Opposition Brief — Transamerica Airlines, Inc. v. Air Line Pilots Ass'n, International

PFiLED

Nov 2 87

| Supreme Court, U.S,

No. 87-373 | |

IN THE

Supreme Court of the United States

October Term, 1987

TRANSAMERICA AIRLINES, INC.,

Petitioner,

V.

Air LINE PILOTS ASSOCIATION, INTERNATIONAL,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

RESPONDENT’S BRIEF IN OPPOSITION

MICHAEL .E. ABRAM

JAMES L. LINSEY

(Counsel of Record)

STEPHEN PRESSER

COHEN, WEISS and SIMON

330 West 42nd Street

New York, New York 10036

Attorneys for Respondent

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Wes.

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TABLE OF CONTENTS

PAGE

TABLE OF AUTHORITIES ................ Pr

GRINEONS BELOW ........ coc occccee eee 2

ee wy es 2

STATUTE INVOLVED ................-0-. 3

STATEMENT OF THE CASE .............. 3

ee GC Ed AE OLED EOD 6

I. THE DECISION BELOW CREATES NO

CONFLICT AMONG THE CIRCUITS OVER

THE NATURE OF THE RLA REPRESEN-

TATION DISPUTES COMMITTED TO THE

NMB’S EXCLUSIVE JURISDICTION ..... 7

Il. THE DECISION BELOW IS FULLY CON-

SISTENT WITH THIS COURT'S SETTLED

CONSTRUCTION OF THE DUTY TO BAR-

GAIN IN GOOD FAITH UNDER SECTION

2, FIRST OF THE RLA ...........1.... 13

Cueeasurs.id......... ss, 20

NI Se aa") fg ey Ae ang We OA Al

if

TABLE OF AUTHORITIES

CASES PAGE

Air Line Pilots Ass'n, Int'l v. Texas Int'l Airlines,

Inc., 656 F.2d 16 (2d Cir. 1981) 22. cess: 6, 10-12

Brotherhood of Ry. & S.S. Clerks v. Florida E.C.

RR... 3840S. 2355 (IR chic xt 17

Brotherhood of R.R. Trainmen v. Jacksonville

Terminal Co., 394 U.S. 369 (1969) ........ 14

Burlington Northern R.R. Vv. Brotherhood of Main-

tenance of Way Employes, 107 S. Ct. 1841

‘te, ff PORT Te ee ee 8, 14, 17

Chicago & N.W. Ry. v. United Transp. Union, 402

US. SO C9971) 262302 eee eee passim

Delta Airlines, Inc. v. International Bhd. of Team-

sters, 56 U.S.L.W. 3241 (U.S. Oct. 6, 1987) .. 13

Detroit & T.S.L. R.R. v. United Transp. Union,

26 US. 142 (EGG) .. ckactesee eee passim

Elgin, J. & E. Ry. v. Burley, 325 U.S. 7i1 (1945) 18

First Nat’! Maintenance Corp. v. NLRB, 452 U.S.

G66 £99843) soos dk d ieee 6

General Comm. of Adjustment v. Missouri-Kansas-

Texas ALR... 320 U.S. 323 COOP cic isceaxs 9

International Ass'n ef Machinists v. Street, 367

aS. 700 (9968) 26sec eee ee 7

International Bhd. of Teamsters v. Texas Int'l Air-

lines, Inc., 717 F.2d 157 (Sth Cir. 1983) .... iZ

Local 553, Transp. Workers Union v. Eastern Air

Lines, Inc., 544 F. Supp. 1315 (E.D.N.Y.), aff'd

as mod., 695 F.2d 668 (2d Cir. 1982) ...... 8

PAGE

NLRB vy. Insurance Agents’ Int’l Union, 361 USS.

EE GE a 19

NLRB Vv. Katz, 369 U.S. 736 (1962) .......... 18

NLRB vy. Reed & Prince Mfg. Co., 205 F.2d 131

(1st Cir.), cert. denied, 346 U.S. 887 (1953) .. 16

Railway Labor Executives Ass’n v. Boston & Maine

Corp., 808 F.2d 150 (1st Cir. 1986), cert.

denied, 56 U.S.L.W. 3245 (U.S. Oct. 6, 1987) 10

Ruby v. TACA Int'l Airlines, S.A., 439 F.2d 1359

ss Wh de wes wie ae ace ou 8,11

Scheuer v. Rhodes, 416 U.S. 232 (1974) ...... 6

Southern Ry. v. Brotherhood of Locomotive Engine-

men and Firemen, 337 F.2d 127 (D.C. Cir.

a ko a ae nse eke 6 ob dw aces 8

Switchmen’s Union of North Am. v. National Media-

tion Board, 320 U.S. 297 (1943) .......... 9,10

Texas & N.O. Ry. v. Brotherhood of Ry. & S.S.

