Petition for Writ of Certiorari — Service, Hospital, Nursing Home & Public Employees Union, Local 47 v. Commercial Property Services, Inc.

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85-243 [rere

JUN 21 1985

IN THE ALEXANDER 1. STEVAS,

SUPREME COURT OF THE UNZZED STA PES

OCTOBER TERM, 1984

SERVICE, HOSPITAL, NURSING HOME AND

PUBLIC EMPLOYEES UNION, LOCAL 47

Petitioner,

V+

COMMERCIAL PROPERTY SERVICES, INC.,

CLEVELAND CLEANING & MAINTENANCE CO.,

TOTAL SYSTEMS MANAGEMENT, INC.,

ANTARES, INC.

AND

FIRST UNION MANAGEMENT, INC.

Respondents.

On Writ of Certiorari to the United States

Court of Appeals for the Sixth Circuit

PETITION FOR WRIT OF CERTIORARI

GREGORY J. LAVELLE

2201 Superior Avenue, Room 201

Cleveland, Ohio 44114

(216) 621/0995

Counsel for Petitioner

QUESTIONS PRESENTED FOR REVIEW

Whether related entities which an

employer expressly agrees are employers

under the Collective Bargaining Agreement

should be required to arbitrate a dis-

pute falling under that Agreement?

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES.............0%. (ii)

I. QUESTIONS PRESENTED FOR

Serres 1

a 5

III. RELEVANT STATUTES.............. g

IV. STATEMENT OF THE CASE.......... 11

oe: TEETER TEe 19

a 46

Eg acc tcc c we cenccccn a

Part A

Judgment and Order of the

United States Court of

Appeals for the Sixth

CarccuLt

Memorandum and Order of the

United States District Court,

Northern District of Ohio,

Eastern Division

Part B

Exhibits "A" - "D" listed

TABLE OF AUTHORITIES

Page

American Bell v. Federation

of Telephone Workers

736 F. 2d 879 (3rd

Caes SOONE aS kN eas cue ke 17, 31-35

Howard Johnson Co., Inc. v.

Detroit Joint Local Execu-

tive Board, Hotel & Restaur-

ant Employees & Bartenders

International Union, AFL-CIO

417 U.S. 249 (1974)........ 28-30, 40

John Wiley and Sons v.

Livingston, 376 U.S. 543

a: eS ee ee 27-30

United Steelworkers of America

v. American Manufacturing

Co., 363 U.S. 564 (1960)... 6, 1

United Steelworkers of America

v. Enterprise Wheel & Car

Corp., 363 U.S. 593 (1960). 6, 20

United Steelworkers of America

v. Warrior & Gulf Navi-

gation Co., 363 U.S.

Fe oes | Perret et 6, 18-20

«i he

I. QUESTIONS PRESENTED FOR REVIEW

Whether related entities which an

employer expressly agrees are employers

under the Collective Bargaining Agreement

should be required to arbitrate a dis-

pute falling under that Agreement?

Related entities which an employer

Collective Bargaining Agreement should be

required to arbitrate a dispute falling un-

der that Agreement.

Petitioner Service, Hospital, Nursing

Home and Public Employees Union, Local 47

(hereinafter "Local 47") is a party to a

Collective Bargaining Agreement of which

Respondent Commercial Property Services, Inc.

(hereinafter, "CPS") is a signatory. (Rele-

vant portions of that Agreement are attached

hereto and marked Exhibit "A".)

CPS agreed that parties to the Collec-

tive Bargaining Agreement, i.e., the

"Employer" be defined as follows:

(Article XXI, Sus cessors and Assigns

Other Empbove r:

~-»-This Agreement hereby covers as

an Employer subject to the full

terms of this Agreement any indivi-

dual proprietors hip, partnership,

corporation, firm, or any other

entity which is engaged in janitorial

work and is in any way a subsidiary

or related entity to any Employer

covered by this Agreement. speciti-

cally and without limitation, this

Agreement hereby includes any entity

engaged in janitorial work which is

operated in whole or in part by any

officer, director or any person em-

ployed by any Employer covered by

this Agreement, and further includes

any entity engaged in janitorial

work in which any investor in any

Employer covered by this Agreement

has any interest of any kind...

Respondent Cleveland Cleani ng and

Maintenance Company (hereinafter, "CCM")

fits the contractual detinition of the

Employer since it was partially (70%) owned

by Patrick J. Cassese (hereinafter, "Cassese")

an officer of CPS who owned one hundred

percent (100%) of Antares, Inc. (here-

inafter, "Antares"), which in turned owned

one hundred percent (100%) of CPS. Re-

spondent Antares fits the contractual

=2-

definition of the Employer since it owns

CPS. Respondent Total Systems Management,

Inc. (hereinafter, "TSM") fits the con-

tractual definition of the Employer since

it is one hundred percent (100%) owned by

CPS.

Local 47 sought to have grievances

filed under the Collective Bargaining

Agreement arbitrated by CPS, CCM, Antares

and TSM since they were by definition the

Employer under the Collective Bargaining

Agreement.

The Sixth Circuit Court has held that

CCM, Antares and TSM could only be required

to arbitrate if the Court finds that there

should be a piercing of the corporate veil

on an alter ego theory or otherwise at law.

Local 47 would have this Court require

that the parties arbitrate so long as they

fit the contractual definition of the Em-

ployer as agreed by the parties. Since

the undisputed findings of the District

—3-

Court establish the oni.2rship and control

of CPS, CCM, Antares and TSM, and thus,

their status as Employers under the

Collective Bargaining Agreement, such

entities must be ordered to arbitrate.

Ii. WJURISDICTION

This matter arose under Section 301

of the Labor-Management Relations Act,

29 U.S.C. §185, as an action to enforce

a coliective bargaining agreement.

This Petition for Writ of Certiorari

requests this Court to review the order

of the United States Court of Appeals

for. the Sixth Circuit in Case Numbers

83-3761, 83-3762 and 83-3788 decided and

filed on February 21, 1984 which vacated

the decision of the United States District

Court for the Northern District of Ohio,

Eastern Division, which has required CCM

to arbitrate a grievance with Local 47 and

which upheld the decision of the District

Court in dismissing Antares and TSM. No

motion for reconsideration was filed. An

application for an extenstion of time in

which to file a Petition for Writ of

Certiorari was filed on May 21, 1985

(formally resubmitted on May 31, 1985).

-5-

An order extending time to file a Petition

for Writ of Certiorari was granted on

June 4, 1985 which extended the time for

filing this Petition to June 21, 1985.

Jurisdiction of this Court is invoked

under Supreme Court Rule 17.1 (c) in that

the United States Court of Appeals for

the Sixth Circuit had decided an important

question of Federal Law which should be

settled by this Court, the question of

whether related entities which an employer

expressly agrees are employers under the

Collective Bargaining Agreement should

be required to arbitrate a dispute falling

under that Agreement.

The decision of the Sixth Circuit is

in conflict with the decisions in United

Steelworkers of America v. American Manu-

facturing Co., 363 U.S. 564 (1960), United

Steelworkers of American v. Warrior & Gulf

Navigation Co., 363 U.S. 574 (1960) and

United Steelworkers of America v. Enter-

prise Wheel & Car Corp., 363 U.S. 593

(1960).

Iil.

RELEVANT STATUTES

Section 203 (da) of the National

Labor Relations Act, 29 U.S.C.

§173 (da):

Final adjustment by a method agreed

upon by the parties is hereby de-

clared to be the desirable method

for settlement of grievance dis-

putes arising over the application

or interpretation of an existing

collective bargaining agreement.

The Service is directed to make

its conciliation and mediation

services available in the settle-

ment of such grievance disputes

only as a last resort and in excep-

tional cases.

Section 301 of the National Labor

Relations Act, 29 U.S.C. §185:

(a) Suits for violation of con-

tracts between an employer and a

labor organization representing

employees in an industry affecting

commerce as defined in this Act,

or between any such labor organiza-

tions, may be brought in any dis-

trict court of the United Siates

having jurisdiction of the parties,

without respect to the amount in

controversy or without regard to

the citizenship of the parties.

(b) Any labor organization which

represents employees in an industry

affecting commerce as defined in

this Act and any employer whose

— —

activities affect commerce as

defined in this Act shall be

bound by the acts of its agents.

Any labor organization may sue

or be sued as an entity and in

behalf of the employees whom it

represents in the courts of the

United States. Any money judgment

against a labor organization in

a district court of the United

States shall be enforceable only

against the organization as an

entity and against its assets and

shall not be enforceable against

any individual member or his assets.

and proceedings by or against

labor organizations in the district

courts of the United States, dis-

trict courts shall be deemed to

have jurisdiction of a labor organi-

zation (1) in the district in which

such organization maintains its

principal offices, or (2) in any

district in which its duly authorized

officers or agents are engaged in

representing or acting for employee

members.

(a) The service of summons, sub-

poena, or other legal process of any

court of the United States upon an

officer or agent of a labor organiza-

tion, in his capacity as such, shall

constitute service upon the labor

organization.

(e) For the purposes of this

section, in determining whether

any person is acting as an "agent"

of another person so as to make

such other person responsible for

his acts, the question of whether

the specific acts performed were

actually authorized or subsequently

ratified shall not be controlling.

om 10-

IV. STATEMENT OF THE CASE

Petitioner Local 47 and CPS were

parties to a Collective Bargaining Agree-

ment effective May 1, 1981 through

April 30, 1984. CPS is a company which

provides janitorial (cleaning) services at

numerous locations (accounts). CPS and

a number of other cleaning contractors

execute identicle collective bargaining

agreements with Local 47 under which any

Employer covered by the Agreement taking

over an account previously serviced by

another Employer covered by the Agreement

is required to retain the previous Em-

ployer's employees at the same wages, terms

and conditions of employment and hours of

work and to recognize the seniority of

those employees—’. (A copy of the rele-

MW see Master Agreement, Article XI,

Sections 1, 2, 5 and 8.)

-ll-

vant portions of said Collective Bar-

gaining Agreement, hereinafter referred

to as the "Master Agreement", is attached

hereto and marked Exhibit "A".) CPS was

also covered by a Collective Bargaining

Agreement (hereinafter referred to as

the “Downtown Building Agreement") which

contained a Work Preservation clause which

states:

If an Employer signatory to an agree-

ment with the Union takes over the

operation of the janitorial and/or

maintenance work in a building or

buildings covered by this Agreement,

the employees performing that work

shall be retained in order of their

building seniority and in accord with

the wages, hours, and other terms and

conditions of employment established

in this Agreement.

The Collective Bargaining Agreement

was executed by CPS on behalf of its

Successors, assigns and related entities

and defined as the Employer covered by

the Agreement such related entities.

(See Article XXI, Successors and Assigns,

Other Employers, Exhibit "A".)

-]2-

Signatory CPS was owned by Antares

which in turn was owned by Cassese, an

officer of CPS. Cassese also owned seventy

percent (70%) of CCM.

During the term of the Collective

Bargaining Agreement and prior to Local 47's

knowledge of the relationship between

CPS and CCM, CCM took over a number of

accounts serviced by contractors covered

by the Master Agreement; the Lakeland

Medical Building, the Young Medical Building,

the Shaker Medical Building, Curtis Indus-

tries and Diamond Shamrock.

In February of 1983, Local 47 became

aware of the relationship between CPS

and CCM and also became aware that CCM

would begin servicing two accounts operated

by First Union Management (hereinafter,

"First Union"), the Illuminating Building

and the Rockwell Building. These accounts

had been serviced by National Cleaning,

a Signatory to the Master Agreement.

«} Be

Local 47 thereupon filed a grievance

in the form of a letter (attached hereto

and marked Exhibit "B") alleging a viola-

tion of Articles XI and XXI of the Master

Agreement and/or the Work Preservation

article of the Downtown Building Agreement.

The letter informed the Employer that

unless it agreed to restore the former

employees to employment and otherwise

honor its Collective Bargaining Agreement,

Local 47 would seek injunctive relief

and would week arbitration of the dispute. 2/

When CCM failed to comply wi-.h the

directions in the grievance letter, Local 47

filed suit against CPS, CCM, Antares,

TSM and First Union=* in the United States

District Court for the Northern District

2! see Article XXVIII of the Master

Agreement, Remedies.

— 2

3 First Union was joined for injunctive

purposes and under a cause of action

for malicious interference with con-

tract. (See Plaintiff's Second Cause

of Action. )

-l]14-

of Ohio, Eastern Division pursuant to

Section 301 of the Labor-Management

Relations Act, 29 U.S.C. §185. (A copy

of Local 47's Complaint as amended is

attached hereto and marked Exhibit "C".)

Local 47 moved for Summary Judgment

on its Complaint; CCM moved for Partial

Summary Judgment; Antares and TSM filed

Motions to Dismiss.

Local 47's Motion for Summary Judg-

ment was granted to the extent that CPS

and CCM were ordered to arbitrate but

granted Antares and TSM's Motion to

Dismiss. (See Memorandum and Order of

the District Court included in the

Appendix hereof.)

CPS and CCM appealed the decision

of the District Court in ordering CCM

to arbitrate. Local 47 cross-appealed

from the decision of the District Court

-15-

to dismiss Antares and TSM.

The United States Court of Appeals

for the Sixth Circuit vacated the de-

cision of the District Court which

ordered CCM to arbitrate saying, "We

hold that a district court may not order

a non-Signatory to arbitrate a labor

dispute absent a specific finding that

the relationship between it and the

party bound to the agreement is such that

1t too is bound... We, therefore, vacate

the order of the district court and

remand the case to it for a determina-

tion of whether the facts warrant a

finding that CCM and CPS are alter egos

Or constitute a single Employer or whether

the corporate veil should otherwise be

pierced".

The Sixth Circuit Court further

ak Pana

upheld the District Court's dismissal

of Antares and rsm.2/

The Sixth Circuit thus held that

there must be a finding of alter ego

or single-employer status generally at

law to bind a non-signatory employer to

arbitrate even where the Collective Bar-

gaining Agreement defines that related

entity as the Employer .=/

Petitioner believes that where an

— The Sixth Circuit Court also upheld

the District Court's denial of CCM's

Motion for Partial Summary Judgment

indicating that Local 47, since dis-

covery had not been completed, had

not had the opportunity to present

evidentiary support for its alter ego

single-employer theory.

—It is interesting to note that the

case cited in support of the Sixth

Circuit Court's decision, American

Bell v. Federation Telephone Workers,

736 F. 2d 879 (3rd Cir. 1984) was a

split decision of the Court. The

dissent would have required arbitra-

tion and the majority remanded noting

that the contract definition was unclear.

a 3 Fa

employer signatory to a Collective Bar-

gaining Agreement agrees that certain

related entities are also bound by the

Collective Bargaining Agreement, such

related entities should be required to

arbitrate a dispute under the Collective

Bargaining Agreement, "unless it can be

said with positive assurance that the

arbitration clause is not susceptible

of an interpretation that covers the

asserted dispute", United Steelworkers

v. Warrior & Gulf Navigation Co.,

363 U.S. 574 (1960).

-|18-

V. ARGUMENT

There is nothing more important to

Federal labor policy than the existence

Of a functioning labor arbitration System.

