone cannot justify judicially imposed exhaustion
unless exhaustion is consistent with congressional intent.” Patsy,
457 US. at 513; see id. at 501-02 & n.4 (followed in McCarthy,
503 U.S. at 144). In particular, “the perceived burden that . . .
actions impose on federal courts” “alone is not sufficient to
justify a judicial decision to alter congressionally imposed
-22.-
jurisdiction.” /d. at 512 & n.13; cf La Buy v. Howes Leather
Co., 352 U.S. 249, 256, 259 (1957) (neither a crowded calendar
nor the presence of complex issues warrants appointment of a
special master in a federal action over a party’s objections), In
re Bituminous Coal Operators’ Ass'n, 949 F.2d 1165, 1168-69
(D.C. Cir. 1991) (R. Ginsburg, J.) (same).
Policy considerations alone are insufficient for the federal
courts to impose exhaustion, because those courts “are vested
with a ‘virtually unflagging obligation’ to exercise the jurisdic-
tion given them.” McCarthy, 503 U S. at 146 (quoting Colorado
River Water Conservation Dist. v. United States, 424 U.S. 800,
817-18 (1976)). The source of that obligation is Article III,
section | of the Constitution, which “preserves to litigants their
interest in an impartial and independent federal adjudication of
claims within the judicial power of the United States.” Commod-
ity Futures Trading Comm'n v. Schor, 478 U.S. 833, 850 (1986)
(emphasis added); see Pacemaker Diagnostic Clinic v. Instro-
medix, Inc., 725 F.2d 537, 541 (9th Cir.) (Kennedy, J., en banc),
cert. denied, 469 U.S. 824 (1984).
There are only four exceptions to Article III's rule that
Article II] judges must decide federal cases. None applies here.
The first two, “military tribunals” and “territorial courts,” are
clearly inapplicable. See Thomas v. Union Carbide Agric. Prods.
Co., 473 U.S. 568, 585 (1985). The third is when parties waive
their right to a judicial determination. See Schor, 478 U.S. at
848-49. That condition is not met here, because the pilots did not
consent to determination of their statutory and constitutional
claims by ALPA’s “arbitrator.” See supra pp. 20-21.
The fourth exception to the rule of Article III adjudication
is where a “statutory cause of action inheres in, or lies against,
the Federal Government in its sovereign capacity” or where
“Congress, acting for a valid legislative purpose
pursuant 10 its constitutional powers under Article I
[has] create{[d] a seemingly ‘private’ right that is so
-%-
closely integrated into a public regulatory scheme as to
be a matter appropriate for agency resolution with
limited involvement by the Article III judiciary.” If a
statutory nght is not closely intertwined with a federal
regulatory program Congress has power to enact, and
if that right neither belongs to nor exists against the
Federal Government, then it must be adjudicated by
an Article III court.
Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 53-55 (1989)
(quoting 7homas, 473 U.S. at 593-94) (alteration in original)
(emphasis added) (citation omitted). That returns the issue here
to the controlling question of congressional intent.
The statutes mandating federal subject-matter jurisdiction
upon which the pilots rely—28 U.S.C. §§ 1331 and 1337(a)
(1988)}—contain no explicit, or judicially divined, expression of
congressional intent that arbitration procedures be exhausted in
any case. Also, ALPA and its amici identify no congressional
intent that agency-fee disputes under the RLA should be
submitted to arbitration, much less union-created ersatz
“arbitration.” The closest they come is that ALPA mentions that
“*Congress has expressly approved contract grievance proce-
dures as a preferred method for settling disputes.’” (ALPA’s Br.
at 20 (quoting Republic Steel, 379 U.S. at 653).)
However, the congressional preference to which ALPA
adverts is for “adjustment by a method agreed upon by the
parties... for settlement of grievance disputes arising over the
application or interpretation of an existing collective-bargain-
ing agreement,” i.e., disputes between employees and/or unions
on the one hand and employers on the other. 29 U.S.C. § 173(d)
(1988) (emphasis added); see Republic Steel, 379 U.S. at 652-
53. Here, the pilots have not agreed to use ALPA’s procedure,
and this is not a dispute over a collective-bargaining contract.
Congress has done more than refrain from expressly
approving union “arbitration” procedures as the preferred
-24-
method for settling agency-fee disputes. In the RLA, as inter-
preted by this Court, Congress also has indicated an intent that
such cases be determined by the federal courts.
A claim that a union unlawfully exacts agency fees under
the RLA for purposes other than collective bargaining raises
issues under both the statute and the First Amendment. See Filis,
466 US. at 445-48, 455-56. It also is a claim of breach of the
union's statutory duty of fair representation. Communications
Workers v. Beck, 487 U.S. 735, 742-44 (1988). In Steele v.
Louisville & Nashville R.R., to avoid constitutional questions,
this Court found that the RLA imposes that duty on an exclusive
bargaining representative. 323 U.S. 192, 198-203 (1944).
Steele also held that an unfair representation claim “is not
one... determinable under the administrative scheme set up by
the Act or restricted by the Act to voluntary settlement by
recourse to the traditional implements of mediation, conciliation
and arbitration.” /d. at 204-06 (citations omitted); see Beck, 487
U.S. at 743. Rather, the Court concluded,
the right here asserted, to a remedy for a breach of the
statutory duty of the bargaining representative to
represent and act for the members of a craft, is of
judicial cognizance. That right would be sacrificed or
obliterated if it were without the remedy which courts
can give for breach of such a duty or obligation and
which it is their duty to give in cases in which they
have jurisdiction. .
_. . . [T]he statute contemplates resort to the
usual judicial remedies of injunction and award of
damages when appropriate for breach of that duty.
Id. at 207 (emphasis added); see Beck, 487 U.S. at 743 (“the
RLA _. . leaves it to the courts to determine the validity of
[union] activities challenged under the Act”). Congress, which
obviously is aware of Steele’s construction of the RLA in 1944,
-25-
has not seen fit to amend the Act to limit or qualify the courts’
jurisdiction over unfair representation cases.
Furthermore, like 42 U.S.C. § 1983 (1988), the purpose of
the duty of fair representation is to interpose the federal courts
as the “paramount” guardians of individual rights. Compare
Breininger v. Sheet Metal Workers Local 6, 493 U.S. 67, 74-75
(1989) and Vaca v. Sipes, 386 U.S. 171, 181-82 (1967) with
McDonald v. City of West Branch, 466 U.S. 284, 290 (1984) and
Patsy, 457 U.S. at 503-04. Indeed, because the “right of the
individual employee to be made whole is ‘[o]f paramount
importance,’” that “a breach of the duty of fair representation
might also be an unfair labor practice [normally within the
exclusive jurisdiction of the National Labor Relations Board
(“NLRB”)] is . . . not enough to deprive a federal court of
jurisdiction over the fair representation claim.” Breininger, 493
U S. at 75 (quoting Bowen v. United States Postal Serv., 459
U.S. 212, 222 (1983)); see Beck, 487 U.S. at 743."