Core ae Sie Oe CE950) .. ww. cea aes 8, 10

Trans Int'l Airlines, Inc. v. International Bhd. of

Teamsters, 650 F.2d 949 (9th Cir. 1980), cert.

denied, 449 U.S. 1110 (1981) ............. 18

Virginian Ry. v. System Fed’n No. 40, 300 USS.

I ek gg wily dea eh hb Ww be waa ee passim

Weinstein V. Bradford, 423 U.S. 147 (1975) .. 6

Western Airlines, Inc. Vv. International Bhd. of

peters, 107 S. Ct. 1515 (1967) ......... iZ, 13

STATUTES

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

et seq.:

Section 8(a)(5), 29 U.S.C. § 158(a)(5) .... 18

iV

PAGE

Railway Labor Act, 45 U.S.C. § 151 et seq.:

Section 2, First, 45 U.S.C. § 152, First ...... passim

Section 2, Second, 45 U.S.C. § 152, Second .. 14

Section 2, Third, 45 U.S.C. § 152, Third .... 3,4, 7

Section 2, Fourth, 45 U.S.C. § 152, Fourth .. 3,4,7

Section 2, Ninth, 45 U.S.C. § 152, Ninth .... 3,9

Section 5, First, 45 U.S.C. § 155, First ...... 8, 14

eae Be one 8 er 3, 4, 8, 14

meee: 7, 4S VIR SASF 0c nn cca seen de 14

LEGISLATIVE HISTORY

Hearings on H.R. 7150 before the House Committee

on Interstate and Foreign Commerce, 69th Cong.,

Se ONE a xs ws so 0 aoe ee ens 16

MISCELLANEOUS

Cox, The Duty to Bargain in Good Faith, 71 Harv.

EE SEUE DT es a's os Wa'ekek ee aw aes 18

ay bie bake td A ee males 17

SE ED 6 pl cb esa ceed deer ee ean ee 17

IN THE

Supreme Court of the United States

October Term, 1987

No. 87-373

}

TRANSAMERICA AIRLINES, INC.,

Petitioner,

Vv.

AIR LINE PILOTS ASSOCIATION, INTERNATIONAL,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

¢

RESPONDENT’S BRIEF IN OPPOSITION

The complaint filed by Respondent Air Line Pilots

Association, International (“ALPA”) in this dispute al-

leges that Petitioner Transamerica Airlines, Inc. (“Trans-

america”) violated the bargaining, status quo and recogni-

tional requirements of the Railway Labor Act (“RLA”),

45 U.S.C. § 151 et seq., by (1) refusing to bargain in good

faith with ALPA and (2) creating a nonunion, replacement

subsidiary during contract negotiations to obtain work his-

torically and actually performed by Transamerica. ALPA

seeks the settled judicial remedy for these alleged RLA

violations, namely an order requiring Transamerica to

bargain in good faith and to restore the status quo working

conditions of Transamerica’s pilots through injunctive relief

and back pay. Transamerica does not dispute that the com-

plaint states claims for relief under the RLA; instead, the

narrow issue presented for review is whether federal courts

maintain subject matter jurisdiction to adjudicate those

claims.

The United States Court of Appeals for the Ninth Circuit

held that the complaint, when construed in the light most

favorable to ALPA, squarely alleged an RLA dispute within

the jurisdiction of the federal courts. In doing so, the court

of appeals rejected Transamerica’s attempt to recast ALPA’s

replacement subsidiary claim as a “representation dispute”

committed to the National Mediation Board (“NMB”) and

carefully distinguished ALPA’s complaint from cases raising

representation disputes under the RLA. The court of

appeals further held that Congress did not create any

“exception” to judicial enforcement of the RLA’s good faith

bargaining duty during the collective bargaining process

itself. Because the court of appeals’ decision correctly

applies the settled judicial interpretation of the RLA and

is fully consistent with other federal appellate decisions,

Transamerica’s petition presents no issue which warrants

review by this Court.