It 1S so important that Congress has

seen fit to express the National policy

favoring arbitration as a matter of law

in Section 203 (d) of the National Labor

Relations Act, 29 U.S.c. §173 (d):

Final adjustment by a method agreed

upon by the parties is hereby declared

to be the desirable method for settle-

ment of grievance disputes arising over

the application or interpretation of

an existing collective bargaining agree-

ment. The Service is di rected to make

its conciliation and mediation servi, es

available in the settlement of such

grievance disputes only as a last re-

sort and in exceptional cases.

This Court likewise has expressed

its Policy toward favoring arbitration

in the Steelworkers Trilogy; United Steel-

workers of America V- American Manu-

facturing Co., 363 U.S. 564 (1960), United

Steelworkers of America V. Warrior & Gulf

-~]9-

Navigation Co., 363 U.S. 574 (1960) and

United Steelworkers of America v. Enter-

prise Wheel & Car Corp., 363 U.S. 593 (1960).

This Court expressly stated in Warrior

& Gulf, supra, "The grievance machinery

is at the very heart of the system of

industrial self-government" (363 U.S.

574 at 581). The message of the Steel-

workers' cases is clear; arbitration is

a system of industrial self government

under which parties bargain for a decision

by an arbitrator based on the terms of

their agreement, not on some body of law

external to that document. The Sixth

Circuit Court would have the external

body of law, the doctrine of successor-

ship, alter ego and piercing of the corpor-

ate veil prevail over the Collective Bar-

gaining Agreement requiring a finding

at law on these issues before arbitrating

a dispute falling within the Collective

Bargaining Agreement. This holding flies

-20-

in the face of the Steelworkers' cases.

Under the Steelworkers' cases, if

a party claimed that there was a violation

of a collective bargaining agreement,

an arbitrable issue was created. [In

American Manufacturing, supra, the test

was stated clearly and unequivocably.

"The Union claimed in this case that

the Company had violated a specific pro-

vision of the contract. The Company took

the position that it had not violated

that clause. There was, therefore, a

dispute as to 'the meaning, interpretation

and application’ of the Collective Bar-

gaining Agreement. Arbitration should

have been ordered". (363 U.S. 564 at 569)

The effect of the decisions in the

Steelworkers’ cases was dramatic. This

Court did not just decide three cases;

it changed in one bold swoop the entire

system of handling grievances across the

nation.

-2?\i-

Where a party could, with impunity,

resist arbitration through obstinance

or protracted appeal, that avenue was

no longer generally available.

Before the Steelworkers' cases, a

party demanding arbitration from an unwill-

ing party could expect to fact a full adjudi-

catory hearing in the Federal Courts and

an appeal from that determination. The

rezcisting party could create an issue

requiring a full hearing in the Court

by simply stating, "The meaning of the

language of the Collective Bargaining

Agreement is beyond dispute". The Steel-

workers' cases put an end to that ploy

by taking the question of the merits of

the controversy out of the hands of the

Courts recognizing that allowing the Courts

to determine the merits of an arbitration

“could only have a crippling effect on

grievance arbitration", American Manu-

facturing, 363 U.S. 564 at 567.

-22-

Allowing the Courts to hear the

merits of arbitration had, in fact,

crippled grievance arbitration. The

projected cost of a procedure where the

courts would be able to hear the merits

of any arbitration would easily dissuade

or destroy the party seeking to vindicate

its rights.

Cost alone was not the only problem.

The delay occasioned by such a procedure

could destroy the entire collective bar-

gaining process as decisions would be

rendered long after the collective bar-

gaining agreements under which they arose

expired. (The case, the subject of this

Petition for example, relates to decisions

of the District Court on Motions for

Summary Judgment concerning a grievance

filed in 1983.) Further, prior to the

Steelworkers‘ cases, during the interim

between the filing of the grievance and

final adjudication in the Courts, a lack

-—-23-

of confidence or disenchantment with the

arbitration process could develop and

could lead to the result Congress most

wanted to avoid; labor strife.

This Court is quite aware that

"arbitration is the substitute for labor

strife", Warrior & Gulf, 363 U.S. 574

at 378.

After the Steelworkers' cases, the

burdens of money and time were all bvt

eliminated. A party seeking arbitration

could expect the prompt granting of a

Motion for Summary Judgment based on

nothing more than a short memorandum and

an affidavit, a relatively inexpensive

proposition.

The result in such cases would be

pre-ordained in light of this Court's

admonishment that "an order to arbitrate

the particular grievance should not be

denied unless it may be said with positive

assurance that the arbitration clause

is not susceptible of an interpretation

—-24-

that covers the asserted dispute. Doubts

should be resolved in favor of coverage".

Warrior & Gulf, supra, at 583.

Parties resisting arbitration were

foreclosed from protracting litigation

by arguing the merits of the grievance

and were severely burdened in prevailing

on the remaining issue of procedure arbi-

trability.

In most cases, parties ceased to

resist arbitration. Where parties did

resist to the point of facing suit, a

result was obtained at a bearable expense,

in a reasonable time in such a manner

to vindicate the arbitral process. Where

parties resisted beyond the Summary Judg-

ment stage, they ran the ri. of facing

sanctions under Rule 11 of the Federal

Rules of Civil Procedure.

The beauty of the Steelworkers'

cases was the fact that they were nearly

a Bion

self policing. This Court gave direction

in an important federal area, closing

a door to those who could resist arbitra-

tion. With the door closed once and for

all, parties to collective bargaining

agreements were channelled into arbitra-

tion, the method Congress favored for

dispute resolution.

The case presented for review today

asks this Court to give the same type

of direction to the parties to collective

bargaining agreements across the nation,

at the same time to vindicate its decision

in the Steelworkers' cases and to re-

enforce the Congressional policy in favor

of arbitration.

Here, CPS cannot legitimately claim

that CCM, Antares and TSM are not covered

by the express language of the Collective

Bargaining Agreement. CPS essentially

claims that those entities which it agreed

were bound as employers to the Collective

—-26-

Bargaining Agreement need not arbitrate

the grievance because they are not sSigna-

tories to the Agreement.

The fact of an Employer being or

not being a Signatory to a collective

bargaining agreement has never been the

determining factor. The question is

whether the successor undertook the obli-

gations of the contract. See John Wiley

and Sons v. Livingston, 376 U.S. 543

1964, 2/ Wiley stands for the proposition

that once an entity undertakes the obliga-

tions of a collective bargaining agreement,

it becomes bound to the arbitration clause.

It is clear here that the related entities

of CPS undertook the obligations of the

Collective Bargaining Agreement expressly

by negotiation and under Wiley should be

bound to arbitrate.

Note, there was no successorship

clause in the collective bargaining

agreement in Wiley.

-2?7-

Obviously, the Respondent will cite

Howard Johnson Co., Inc. v. Detroit Joint

Local Executive Board, Hotel & Restaurant

rry

mployees & Bartenders International Union,

—————E————EE

AFL-CIO, 417 U.S. 249 (1974) for the propo-

sition that CCM, Antares and TSM should

}

»9t be bound claiming that there was "no

substantial continuity of identity in

the business enterprise" between CPS and

its three related companies.

If one looks closer, however, at

the decision in Wiley and Howard Johnson's,

One can see that the two decisions are

completely consistent in saying that the

duty to arbitrate arises from the existence

of either of two factors; the "substantial

continuity of identity in the business

enterprise" or the Collective Bargaining

Agreement itself. Wiley states‘ at

page 551:

—-?8-

"There may be cases in which the lack

of any substantial continuity of identity

in the business enterprise %efore and

after a change would mak* tse duty to

arbitrate something imposed irom without,

not reasonably, to be found in the

particular bargaining agreement and the

acts of the parties involved." (Emphasis

supp lied)

(376 U.S. 543 at 551)

In other words, under Wiley, if the

Collective Bargaining Agreement itself

is not expressly a source of the duty to

arbitrate, that duty might be found to

exist by implication due to a “substantial

continuity of identity". Howard Johnson's

again stressed as in Wiley that a lack

of substantial continuity of identity

and an absence of an agreement to arbi-

trate relieved the entity from the duty

tc arbitrate:

Since there was plainly no substantial

continuity of identity in the work force

hired by Howard Johnson's with that of

Grissom's and no express or implied

assumption of the agreement to arbi-

trate, the courts below erred in con-

pelling the company to arbitrate...

417 U.S. 249 at 264 (Emphasis supplied)

-—-29-

. 3 Ww

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;

yay

tr}

Wil

Both the District Court and the

th Circuit Ccurt have overlooked the

t that there are two separate grounds

holding a non-Signatory liable t

itrate a dispute under a collective

gaining agreement in Wiley and

fT f

ird J hn son's; Ll) the a spect > OF ilter

n ubstantial continuity « bus] 3S

rprise which aris iS a matter of

, and 2) the assumption of the duties

the Collective Bargaining Agreement

ch arises as a matter of contract.

Local 47's suit to compel arbitra-

n seeks to compei CCM, Antares and

law rather

TSM to arbitrate on both theories; that

CI contract by agreement of the parties .

binds them, and that as alter egos they 3

are bound as a matter of law. Both courts

rocus on the rights arising outside of

the Collective Bargaining Agreement seeking

to find the non-sSignatory liable as a

re |

-38-

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matter of contract.

The fact that the argument of

Local 47 relating to the rights under

the contract was missed by the Sixth

Circuit Court is found in that Court's

reliance on American Bell, Inc. v. Federa-

tion of Telephone Workers of Pennsylvania,

736 F. 2d 879 (3rd Cir. 1984).

The Sixth Circuit cited American

Bell, supra, for the proposition that

the Federal Court must make a determina-

tion of whether an entity is bound to a

collective bargaining agreement as a matter

of law before arbitration will be compelled.

The Sixth Circuit takes it that the de-

termination must be made on the basis of a

sham corporation or alter ego theory. While

the Sixth Circuit notes that the Seventh

Circuit remanded the case to the District

Court in American Bell, it does not go on

to determine why the case was remanded.

-—3]-

Looking carefully at American Bell,

we find that the reason the case was re-

manded was that the Circuit Court could

not determine that the lower court had

found that the company was a party by

definition of the Collective Bargaining

Agreement.

The Collective Bargaining Agreement

in American Bell required the employer

to-secure the assent of any “successor

organization" that the Collective Bar-

gaining Agreement between the Employer

and the Union would continue in effect

and bind that successor organization.

The company in American Bell had

argued in the lower court that "successor

organization" meant a "Successor" as de-

fined at law. The Union, however, argued

that the definition of successor organiza-

tion included all related transferees.—

Tyote again that we do not have any

definitional problem or argument

i BD

| | ———_

The Court of Appeals in American

Bell was concerned with the contract

definition of successor organization

but could not determine the lower court's

Oe ea Fe

interpretation:

The resolution of the dispute about

the interpretation of successor

organization in the present case de-

pends on the intent of the parties,

a question of fact. We may infer

from the district court's ruling

that it concluded ABI was a successor

organization. Without an adequate

record and articulation of factual

findings, however, we cannot review

that conclusion 736 F. 2d 879 at 885

The Seventh Circuit later in its

opinion discarded completely the theory

of binding American Bell on the issue

of successorship at law but again rein-

forced its direction to consider the

Collective Bargaining Agreement, itself,

| as a source of a duty to bind the related

entity:

in this case since "related entities"

is exhaustively defined in the

Collective Bargaining Agreement.

-33-

We simply hold that the Union may

not use the successor doctrine to

bind ABI to the bargaining agreement

with regard to the transferred assets.

We do not hold that ABI is not a

"successor" within the meaning of

federal labor law. Although normally

the question of ABI's status as a

successor would not be relevant once

the doctrine itself had been found

to be inapplicable, in the present

case ABI's status as a successor may

also be relevant to a determination

of ABI's obligations on the basis of

paragraph 12 of the Memorandum of

Agreement. See supra at p. 885.

The district court will be free on

remand to consider this issue.

(Emphasis supplied) 736 F. 2d 879 at 888

The Third Circuit Court finally dis-

carded the single enterprise and alter

ego theories completely as a reason to

bind the related entity leaving the con-

tract theory the only issue on remand:

We therefore conclude that ABI is not

obligated to arbitrate its grievances

with the Union under the collective bar-

gaining agreement on the basis of some

extra-contractual theory of federal law.

If arbitration is required, it must be

because such an obligation has been im-

puted to ABI on the basis of the Memo-

randum of Agreement. The order of the

District Court will be reviewed and this

action will be remanded for further

proceedings consistent with this opinion.

[id at 889]

-34-

What the Sixth Circuit Court seems

to have missed in reading American Bell

is that if a non-signatory related entity

cannot be bound by the contract, then

there would have been nothing left to

consider on remand in American Bell. If

the contract theory could not apply,

American Bell would have been reversed

and remanded with directions to dismiss

the’ action. Instead, the Third Circuit

gave the District Court express directions

to consider the Collective Bargaining

Agreement and make its findings clear.

The remand, as in the case at hand,

would not have happened in the Third Cir-

cuit since there is no question as to

the meaning of the term "related entity"

aS it applies to CCM, Antares and TSM.

The Sixth Circuit has ordered a re-

mand where none was necessary and remanded

the case without even mentioning the

-35-

oe, ian

meaning of the Collective Bargaining

Agreement ; the agreement of the Parties,

Unfortunately, the Sixth Circuit has

Strayed from the teachings Of the Stee]l-

workers' cases that arbitration is a

System of industria] self government.

It has ignored the fac

t that arbitration

is the Substitute for labor Strife and

that, therefore, judgments and final

Settlements must come quickly in a manner

Only arbitration Can provide.

Today, more than ever, it is necessary

that direction be given by this Cour

that when a Party to a Collective bargaining

agreement Specifically “grees that its

related Entities are bound to the Collec-

tive Bargaining Agreement, an arbitration

Of a dispute With the related entity wil]

be ordered to arbitration.

The reasons for such direction are

©xXactly those which existed Prior to the

—- 36-

Steelworkers' cases. The remedies at law

are inadequate to avoid inequity and in-

dustrial strife. Just as in the Steel-

workers' cases, the costs to obtain judg-

ments are too great in most cases and the

delays are such as to render even victories

hollow.

Since the Steelworkers' cases of

twenty-five years ago, the nature of

collective bargaining agreements and the

“nature of the work force make direction

of this Court even more vital.

Today, collective bargaining agree-

ments often contain jointly trusteed

health & weifare and pension plans, like

those in the Collective Bargaining Agree-

ment between Local 47 and CPS. (See

Articles IX and XII of the Master Agree-

ment, Exhibit "A".)

These funds have a definite interest

in maintaining their actuarial base. As

-37-

tainly aware of the potentiai problems

involved with labor strife. The National

Labor Relations Act obviously did not

come about as a result of smooth sailing

in the relationship between labor and

management through the 1930's. Congress

created the National Labor Relations Act

in 1934 to establish the Federal Policy

of peacefully resolving labor disputes.

Twenty-Six years later, this Court found

it necessary, in the Steelworkers' cases,

to make sure that the machinery of re-

solving labor disputes could function

in the industrial setting. Another twenty-

Six years has almost passed, and now we

believe it necessary that this Court again

give direction so that the arbitration

system can function effectively in today's

service related economy.