Thus, this case is similar to Patsy, in which the Court
reaffirmed “categorically that exhaustion is not a prerequisite to
an action under § 1983,” policy considerations notwithstanding.
457 US. at 500-01, 512-16; see Felder v. Casey, 487 U.S. 131,
146-50 (1988). Public-sector agency-shop cases are brought
under section 1983. See, e.g., Lehnert v. Ferris Faculty Ass'n,
500 U.S. 507, 513 (1991), Bromley v. Michigan Educ. Ass'n, 82
F.3d 686, 688, 692 (6th Cir. 1996), cert. denied, 117 S. Ct. 682
(1997). Patsy and Felder are controlling on the exhaustion issue
in those cases. See Knight v. Kenai Peninsula Borough Sch.
* Like the vast majority of the courts, see supra note 4, the Board has
rejected as “meritless” a union’s argument that it should await exhaustion
of “the arbitration procedure set forth in (the union's] dues-objection policy”
before proceeding on claims that the union has extracted agency fees for
purposes other than collective bargaining and contract administration.
California Saw & Knife Works, 320 N.L.R.B. 224, 224 n.1, 276-77 (1995),
enforced, 157 L.R.R.M. (BNA) 2287 (7th Cir. Jan. 14, 1998).
xo
Dist., 131 F.3d 807, 816 (9th Cir. 1997); Hohe v. Casey, 956
F.2d 399, 408-09 (3d Cir. 1992); Tierney v. City of Toledo, 917
F 2d 927, 939-40 (6th Cir. 1990); Brosterhous v. State Bar, 906
P 2d 1242, 1255-58 (Cal. 1995); Gibney v. Toledo Bd. of Educ.,
§32 N.E.2d 1300, 1303-05 (Ohio 1988).
This Court has treated the rights of private- and public-
sector employees forced to pay agency fees as essentially
coextensive. See, e.g., Lehnert, 500 U.S. at 516, 523 (opinion of
the Court), 555 (Scalia, J., concurring); Abood v. Detroit Bd. of
Educ., 431 U.S. 209, 229-32 (1977). Thus, to hold that exhaus-
tion can be required here, the Court would either have to treat
private- and public-sector employees in radically different ways
for the first time, or overrule Patsy and Felder.
ALPA and the NEA argue that an exhaustion requirement
in agency-fee cases is not inconsistent with Patsy, because Patsy
concerned state remedies, but, they say, the “impartial-decision-
maker procedure required by Hudson . . . is a federal remedy.”
(ALPA’s Br. at 18 n.9; accord NEA’s Br. at 17.) However, the
principles of the exhaustion doctrine Patsy applied are the same
for state and federal remedies. Compare McCarthy, 503 U.S. at
144 with Patsy, 457 U.S. at 501-02 & n.4.
Moreover, ALPA’s “arbitration” is not a federal administra-
tive remedy. It is a union-created and -controlled private
remedy, voluntarily adopted by ALPA to satisfy a constitutional
and statutory prerequisite to its collection of agency fees.
Clearly, if federal courts need and ought not defer to a federal
agency in agency-fee cases arising under the duty of fair
representation, as Beck held, 487 U.S. at 743-44, with even
greater reason they need and ought not defer to a private
“arbitration” set up by the very union the employees claim
violated that duty.
In sum, as in Patsy, exhaustion cannot be required here, and
there is no occasion to determine the weight of the policy
considerations urged by ALPA and its amici, because exhaustion
ats
is inconsistent with Congress’ intent that the federal courts have
a paramount role in the determination of constitutional and duty-
of-fair-representation claims.
Ill. Even If It ls Assumed Arguendo That Policy Considera-
tions Are Relevant, They Suggest That Exhaustion
Should Not Be Required in Agency-Fee Cases.
Where congressional intent does not militate against an
exhaustion requirement, as it does here, “federal courts must
balance the interest of the individual in retaining prompt access
to a federal judicial forum against countervailing institutional
interests favoring exhaustion.” McCarthy, 503 U.S. at 146.
Although Patsy held that exhaustion could not be required under
section 1983 as a matter of judicial discretion, due to its incon-
sistency with congressional intent, the Court also concluded that
“policy considerations” could not justify judicially imposed
exhaustion there because they did “not invariably point in one
direction.” 457 U.S. at 512-13. Assuming for the sake of
argument that policy considerations can be weighed at all here,
they are at least equally inconclusive, if not heavily weighted
against exhaustion.
A. Exhaustion Will Not Relieve the Courts of Having
to “Micromanage” Agency-Fee Cases.
The first policy consideration ALPA advances is that
exhaustion purportedly would “relieve the courts of having to
‘micromanage’ agency-fee calculations.” (ALPA’s Br. at 21.)
Yet, ALPA admits that “this Court has already made clear that
the arbitration would not be ‘preclusive.’” (/d. at 24 (quoting
Hudson, 475 U.S. at 308 n.21).) Thus, ALPA apparently means
that judicial review of agency-fee calculations will be limited to
the “arbitration” record on a “clearly erroneous” basis unless “in
a particular case the challengers could show that the arbitration
a4 were somehow inadequate or unfair.” (See id. at 22
n.10, 24.
- 28 -
That suggestion presumes the answer to a question that “was
excluded from this Court’s grant of certiorari,” (id at 9 n.6), i.e.,
whether judicial review is limited, as the district court held, (Pet.
App. at 22a), or de novo, as the court of appeals recognized, (id.
at 15a, 17a-20a). ALPA’s suggestion also is erroneous, because,
in ruling that an “arbitrator's decision would not receive
preclusive effect in any subsequent . . . action” in federal court
challenging an agency fee, Hudson cited McDonald v. City of
West Branch, 466 U.S. 284 (1984). 475 U.S. at 308 n.21.
McDonald held that, “in a § 1983 actior., a federal court
should not afford . . . collateral-estoppel effect to an award in an
arbitration proceeding.” 466 U.S. at 292. McDonald also
described “a rule that would have required federal courts to defer
to an arbitrator’s decision” as one that would “preclude a
subsequent suit in federal court.” /d. at 288-89 (emphasis
added). Thus, per McDonald, Hudson’s ban on deference to
arbitration embraces both legal and factual issues. See McDon-
ald, 466 U.S. at 287 n.5 (collateral estoppel applies to issues of
fact), 292 & n.13 (“an arbitration proceeding cannot provide an
adequate substitute for a judicial trial’; it “*is the duty of courts
to assure the full availability of th{e judicial] forum””) (quoting
Alexander v. Gardner-Denver Co., 415 U.S. 36, 60 n.21 (1974))
(emphasis added); see also Clayton v. Auto Workers, 451 U.S.