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. Al-A14)

is reported at 817 F.2d 510 (9th Cir. 1987). The June 5,

1985 oral decision of the district court (Pet. App. A16-

A23) is unreported; the August 6, 1985 written decision

of the district court is reported at 615 F.Supp. 371 (N.D.

Cal. 1985).

JURISDICTION

The court of appeals entered its judgment on May 14,

1987 (Pet. App. Al) and denied Transamerica’s petition

for rehearing and suggestion for rehearing en banc on

August 12, 1987 (Pet. App. Ai5). Petitioner invokes this

Court’s jurisdiction under 28 U.S.C. § 1254(1).

nT

STATUTE INVOLVED

The case concerns the proper interpretation of the RLA’s

bargaining, status quo and recognitional provisions, 45

U.S.C. $§ 152, First, 152, Third, 152, Fourth, 152, Ninth,

155, First, 156. Certain of these provisions are reproduced

as Appendix E to the Petition (Pet. App. A38-A41); the

remaining relevant RLA provisions are reproduced in the

Appendix to this Brief in Opposition (Opp. App. A1).

STATEMENT OF THE CASE

Because the petition ignores the narrow procedural pos-

ture of this case and rests on Transamerica’s version of the

untried facts underlying this dispute, we begin with a fuller

description of both the proceedings below and ALPA’s

complaint as censtrued by the court of appeals. Trans-

america, a wholly-owned subsidiary of the Transamerica

Corporation (“TAC”), operated as a charter airline pro-

vidir.g passenger and cargo transportation services in inter-

state and foreign commerce. ALPA is the exclusive collec-

tive bargaining representative under the RLA for the airline

pilots employed by Transamerica. In March of 1984,

ALPA and Transamerica entered into collective bargain-

ing negotiations over the terms of a new labor contract.

The parties invoked the mediation services of the NMB

in July of 1984 and continued in mediation until Trans-

america terminated flight operations in September of 1986.

Fairly construed, ALPA’s complaint alleges that Trans-

america committed two distinct RLA violations during this

collective bargaining period. First, the complaint asserts

that “Transamerica has entered into collective bargaining

negotiations with ALPA, ostensibly to conclude a new col-

lective bargaining agreement, but in those negotiations it

has failed and refused to exert reasonable efforts to reach

agreement with ALPA or to otherwise bargain in good faith

4

with ALPA.” (Pet. App. A7). ALPA claims that, by

engaging in negotiations with no intent to reach agreement,

Transamerica has violated its duty under Section 2, First

of the RLA to “exert every reasonable effort to make and

maintain agreements.” 45 U.S.C. § 152, First.

Second, the complaint alleges that Transamerica acted

with its corporate parent TAC to create and operate a

nonunion airline subsidiary—Trans International Airlines

(“TIA”)—in Transamerica’s actual and historic market-

place as a device to achieve its bargaining demands.

Although Transamerica now seeks refuge in ALPA’s as-

serted failure to list some specific transfer of work from

Transamerica to TIA (e.g., Pet. 3, 6-7, 9, 11, 15), the

court of appeals easily construed the complaint to allege

that Transamerica purposefully created and operated

TIA to divert work actually and historically performed by

Transamerica’s pilots to its nonunion replacement subsi-

diary. (Pet. App. A10-A13). So, too, the limited record

evidence before the courts below indicates that Trans-

america created TIA to obtain the lower labor costs that

Transamerica had failed to achieve through collective

bargaining (R. 138-39, 158) and that Transamerica

specifically designed and operated TIA to obtain the freight

delivery contracts actually and traditionally flown by

Transamerica (R. 134-139, 145).

The complaint alleges that such conduct violates the

recognitional and noninterference obligations established

in Sections 2, Third and 2, Fourth of the RLA, 45 U.S.C.

$$ 152, Third, 152, Fourth, by subverting ALPA’s status

as the collective bargaining representative of Trans-

america’s pilots. As the court of appeals explained, the

complaint also states a claim that Transamerica violated

the RLA’s status quo requirements, see id. §§ 152, First,

156, by unilaterally altering the actual, objective working

conditions of Transamerica’s pilots through the creation and

operation of TIA during contract negotiations. (Pet. App.