-45-

IV. COWCLUSION

For the above reasons, this Court

should grant the Petition for Certiorari

to hear Petitioner's claim that related

entities which an Employer expressly agrees

are employers under

the Collective Bar-

gaining Agreement should be required to

arbitrate a dispute

Agreement.

falling under that

Respectfully submitted,

/) | / ) hf

LD || food

Gregory J. Wavelle

2201 Superigr Avenue

Room 201

Cleveland, Ohio 44114

(216) 621/0995

Counsel for Petitioner

46-

te + ee

a! 4" 4A ste

CERTIFICATE OF SERVICE

Copies of the within Petition for

Writ of Certiorari were served upon

Respondents Commercial Property Services,

Inc., Antares, Inc. and Total Systems

Maragement, Inc. c/o Robert T. Rosenfeld,

Esquire, Walter, Haverfield, Buescher

& Chockley, 1215 Terminal Tower, Cleveland,

Ohio 44113; Respondent Cleveland Cleaning

and*Maintenance Company c/o Gregory P. Szuter,

Esquire, Schwartz, Einhart & Simerka,

800 National City Bank Building, Cleveland,

Ohio 44114; and Respondent First Union

Management, Inc. c/o Keith Ashmus, Esquire,

Thompson, Hine and Flory, 1100 National

City Bank Building, Cleveland, Ohio 44114

and c/o Daniel K. Wright, II, Esquire,

55 Public Square, Suite 1900, Cleveland,

Ohio 44113 on this 22nd day of July, 1985

by depositing same in the United States

-A7-

Regular Mail, First Class, Postage

Pre-paid.

is iy

Gregory J./ Lavelle

Attorney for |/Petitioner

-48-

VII. APPENDIX

Part A

JUDGMENT AND ORDER of the United

States Court of Appeals for the

Sixth Circuit, Case Nos. 83-3761,

83-3762 and 83-3788

MEMORANDUM AND ORDER of the United

States District Court, Northern

District of Ohio, Eastern Division,

Case No. C83-588

Part B

Exhibit "A" - Relevant portions of

Master Agreement

pp. A-1l to A-17

Exhibit "B" - Local 47's Grievance

(in letter form)

pp. B-l to B-3

Exhibit "C" - Local 47's Complaint

as amended

pp. C-l to C-2l

Exhibit "D" - Page 61 of the transcript

of proceedings before

Judge Bell in the United

States District Court

for the Northern District

of Ohio, Eastern Division,

found at page 618 of the

Joint Appendix before the

Sixth Circuit Court

pp. D-1 to D-2

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

NOS. 83-3761

83-3762

83-3788

SERVICE, HOSPITAL, NURSING HOME AND PUBLIC

EMPLOYEES UNION, LOCAL NO. 47, affiliated

with the SERVICE EMPLOYEES INTERNATIONAL

UNION, AFL-CIO, CLC

Plaintiff-Appellee,

Cross Appellant,

Vv.

COMMERCIAL PROPERTY SERVICES, INC., and

CLEVELAND CLEANING & MAINTENANCE COMPANY,

Defendants-Appellants,

Cross Appellees,

and

TOTAL SYSTEMS MANAGEMENT, INC,, ANTARES, INC.,

and FIRST UNION MANAGEMENT, INC.

Defendants,

Cross Appellees.

ENGEL and WELLFORD, Circuit Judges; and ROSENN,

Senior Circuit Judge.

JUDGMENT

ON APPEAL from the United States Dis-

trict Court for the Northern District of

Ohio.

THIS CAUSE came on to be heard on the

record from the said District Court and was

argued by counsel.

ON CONSIDERATION WHEREOF, It is now here

ordered and adjudged by this court that the

judgment of the said District Court in this

case be and the same is hereby affirmed in

s BEST AVAILABLE COPY

————————eeaaaeaeEeEeyQGVQVEuECNV070XQuVQuV50QQQQQrereEYEe ™

part and the case is remanded for further

proceedings not inconsistent with this

opinion.

It is further ordered that in case

83-3761, each party is to

costs in this appeal. It

that in case 83-3762, the

cover from Appellants the

as itemized below. It is

that in case 83-3788, the

bear its own

is further ordered

Appellees re-

costs on appeal

further ordered

Cross Appellees

recover from Cross Appellant the costs on

appeal, as itemized below.

Execution there-

for shall issue out of said District Court,

if necessary.

A TRUE COPY

Attest:

Deputy Clerk

ENTERED BY ORDER OF

THE COURT

John P. Hehman, Clerk

/s/ John P. Hehman

Nos. 83-3761

83-3762

83-3788

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

SERVICE, HOSPITAL, NURSING HOME :

AND PUBLIC EMPLOYEES UNION,

LOCAL NO. 47, AFFILIATED WITH

THE SERVICE EMPLOYEES INTER-

NATIONAL UION [sic], AFL-CIO, CLC,:

Plaintiffs-Appellees,

Cross-Appellants,

WR ON Cora eStats lS”.

ANTARES, INC.; TOTAL SYSTEMS

MANAGEMENT INC.; FIRST UNION

MANAGEMENT, INC.,

Defendants-Appellees.

COMMERCIAL PROPERTY SERVICES,

INC... EY AL.,

Defendants, :

CLEVELAND CLEANING & MAINTENANCE :

COMPANY,

Defendant-Appellant,

Cross-Appellees. :

Upon consideration of the motions of

the parties to the appeal and cross-appeals

herein to enlarge the oral argument time by

an additional fifteen rr tes,

IT IS ORDERED that tne motions be,

and they hereby are granted.

ENTERED BY ORDER OF THE COURT

John P. Hehman, Clerk

/s/ John P. Hehman

Sa &es--”™”””&©«»©3=273=723=73;7S;7S;CS;CT;CS CT OSté‘(=‘:

RECOMMENDED FOR FULL TEXT

PUBLICATION

See, Sixth Circuit Rule 24

Nos. 83-3761, 83-3762, 83-3788

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

SERVICE, HOSPITAL, NURSING

HOME AND PUBLIC EMPLOYEES

UNION, LOCAL NO. 47,

AFFILIATED WITH THE SER-

VICE EMPLOYEES INTER-

NATIONAL UNION, AFL-CIO,

CIC,

Plaintiff-Appellee,

Cross-Appellant,

)

Vv. ) ON APPEAL from

) the United States

COMMERCIAL PROPERTY SER- ) District Court

VICES, INC., AND CLEVE- ) for the Northern

LAND CLEANING & MAINTEN- ) District of Ohio,

ANCE COMPANY, ) Eastern Division.

Defendants-Appellants,)

)

Cross-—Appellees,

and

TOTAL SYSTEMS MANAGEMENT,

INC., ANTARES, INC., AND

FIRST UNION MANAGEMENT,

INC.,

Defendants,

Cross-Appellees.

Decided and Filed February 21, 1985

Local No. 47 v. Commercial Property

Nos. 83-3761, etc.

Before: ENGAL and WELLFORD, Circuit

Judges; and ROSENN, Senior Circuit Judge.°

ROSENN, Senior Circuit Judge. The novel

and underlying issue raised in these pro-

ceedings is whether a non-signatory to a

collective bargaining agreement who does not

stand in a successor relationship to a

Signatory to the agreement or to its work

force can be bound by the grievance and

arbitration provisions of that contract. In

a suit brought by Service, Hospital, Nursing

Home and Public Employees Union, Local No. 47,

affiliated with the Service Employees Inter-

national Union, AFL-CIO, (Local 47 or Union),

under section 301 of the Labor Management

Relations Act, 29 U.S.C. §185 (1982), Local

47 alleged that the defendant, Commercial

Property Services (CPS) through its alter

ego, Cleveland Cleaning and Maintenance

Co. (CCM) breached a collective bargaining

agreement with Local 47. The complaint

alleged that the employer violated the

collective bargaining agreement by hiring

non-union employees to work at several

Cleveland buildings, operated by First

Union Management Co. (First Union). The

district court granted Local 47's motion

for summary judgment and ordered CPS and

CCM to arbitrate. The court denied

Local 47's request for injunctive relief

and dismissed First Union and two companies

related to CPS. We affirm in part and

reverse in part.

°Honorable Max Rosenn, Senior United

States Circuit Judge for the United States

Court of Appeals for the Third Circuit,

Sitting by designation.

Local 47 has been a party to a series of

collective bargaining agreements with the

defendant, Commercial Property Services, Inc.,

covering the employees engaged in the Cleve-

land area in janitorial and custodial work

since the founding of the company in 1974.

The most recent of these agreements, effective

May 1, 1981, to April 30, 1984, contains

three provisions that are pertinent to this

proceeding. Article XI is a job security

provision and requires a signatory employer

who takes over an account previously serviced

by another signatory employer to retain the

prior employer's employees at the same wages,

terms, and hours of work.1 Article XXI de-

fines in broad terms the scope of the agreement.

It provides, in part, that the contract covers

as an employer subject to its full terms,

tthe relevant provisions of Article XI state:

* JOB PROTECTION

Section 1. When an Employer takes over

an account at which employees represented

by the Union were previously employed, re-

gardless of who was the Employer, the

Employer shall not reduce the rate of pay,

the other terms of compensation, or the

number of employees and their hours of

work...without the express written consent

of the Union, unless one of the exceptions

set forth in Section 2 of this Article may

be applied.

Section 8. If an Employer takes over an

account with which Local 47 has an Agreement

other than this Agreement, the Employer will

sign an Assumption Agreement prior to taking

over the job. All conditions such as rates of

pay, hours of work, seniority, vacations, holi-

days,...shall continue as they previously existed.

any...corporation, firm, or any other

entity which is engaged in janitorial

work and is in any way a subsidiary

or related entity to any Employer

covered by this Agreement. Specifi-

cally and without limitation, this

Agreement hereby includes any entity

engaged in janitorial work which is

operated in whole or in part by any

officer, director or any person em-

ployed by any Employer covered by

this Agreement, and further includes

any entity engaged in janitorial work

in which any investor in any Employer

covered by this Agreement has any in-

terest of any kind.

Finally, Article XIX requires the parties

to settle any differences “as to the meaning

of or application of provisions of this

agreement" in a four-step process terminating

in final and binding arbitration.

Local 47 also had a three-year contract with

National Cleaning Contractors (National),

executed in November, 1982. Local 47 members

employed by National cleaned and maintained

two downtown Cleveland office buildings (the

Rockwell properties and the Illuminating

Building), which were operated by First Union

Management, Inc. First Union entered into

subcontracts with independent companies for

janitorial and custodial services.

When the cleaning contract between National

and First Union expired in 1982, First Union

solicited bids from other cleaning companies.

National and CPS, signatories to a master

ayreement with Local 47, both submitted bids

which were rejected, and First Union ulti-

mately awarded the contract to CCM, a non-

union firm. National thereupon laid off

the Local 47 members whom it previously

had employed to clean the First Union

buildings. CCM took over the janitorial

and custodial services in both buildings

in February 1983 with its own non-union

employees.

In February 1983, Local 47 discovered

that there was a close relationship be-

tween CCM and CPS. This discovery drew

forth the remainder of the corporate cast

in these proceedings. The principal actors

are CPS and CCM, and playing a major role

because of his relationship with each of

them is Patrick Cassese. He and twelve

other investors formed CPS, and Ohio corpora-

tion, in 1974 and Cassese operated the

company and owned 49% of its shares. In

1978, CPS created a wholly-owned subsidiary,

Total Systems Management, Inc. (TSM) to act

as a consulting firm for small tenant

buildings. TSM subcontracted all services

to other companies, including both CPS and

CCM, employed no one subject to Local 47's

jurisdiction, and ceased business in 1982.

In November 1982, Cassese formed Antares,

Inc., a Pennsylvania corporation, for the

express purpose of purchasing the shares of

the other twelve investors in CPS. The

district court found that Cassese owned all

of the capital stock of Antares which in

turn owned 100% of CPS.

Jack Cornachio, a nephew of Cassese,

acquired the CCM business in 1976. Because

of financial difficulties, Cornachio en-

tered into an agreement in October 1982 with

Cassese to sell him 70% of the shares but

with an arrangement to retain 50% control.

Cornachio continued as president and in con-

trol of CCM operations. Cassese's personal

attorney, Robert Rosenfeld, served as one

of CCM's two directors and as its secretary-

treasurer. In fact, Cassese personally

represented CCM in its successful negotia-

tions with First Union, after CPS's bid had

been rejected.

With the foregoing information in its

possession, Local 47 launched its attack

on CPS and CCM. First, it sent a letter

to Cassese as president of CPS alleging

that CPS violated the work preservation

clause of the collective bargaining agree-

ment with Local 47 by replacing Local 47

members with non-union employees at the

two First Union buildings and at five other

buildings, Lakeland Medical, Young Medical,

Shaker Medical, Curtis Industries, and

Diamond Shamrock. The letter informed CPS

that unless it agreed to restore the former

employees, Local 47 would seek injunctive

relief to compel arbitration.

When CCM refused to retain the former

National employees pending arbitration,

Local 47 filed suit against CPS, CCM, First

Union, Antares, and Total Systems Manage-

ment (TSM)2 Local 47 also filed a motion

a at the same time, Local 47 filed an un-

fair labor practice charge with the National

Labor Relations Board (NLRB) against CPS, CCM,

and First Union. CPS responded by filing a

petition for unit classification with the

NLRB by which it sought to define the number

of its employees subject to the terms of the

master agreement. Local 47 also filed unfair

labor p»actice charges with the Board charging

CPS with interfering with its employees" bar-

gaining rights and with assaulting its pickets

at the Rockwell building.

for a temporary restraining order and First

Union moved to dismiss. After a hearing on

Local 47's motion, the court granted First

Union's motion and denied Local 47's. Local

47 then moved for summary judgment. CCM

moved for partial summary judgment and

Antares and TSM filed motions to dismiss.

In September 1983, the court granted

Local 47's motion for summary judgment,

ordering CCM and CPS to arbitrate with

Local 47 the questions of whether CCM was

bound by the terms of the CPS-Local 47

agreement and whether the agreement had

been breached. The court dismissed Antares

and TSM from the lawsuit and denied CCM's

motion for partial summary judgment.

CCM and CPS appealed from the rulings

granting Local 47's motion for summary

judgment, and CCM appeals from the denial

of its motion for partial summary judgment.

Local 47 cross-appeals from the dismissal

of First Union, TSM, and Antares and from

the denial of injunctive relief.

CPS and CCM argue that the court erred in

granting Local 47's motion for summary judg-

ment and ordering them to arbitrate. They

contend that before ordering arbitration,

the court should have determined whether

CCM was bound by the terms of the Local 47-

CPS collective bargaining agreement.

In Howard Johnson Co. v. Detroit Local

Joint Executive Board, 417 U.S. 249 (1974),

the Supreme Court addressed a question with

respect to a contract which purported to

bind the successors and assigns of the em-

ployer. In that case, the former employer,

the Grissoms, Signed collective bargaining

agreements which contained arbitration

clauses and provided that the contract would

be binding upon the employer's "successors,

assigns, purchasers, lessees, or trans-

ferees". Howard Johnson, 417 U.S. at 251.

The Grissoms sold their business to

Howard Johnson, with an agreement expressly

providing that Howard Johnson with certain

exceptions would not assume the Grissoms'

obligations, “including those under a labor

agreement covering employees at two establish-

ments". Howard Johnson then terminated the

Grissom employees and hired its own employees,

few of whom previously had worked for the

Grissoms.