679, 693 (1981) (“exhaustion [of union remedies] would not
lead to significant savings in judicial resources, because regard-
less of the outcome of the internal appeal, the employee would
still be required to prove de novo in his . . . suit that the union
breached its duty of fair representation”).
Furthermore, even if ALPA were correct that only limited
judicial review is available where agency-fee arbitration
procedures are adequate and fair, that would merely mean that
the federal courts would have to “micromanage” a different, but
no less difficult, set of issues in these cases, i.e., the adequacy
and fairness of the particular “arbitration” proceeding and
whether the decisionmaker’s factual findings were clearly
erroneous.
. >}
B. The Purported Burden of Simultaneous Arbitration
and Litigation Is Improbable and Irrelevant.
ALPA next complains that, unless exhaustion is required, “a
union could be confronted by simultaneous agency-fee chal-
lenges, in court and before a Hudson impartial decisionmaker.”
(ALPA’s Br. at 21.) The NEA adds that simultaneous litigation
and arbitration “would be the most expensive and burdensome
system imaginable.” (NEA’s Br. at 13-14.) However, unless a
union fails to provide the “expeditious arbitration” and “reason-
ably prompt decision” Hudson requires, 475 U.S. at 307, 308
n.21, arbitration is likely to be concluded before the merits are
at issue in a court action.
Moreover, if, instead of opposing class certification and
discovery, as ALPA did here, see supra note 1 & pp. 3, 6-7, a
union agreed to class treatment of judicial claims and willingly
provided discovery, arbitration would be unnecessary, as the
court of appeals pointed out. (Pet. App. at 12a-13a.) It is highly
unlikely that any objecting nonmembers would opt out of a class
action and insist on submitting their claims pro se or through
personal counsel to a privately appointed decisionmaker if
notified that their claims would be determined by the federal
courts in an action in which the class representatives would
provide counsel.
This action was filed more than a year and a half before
ALPA’s internal proceedings began. (Compare J.A. at | with id.
at 71-78.) ALPA chose to conduct the latter over the pilots’
objections. (See id. at 103-04.) ALPA contends that it had to
proceed, because “fee payers who were not litigants in this case
requested arbitration.” (ALPA’s Br. at 21.) However, it is
implausible that any of those fee payers would have insisted on
pursuing ALPA’s procedure had they been notified that the
federal courts would decide their challenges.
In any event, the union’s costs and administrative burdens
in meeting the “impartial decisionmaker” requirement are
-30-
irrelevant. The “procedures mandated by Hudson are to be
accorded all nonmembers of agency shops regardless of whether
the union believes them to be excessively costly.” Andrews v.
Cheshire Educ. Ass'n, 829 F.2d 335, 339 (2d Cir. 1987); accord
Lowary v. Lexington Local Bd. of Educ., 903 F.2d 422, 431 (6th
Cir.), cert. denied, 498 U.S. 958 (1990); see Keller v. State Bar,
496 U.S. 1, 16-17 (1990) (quoting with approval Keller v. State
Bar, 767 P.2d 1020, 1046 (Cal. 1989) (Kaufman, J., dissenting),
rev'd, 496 U.S. 1 (1990)); Ellis, 466 U.S. at 444.
Furthermore, the unions’ complaints about the burdens and
costs of satisfying Hudson are hypocritical. They can reduce
those burdens by not engaging in dilatory litigation tactics and
providing for expedited judicial proceedings, instead of
“arbitration,” in their procedures. See supra p.17. Moreover, a
union has those burdens only because “it voluntarily seeks to
collect service fees from the non-union members.” See Jierney
v. City of Toledo, 824 F.2d 1497, 1503 n.2 (6th Cir. 1987)
(emphasis added).
C. Exhaustion Is Unlikely to Resolve Many Cases.
The third policy consideration that ALPA and its amici
propose is that, “on some occasions, all parties will accept the
decision of the arbitrator, thus obviating the need for court
litigation.” (ALPA’s Br. at 22; see AFL-CIO’s Br. at 15-16;
NEA’s Br. at 14, 17.) This is improbable for three reasons.
First, as ALPA notes, this Court’s “broad standards [as to
what is chargeable or not] have proven to be distressingly
difficult to apply.” (ALPA’s Br. at 13); see, e.g., Bromley, 82
F.3d at 691; Beckett v. ALPA, 59 F.3d 1276, 1280-81 (D.C. Cir.
1995) (Silberman, J., concurring). Thus, until this Court settles
more clearly what activities are lawfully chargeable, nonmem-
bers are likely to continue to seek resolution of chargeability
issues by the federal courts.
. =
Second, as in Patsy, “it is by no means clear that judicial
discretion to impose an exhaustion requirement . . . would lessen
the caseload of the federal courts, at least in the short run,” for
another reason. 457 U.S. at 513 n.13. That is, the courts still
would have to answer “difficult questions concerning the design
and scope of [the] exhaustion requirement,” including
the standards for judging the kinds of [arbitration]
procedures that should be exhausted; what tolling
requirements and time limitations should be adopted;
what is the res judicata and collateral estoppel effect of
particular [arbitration] determinations; [and] what
consequences should attach to the failure to comply
with procedural requirements. . . . These and similar
questions . . . would create costly, remedy-delaying,
and court-burdening litigation if answered incremental-
ly by the judiciary.
Id. at 513-14 (footnotes omitted).
Third, as the court of appeals recognized, nonmembers are
unlikely to accept the decisions of “arbitrators” under the
particular scheme at issue here, because they understandably
question the fairness of a procedure in which they have no say
in the selection of the decisionmaker and no right to discovery,
even though all potential evidence is solely in the union’s hands.
(See Pet. App. at 1 la-12a); see also Thomas R. Haggard, Union
Security in the Context of Labor Arbitration, 1994 Nat’! Acad.
Arb. Proc. 110, 123 (same). This scheme, which is used by most
unions, (NEA’s Br. at 12 n.10.), is not true arbitration.’
* The NEA asserts that the question of whether use of an AAA
“arbitrator” satisfies Hudson “was not raised below and is not encompassed
in the grant of certiorari.” (NEA’s Br. at 13 n.10.) The question is not
whether the AAA scheme satisfies Hudson, but whether this is the type of
procedure that permits judicial deference to it. See McCarthy, 503 U.S. at
(continued...)