The Grissoms admitted that the collective

bargaining agreement required that they as

Signatories arbitrate. Howard Johnson,

howcver, refused to do so. The Supreme

Court held that Howard Johnson could not be

bound to the collective bargaining acreement

between the Grissoms and the Union, absent

a judicial determination of substantial con-

tinuity or identity of the work force or

assumption of the agreement to arbitrate by

Howard Johnson.

The mere existence of the successor-

ship clauses in the bargaining agree-

ments between the unions and the

Grissoms, however, cannot bind

Howard Johnson either to the sub-

stantive terms of the agreements or

to the arbitration clauses thereof,

absent the continuity required by

Wiley, when it is perfectly clear

the Company refused to assume any

obligations under the agreements.

ied. #6 258, nad.

The Court distinguished its previous de-

cision in John Wiley and Sons v. Livingston,

376 U.S. 543 (1964), in which a successor

corporation was ordered to arbitrate pur-

Suant to a collective bargaining agreement

signed by its predecessor, with whom it

had merged. The Court noted that the

successor was properly ordered to arbitrate

in Wiley where the predecessor employer

entity had "completely disappeared" as

the result of a merger. Unless the union

were afforded some remedy against the

successor, it would have no means of en-

forcing those obligations voluntarily under-

taken by the merged corporation which were

intended to survive a change in ownership.

Howard Johnson, 417 U.S. at 257. The hiring

in Wiley by the surviving corporation of

all of the employees of the predecessor

corporation also weighed heavily in the

Howard Johnson decision. The grievance which

the union sought to compel Wiley to arbi-

trate were the claims of Wiley's own employees.

In Howard Johnson, by contract, the union

sought arbitration on behalf of the former

Grissom employees who were not hired by

Howard Johnson. Id. at 258-260.

What Local 47 seeks to do here is very

Similar to what the union sought in Howard

Johnson, and the result must be the same.

In this case, the signatory employer, CPS,

continues as a viable entity with which the

Union may bargain and arbitrate.3 Therefore,

>the district court found that approximately

2000 people are now engaged in janitorial and

security guard work for CPS in Cleveland and

Columbus, and in various cities in Pennsylvania,

Colorado, and Texas. Service, Hospital, Nursing

Home and Public Employees Union, Local No. 4/7

v. Commercial Property Services, Inc.,No. C83-588

(N.D. Ohio Feb. 25, 1983) (order denying motion

for temporary restraining order and dismissing

First Union).

if CCM is not ordered to arbitrate, the

Union is not left without a remedy.

Furthermore, the employees Local 47 seeks

to protect are not and were not CCM's em-

ployees, but rather National employees.

National laid them off when First Union

awarded the contract to CCM. In this case,

as in Howard Johnson, there is no continu-

ity or identity of CCM's work force with

National's work force. Therefore, the

court may not order CCM to arbitrate, ab-

sent a finding that CCM and CPS are alter

egos, or that the two constitute a single

employer, or without otherwise determining

that the situation is appropriate for

piercing the corporate veil. See American

Bell, Inc. v. Federation of Telephone

Workers, 736 F. 2d 879, 886-889 (3rd Cir.

1984) .4

The leading Sixth Circuit case in this

area is not to the contrary. In Local 6,

Bricklayers International Union v. Boyd G.

Heminger, Inc., 483 F. 2d 129 (6th Cir.

1973), three unions charged that Yeminger

violated the union security and arpitration

clauses of their collective bargaining

agreement by hiring non-union employees

through its “sham" corporation, Frank Fulton,

Inc. The district court refused to refer

the matter to arbitration because "the

evidence and testimony indicate[d] a lack

of sufficient common factors to illustrate

a Single employer or alter ego theory".

1c. Qt &3i.

‘whe Howard Johnson court emphasized that

"this is not a case where the successor corpora-

tion is the ‘alter ego' of the predecessor..."

417 0.8. at 259, 2.35.

The unions sought a remand with regard

to Heminger only. This court reversed,

holding that "[I]n signing these arbitra-

tion agreements the parties agreed to 'sub-

mit all grievances to arbitration, not

merely those a court may deem to be

meritorious'". Id. at 131, quoting

United Steelworkers v. American Manu-

facturing, Inc., 363 U.S. 564, 567 (1960).

The court therefore ordered Heminger to

arbitrate the dispute according to the

arbitration agreement which it hac signed;

it held Heminger to its promise to arbi-

trate grievances. The court, however, did

not order Fulton, the non-signatory sub-

cidiary, to arbitrate the dispute.

Consistent with Heminger, the district

court in the case at bar did not err in

ordering CPS to arbitrate, for CPS, like

Heminger, wasS a Signatory to the collective

bargaining agreement, CPS must keep its

promise to the Union to arbitrate grievances

under the contract. However, we hold that

a district icourt may not order a non-

Signatory to arbitrate a labor dispute,

absent a specific finding that the relation-

ship between it and the party bound to the

agreement is such that it too is bound to

arbitrate. See also General Drivers,

Local Union No. 89 v. Public Service Co.

of Indiana, 705 F. 2d 238, 241 (7th Cir.

1983). We therefore vacate the order of

the district court and remand the case

to it for a determination of whether the

facts warrant a finding that CCM and CPS

are alter egos, or constitute a single

employer or whether the corporate veil

should otherwise be pierced. See

American Bell, 736 F. 2d at 886-89.>

cps and CCM also contend that they may not

be compelled to arbitrate without a determina-

tion by the National Labor Relations Board of the

appropriate bargaining unit. The threshold

question of whether CCM is bound by the CPS-

Loci l 47 collective bargaining agreement does

not require the determination of an appropriate

bargaining unit. The matter would only warrant

a submission to the Board if the district court

found that CCM was bound by the collective

bargaining agreement had been breached.

Counsel for CPS has brought to our attention

the recent decision of this court in Aquabrom,

Division of Great Lakes Chemical Corp. v.

NLRB, 746 F. 2d 335 (6th Cir. 1984). That

case, however, arose in a different procedural

context from the case at bar, and is there-

fore distinguishable. Aquabrom involved a

Board order upholding a representation

election and ordering Drug Research, Inc. its

successors and assigns to bargain with the

union. Aquabrom refused to do so on the

grounds that it was not a successor to Drug

Research, and the Board sued for contempt.

This court held that, in that context, it

was up to the Board, rather than the Special

Master appointed by the district court, to

determine whether Aquabrom would be bound

by the Board's order. Aquabrom involved the

question of whether a successor would be held

liable for the unfair labor practices of its

predecessor, and the concerns for procedural

safeguards and deferral to agency expertise

were more pressing than in the essentially

contractual dispute at bar.

Iil.

In the prayer of their amended complaint,

Local 47 sought inter alia, to enjoin all

the defendants from: "discharging the

employees currently performing janitorial

word" at the Rockwell and the Illuminating

Buildings; "changing any of the wages,

hours, or the terms and conditions of em-

ployment of said employees", and directing

the reinstatement of the employees dis-

charged.

The district court denied injunctive re-

lief on the ground that Local 47 failed to

establish irreparable harm as a result of

CCM's actions. On appeal, Local 47 argues

"that all [it] seeks is the reinstatement

of employees it has represented for many

years to the locations where CCM has taken

that work away". Brief for Local 47 In

Answer to Brief of CPS at 16.

In Aluminum Workers International Union,

Local 215 v. Consolidated Aluminum Corp.,

696 F. 2d 437, 441-444 (6th Cir. 1982),

this court considered the narrow exception

to the anti-injunction policy of our national

labor laws announced in Boys Markets v.

Retail Clerks Union, 398 U.S. 235, 254 (1970).°

°F 5 Boys Markets, the Court carved out an

exception to the narrow strictures of section 4

of the Norris-LaGuardia Anti-Injunction Act,

29 U.S.C. §104 (1982), by holding that when the

underlying dispute is one over which the parties

have agreed to arbitrate and ordinary equitable

norms for relief have been met, a court may

enjoin a strike in violation of a no-strike clause.

It noted that the courts have extended this

exception "to embrace employer behavior

which has the effect of evading a duty to

arbitrate or which would otherwise under-

mine the integrity of the arbitral process".

Aluminum Workers, 696 F. 2d at 441.

To obtain an injunction under Aluminum

Workers, the Union must establish that the

"underlying grievance is one which the par-

ties are contractually bound to arbitrate”

and must "satisfy the court that injunctive

relief is warranted under ‘ordinary principles

of equity'". Id. at 442, quoting Boys

Markets v. Retail Clerks Union, 398 U.S.

at 254.

In the instant case, the Union did not

establish that the underlying grievance

is one which CCM was bound to arbitrate.

The district court could not have enjoined

CCM, the non-signatory, without first de-

termining that CCM was bound by the arbitra-

tion agreement. We therefore hold that

absent a judicial determination that two

corporations are alter egos or a singular

employer, a court may not enjoin a non-

Signatory to an arbitration agreement from

hiring non-union employees. Furthermore,

on this record it appears that the Union

employees at the Rockwell and Illuminating

Buildings were never hired nor discharged

by CPS, CCM or the other defendants. Thus,

the district court did not err in denying

Loc. 1 47's motion for injunctive relief

directing their reinstatement.

Local 47 also contends that the district

court erred in granting First Union's

motion to dismiss. The court dismissed

Hoetger & Co., 672 F. 2d 580, 583 (6th

Cir. 1982); "We recognize that courts

Sued upon." Local 47 argues that the court

had jurisdiction Over First Union, even

On Smith y, Evening News Association,

371 U.S. 195 (1962), which held that a

ment,

The holding in Evening News has been

extended by this court to include Suits

collective bargaining agreements, Hazen

Vv. Western Union Telegraph Co., 518 F. 24

766 (6th Cir. 1975) (Suit brought by widow

Of union member), and to Suits brought by

non~signatory employees who Claimed that

bargaining agreements, Hill y. Iron Workers

Local 25, 529 FP. 2d 40 (6th Cir. 1975)

(Suit brought by non-union member alleging

he was Protected by Provisions of collective

bargaining agreement). In the case at bar,

neither the rights of First Union are in

any way protected nor are its duties set

forth in the Provisions of the Local 47-cps

The Union relies heavily on Wilkes-Barre

Publishing Co. v. Newspaper Guild of

Wilkes-Barre, Local 120, 647 F. 2d 372

(3d Cir. 1981), cert. denied, 454 U.S.

1143 (1982) and Painting and Decorating

Contractors Ass'n of Sacramento v. Counties,

ing., fue &. 2a i067 (Sth Cir. 1983), cert.

denied, 104 S. Ct. 1709, (1984), in support

of its broad contention that section 301

subject matter jurisdiction exists over all

suits for violation of collective bargaining

agreements.’ The majority of courts,

however. continue to apply a much narrower

Even in Wilkes-Barre Publishing and Painting

and Decorating Contractors, there were close re-

lationships between the parties and the sig-

natories of the collective bargaining agree-

ments. In Wilkes-Barre, the non-signatory party

was a co-venturer in an enterprise which

allegedly breached the coliective bargaining

agreement, and in Painting and Decorating

Contractors, the non-signatory party was

a non-profit corporation which consisted

of presentatives from the signatory em-

ployer associations and union. In the instant

case, the connection between First Union and

the collective bargaining agreement is tenuous:

First Union has an agreement with an independent

contractor, CCM, and CCM is allegedly an alter

ego of CPS, a signatory to the agreement.

interpretation of the scope of section 301

jurisdiction. See Carpenters Local Union

No. 1846 v. Pratt-Farnsworth, Inc., 690

F. 2d 489, 502 (5th Cir. 1982), cert.

denied, 104 S. Ct. 335 (1984); Loss v.

Blankenship, 673 F. 2d 942, 946 (7th Cir.

1982); Bowers v. Ulpiano Casal, Inc.,

393 F. 2d 421, .423 (lst Cir. 1968);

Fox_v. Mitchell Transport, Inc., 506 F. Supp.

1346, 1349 (D.Md.), aff'd mem., 671 F. 2d

498 (4th Cir. 1981).

We therefore hold that a district court

does not have subject matter jurisdiction

over a non-Signatory to a collective bar-

gaining agreement, where no rights or

duties of the non-signatory party are

stated in_the terms and conditions of the

contract.

First Union originally moved to dismiss

solely on the grounds that the court lacked

subject matter jurisdiction over it under

section 301. Local 47 then amended its com-

plaint to include a pendent state law claim

for tortious interference with contractual

rights. Dismissal of this pendent claim was

required once the federal claim was dis-

missed. See United Mine Workers of America

v. Gibbs, 383 U.S. 715, 726 (1966); Kurz

v. Michigan, 548 F. 2d 172, 175 (6th Cir.),

cert. denied, 434 U.S. 972 (1977); Gibson

v. First Federal Savings and Loan Ass'n

of Detroit, 504 F. 2d 826, 830-31 (6th

Socal 47 also argues that the court

erred in granting First Union's motion to

dismiss solely on the basis of evidence pre-

sented at the hearing on Local 47's motion

for a temporary restraining order. Because

we conclude that the court lacked subject

matter jurisdiction over the claims against

First Union, we do not reach this issue.

Gir. 1974).° Thus, the district court erred

in dismissing Local 47's state law claim

on the merits. It should have dismissed

the claim without prejudice for want of

jurisdiction.

Local 47 also objects to the dismissal of

TSM and Antares from the suit. It contends

that the court should have ordered these

corporations to arbitrate in order to "fully

develop" the relationships among TSM, Antares,

CCM, and CPS. As we held earlier in this

opinion, a non-signatory to a collective bar-

gaining agreement cannot be bound to its

arbitration clause unless the court deter-

iiines that the corporations may be pierced

ar that the corporations constitute a single

employer. Moreover, in the instant case,

Local 47 has never alleged that TSM or

Antares violated the terms of the collective

bargaining agreement. Furthermore, these

corporations, as we have suggested, never

hired ner discharged any of the employees

whom Local 47 now seeks to reinstate. There-

fore, the district court committed no error

in dismissing the claims against TSM and

Antares.

"This circuit has moved away from the

position that the court has discretion to re-

tain jurisdiction over a pendent state claim

where the federal claim has been dismissed be-

fore trial. Compare Kurz v. Michigan, 548

F. 2d at 175, and Gibson v. First Federal

Savings and Loan Ass'n. of Detroit, 504 F. 2d

at 830-31, with Gray v. International Ass'n

of Heat & Frost Insulators, Local No. 5l,

447 F. 2d 1118, 1120 (6th Cir. 1971).

VI.

Finally, CCM asserts that the court erred

in denying its motion for partial summary

judgment. According to CCM, the record

demonstrates that there are no material

facts in dispute with regard to the single

employer-alter ego issue and that judgment

should have been entered for CCM as a matter

of law. CCM's argument is based on its

contention that the district court should

have made a determination on the single

employer-alter ego issue. Had the court

done so, according to CCM, it would have

concluded that the facts as presented at

the hearing and alleged by the parties could

not support a finding that CPS and CCM were

alter egos or constituted a single employer, 10

Local 47 argued in response to CCM's motion

for summary judgment that discovery has not

been completed and that a determination by

the court on the alter ego-single employer

issue would be premature until further evi-

dence has been presented. We agree. Local

47 has not yet had the opportunity to pre-

sent the evidentiary support for its position

that CPS and CCM constituted a single employer

105, appeal, CCM has apparently dropped

its argument that the court lacks subject

matter jurisdiction under section 301 be-

cause CCM was a non-signatory to the

collective bargaining agreement.

or are alter egos. 7 Under the circumstances,

and because we remand the case to the dis-

trict court for a full determination of this

question, we conclude that the district

court did not err in denying CCM's motion for

partial summary judgment on this issue.

Vil.

To recapitulate, we hold that the district

court erred in ordering CCM to arbitrate

under a collective bargaining agreement to

which it was a non-Signatory, and we remand

for a determination of whether CCM and CPS

constitute a single employer or alter egos,

or whether the relationship between them

is such that piercing the corporate veil

separating them would be appropriate. We

also conclude that the district court had

no jurisdiction to entertain the merits of

the state law claim against First Union. In

all other respects, the judgment of the

district court is affirmed.

In the appeal of CCM, No. 83-3761, each

side will bear its own costs. In the appeal

of CPS, No. 83-3762, costs are taxed against

the appellants. In the cross-appeal of

Local 47, No. 83-3786, costs are taxed

against the cross-appellant.

*toeal 47's motion for summary judgment

and its response to CCM's motion focused

almost exclusively on the argument that the

alter ego-single employer issue should be

determined by the arbitrator rather than by

the court.

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF OHIO

EASTERN DIVISION

SERVICE, HOSPITAL, NURSING) CASE NO. C83-588

HOME AND PUBLIC EMPLOYEES

UNION, LOCAL NO. 47,

AFFILIATED WITH THE SER-

VICE [EMPLOYEES] INTER-

NATIONAL UNION, AFL-CIO,

CLC

Plaintiff JUDGE SAM H. BELLI.

—

COMMERCIAL PROPERTY SER-

VICES, INC., et al.

MEMORANDUM AND ORDER

Defendant.

Service, Hospital, Nursing Home and Pub-

lic Employees Union, Local No. 47, affilia-

ted with the Service Employees International

Union, AFL-CIO, CLC (hereinafter Local 47)

filed this action pursuant to §301 of the

Labor Management Relations Act (hereinafter

LMRA), 29 U.S.C. §185, seeking a temporary

restraining order, preliminary and permanent

injunctive relief. Five companies are named

as defendants: Commercial Property Ser-

vices, Incorporated (hereinafter CPS);

Cleveland Cleaning and Maintenance Company

(hereinafter CCM); Total Systems Management,

Incorporated (hereinafter TSM); Antares,

Incorporated (hereinafter Antares); and

First Union Management, iene.

After a hearing and order dated

February 25, 1983, this court denied

plaintiff's motion for temporary restraining

order having found that the criteria for

such relief had not been established. In

addition, the order granted a motion to

dismiss First Union Management, Incorporated.

Presently pending before the court is

plaintiff Local 47's motion for summary

judgment, defendant CCM's motion for par-

tial summary judgment, defendant's Antares

and TSM motions to dismiss the complaint as

it relates to them, plaintiff Local 47's

motion to dissolve protective order and

First Union's motion for modification of

blanket protective order. Motions in

opposition have been filed to all of the above.

I. Local 47's Motion for

Summary Judgment and CCM's

Motion for Partial Summary

Judgment

A. Local 47's Motion for Summary

Judgment

Local 47's major premise is that all

the defendants are bound to the terms of

Article x1t of the collective bargaining

agreement which covers job protection of

its employees. Two incidents of alleged

violation of Article XI are cited: the

contracts entered between CCM and First

Union Management, Incorporated, for the

provision of janitorial services at the

Rockwell Building and the Illuminating

this article provides that when

one employer of Local 47's members

loses a contract to another employer

of Local 47's members, the members'

jobs are to be preserved under the new

contract; in other words, the previous

employees would be retained by the new

employer at the building covered by

the contract.

Building in downtown Cleveland. Both of

these contracts have been filled with

non-union workers which has served to dis-

place Local 47's members employed at these

locations under the previous contracts.

Local 47 requested that CPS and CCM arbi-

trate two grievances: one relating to known

sites where CCM had assumed contracts which

displaced Local 47 members and the other

relating specifically to the Rockwell

Properties and the Illuminating Building.

Both defendants have refused to submit these

matters to arbitration.

Plaintiffs assert the position that on

these and the following undisputed facts

they are entitled to summary judgment. The

relief sought is this court's order com-

pelling all defendants to arbitrate the two

grievances concerning the displacement of

Local 47 members by non-union janitorial

workers hired by CCM. Injunctive relief

including reinstatement of Local 47 and

continuation of the terms of the collective

bargaining agreement duri~™= the pendency

of arbitration is also sought.

Pursuant to Federal Rule of Civil

Procedure 56(c), the party wowing for summary

judgment has the burden of showing that no

genuine issue of material fact exists and

that as a matter of law, they are entitled

to judgment. In reviewing a motion for

summary judgment, a court must consider the

pleadings, related documents and evidence,

and all reasonable inferences in a manner

most favorable to the non-moving party.

Adickes v. Kress & Co., 398 U.S. 144 (1970);

Smith v. Hudson, 600 F. 2d 60 (6th Cir.

1979), cert. dismissed, 444 U.S. 986 (1979);

Board of Cincinnati v. Department of H.E.W.,

532 F. 2d 1070 (6th Cir. 1976).

After a lengthy hearing related to a

motion for temporary restraining order and

review of a myriad of exhibits, this court

set out the facts before it in its order

dated February 25, 1983. The summary of

facts at pages 1-6 of that order has not

been expanded or altered for the purpose

of summary judgment review and shall be

incorporated by reference in this order.

Because Local 47 first addresses its

allegations toward CPS and CCM and also

because there is a motion to dismiss

Antares, Incorporated and Total Systems

Management before this court, discussion

of plaintiff's claim against the four

defendants will be divided accordingly.

The master collective bargaining

agreement at issue in this matter con-

tains a clause entitle? Grievance and

Arbitration. See Plaintiff's Exhibit A,

Article XIX. A grievance procedure is

established which uses arbitration as the

final resolution disputes and makes the

arbitrator's decision "final and binding

upon the Employer and the Union". Id. at

Article XIX, section 4.

CPS is a signatory on the master

collective bargaining agreement with

Local 47. CCM, on the other hand, has

employed non-union janitorial workers since

its inception and has never been a party

to or signatory on any collective bargaining

agreement with Local 47.

The first question which must be

addressed is whether this court may assume

§301 jurisdiction as it relates to CCM

inasmuch as there is an absence of con-

tractual relationship between it and

Local 47. Section 301(a) provides that

federal ‘courts have jurisdiction to examine

alleged violations of collective bargaining

agreements:

(a) Suits for violation of

contracts between an employer

and a labor organization

representing employees in an

industry affecting commerce

as defined in this chapter,

or between any such labor

organizations, may be brought

it any district court of the

United States having juris-

diction of the parties, without

respect to the amount in con-

troversy or without regard

to the citizenship of the

parties.

29 U.S.C. §185(a). Three requirements must

be met to assert a §301 claim: (1) an

assertion of a violation of (2) a contract

(3) between an employee and a labor organi-

zation. Carpenters Local Union No. 1846

v. Pratt-Farnsworth, 690 F. 2d 489, 500 (5th

Cir. 1982), citing, Alvares v. Erickson,

514 F. 2d 156, 161 (5th Cir.) cert. denied,

423 U.S. 874 (1975). These requirements are

definitely met as to CPS. As CCM is a non-

Signatory to the contract, however, juris-

diction may only be assumed if Local 47

can establish an alternate ground for holding

CCM to agreement. ° Carpenters Local Union

Jurisdiction of a §301 claim against

one who was not a party to a collective

bargaining agreement was recently approved

by the Sixth Circuit in Metropolitan

Detroit Bricklayers District Council,

Int'l Union v. J. E. Hoetger & Co., 672

F. 2d 580 (6th Cir. 1982), in the context

of a joint employer issue.

No. 1846 v. Pratt-Farnsworth, supra at

503. Local 47 contends that CCM is in

fact bound to the master contract on

either of two theories: First, by

virtue of Article XXI 2 of the contract

3rhis agreement shall be binding upon

and for the benefit of the signatories

hereto and their respective successors

and assigns.

This agreement hereby covers as an

Employer subject to the full terms of

this agreement any individual proprietor-

ship, partnership, corporation, firm, or

any other entity which is engaged in

janitorial work and is in any way a

subsidiary or related entity ‘to any Em-

ployer covered by this agreement. Speci-

fically and without limitation, this

agreement hereby includes any entity en-

gaged in janitorial work which is operated

in whole or part by any officer, director

or any person employed by any employer

covered by this agreement, and further

includes any entity engaged in janitorial

work in which any investor in any employer

covered by this agreement has any interest

of any kind.

Any employer covered by this agree-

ment, including without being limited

to employers covered solely by operation

of this article, may not subcontract to

any other person or entity any of the

work which is or may be performed by em-

ployees covered by this agreement, ex-

cept for the cleaning of venetian blinds,

cleaning required by an emergency occasioned

by fire or flood, or a one time only special

job.

and second, because CCM is allegedly an

alter ego of CPS. Either of these theories

properly allege §301 jurisdiction as to

CCM as long as the underlying grievances

are arbitrable. See Buffalo Forge Co. v.

United Steelworkers of America, 428 U.S.

397 (1976) and the Steelworkers Trilogy:

United Steeiworkers v. American Mfg. Co.,

363 U.S. 564 (1960); United Steelworkers

v.-Warrior & Gulf Navigation Co., 363 U.S.

574 (1960); United Steelworkers v. Enter-

prise Wheel & Car Corp., 363 U.S. 593 (1960).

In this case the underlying grievances in-

volve the Sieniacinune of workers covered

by Local 47's master agreement. This is a

matter that would violate a specific pro-

vision of the contract by a party and would

be subject to arbitration under that agree-

ment. See Plaintiff's Exhibit A, Article XI,

Job Protection. Accordingly, the court finds

that it may assume §301 jurisdiction over

Local 47's claim as it relates to both CPS

and CCM.

The Sixth Circuit Court of Appeals

has defined the inquiry to be undertaken

by a district court when a union files a

Suit to compel arbitration under these cir-

cumstances. Local No. 6, Bricklayers,

Masons and Plasterers International Union

of America v. Boyd G. Heminger, Inc.,

483 F. 2d 129 (6th Cir. 1973). The court

held that the union's burden "was not to

present a prima facie case on the creation

of a sham or alter ego corporation by the

employer. The burden was to show that,

assuming there was a sham or alter ego

corporation..., there would then be a vio-

lation of the collective bargaining agree-

ment". Id. at 131. In compliance with

federal policy favoring arbitration when it

is made a part of a collective bargaining

agreement, the court found that because the

underlying dispute was arbitrable, the alter

ego issue shouid also be resolved by arbi-

tration. The case was remanded to the

district court to order arbitration be-

tween the signatory company and the union.

The union had not sought a remand for

direction of arbitration as it relates to

the alleged alter ego company.

With the guidance of the Sixth Circuit

and the national policy favoring arbitra-

tion, South Prairie Construction Co. v.

Local 627, IUVOE, AFL-CIO, 425 U.S. 800

(1976); Carey v. Westinghouse Electric

Corp., 375 U.S. 261 (1974), it seems apparent

to this court that not only the underlying

grievances but also the issues as to whether

CCM is bound to the master agreement by vir-

tue of the contract or by virtue of being

an alter ego should be ordered to arbitra-

tion.

CPS and CCM argue in their briefs in

opposition to Local 47's mution for summary

judgment that the matters involved in this

case are "representational" rather than

"contractual". The significance of this

argument is that representational issues

are clearly within the exclusive domain of

the National Labor Relations Board (here-

inafter NLRB) and not niituek to arbitra-

tion. It would appear that if CC” is found

to be liable under the contract for the pur-

pose of the grievances before the arbitrator,

however, no new representation would have to

be ascertained since all of the affected em-

ployees had been Local 47 members before

displacement. In addition, if the arbi-

trator's decision does not completely dis-

pose of this dispute, and if actual repre-

sentational issues need to be resolved, the

NLRB could then take jurisdiction of those

issues.

Accordingly, it is the order of this

court that Local 47's summary judgment motion

as to CPS and CCM is granted. CPS and CCM

are ordered to submit to arbitration the two

grievances filed by Local 47 which are the

Subject of this controversy.

The additional relief sought by

Local 47 in the form of injunctive relief

for reinstatement of Local 47 employees is,

however, denied. The court fully explored

the evidence in relation to the requirements

for granting injunctive relief in its

February 25, 1983 order denying plaintiff's

motion for temporary restraining order. No

new evidence has been presented, and the

court finds no reason to justify such relief.

B. CCM's Motion for pirtial Summary

Judgment.

The major premise advanced by CCM in

support of its motion is that it is entitled

to judgment as a matter of law because it is

a nonsignatory on any coilective bargaining

agreement with Local 47 and not an alter ego

of CPS. CCM argues that if this court does

not so find, then its motion to stay should

be granted pending resolution of the

alleged unit ussue by the NLRB.

In view of the findings of the court

in relation to Local 47's motion for summary

judgment, CCM's position is untenable. It

has been decided that §301 jurisdiction is

possible over a nonsignatory party and that

the alter ego issue should be referred to

arbitration with the underlying grievances.

CCM argues that the Sixth Circuit has

addressed the issues before this court in

Service, Hospital, Nursing Home and Public

Employees Union, Local 47 v. Cleveland

Tower Hotel, Inc., 606 F. 2d 684 (6th Cir.

1979) and decided that Local 47 could not

impose its bargaining agreement upon non-

Signatories in this situation. That suit

was a §301 claim seeking enforcement of

four collective bargaining agreements as

they allegedly related to a successor em-

ployer. Arbitration was not sought or con-

Sidered. The factual inquiry as to whether

the new employer was successor to the old,

and thereby a signatory on the bargaining

agreement, was squarely before the court

and decided against Local 47. The complaint

before this court seeks an order to arbi-

trate and injunctive relief and has been

found subject to arbitration pursuant to

Sixth Circuit direction in more similar

circumstances. See Local 6, Bricklayers,

Masons and Plasterers Int'l Union of

America v. Boyd G. Heminger, Inc., Supra.

This court is not addressing the merits of

whether the bargaining contract may be ex-

tended to reach CCM but only whether it

should be submitted to arbitration.

Accordingly, the Cleveland Tower Hotel, Inc.

case is inapposite.

For these reasons, it is ordered that

CCM's motion for partial summary judgment

is denied.

II. Antares and TSM Motions

to Dismiss

TSM, a wholly owned subsidiary of CPS,

was formed in 1978 to serve as a managing

consulting company for small tenant

buildings which generally cannot afford

the service of a full cleaning service.

TSM would secure written bids from

various contractors to service the small

tenant accounts on a subcontractors basis.

Janitorial workers were never employed by

TSM but rather provided by the sub-contractor.

CPS, among others, held sub-contracts with

TSM. A management account was sold to CCM

in February, 1982 which expired in

June, 1982. Otherwise, TSM has not con-

ducted any business since June, 1981.

Antares, a Pennsylvania Corporation,

was formed by Mr. Patrick J. Cassese in

November, 1982 for the purpose of pur-

chasing CPS stock owned by its twelve in-

vestors (hereinafter B Shareholders).