-32-
Mutual “selection of the arbitrators by the parties to the
dispute” is “a fundamental characteristic of arbitration.” Associ-
ated Plumbing & Mech. Contractors v. Plumbers Local 447, 81
F 2d 480, 483-84 (9th Cir. 1987); see Frank Elkouri & Edna A.
Elkouri, How Arbitration Works 135-37 (4th ed. 1985), Owen
Fairweather, Practice and Procedure in Labor Arbitration 79-90
(2d ed. 1983) (cited in Hudson, 475 U.S. at 308 n.21). Indeed,
a scholar cited by ALPA and the NEA, (ALPA’s Br. at 19 0.9;
NEA’’s Br. at 19), in an article they do not cite, includes “mutual
selection of the arbitrator” as one of the “minimum standards of
arbitral procedural justice.” Martin H. Malin, Arbitrating
Statutory Employment Claims in the Aftermath of Gilmer, 40 St.
Louis U. L.J. 77, 96-99 (1996) (emphasis added).'°
ALPA contends that “there is no basis” for attacking the
impartiality of the AAA, because such attacks have “been
uniformly rejected.” (ALPA’s Br. at 23 & n.11.) The cases
ALPA cites, though, merely held that the AAA’s procedure
satisfies Hudson’s requirement for an “impartial decisionmaker”
* (...continued)
146-49. This question was raised below. (See Appellants’ Br. at 18-19, 21-
23.) It also is “fairly included” within the question presented, Sup. Ct. R.
14.1(a), because, before the Court can require exhaustion as a matter of
judicial discretion, it must address the adequacy of the procedure. See
McCarthy, 503 U.S. at 146-49. In any event, a respondent here is “entitled
_.. 0 urge any grounds which would lend support to the judgment below.”
Dayton Bd. of Educ. v. Brinkman, 433 U.S. 406, 419 (1977).
‘© Malin says that mutual selection is “impractical” in agency-fee
disputes, because they “often involve numerous objecting fee-payers.”
Malin, supra, at 99. However, he also suggests that “candidates for inclusion
on employment arbitration rosters” should be required to have equal
numbers of “references from employer and employee advocates.” /d. at
n.104. Similarly, arbitrators could easily be mutually selected by the union
and an advocate of the interests of nonmembers, e.g., the National Right to
Work Legal Defense Foundation.
- 33-
in the abstract. They did not consider whether that scheme is
adequate to support forced arbitration. One ground Malin gives
to justify the lack of mutual selection under the AAA’s proce-
dure is that “the union security fee objector is not obligated to
use the arbitration procedure, but may bypass it and sue the
union in federal court.” Malin, supra, at 99.
Contrary to ALPA’s speculation, nonmembers are more
likely to accept the decisions of arbitrators, thus making court
litigation unnecessary, if both options are available in the first
instance, because then unions are more likely to adopt arbitration
procedures that will satisfy nonmembers. At the least, as the
Court said in Patsy, “it is uncertain whether the present ‘free
market’ system, under which litigants are free to pursue adminis-
trative remedies if they truly appear to be cheaper, more
efficient, and more effective, is more likely to induce the
creation of adequate remedies than a... standard under which
plaintiffs have no initial choice.” 457 U.S. at 513 n.15.
The only sense in which an exhaustion requirement here
might lead to reduced litigation is that “exhaustion might deplete
the employee's energy and resources to the point where he
chooses not to pursue his [statutory] claim in court, but that
result is surely inconsistent with federal policy.” Clayton v. Auto
Workers, 451 U.S. 679, 693 n.22 (1981).""
D. Exhaustion Is Unlikely to Simplify Many Cases.
ALPA and its amici also argue that the “record of the
arbitration proceeding, and the arbitrator's decision, should help
to define the issues before the court and streamline both pretrial
'' Contrary to the implication of ALPA’s Brief at 14, the National
Right to Work Legal Defense Foundation does not have the resources to
support a lawsuit for every nonmember who wants to challenge his agency
fees. In this case, the Foundation provided the pilots with an attorney only
after they had filed their Notice of Appeal. (See R. 138; R. 140.)
aes
and trial procedures.” (ALPA’s Br. at 22, see AFL-CIO’s Br. at
16-18, NEA’s Br. at 14, 17.) This really means that the unions
want to use “arbitration” to avoid disclosing the relevant facts to
their litigation opponents and having to meet their burden of
proof, under rules of evidence, in a truly adversary hearing
before an Article III judge qualified to determine what speech
and association they can lawfully compel.
ALPA discloses the unions’ true agenda by contending that,
“because the union entre ager er roe
tively present evidence explaining justifying its agency-fee
mer objectors would normally have little need for
prehearing discovery.” (ALPA’s Br. at 24.) The NEA adds that,
because “objectors have already received a notice informing
them of the union’s expenditures, there is no reason why [AAA]
Rule 14 should not enable objectors to obtain sufficient
‘discovery.’” (NEA’s Br. at 15 n.11 (citation omitted).) Rule 14,
of course, is the rule under which discovery is available to
nonmembers only at the discretion of the AAA-appointed
“arbitrator’—and under which the “arbitrator” in this case
denied the pilots any discovery. (J.A. at 90, J 14; J.A. at 136.)
The AFL-CIO further reveals the unions’ agenda here by
asserting that in a subsequent court action “the objecting fee
payer can reasonably be required to identify in what respects the
union’s evidence accepted by the arbitrator is insufficient to
justify the fee.” (AFL-CIO’s Br. at 18.) That would impermis-
sibly shift the burden of proof to the pilots. This Court has
repeatedly held that, “ahways, the union bears the burden of
proving the proportion of chargeable expenses to total ex-
penses.” Lehnert, 500 U.S. at 524 (emphasis added) (citing
cases). “The nonmember’s ‘burden’ is simply the obligation to
make his objection known,” Hudson, 475 U.S. at 306 n.16, in
general terms. See Abood, 431 U.S. at 241 & n.42. Moreover,
the AFL-CIO does not explain how nonmembers can specify
which union evidence is insufficient if they have not had
discovery.
-35-
“[RJules of evidence that treat hearsay with skepticism, and
discovery procedures that allow litigants to probe their adver-
saries’ cases in depth prior to hearing,” are particulary necessary
in challenging the misuse of agency fees. See Bromley, 82 F 3d
at 693-94 Lehnert requires “a case-by-case analysis in determin-
ing which activities a union constitutionally may charge to
dissenting employees.” 500 U.S. at 519. These are “difficult”
mixed questions of fact and law that cannot be determined
without “factual concreteness and adversary presentation” on an
“evidentiary record” providing “specificity in the description of
[the] activities.” Abood, 431 U.S. at 236 & n.33. And, the union
alone possesses the facts and records that would show whether
its calculations satisfy the constitutional test for chargeability
and its burden of proof. See, e.g., Hudson, 475 U.S. at 306.