(Mr. Cassese held the thirteenth interest

in CPS.) The agreement between Antares and

the B Shareholders was for the purchase and

retirement of their shares by Antares and

and issuance of notes to the B Shareholders

secured by the shares pledged to three of

the B Shareholders under a pledge agreement.

In this manner, Mr. Cassese became owner of

one hundred percent of Antares which in turn

owns one hundred percent of CPS.

TSM and Antares assert that they should

be dismissed becwnee wither has or has had

any janitorial employees nor has Local 47

demonstrated any dispute as it relates to

them. Local 47 contends first that §301

jurisdiction should extend to these non-

Signatories as well and that as entities

covered by Article XXI, supra at n. 3, they

should be required to appear before the

arbitrator for a full resolution of the

alter ego issue.

Although Local 47 argues that the evi-

dence does not substantiate that these en-

tities have no employees, it appears clear

to the court that there is no evidence pro-

duced by Local 47 that either entity employs

or could employ janitorial workers. There

is certainly no allegation that either

entity has contracted to provide janitorial

services which has resulted in the displace-

ment of its members. This court has deter-

mined that §301 jurisdiction is possible as

to nonsignatories to a bargaining agreement

but only upon the showing of some alternate

ground. As plaintiff's claim relates to

Antares and TSM, however, even iff they could

be found to be alter egos, they have not been

alleged to have caused injury to Local 47.

Accordingly, Antares and TSM are dis-

missed as parties and are not included in

the court's arbitration order.

III. First Union Management,

Incorporated, Motion for

Modification of Blanket

Protective Order and

Local 47's Motion to

Dissolve Protective Order.

The numerous exhibits submitted during

the course of the temporary restraining order

hearing have been subject to a blanket pro-

tective order entered without objection by

any party. Review and copying by each party

was allowed for the purpose of preparing

post-hearing briefs. While Local 47 now

requests that the protective order be dissolved,

First Union and CCM urge that it be con-

tinued due to the prejudicial effect dis-

closure would have upon them in the market-

place and in a labor relations sense. The

court finds that these concerns are well

taken, especially as they relate to First

Union who has been dismissed from this suit.

As this case is terminated before this court

with the issuance of this order, the follow-

ing order shall apply to the exhibits held

by the court:

(1) The exhibits shall be used for no

purpose other than preparation for arbitra-

tion or of an appeal ce rulings of this

court.

(2) All protected materials in

possession of any party shall be returned

under seal to its owner within ten days of

this order.

(3) For the purpose of arbitration or

appeal preparation, counsel for all con-

cerned parties shall meet within the thirty-

day period to agree upon the exhibits they

each require for use on appeal. A statement

Shall be drawn and submitted to the court

indicating each parties requests by exhibit

number. Copies may be made the courthouse

at the attorneys' expense or the court will

approve another method of duplication pro-

vided all parties have agreed.

(4) After thirty days have passed from

the date of this order, the court will dis-

tribute the exhibits to their owners through

the respective attorneys who make a request

within ten days.

1T IS SO ORDERED.

/s/ Sam H. Bell

SAM H. BELL

U. S. District Judge

EXHIBIT "A"

AGREEMENT

between

SERVICE, HOSPITAL, NURSING HOME

AND PUBLIC EMPLOYEES UNION,

LOCAL 47

AFL-CIO

and

CLEANING CONTRACTORS

TERM OF AGREEMENT:

May 1, 1981 to April 30, 1984

Article

XXV

XXVI

XXVIII

XXIX

XXX

Exhibit "A"

CONTENTS

Description

Recognition, Union Shop,

Checkoff and Non-

Interference

Management

Seniority

Overtime

Holidays

Designated Pay Day

No Wage Penalty

Wage Schedule

Pension Plan

Attrition

Job Protection

Health and Welfare Fund

Miscellaneous Employer and

Union Responsibilities

No Collections

Vacations

Authorized Leaves of Ab-

sence Without Pay

Miscellaneous Benefits

Discharge and Discipline

Grievance and Arbitration

Picket Lines

Successors and Assigns

Other Employers

Minimum Rates

Employees' Records

Compliance With Regulatory

Laws

General Provision

Union Stewards

Supervision

Remedies

Complete Agreement

Duration

Schedule A Schedule of Benefits

A-2

Page

AGREEMENT

THIS AGREEMENT made and entered into

between SERVICE, HOSPITAL, NURSING HOME AND

PUBLIC EMPLOYEES UNION, LOCAL NO. 47,

AFL-CIO, hereinafter referred to as the

"UNION", affiliated with Service Employees

International Union, AFL-CIO, and

COMMERCIAL PROPERTY SERVICES, INC.,

hereinafter referred to as the "EMPLOYER",

WITNESS ET Hd:

WHEREAS, it is the desire of the said

Union and the Employer to enter into an

Agreement to establish a peachful settle-

ment and adjustment of all grievances which

wili tend to stabilize and strengthen the

business of the Employer and to establish

wage rates and working conditions, including

work load, which will prevail between the

parties hereto during the existence of this

Agreement,

NOW, THEREFORE, it is hereby mutually

agreed:

ARTICLE I

Recognition, Union Shop, Checkoff

and Non-Interference

Section 1. Recognition. The Employer

recognizes the Union as the exclusive

collective bargaining agent for all its

employees engaged in janitorial work, ex-

cluding office employees and supervisors

as defined in the Labor-Management Relations

Act of 1947, as amended; i.e., Supervisors

who only perform bargaining unit work as per-

mitted by Article XXVII and also excluding

Only any such account where only one (1)

employee is engaged, if such an account is

not owned or operated by an entity which

operates in more than one location serviced

by the Employer. Accounts being serviced

A= 3

as of June 15, 1981 under the fifteen (15)

hour or less exclusion in the 1978-1981

Agreement between the parties shall, so long

as the same Employer continues to service

the account, remain excluded if the Employer

provides to the Union by June 30, 198l a

written list of the name, locations at which

the work is performed, and initial ser-

vicing date of all such accounts.

ARTICLE IX

Pension Plan

Section 1. Signatory to Plan.

The Employer, by becoming signatory

to this Agreement, agrees to be bound by

the trust document establishing the Building

Service Local 47 - - Cleaning Contractors

Pension Plan, and the Employer further here-

by agrees to abide by all rules and regu-

lations promulgated by the Trustees of said

Plan, not inconsistent with this Agreement.

Section 2. Contributions.

The Employer shall contribute to the

Building Service Local 47 - - Cleaning Con-

tractors Pension Plan the following amounts:

Effective Date Amount

May 1, 1981 Sixteen cents (.16)

May 1, 1982 Eighteen and one-half

cents (.185)

May 1, 1983 Twenty-one cents (.21)

for each hour compensated by the Employer

for the term of this Agreement for each em-

ployee in the bargaining unit from the date

of hire, provided that the Employer shall

not have to contribute for employees hired

to replace employees on vacation for whom

contributions are being made. Such con-

tributions shall be due on a monthly basis.

Each monthly period shall be a calendar

month and shall include all hours compen-

sated in all payroll periods which were

paid during that calendar month. The amount

A-4

due for any given month shall be paid in

full to the Pension Plan not later than

the twentieth (20th) day of the second

month after the month due, i1.e., con-

tributions due for hours compensated in

January are to be paid not later than

March 20. The Employer shall also con-

tribute to the Pension Plan any amounts

it owes as withdrawal liability as pro-

vided by law. Contributions shall be paid

by the Employer to the agent designated

by the Trustees of the Pension Plan, and

Shall be accompanied by a list of the full

names of all employees for whose compensated

hours contributions are being made, the

social security numbers of each such em-

ployee, and the number of hours compensated

for each employee on which contributions are

then being made.

ARTICLE XI

Job Protection

Section 1. When an Employer takes

over an account at which employees repre-

sented by the Union were previously employed,

regardless of who was the Employer, the

Employer shall not reduce the rate of pay,

the other terms of compensation, or the

number of employees and their hours of work,

Or change the starting and quitting times

of any employee on that account without the

express written consent of the Union, unless

one of the exceptions set forth in Section 2

of this Article may be applied.

Section 2. The Employer shall not re-

duce the rate of pay, other terms of com-

pensation, the number of employees or the

total number of hours assigned, or change

the starting and quitting times of any em-

ployee at any individual account or job

Site from what they were on the effective

date of this Agreement, without the ex-

A-5

press written consent of the Union. How-

ever, the application of the provisions of

Article X, Attrition, shall be an exception

to this Section, and the reduction of a

Substantial amount of work on an account

shall permit a layoff of employees in accord

with the terms of this Agreement appropriate

to the reduction of work for the Employer

on that account. This exception for reduc-

tion of work on an account shall not be used

as a basis for increasing the workload of any

employee.

Section 3. Whenever an Employer loses

an account or job site such Employer shall

give written notice of such loss of the

account or job site at least twenty (20)

days prior to the effective date of the

loss, if such notice is possible. The notice

shall specify the person or business entity

which will provide the cleaning services to

that account, if known, upon the termination

or the service by the Employer giving the

notice, and shall list employees who were

working at that account, including their

addresses and telephone numbers, and the

job classification, current rate of pay,

and schedule of hours worked with starting

and quitting times for each day for each

employee. Failure to give such notice re-

quired above shall subject the Employer to

liquidated damages of One Hundred Dollars

($100.00).

Section 4. If an individual account or

job site has been taken over by an Employer,

Or an employee files a written complaint

with the Union claiming a violation of this

Article at an individual account or job site,

the Union shall have the right to conduct

an investigation, including the inspection

and auditing of the books or records of the

present or former Employer necessary to

verify the hours of work of the employees

relating to such an individual account or

job site, in order to determine whether any

provisions of this Article have been violated.

All fringes shall be the continued obligation

of the new Employer.

A-6

Section 5. When an Employer takes over

an account upon which employees were pre-

viously represented by the Union, such Em-

ployer shall immediately notify the Union

of such take-over and furnish the Union a

written list of the employees who are to be

retained at the account. Failure to give

such notice required above shall subject

the Employer to liquidated damages of One

Hundred Dollars ($100.00). The Empioyer

shall employ the same employees that worked

on that account as specified in Section l

of this Article, except for those employees

who elect to continue working for the Employer

which has lost the account. Those employees

shall have as their seniority with the new

Employer the same total seniority which they

had with the previous Employer. Also, the

seniority of the employees at the individual

account shall be that which they had with

the previous Employer at that account.

Section 6. No work which is now or may

be performed by the members of the bargaining

unit covered by this Agreement shall be

performed by any person who is not a member

of the bargaining unit; except in an emer-

gency or for the purpose of instructing

in proper methods.

Section 7. If an Employer which has

Signed this Agreement as its first Agreement

with the Union has reduced the number of

employees or the hours of work at an account

or job site at which employees were repre-

sented by the Union prior to that Employer

taking over the account or job site, the

number of employees and/or the total number

of hours worked at such accounts or job

Sites shall immediately be restored to the

levels that existed when the Union last

previously represented employees working

at that account and/or job site.

Arf

Section 8.

an Employer takes over

an account with ich Local 47 has an

Agreement other ..i.an this Agreement,

the Employer will sign an Assumption Agree-

ment prior to taking over the job. All

conditions such as rates of pay, hours

of work, seniority, vacations, holidays,

insurance coverages, pension coverages

and any items not specifically enumerated

herein shall continue as they previously

existed.

ARTICLE XII

Health and Welfare Fund

Section 1. Signatory to Plan.

The Employer, by becoming signatory

to this Agreement, agrees to be bound by

the trust document establishing the

Local No. 47 Welfare Fund No. 1 and the

Employer further hereby agrees to abide

by all rules and regulations promulgated

by the Trustees of said Fund, not incon-

Sistent with this Agreement.

Section 2. Contributions.

Effective May 1, 1981 the Employer

Shall contribute forty cents (.40) per hour

to the Local No. 47 Welfare Fund No. 1

for each hour compensated by the Employer

for the term of this Agreement for each

employee in the bargaining unit from the

date of hire, provided that the Employer

Shall not have to contribute for employees

hired to replace employees on vacation for

whom contributions are being made. Such

contributions shall be due on a monthly

basis. Each monthly period shall be a

calendar month and shall include all hours

compensated in all payroll periods which

were paid during that calendar month. The

amount due for any given month shall be paid

in full to the Welfare Fund not later than

the twentieth (20th) day of the second month

after the month due, i.e. contributions due

A-8

for hours compensated in Janvary are to be

paid not later than March 20. Contribu-

tions shall be paid by the Employer to

the agent designated by the Trustees of the

Welfare Fund, and shall be accompanied by a

list of the full names of all employees for

whose compensated hours contributions are

being made, the social security numbers of

each such employee, and the number of hours

compensated for each employee on which con-

tributions are then being made.

Section 9. Benefits.

During the term of this Agreement the

benefits provided by the Fund shall be the

benefits provided on April 30, 1981 plus

the improvements in life insurance, acci-

dental death and dismemberment insurance,

accident and sickness weekly indemnity, and

paid prescription benefits reflected in

Schedule A. The eligibility requirements

for benefits provided by the Fund shall re-

main the same as they were on April 30, 1981.

Section lo. Reserves of the Fund.

Whenever the reserves of the Health

and Welfare Fund fall below the amount of

three months' expenditures, the Trustees

shall immediately meet and determine the

amount of additional contribution necessary

by the Employers to meet all the obligations

of the Fund and to maintain the aforesaid

reserve. Immediately upon such a determina-

tion each Employer contributing as a party

to this Agreement shall be informed of the

decision of the Trustees and shall begin

making contributions as required by that

decision.

The term "three months' expenditures"

Shall be deemed to equal one-fourth (1/4)

of the Fund's expenditures in the twelve-

month period ending with the date of the

last financial statement. The Trustees

Shall work diligently to effect cost

Savings where reasonable and proper and to

A-9

increase administrative efficiency in the

operation of the Health and Welfare Plan.

ARTICLE XIX

Grievance and Arbitration

Section 1. Grievance Procedure.

Should differences arise between the Em-

ployer and the Union as to the meaning

of or application of provisions of this

Agreement, such differences shall be

settled in the following manner and order:

(a) The matter shall be discussed

between the employee, his Steward,

if there is a Steward on the account,

and the immediate supervisor within

a reasonable time after the employee

has knowledge of the event giving

rise to the grievance.

(b) If a satisfactory settlement is

not reached in Step (a), the matter

shall be discussed within a reasonable

time between the designated repre-

sentatives of the Employer and the

Union. The representative of the

Employer shall state, in writing,

the reasons for disagreement with

the position taken by the representa-

tive of the Union. Reasons cited

shall be made with specificity, shall

cite this Agreement where appropriate

and shall state all issues of fact

and interpretation. The Employer

may request a like statement from

the Union.

not reached at Step (b) concerning

an Employer or employee gri¢evance,

the matter may be taken before the

Executive Board of the Union for

approval to submit the matter to

arbitration. If the matter is not

taken before the Executive Board

within sixty (60) days of the

Union's receipt of the Employer's

A-10

written statement in Step (b), the

matter shall be considered settled

in accordance with the Employer's

written statement.

Section 2. Powers of the Executive

Board. The Executive Board, upon due con-

Sideration, may deny approval for the sub-

mission of any matter to arbitration. Fur-

ther, the Executive Board may approve the

Submission of any matter to arbitration of

its own motion without consent of the em-

ployee or employees involved.

Section 3. Arbitration. Once a

matter has been approved for arbitration,

the Union shall request a panel of seven

(7) arbitrators from Federal Mediation and

Conciliation Service. If none of the arbi-

trators on the panel is acceptable to the

Union, the Union shall so notify the Enm-

ployer and request Federal Mediation and

Conciliation Service to forward a second

panel.

If the Union finds one or more arbi-

trators on the list to be acceptable, it shall

send by Certified Mail a priority listing,

ranking all acceptable arbitrators in order

of preference, said priority listing to be

sent to the Employer or his representative

designated, in writing, to receive such

correspondence.

If no response is received frim the

Employer or his representative by Certi-

fied Mail within fourteen (14) days from

the mailing of the Union's priority listing,

the Employer shall be deemed to have agreed

to the appointment of the first arbitrator

on the Union's priority listing.

The Employer or his representative may

within the fourteen (14) day period notify

the Union, in writing, by Certified Mail

of its preference for the appointment of

an arbitrator or may request that a second

panel be obtained from the Federal Media-

tion and Conciliation Service.

A-11l

If both parties forward a list of

preferred arbitrators, t*»*y shall discuss

the appointment of an arbitrator by

mutual designation. If no agreement is

reached within fourteen (14) days of the

Union's receipt of the Employer's priority

listing, the Union shall automatically re-

quest a second panel from the Federal

Mediation and Conciliation Service, unless

the parties mutually agree to the contrary.

In any case where a second panel is

requested, the parties shall be bound to

select an arbitrator by the strike-off

method, the Union and the Employer alter-

nately striking a name from the panel,

the last remaining arbitrator to be deemed

the mutual selection of the parties.

Section 4. Power of Arbitrator. De-

cision of the Arbitrator shall be final

and binding upon the Employer and the Union.

The arbitration procedure shall not be used

to change or modify this Agreement.

Section 5. No Strike - - No Lockout.

Inasmuch as this Agreement provides for

fair and equitable means of disposing of

grievances, the employees and the Union,

both individually and collectively, agree

that, except as provided herein, there

Shall be no strike, slow-down, or inter-

ference with production during the life of

this Agreement and the Employer agrees it

will not lock out the employees during the

life of this Agreement.

Section 6. The Employer, in any actual

case or controversy, may institute a griev-

ance at Step (b) by serving a written state-

ment on the designee of the Union. Such

statement shall be sent by Certified Mail

and shall state all issues of fact and inter-

pretation, citing the contract where appro-

priate and shall make a specific demand for

relief.

In all such cases the status quo, as

determined by the position of the Union,

shall be maintained until the matter is

settled.

Section 7. It is agreed by the Union

and the Employer that the individual fees

and expenses of the arbitrator will be paid

equally by both the Union and the Employer.

ARTICLE XXI

Successors and Assigns

Other Employers

This Agreement shall be binding upon

and for the benefit of the signatories

hereto and their respective successors and

assigns.

This Agreement hereby covers as an

Employer subject to the full terms of this

Agreement any individual proprietorship,

partnership, corporation, firm or any other

entity which is engaged in janitorial work

and is in any way a subsidiary or related

entity to any Employer covered by this

Agreement. Specifically and without limi-

tation, this Agreement hereby includes any

entity engaged in janitorial work which is

operated in whole or in part by any officer,

director or any person employed by any

Employer covered by this Agreement, and

further includes any entity engaged in

janitorial work in which any investor in

any Employer covered by this Agreement

has any interest of any kind.

Any Employer covered by this Agreement,

including without being limited to Employers

covered solely by operation of this Article

may not subcontract to any other person or

entity any of the work which is or may be

performed by employees covered by this

Agreement, except for the cleaning of

venetian blinds, cleaning required by an

emergency occasioned by fire or flood, or

a one time only special job.

A-13

ARTICLE XXVIII

Remedies

The provisions of this Agreement, as

they relate to Union Security and dues

collection, bonding requirements, Pension,

Health and Welfare and other economic items,

may be enforced by a civil action filed in

any Court of the United States_or of any

State which has competent jurisdiction, and

the Employer and the Union agree that such

Court shall have jurisdiction to grant

specific performance and/or all forms of

equitable and/or legal relief. The Em-

ployer agrees that it will not assert as a

defense to any such action the failure of

the Union to file and process a grievance

under the procedures of this Agreement.

ARTICLE XXX

Duration

THIS AGREEMENT shall become effective

as Of May 1, 1981 and will continue in force

and effect until midnight, April 30, 1984,

and from year to year thereafter until

either party desires to modify or terminate

the Agreement, and notifies the other party,

in writing, of its desire to terminate or

modify at least sixty (60) days prior to

May lst of any subsequent year.

THIS AGREEMENT shail be subject to

Amendment at any time by mutual consent of

the parties hereto, and any such Amendment

agreed upon shall be reduced to writing and

Signed by the parties hereto.

THIS AGREEMENT WAS EXECUTED BY DULY

AUTHORIZED REPRESENTATIVES OF THE PARTIES

ON THE DATES BELOW THE SIGNATURES AFFIXED

NERETO.

SERVICE, HOSPITAL, NURSING HOME AND

PUBLIC EMPLOYEES UNION, LOCAL 47,

SERVICE EMPLOYEES INTERNATIONAL UNION,

AFL-CIO

Eee

PCC Se EG Geb oGs sce cece ssccccccee

eh Eh SSeS ses ee be cece ce ccc cee

EES SEG we ees sescceccecrecc

Dt Cee Ech SS bes bes eseesecscccccecs

ES ST Tee

PCM ET CCS Gb ee eee secerccssccce

SCHEDULE A

SCHEDULE CF BENEFITS

1. Life Insurance (as described in your

OE $5,000

Beeweuewe wury 1, 1981....... $6,000

Beeeecewe wey 2b, 1983........ $7,000

Note: This life insurance benefit

. 00

will be reduced to $2,000.00 ($3,000.00

effective July 1, 1981) and will con-

tinue in effect for eligible employee-

members receiving benefits under the

Building Service Local 47 - - Cleaning

Contractors Pension Plan. Effective

May 1, 1983 Penioners will be covered

by $4,000.00 in life insurance benefits.

A-15

Accidental Death and Dismemberment

DS on 664K HO OA Km Oe Os ee $5,000.00

Effective July 1, 1981l........ $6,000.00

BEseeceve MOy ky EOB2 i oc ss 0 us $7,000.00

Accident and Sickness Weekly Indemnity

Maximum

Bctective July 1, L9OL.....0s. $ 45.00

BEteccive May 15: 29B2K sc 6 cw cies $ 55.00

BETOCtive Bay 2, ASBdecavccecs $ 65.00

Accident benefits begin with the first

day of non-occupational disability.

Sickness benefits begin with the eighth

day of non-occupational disability.

Each is payable for a maximum of twenty-

six weeks during any period of disability.

Your Weekly Indemnity will be equal to

Sixty-six and two-thirds percent

(66-2/3%) of your average straight time

earnings for the ninety (90) days be-

fore the beginning of the period of

disability for which benefits are

payable, however, it will not exceed

the maximum benefit as shown above.

Medical Benefits

Your coverage for the following plan

of medical insurance benefits will

begin automatically when yor become

eligible. If you elect to obtain your

medical coverage through the Kaiser

Community Health Foundation or Group

option is made available to you, you

will be covered by the provisions of

either plan. Those of you who do

not elect to be covered by the Kaiser

Group Health Plan will continue to

be covered for the following plan of

benefits:

A-16

Hospital Room and Board -- full cost

of semi-private care.

Number of days per disability....70 days

Hospital Emergency Accident

ee a ae | rar ee Full Cost

Surgical Expense Benefit

(Scheduled Amounts) ......scecseee $500.00

Paid Prescription Benefit--Full cost

less $1.00 deductible charge per pre-

scription. Family coverage of the paid

prescription benefit for active employees

Shall be furnished by the Fund effective

May 1, 1983, if in the opinion of an

actuary employed by the Fund said bene-

fit can be provided for twelve (12)

months without increasing the contribu-

tion rate of the Employers during said

twelve (12) months.

Vision Care Benefit--full cost less

$5.00 Deductible charge for examina-

tion, frames and lenses, if provided

by a participating panel doctor. If a

non-panel doctor is selected, then a

benefit schedule will apply.

Major Medical Insurance--Maximum

Amount (for each cause) $15,000.00.

Deductible Amount--the amount of bene-

fits provided under our basic plan

described above and under any other

group plan.

Private Room Limit...Up to the

hospital's average charge for semi-

private rooms.

Co-Insurance Factor...See limits

respecting psychiatric treatment.

Except for the drug prescription benefit pre-

scribed above, dependent benefits are not pro-

vided under this plan.

A-17

EXHIBIT "B"

February 7, 1983

Mr. Patrick J. Cassese

President

Commercial Property Services, Inc.

3416 Prospect Avenue

Cleveland, Ohio 44115

Dear Mr. Cassese:

Local 47 has just learned that for

some time Commercial Property Services,

Inc. (CPS) has transfered janitorial work

from employees represented by Local 47

to operations under an alter ego of CPS,

Cleveland Cleaning & Maintenance, where the

employees have been treated as if the

were not represented by Local 47 and not

covered by collective bargaining agreements

between CPS and Local 47. Jn some instances

the transfer has been from ¢. tuations where

the work was actually performed by CPS,

and in other instances the work was per-

formed by other employers who were under

contract with Local 47 as the representative

of their janitorial employees.

Local 47 is currently aware of such

transfer of operations at the following

locations:

Curtis Industries, Inc.

Eastlake, Ohio

Lakeland Medical Building

Euclid, Ohio

Young Medical Building

Cleveland, Ohio

Shaker Medical Building

Cleveland, Ohio

Diamond Shamrock

Concord, Ohio

B-1

In addition Local 47 has learned a

Similar transfer of work is scheduled to

take place on February 13, 1983 for the

janitorial services performed at the

Illuminating Building, 55 Public Square,

Cleveland, Ohio, and two buildings located

at Rockwell and East Sixth Street in

Cleveland, Ohio. Both of those properties

are managed by First Union Management, Inc.

In all these instances the conduct vio-

lates either Article XI and Article XxXI of

collective bargaining agreements between

CPS and Local 47 which became effective on

May 1, 1978 and May 1, 1981, or violates

the provision for work preservation in the

Agreement reached between Local 47 and

Employers of the Downtown Building Group,

in¢luding CPS, on November 15, 1982. This

letter constitutes two grievances protesting

these transfers of work as violations of

said Agreements. The first grievance deals

with all of the locations listed separately

above. The second grievance deals with the

work which Cleveland Cleaning & Maintenance

is to take over on February 13, 1983 at the

Illuminating Building and the East Sixth

and Rockwell buildings. [In both grievances

the Union seeks restoration of employees

displaced from work, full back pay and

restoration of all benefits for those em-

ployees, payment of all\contributions due

to the Pension and Welfare Funds, and ful-

fillment of all other obligations which

CPS had or has as an employer under the

collective bargaining agreements.

Since the actions giving rise to the

second grievance has not yet taken place

but will take place shortly, it is necessary

that CPS immediately enter into a written

agreement with Local 47 that work performed

at the East Sixth and Rockwell Building will

B-2

be performed in accord with all terms and

conditions of the agreement between CPS

and the Union effective May 1, 1983, in-

cluding, without limitation, the retention

cf employees currently providing janitorial

services at that location, and that the

work to be performed at the Illuminating

Building will be performed in accord with

the Agreement reached with CPS and other

Downtown Building Employers on November 15,

1982, including, without iimitation, reten-

tion of the employees who are currently

providing janitorial services at that

location, until this grievance can be arbi-

trated. If CPS does not enter into such a

written agreement by 10:00 A.M. on Wednesday,

February 9, 1983 then be hereby advised

that at that hour Local 47 will file an

action in the United States District Court

for the Northern District of Ohio, Public

Square, Cleveland, Ohio, seeking injunctive

relief, including the granting of a tem-

porary restraining order immediately after

the filing of the lawsuit, to require the

enforcement of the Agreements between CPS

and Local 47 as requested in this para-

graph, pending arbitration of the second

grievance, and if necessary to require such

enforcement during action to enforce the

award issued by the arbitrator.

Very truly yours,

Joseph E. Murphy

JEM: tmh

0309H

EXHIBIT "C"

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF OHIO

EASTERN DIVISION

SERVICE, HOSPITAL, NURSING ) CASE NO. C83-588

HOME AND PUBLIC EMPLOYEES

UNION, LOCAL NO. 47,

AFFILIATED WITH THE SER-

VICE EMPLOYEES INTER-

NATIONAL UNION, AFL-CIO,

CLC

Plaintiff,

COMMERCIAL PROPERTY

SERVICES, INC.

c/o Patrick J. Cassese,

Statutory Agent

1200 Ohio Savings Plaza

Cleveland, Ohio 44114

CLEVELAND CLEANING AND

MAINTENANCE COMPANY

c/o CT CORPORATION

SYSTEMS,

Statutory Agent

Union Commerce Building

Cleveland, Ohio 44115

TOTAL SYSTEMS MANAGEMENT,

INC.

c/o Sanford Gross,

Statutory Agent

1326 Terminal Tower

Cleveland, Ohio 44113

— ee eee ee ee ee ee ee ee ee ee ee ee ee ee ee ee Ne ee ee Ge es es Ge Ge

JUDGE BELL

AMENDED COMPLAINT

ANTARES, INC.

c/o Patrick J. Cassese

President and Chairman

of the Board

3416 Prospect Avenue

Cleveland, Ohio 44115

and

FIRST UNION MANAGEMENT,

INC.

c/o C.T. Corp. Systems,

Statutory Agent

Union Commerce Building

Cleveland, Ohio 44115

Defendants.

ert ee

JURISDICTION AND VENUE

1. The jurisdiction of this Court

is invoked pursuant to §301 of the Labor

Management Relations Act (LMRA), 29 U.S.C.

§185.

2. Venue of this controversy is

conferred upon this Court by §301 of the

UMRA, 29 U.S.C. §185 and by 28 U.S.C. §1391.

THE PARTIES

3. Plaintiff Service, Hospital, Nur-

Sing Home and Public Employees Union,

Local No. 47, affiliated with Service

Employees International Union, AFL-CIO, CLC

C-2

(the Union or Local 47), is a labor organi-

action within the meaning of §301 of the

LMRA, 29 U.S.C. §185.

4. Local 47 is the sole and ex-

clusive bargaining agent for all janitorial

employees who are engaged in janitorial

work at the two buildings located at

Rockwell and East Sixth Street in Cleveland,

Ohio (Rockwell-Sixth Buildings) and at the

Illuminating Building, 55 Public Square,

Cleveland, Ohio. Local 47 represents these

employees for the purpose of collective

bargaining with respect to rates of pay,

wages, benefits and all other terms and

conditions of employment.

5. Defendant Commercial Prorerty

Services, Inc. (CPS) is an Ohio corporation

having its principal place of business at

3416 Prospect Avenue, Cleveland, Ohio 44115.

It is an employer engaged in an industry

affecting commerce within the meaning of

§301 of the LRMA [sic], 29 U.S.C. §185.