Contrary to the NEA’s implication, the “amount of financial
disclosure a union must provide to a non-member to enable her
to decide whether or not to object . . . is not necessarily suffi-
cient to determine the propriety of the agency fee.” Tierney v.
City of Toledo, 917 F.2d 927, 938 n.9 (6th Cir. 1990). That is so,
because Hudson requires advance disclosure of only “the major
categories of expenses.” 475 U.S. at 307 n.18. Here, ALPA’s
SGNE, while it disclosed some 1200 “project codes,” merely
identified each code with a short, cryptic title which seldom
showed the nature of the activity involved. (See Pet. App. at
118a-57a.)
Thus, because the pilots were denied discovery, and even
advance identification of ALPA’s witnesses and exhibits, and
could not conipel the testimony of union witnesses or production
of union documents at the hearing under ALPA’s procedure,
they were unable effectively to cross-examine, impeach, or rebut
ALPA'’s case. Moreover, that case consisted solely of hearsay.
“summaries of documents that were not presented in evidence
and had not been made available for inspection by [the] dissent-
ers prior to the arbitration hearing,” Bromley, 82 F.3d at 693,
and general, self-serving testimony of ALPA employees. See
supra pp. 5-6 & note 2.
oni.
In short, the pilots and their attorney were mere spectators
at a “show trial.” Such a proceeding neither significantly reduces
the need for discovery in the subsequent court action nor creates
a record of the type that can be relied upon to decide a motion
for summary judgment. See Bromiley, 82 F.3d at 693-94.
ALPA relies on the fact that “Hudson itself states that ‘a
full-dress administrative hearing, with evidentiary safeguards’ is
not required.” (ALPA’s Br. at 24 (quoting 475 US. at 308
n.21).) However, Hudson merely says that “a full-dress adminis-
trative hearing . . . is [not] part of the ‘constitutional minimum””
for the initial collection of agency fees. 475 US. at 308 n.21. It
unnecessary to protect nonmembers’ rights where, after the fees
have been collected, arbitration is asserted as a prerequisite to or
substitute for “ordinary judicial remedies,” id. at 307 n.20.
ALPA also argues that this Court has rejected the lack of
rules of evidence and “broad discovery” “as a basis for not
enforcing an agreement to arbitrate federal statutory claims, even
when the arbitration . . . is a binding substitute for court
litigation.” (ALPA’s Br. at 24.) ALPA cites Gilmer v. Inter-
state/Johnson Lane Corp., 500 U.S. 20 (1991). However,
Gilmer, unlike this, was a case in which the plaintiff individually
agreed to arbitrate his statutory claims. /d. at 23. “By agreeing
to arbitrate a statutory claim, a party. . . trades the procedures
and opportunity for review of the courtroom for the simplicity,
informality, and expedition of arbitration.” Mitsubishi Motors
Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 628
(1985) (emphasis added). That a party should be held to his
agreement to waive the rules of evidence and civil procedure
does not mean that a person with a statutory or constitutional
claim can be forced to give up those procedural protections.
Alexander v. Gardner-Denver Co. and McDonald v. City of
West Branch held that arbitration “cannot provide an adequate
substitute for a judicial proceeding in protecting .. . federal
statutory and constitutional rights” where an employee has not
-_ ™
voluntarily waived his st-.vtory cause of action. McDonald v.
City of West Branch, 466 _..S. 284, 290 (1984); see Alexander
v. Gardner-Denver Co., 415 U.S. 36, 56-58 (1974).'* One reason
given for that holding was that “arbitral factfinding is generally
not equivalent to judicial factfinding,” because “‘the usual rules
of evidence do not apply; and rights and procedures common to
civil trials, such as discovery [and] compulsory process . . . are
often severely limited or unavailable.’” McDonald, 466 U.S. at
291 (quoting Gardner-Denver, 415 U.S. at 57-58).
Although Gilmer found these concerns “undermined” where
there is an agreement to arbitrate statutory claims, Gilmer
McDonald and Gardner-Denver because “those
cases did not involve the enforceability of an agreement to
arbitrate statutory claims.” 500 U.S. at 33-35 & n.5. By so
distinguishing the Gardner-Denver line of cases, Gilmer
indicated those cases’ continuing applicability where, as here,
there is no agreement to arbitrate statutory claims. See, e.g
Brisentine v. Stone & Webster Eng’g Corp., 117 F.3d 519, $33.
27 (11th Cir. 1997), see also Livadas v. Bradshaw, 512 U.S.
107, 126 n.21 (1994) (“Gilmer emphasized its basic consistency
with our unanimous decision in Alexander”).
Gardner-Denver and McDonald also found arbitration
inadequate to protect federal statutory and constitutional rights
because “an arbitrator’s expertise ‘pertains primarily to the law
of the shop, not the law of the land.”” Mc onald, 466 U.S. at
290 (quoting Gardner-Denver, 415 U.S. at 57). That factor also
exists here and shows that decisions of “arbitrators” under
'? Both cases also recognized that, despite the availability of arbitra-
tion, employees could “elect to bypass arbitration and institute a lawsuit.”
Gardner-Denver, 415 U.S. at 59; accord McDonald, 466 U.S. at 292 n.11.
> Gilmer also is distinguishable from this case, because the arbitration
procedures there did “allow for document production, information requests,
depositions, and subpoenas.” 500 U.S. at 31.
- 38-
ALPA’s scheme are unlikely to assist the courts in deciding the
statutory and First-Amendment questions presented in agency-
fee cases. See Bromiley, 82 F.3d at 693.
Besides his decision, the only record evidence here as to the
expertise of “arbitrator” Aronin is that the AAA appoints an
arbitrator from a special panel of arbitrators experienced in
employment relations.” (J.A. at 88, 1 3.) However, labor
arbitrators “may not... have the expertise required to resolve
the complex legal questions that arise in § 1983 actions.
McDonald, 466 U.S. at 290.
A labor arbitrator's lack of necessary expertise is particu-
larly likely in considering “difficult line-drawing questions,
Abood, 431 U.S. at 236, whether union activities may be charged
to nonmembers, including whether they “significantly add to the
burdening of free speech that is inherent in the allowance of an
agency . . . shop,” Lehnert, 500 U.S. at 519. As Henry P.
First Amendment “Due Process,” stow meter
8, 523 (1970) (cited approvingly in Hudson, S. at 3
te aid aananmartnem: a labor arbitrator “when dealing
with questions of speech, is more likely to see the problem in
terms of labor-management relations than in terms of first
amendment interests.” Cf Breininger, 493 U.S. at 74 (doubting
any special NLRB expertise in unfair-representation cases).
Insensitivity to First-Amendment interests is evident here
from Aronin’s decision. Aronin upheld ALPA’s treatment of
lobbying concerning federal air safety regulations as chargeable,
(Pet. App. at 108a), despite the fact that, as the court of appeals
said, “it is hard to imagine [nonmembers First Amendment-
type] interests more clearly placed in jeopardy than when the
union uses the dissidents’ money to pursue political objectives
such as air-safety regulations. (/d. at 14a.)
Thus, as in McCarthy, that the nonjudicial decisionmaker
f
here “does not bring to bear any special expertise on the type o
issue presented” militates against requiring exhaustion. See 503
-39-
U.S. at 155. At the least, as in Patsy, exhaustion should not be
judicially imposed, because “there is debate over whether the
specialization of federal courts in constitutional law is more
important than the specialization of administrative agencies in
their areas of expertise.” 457 U.S. at $13 n.15.
E. Exhaustion Will Unduly Prejudice Nonmembers.
Finally, ALPA contends that the pilots’ interests will not be
unduly prejudiced by an exhaustion requirement, because the
“tume required to complete an agency-fee arbitration is generally
not great,” “the challengers are protected .. . by the escrow
requirement imposed by Hudson,” and the “remedial authority
of the arbitrator is as broad as a court’s.” (ALPA’s Br. at 23.)
These contentions are all disingenuous.
* Time: “[U]ndue prejudice to subsequent assertion of a
court action” “may result... from an unreasonable or indefinite
timeframe for administrative action.” McCarthy, 503 U.S. at
146-47. A party cannot be required to exhaust procedures that do
not place a reasonable time limit on the consideration of claims.
See Coit Independence Joint Venture v. FSLIC, 489 U.S. 561,
587 (1989).
Here, the time frame is indefinite, because neither ALPA’s
procedure nor the AAA’s rules contains deadlines for the
initiation of “arbitration” by ALPA and the completion of
hearings. (See J.A. at 69-70, 88-94.) In this case, the pilots sent
their objections to ALPA in August 1993. The final “arbitration”
decision was not issued until September 30, 1994, more than a
year later. (Compare J.A. at 71-78 with Pet. App. at 158a-61a.)
Such a lengthy period not only unreasonably delays judicial
resolution of these cases, but might even more seriously preju-
dice the pilots. The limitations period for unfair representation
actions is six months. De/Costello v. Teamsters, 462 U.S. 151
(1983); Lancaster v. ALPA, 76 F.3d 1509, 1527 (10th Cir.
1996). Thus, “[u]nless the doctrine that statutes of limitations are
- 40 -
not tolled pending exhaustion” is inapplicable in these cases, as
the Tenth Circuit held in Lancaster’s specific circumstances, 76
F 3d at 1528, a judicially imposed exhaustion requirement might
effectively prevent nonmembers from ever receiving judicial
consideration of their claims. See Patsy, 457 U.S. at 514 n.17.
Moreover, ALPA’s procedure requires objecting pilots to
request “arbitration” within thirty days of the SGNE’s mailing,
plus “a reasonable additional time for receipt.” (J.A. at 69, 79.)
Thus, were exhaustion required, ALPA’s scheme would further
prejudice the pilots by drastically truncating the limitations
period from six months to about thirty days.'* That a nonjudicial
procedure imposes a short filing deadline “that create(s] a high
risk of forfeiture of a claim for failure to comply” “counsel(s]
strongly against exhaustion as a prerequisite to the filing of a
federal-court action.” McCarthy, 503 U.S. at 152-53; of
DelCostello, 462 U.S. at 165-66 (a ninety-day arbitration
limitations period is too short for unfair representation claims).
* Escrow: ALPA’s scheme does not completely “avoid
the risk that dissenters’ funds may be used temporarily for an
improper purpose,” Hudson, 475 U.S. at 305. ALPA does not
escrow challengers’ entire agency fees. During a given calendar
year, it escrows only “an amount equal to 1.5 times [its] estimate
of its total agency fee rebate obligation for that year.” (J.A. at
67-68.) When a pilot challenges ALPA’s calculation of the
reduced fee, it escrows “pending the outcome of the arbitration”
only “the portion of the pilot’s agency fee that ALPA determines
to be reasonably in dispute.” (/d. at 69.) Thus, ALPA has the use
of part of challengers’ agency fees at all times, and it is possible
that some part may be spent for lawfully nonchargeable pur-
poses. “The amount at stake for each individual dissenter does
not diminish this concern.” Hudson, 475 U.S. at 305.
‘4 Most unions have similarly short filing deadlines in their agency-fee
objection procedures. See, e.g., Nielsen v. Machinists Local 2569, 94 F.3d
1107, 1116-17 (7th Cir. 1996), cert. denied, 117 S. Ct. 1426 (1997).
-41-
Moreover, even if all portions of the fees for a particular
year ultimately found to be nonchargeable by the “arbitrator”
happen to have been escrowed, challengers have been deprived
for a substantial time of the use for their own purposes of that
portion of their monies.'* That is not merely a deprivation of
property, however. As Justice Brennan said in Elrod v. Burns, a
likely consequence of the deprivation is that “the individual’s
ability to act according to his beliefs and to associate with others
of his political persuasion is constrained.” 427 U.S. 347, 355-56
(1976) (plurality opinion); accord Branti v. Finkel, 445 U.S.
507, 513 n.8 (1980); see Seay v. McDonnell Douglas Corp., 427
F.2d 996, 1004 (9th Cir. 1970). '
_* Remedial Authority. An “administrative remedy may
be inadequate ‘because of some doubt as to whether the agency
was empowered to grant effective relief.’” One such circum-
stance is where the agency may “lack authority to grant the relief
requested.” McCarthy, 503 U.S. at 147-48 (quoting Gibson v.
Berryhill, 411 U.S. 564, 575 n.14 (1973)); see also Clayton, 451
U.S. at 693 (“where an aggrieved employee cannot obtain . . .
the substantive relief he seeks,” exhaustion “would delay judicial
consideration . . . , but would not eliminate it’).
Contrary to ALPA's assertion, there is serious doubt that the
remedial authority of its “arbitrator is as broad as a court’s,”
(ALPA’s Br. at 23.) The RLA “contemplates resort to the usual
judicial remedies of injunction and award of damages when
appropriate for breach of th{e] duty” of fair representation.
Steele, 323 U.S. at 207 (emphasis added). Thus, if a court finds
that a union charged for an activity that is lawfully noncharge-
' In this case, collection began in January 1992, but it was not until
September 30, 1994, that the “arbitrator” found that 1.5% of the 1992 dues
amount had been unlawfully collected from the pilots. (Pet. App. at 161a.)