C-3

6. Defendant Cleveland Cleaning

and Maintenance Company (CCM) is an Ohio

corporation having its principal place of

business at 4838 East 355th Street,

Willoughby, Ohio 44094. It is an employer

engaged in an industry affecting commerce

within the meaning of §301 of the LMRA,

29 U.S.C. §185.

7. Defendant Total Systems Manage-

ment, Inc. (TSM), is an Ohio corporation

having its principal place of business

in Cleveland, Ohio. It is an employer

engaged in an industry affecting commerce

within the meaning of §301 of the LMRA,

29 U.S.C. §185.

8. Defendant Antares, Inc. (Antares)

is a Pennsylvania corporation, which does

business in the State of Ohio, in pait at

3416 Prospect Avenue, Cleveland 44115.

Antares is the parent corporation of

Defendants Commercial Property Services,

Inc., and Total Systems Management, Inc.

c-4

Antares is an employer engaged in an

industry affecting commerce within the

meaning of §301 of the LMRA, 29 U.S.C.

§185.

9. Defendant First Union Management,

Inc. (First Union), operates and manages

commercial properties, including the

Rockwell-Sixth Buildings and the Illumin-

ating Building. First Union has its

principal place of business in the

Illuminating Building. First Union is an

employer engaged in an industry affecting

commerce within the meaning of §301 of the

LMRA, 29 U.S.C. §185.

FIRST CAUSE OF ACTION

10. The allegations contained in

paragraphs one through nine of this Amended

Complaint are hereby restated and re-

alleged as if fully rewritten.

ll. Defendants CPS, CCM, TSM and

Antares are alter egos of one another,

despite their facial separateness because

C-3

they possess substantially identical manage-

ment, business purpose and operation and

because of an absence of arms' length re-

lationship between them.

12. Local 47 and CPS are parties to

a Collective Bargaining Agreement which

governs the rates of pay, wages, benefits

and all other terms and conditions of

employment of CPS' employees engaged in

janitorial work. That Agreement includes

as an Employer party, any Employer engaged

in janitorial work operated in whole or

in part by an officer, director, or em-

ployee of CPS, and any Employer engaged in

the janitorial work in which an investor

in CPS has any interest of any kind.

13. By virtue of the terms of the

Agreement referred to in paragraph 12, and

because of its alter ego status to CPS,

CCM is bound by the Collective Bargaining

Agreement executed by CPS and it must ful-

fill CPS's collective bargaining and

statutory obligations, responsibilities

and duties.

C-6

14. Local 47 is a party to several

Collective Bargaining Agreements with the

employers who currently contract with First

Union to provide janitorial services at

the Rockwell-Sixth Buildings and at the

Illuminating Building. The Agreements

govern the rates of pay, wages, benefits

and all other terms and conditions of

employment for employees engaged in

janitorial work at these locations.

15. The Agreement described in

paragraph 12 contains a job protection

provision which provides that an Employer

which takes over an account at which the

employees were represented by Plaintiff

shall retain those employees and further

provides that:

When an Employer takes over

an account at which employees

represented by the Union were

previously employed, regardiess

of who was the Employer, the

terms of compensation, or the num-

ber of employees and their hours

of work, or change the starting

and quitting times of any employee

C-7

on that account without the ex-

press written consent of the

Union, unless one of the excep-

tions set forth in Section 2 of

this Article may be applied:

The Employer shall not re-

duce the rate of pay, other terms

of compensation, the number of

employees or the total number of

hours assigned, or change the

starting and quitting times of any

employee at any individual account

or job site from what they were

on the effective date of this

Agreement, without the express

written consent of the Union.

16. Under the Agreement described

in paragraph 12, the parties have a right

to initiate grievances should any differ-

ences arise between the employer and the

Plaintiff as to the meaning or application

of the provisions of the Collective Bar-

gaining Agreement. The Agreements provide

for a grievance procedure which culminates

in final and binding arbitration. Copies

of the Agreement's grievance and arbitration

provisions are attached as Exhibit A.

17. On or about February, 1983,

Local 47 discovered that CPS had trans-

C-§

ferred janitorial work at a minimum of

five (5) locations from employees repre-

sented by Local 47 to operations under its

alter ego, CCM. CCM did not retain the

employees represented by Local 47; it has

treated employees as if they were not

represented by Local 47 and not covered

by Collective Bargaining Agreements between

CPS and Local 47 and has unilaterally

changed, eliminated or reduced wages, bene-

fits and terms and conditions of employment.

The transfer has been conducted at laca-

tions where the work had previously been

performed by CPS under the CPS Agreements

and at locations where the work was pre-

viously performed by other employers who

were under contract with Local 47 as the

exclusive representative of their janitorial

employees.

te Because of this conduct, on or

about February 7, 1983, Local 47 initiated

a grievance against CPS pursuant to the

grievance and arbitration provisions of

the relevant Agreements charging CPS/CCM

with violations of the provisions of the

Agreement described in paragraph 12. (A

copy of the letter initiating the grievance

is attached as Exhibit B.)

19. Local 47 discovered that a similar

transfer of work was scheduled to take

place on February 13, 1983, for the jani-

torial services performed at the Rockwell-

Sixth Buildings. The janitorial work at

these buildings has been performed by em-

ployees of an employer which is a signatory

to an Agreement with Local 47.

20. Local 47 alsc@ discovered that

a Similar transfer of work is scheduled to

take place on February 27, 1983, for the

janitorial services performed at the

Illuminating Building, 55 Public Square,

Cleveland, Ohio. The janitorial work at

these buildings has been performed by

C-10

—————

SPATE Mt NE Nn

employees of an employer who is a signatory

to an Agreement with Local 4/7.

21. First Union knew that CPS had

Collective Bargaining Agreements with

Local 47 which would cover the wages and

terms and conditions of employees working

at the Rockwell-Sixth Buildings and at the

Illuminating Building. First Union also

knew that the employers who currently con-

tract with First Union to provide janitorial

services at these locations have collective

bargaining agreements with Local 47 which

cover the wages and terms of conditions of

employees working at the Rockwell-Sixth

Buildings and at the Illuminating Building.

22. In spite of this knowledge First

Union negotiated a contract or Agreement

with CPS and CCM which would require CPS to

breach the collective bargaining agreements

it had with Local 47.

23. Pursuant to the [grievance] and

arbitration procedures of the Agreement,

Cid

on or about February 7, 1983, Local 47

initiated a grievance concerning the con-

duct of CPS and CCM described in paragraphs

17 and 18 above. Local 47 sent CPS a

letter requesting that CPS enter into an

Agreement by 10:00 A.M. February 9, 1983

to abide by its Collective Bargaining Agree-

ments with Local 47 pending arbitration.

(A copy of said letter is attached as

Exhibit B.) CPS has not responded to the

Setter:

24. The grievance described in para-

graph 18 of this Amended Complaint involves

the conduct which has already taken place.

The grievance described in paragraph 23 of

this Amended Complaint involves conduct

which is scheduled to take place on

February 13, 1983 and February 27, 1983.

CPS and CCM have refused to arbitrate either

of these grievances.

vee iii emetic Sgt ts BR ny ADA ES

25. Unless enjoined and restricted

by this Court, CPS and CCM will continue

to fail and to refuse to abide by the

Agreement, including refusing to arbitrate

the grievances. CPS and CCM will not re-

tain the employees who are presently per-

forming janitorial work at the Rockwell-

Sixth Buildings and at the Illuminating

Building; such employees will not be pro-

vided with health and medical insurance

coverage, will not receive pension credits

Or any other benefits which they are en-

titled to receive pursuant to the Agreements.

CPS and CCM will further unilaterally reduce

and change wages, benefits and terms and

conditions of employment at those locations.

26. Unless enjoined First Union will

continue to aid and to participate with CPS

and CCM in avoiding the obligations, duties,

and responsibilities CPS and CCM have pur-

Suant to the Agreements; First Union will

cancel any contracts with employers who are

C-i3

Subject tc a Collective Bargaining Agree-

ment with Local 47. First Union will change

janitorial contractors pending arbitration;

its actions will make a hollow formality

of the arbitral process and will render a

subsequent arbitrator's award a practical

nullity.

27. As a result of the Defendants

contemplated actions, Plaintiff and the

employees it represents will suffer severe

and irreparable injury for which they have

no adequate remedy at law.

SECOND CAUSE OF ACTION

28. The allegations contained in

paragraphs 1 through 27 of this Amended

Complaint are hereby restated and re-

alleged as if fully rewritten.

29. Defendant CCM is engaged in busi-

ness Similar to and in competition with that

of Defendant CPS and other Union cleaning

companies.

aren cmctciy 1 peek APES joo

30. First Union knew that Plaintiff

had collective bargaining agreements with

the employers who currently contract wth [sic]

First Union to provide janitorial services

at the Rockwell-Sixth Buildings, as pre-

viously described in paragraph 21 of this

Amended Complaint.

31. First Union had notice and knowledge

of CCM's alter ego status to CPS; First

Union had notice and knowledge that CCM was

bound by the Collective Bargaining Agree-

ments executed by CPS and that CCM must

fulfill CPS' collective bargaining and

statutory obligations, responsibilities and

duties.

32. On or about February, 1983 First

Union wrongfully, intentionally and

maliciously interfered with said Agreements

by retaining CCM to clean the aforesaid

buildings.

33. As a direct result of these acts

of First Union, Plaintiff's Agreements with

C25

CPS and other Union employers were vio-

lated, repudiated and breached on and

after February, 1983, and will continue

to be violated, repudiated and breached

on February 13, 1983 and February 27, 1983.

34. At all times herein mentioned,

Plaintiff duly performed all the conditions

of the Agreements on its part.

35. By reason of these acts of First

Union, the employees which Plaintiff repre-

sents have been deprived of employment,

wages, and other benefits and income.

36. By reason of these acts of First

Union, justice and the public good require

that in addition to any damages to which

Plaintiff is entitled, Plaintiff is also

entitled to an amount which will serve to

punish First Union and to deter it and

others from the commision of like offenses.

WHEREFORE, Plaintiff prays that this

Court grant judgment as follows:

(ni teeta

A. Issue a temporary restraining

order, preliminary injunction and permanent

injunction enjoining, prohibiting, and

requiring Defendants Commercial Property

Services, Inc., Cleveland Cleaning and

Maintenance Company, Total Systems Manage-

ment, Inc. and Antares, Inc., their officers,

agents, employees, attorneys, all persons

in active concert or participation with

them, and all persons having notice of this

Order to arbitrate the grievances filed by

Service, Hospital, Nursing Home and Public

Employees Union, Local No. 47, affiliated

with the Service Employees International

Union, AFL-CIO, CLC, on February 7, and

pending arbitration and compliance with the

relief, if any, ordered by an arbitrator,

from:

hi Discharging the employees currently

performing janitorial work at the two

buildings located at Rockwell and East

Sixth Streets in Cleveland, Ohio and at

Geis

Pe a at me

moe eve eee diene se epee semen ate prams yD bt ts a eames Ble mae

<< ltt

the Illuminating Building, 55 Public

Square, Cleveland, Ohio, except as per-

mitted under the current Agreements be-

tween Commercial Property Services, Inc.

and Plaintiff;

ye Changing any of the wages, hours,

or the terms and conditions of employment

of said employees, except as permitted

under the current Agreement's between

Commercial Property Services, Inc. and

Plaintiff; and

: Reinstate any of said employees

already discharged.

B. Issue a temporary restraining

order, preliminary injunction and per-

manent injunction, enjoining and pro-

hibiting Defendant First Union Management,

Inc., its officers, agents, employees,

attorneys and all persons in active con-

cert or participation with it and all per-

sons having notice of this Order, pending

arbitration of the grievance filed on

C~is

5 penance

February 7, 1983, by Service, Hospital,

Nursing Home and Public Employees Union,

Local No. 47, affiliated with the Service

Employees International Union, AFL-CIO,

CLC, and pending compliance with the re-

lief, if any, ordered by an arbitrator,

from:

Taking any action which results

in the discharge or failure to reinstate

the employees represented by Local 47

who are or were engaged in janitorial work

at the two buildings located at Rockwell

and East Sixth Streets in Cleveland, Ohio

and at the Illuminating Building, 55 Public

Square, Cleveland, Ohio, chanee any of the

wages, hours, or the terms and conditions

of employment of said employees, except as

permitted under the collective bargaining

agreement covering said employees except

if First Union Management, Inc. establishes

an independent basis which is not related to

a requirement to have janitorial work per-

C-29

formed at

terms and

the buildings by employees whose

conditions of employment are

guaranteed through a Collective Bargaining

Agreement

Union for

amount of

Union for

of $2,000

equal to costs and expenses incurred in

this action, including, but not limited to,

reasonable attorneys fees;

which this Court deems appropriate.

with the Plaintiff;

Judgment against Defendant First

compensatory damages in the

$1,000,000.00.

Judgment against Defendant First

punitive damages in the amount

,000.00.

Order paid to Plaintiff an amount

All such other and further relief

SCHWARZWALD, ROBINER, WOLF

& ROCK - A legal Professional

Association

/s/ Melvin S. Schwarzwald

MELVIN S. SCHWARZWALD

STEVEN B. POTTER

616 Bond Court

1300 East Ninth Street

Cleveland, Ohio 44114

(216) 566-1600

Attorneys for Service, Hospital,

Nursing Home and Public Employees

Union, Local 47, AFL-CIO, CLC

C-20

————

CERTIFICATE OF SERVICE

I hereby certify that copies of the

foregoing Amended Complaint were served

upon Robert T., Rosenfeld, Attorney for

Commercial] Property Services, Inc. and

Total Systems Management, inc., at

Rosenfeld and Gross, 1326 Terminal Tower,

Cleveland, Ohio 44113, Keith Ashmus,

Attorney for First Union Management, inc.,

at Thompson, Hine and Flory, 1100 National

City Bank Building, Cleveland, Ohio 44114,

and Eugene Schwartz, Attorney for Cleveland

Cleaning and Maintenance Co. » £a6., at

Schwartz, Einhart & Simerka, 800 National

City Bank Building, Cleveland, Ohio 44114-3082,

by personal or mail Service, and on

Patrick Cassese, 3416 Prospect Avenue,

Cleveland, Ohio 44115, by regular mail ser-

vice, postage prepaid, this 22nd day of

February, 1983.

/s/ Melvin s. Cchwarzw

Melvin Ss, Schwarzwald

Steven B,. Potter

Attorneys for Service, Hospital,

Nursing Home and Public Employees

Union, Local No. 47, affiliated

with the Service Employees Inter-

national Union, AFL-CIO, CLC

C-21

_Schwarzwald

tenner tte mii me nan oe ewer . ’ ,

EXHIBIT "D"

Cornachio - cross

And all the shares were initially

issued to you; is that right?

Correct.

Prior to the incorporation, did any-

one Other than you have any monetary

interests, ownership interest in

Cleveland Cleaning & Maintenance

prior to the time of your incorpora-

tion?

No, they didn't.

Showing you what has been marked as

Plaintiff's Exhibit G, could you tell

us what that it, please?

This is a sheet from the share ledger

when Pat Cassese and I entered into

an agreement showing that he took

over 35 shares of stock and I re-

tained 15.

Now, sir, was there some compensation

paid by Mr. Cassese for that agreement?

D-1

I believe the corporate record book

shows that there was a sale of stock

for $350.

Did Mr. Cassese loan any money to

the corporation at that time?

After entering into an agreement, yes,

he did provide a loan to the company.

And how much was that loan?

He gave us a loan for $4,000 that

I signed...

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.