That, of course, was in addition to the amounts that ALPA earlier conceded
it had collected unlawfully: 11% of dues in the first six months of 1992 and
2% in the last six months. (See id. at 2a.)
42.
nh he
le, it can not only award damages, but also can enjoin th
~~ on charging objecting nonmembers for that activity in
the future. The pilots requested that relief here. (J.A. at 48.)
However, ALPA’s “arbitrator” cannot provide prospective
relief, wreeey rs authority derives from ALPA’s policy. It
authorizes him only to require restinution of the part of the fees
for the pordestes: year Setre Sis Sake ee ae rat
unlawfully. (See J.A. at 69-70; Pet. App. at 114a- -$ 3
Brosterhous v. State Bar, 906 P.2d 1242, 1253 (Cal. 1995) (the
arbitrator under a Bar’s objection procedure could ~~ grant
declaratory relief or enjoin future violations . . . or make any
ruling that would bind the State Bar in the future’).
In sum, policy considerations do not justify an exhaustion
requirement here, and such a requirement would unduly preju-
dice nonmembers in all respects that ALPA says it would not.
: the Impartial Decisionmaker Procedure Is a
= healer se oar Its Use Is an Exhaustion
Requirement. Moreover, It Is One That Would Unlaw-
fully Infringe Nonmembers’ Right Not to Associate.
find little support for their position
in Por acer a mi the NEA, explicitly, and ALPA
and the AFL-CIO, implicitly, argue that they are not attempting
to impose an exhaustion requirement at all. Rather, they say, “a
nonmember may not bypass a union’s agency fee eg e
process and then mount a First Amendment challenge to the
fee,” because under Hudson “no First Amendment injury accrues
unless and until the arbitrator frees the union to spend money
over the nonmember’s objection.” (NEA’s Br. at 18-19; see
ALPA’s Br. at 19 n.9; AFL-CIO’s Br. at 13-14.)
Willi County Regional Planning Commission v.
Hamilton Bank. a case the NEA cites for this inventive _
ment, shows that ALPA and its amici confuse two ey
distinct” questions: “whether administrative remedies must
o&-
exhausted” and “whether an administrative action must be final
before it is judicially reviewable,” 473 U.S. 172, 192 (1985).
[T}he finality requirement is concerned with whether
the initial decisionmaker has arrived at a definitive
position on the issue that inflicts an actual, concrete
injury, the exhaustion requirement generally refers to
administrative and judicial procedures by which an
injured party may seek review of an adverse decision
and obtain a remedy if the decision is found to be
unlawful or otherwise inappropriate.
/d. at 193 (emphasis added).
Here, ALPA is the “initial decisionmaker” and “arrive[s] at
a definitive position” on the chargeability issue. When ALPA
distributes its SGNE, it has finally determined what percentage
of dues it will seize from nonmembers who object to paying for
nonbargaining activities and will spend, despite those objections,
if they do not seek review of its determination. The “impartial
decisionmaker” does not participate in that decision. And, that
decision “inflicts an actual, concrete injury.” Dues are collected
from the nonmembers based on ALPA’s determination, upon
pain of discharge for nonpayment, thus depriving the pilots of
possession of part of their wages.
On the other hand, Hudson describes the “impartial
decisionmaker” procedure as a “review procedure” and a
“remedy.” 475 U.S. at 307-08 & nn.19-21. And SO it is in
practice. The “arbitrator” determines whether ALPA validly
calculated the agency fee charged objectors and orders a remedy:
restitution of any portion of the fee that he finds was not
lawfully collected. (See J.A. at 69-70; Pet. App. at 114a-152.)
Therefore, Williamson County confirms that the court of
appeals correctly held that exhaustion of ALPA’s “arbitration”
procedure is not required. The claim in that case was not ripe,
because the property owner had not asked the Planning Commis-
-44-
sion to grant a variance and, thus, the prem -eeeyo) oe
“a conclusive determination . . . Wheter
~ree omeeil a owner] to develop the subdivision in the —
{the owner] proposed.” 473 US. at 193. In short, in contras
this case, there was no taking yet.
ther
_ in Williamson County, there were two 0
ert ot to the “impartial decisionmaker” pro
here, that the Court held need not be used before the claim was
ripe for judicial determination. The “State provide(d] procedures
taken by county anthorities.” The Court held that the ——
owner “would not be required to resort to those proced'
before bringing its § 1983 action, because sinner oe
learly are remedial.” It also held that the owner “wou
pooner to appeal the {Planning} Commission's rejection of ta]
preliminary plat to the Board of Zoning Appeals, because —
Board was empowered, at most, to review that rejection, no
participate in the Commission’ s decisionmaking.” /d."°
\6 The other cases the NEA cites are wholly inapposite. Cox v. a.
Hampshire, 312 U.S. $69 (1941), and Poulos v. New rere spotted a :
395 (1953), held merely that government 2 require the ot
license for the use of public property if the oie nl ae ay og
ministerial time, place, and manner determinations. See Poulos, igh
402-05; Cox, 312 U.S. at 575-76. The public owns the public streets
to seek a license from it through its “arbitration” scheme as a precondl 0
to asserting in court their constitutional and statutory right to get
own money. Moreover, Poulos recognized that government cannot require
the obtaining of a license as a precondition to exercising First-Amendmest
accra bed Ce 345 US. at 403 n.9, 412-14.
to make content-based determinations. »¢¢ » ‘a 4
- 45 -
Moreover, the unions’ “ripeness” argument misrepresents
Hudson. A First-Amendment violation, or breach of the duty of
fair representation, occurs when a union spends objecting
nonmembers’ agency fees on nonbargaining activities. However,
such a violation, and a violation of the right not to be deprived
of property without due process, also occurs when a union
collects agency fees without having in place a procedure that
satisfies the Constitution, or the duty of fair representation, in all
respects, even if the union escrows all contested fees.'’ See, e.g.,
Weaver v. University of Cincinnati, 942 F.2d 1039, 1045-46 (6th
Cir. 1991).
Hudson prescribed “constitutional requirements for the
Union's collection of agency fees.” 475 U.S. at 310 (emphasis
added). These requirements were not imposed merely to prevent
improper spending, as the unions argue. They also were imposed
to “provide the protections necessary for any deprivation of
property” and “to minimize both the impingement [of the agency
shop itself on nonmembers’ First-Amendment interests] and the
burden” of objection. /d. at 304 n.13, 309 (emphasis added).
‘© (...continued)
Times Film Corp. v. City of Chicago held only that a permit may be
required to protect the public “against the dangers of obscenity in the public
exhibition of motion pictures,” because “‘obscenity is not within the area of
constitutionally protected speech,”” and motion pictures are “not ‘necessar-
ily subject to the precise rules governing any other particular method of
expression.”” 365 U.S. 43, 49-50 (1961) (quoting Roth v. United States, 354
U.S. 476, 485 (1957), and Joseph Burstyn, Inc. v. Wilson, 343 U.S. 495, 503
(1952)). Here, in contrast, the collection of agency fees even for bargaining
purposes indisputably infringes on First-Amendment interests. See Hudson,
475 US. at 301 n.8, 307 & n.20; Ellis, 466 U.S. at 455; Abood, 431 U.S. at
222 (opinion of the Court), 255 (Powell, J., concurring). Nor does this case
concern motion pictures.
” This Court recognized the procedural due process component of the
duty of fair representation in Steele, 323 U.S. at 204.
- 46 -
Court explicitly rejected the argument, now made
by ALPAsa amici, “that because a 100% escrow a
pletely avoids the risk that dissenters x tee ae
used improperly,” there is no constitutional violation. ne C
held that the Hudson “plaintiffs established a aoe
violation,” because the union’s procedure - e flawed _
two [other] respects”: the lack of eg seat ore sp. “
the advance reduction of dues” and “a reasonably oo
decision by an impartial decisionmaker.” /d. at 309 & n.22.
udson reiterated the Court’s earlier holding in the
sadeame ste ae that the “nonmember’s ‘burden is simply
the obligation to make his objection known.” /d. at be —
(emphasis added). Those earlier cases also held that an ec -
may be made for the first time “in [a] rr rea = te ~ ns
ion.” Rai Clerks v. Allen, 373 U.S. 113, ;
ae mo 4 431 U.S. at 239 & n.39. And, Hudson empha-
sized that the union has “a responsibility to provide a
that minimize th[{e] impingement [of the agency shop -s :
Amendment rights] and that facilitate a nonunion emp rd
ability to protect his rights.” /d. at 307 n.20 (emphasis added).
ecessarily follows that a union’s procedure is in-
we... a ze Oh that the union has rere * we
agency fees is ripe for judicial determination—where the union
procedure fails to include one of the three required a
procedural safeguards (i.e., notice, independent decisionmak —
and escrow) or includes some other element that imposes .
impermissible condition on nonmembers’ exercise of their righ
to challenge its calculation of lawfully chargeable expenses.
“the only aspect
For example, under the NLRA and RLA,
of union membership that can be required pursuant to a union
shop agreement is the payment of dues.” Pattern ayn
League v. NLRB, 473 U.S. 95, 106 n.16 (1985); see Beck,
j : 't v. Hanson, 351 U.S.
.S. at 744-45; Railway Employes Dep'tv ,
ro 235-38 (1956). Thus, clearly, a union could not lawfully
condition exercise of the right not to subsidize its nonbargaining
- 47.
activities, or the right to challenge its calculation of bargaining
costs, upon full membership.
Here, ALPA is attempting to condition exercise of both
rights on compliance with an aspect of full union membership,
use of a union-created remedy, see, e.g, Neal v. § stem Bd. of
Adjustment, 348 F.2d 722, 726 (8th Cir. 1965). ALPA has
demonstrated no consensual or federal statutory source of
authority for that requirement.
Thus, by attempting to include that condition in its proce-
dure, ALPA has invalidated the procedure and infringed on the
pilots’ statutory and F irst-Amendment rights by collecting
agency fees from them, regardless of whether the procedure
otherwise complies with Hudson, including its escrow require-
ment. As the court of appeals held in Abrams v Communications
Workers, a union’ s agency-fee procedure “requiring an objector
who challenges the allocation of chargeable and non-chargeable
of fair representation by limiting the choice of forum for the
challenge.” 59 F.3d 1373, 1382 (DC. Cir. 1995); see also
Bromley, 82 F.3d at 694 (“it is [not] constitutional for an agency
shop agreement to require objecting employees to exhaust their
arbitration remedies before going into court on their constitu-
tional claims”); Hohe v. Casey, 956 F 2d 399, 408-09 (3d Cir
1992) (a state requirement of exhaustion of public-sector union
agency-fee procedures “is constitutionally unenforceable”)
CONCLUSION
The court of appeals correctly held that a nonmember “who
wishes to bring an action in federal court [to challenge the
lawfulness of the amount of an agency fee] is not obliged to
proceed first to arbitration, at the union’s option.” There is “no
legal basis for forcing into arbitration a party who never agreed
to put his dispute over federal law to such a process,” (Pet. App.
- 48 -
at | la), either in Hudson or under the doctrine of exhaustion.
The court of appeals’ decision should be affirmed.
February 6, 1998
Respectfully submitted,
RAYMOND J. LAJEUNESSE, JR.
Counsel of Record
National Right to Work Legal
Defense Foundation, Inc.
8001 Braddock Road, Suite 600
Springfield, VA 22160
(703) 321-8510
PHILIP F. HUDOCK
P.O. Box 3796
Reston, VA 20195
(703) 757-9577
ATTORNEYS FOR RESPONDENTS
APPENDIX
United States Constitution, Article III
Section 1. The judicial Power of the United States, shall be
vested in one Supreme Court, and in such inferior Courts as the
Congress may from time to time ordain and establish. .. .
Section 2. The judicial Power shall extend to all Cases, in
Law and Equity, arising under this Constitution [and] the Laws
of the United States. . . .
Railway Labor Act, §§ 2, Fourth and Fifth,
45 U.S.C. §§ 152, Fourth and Fifth (1988)
§ 152. General Duties
Fourth. Organization and collective bargaining; freedom
from interference by carrier; assistance in orga-
nizing or maintaining organization by carrier
forbidden . . .
Employees shall have the right to organize and bargain
collectively through representatives of their own choosing. The
majority of any craft or class of employees shall have the right
to determine who shall be the representative of the craft or class
for purposes of this chapter. No carrier, its officers or agents,
shall deny or in any way question the right of its employees to
join, organize, or assist in organizing the labor organization of
their choice, and it shall be unlawful for any carrier to interfere
in any way with the organization of its employees, or to use the
funds of the carrier in maintaining or assisting or contributing to
any labor organization, labor representative, or other agency of
collective bargaining, or in performing any work therefor, or to
influence or coerce employees in an effort to induce them to join
-2a-
or remain or not to join or remain members of any labor
organization. .. .
Fifth. Agreements to join or not to join labor organizations
forbidden
No carrier, its officers, or agents shall require any person
seeking employment to sign any contract or agreement promis-
ing to join or not to join a labor organization. .. .
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.