Al11-A12). The complaint seeks an order directing Trans-

america to bargain in good faith with ALPA, to restore

the status quo working conditions at Transamerica prior

to the creation and operation of TIA, and to award Trans-

america’s pilots back pay for the losses they incurred

through Transamerica’s operation of TIA.

On Transamerica’s motion, the district court dismissed

the entire complaint for lack of subject matter jurisdiction.

In a terse oral opinion, the district court simply held that

federal courts lack jurisdiction “to allow a case to go for-

ward challenging a lack of good faith [bargaining] until

the bargaining is over.” (Pet. App. A20). In a subsequent

written opinion, the district court accepted Transamerica’s

argument that its operation of TIA created an RLA

“representation dispute” and thereby precluded ALPA from

protecting the organizational rights and working conditions

of Transamerica’s pilots under the RLA’s recognitional and

status quo provisions. (Pet. App. A30-A31).

The court of appeals reversed in a unanimous decision.

Following this Court’s opinion in Chicago & N.W. Ry. v.

United Transp. Union, 402 U.S. 570 (1971) (“Chicago

& North Western”), the court of appeals held that Congress

specifically intended federal courts rather than the NMB

to enforce the bargaining requirements of Section 2, First

and that nothing in the RLA or its legislative history divests

federal courts of such jurisdiction while the parties engage

in mediation with the assistance of the NMB. (Pet. App.

A5S-A7). The court then rejected Transamerica’s attempt

to characterize ALPA’s replacement subsidiary allegations

as a nonjusticiable “representation dispute” concerning the

proper bargaining representative for 77A pilots. The court

held that the complaint properly challenges Transamerica’s

treatment of its own pilots (as represented by ALPA)

through its creation and operation of TIA during the RLA’s

status quo period. (Pet. App. A9-A10). In doing so, the

court of appeals carefully distinguished this case from the

Second Circuit’s decision in Air Line Pilots Ass'n, Int'l v.

Texas Int'l Airlines, Inc., 656 F.2d 16 (2d Cir. 1981),

which did not involve a replacement subsidiary created to

obtain work actually or traditionally performed by the car-

rier and which explicitly recognized federal jurisdiction to

enforce the RLA’s status quo and recognitional obligations

against the type of carrier conduct challenged in this case.

(Pet. App. A9-A11).’

ARGUMENT

In its petition for review by this Court, Transamerica has

abandoned its earlier position that ALPA’s complaint fails

to state claims for relief under the RLA’s bargaining, rec-

ognitional or status quo provisions. (E.g., Pet App.

A7-A8, Al1-14). Instead, Transamerica seeks to insulate

its conduct from judicial scrutiny on the theory the RLA

implicitly deprives federal courts of subject matter jurisdic-

tion to consider ALPA’s claims. In this procedural posture,

the allegations of the complaint must be construed in the

light most favorable to ALPA, and all ambiguity must be

resolved in favor of factual assertions that support federal

jurisdiction. See, e.g., Scheuer Vv. Rhodes, 416 U.S. 232,

1 Although Transamerica terminated its flight operations in

September cf 1986 (Pet. App. A3), the parties continue to engage

in bargaining over the effects of Transamerica’s shutdown, see First

Nat'l Maintenance Corp. v. NLRB, 452 U.S. 666, 677 n.15 (1981).

The court of appeals held (Pet. App. A3 & n.1) that Transamerica’s

shutdown does not render this case moot because ALPA secks

damages under its TIA claims, because the parties continue to

engage in collective bargaining, and because the underlying labor

dispute is “capable of repetition yet evading review.” See Weinstein

V. Bradford, 423 U.S. 147, 149 (1975) (per curiam).

236 (1974). As we show below, however, Transamerica’s

quarrel] with the court of appeals lies not so much with its

construction of the RLA but with its construction of ALPA’s

complaint. Without the ability to mischaracterize the under-

lying facts in this dispute, Transamerica lacks any plausible

claim that the decision below misconstrues the RLA or

creates 1n intercircuit conflict concerning the RLA disputes

committed to the exclusive jurisdiction of NMB.

I. THE DECISION BELOW CREATES NO CONFLICT

AMONG THE CIRCUITS OVER THE NATURE OF

THE RLA REPRESENTATION DISPUTES COMMIT-

TED TO THE NMB’S EXCLUSIVE JURISDICTION.

In an effort to establish a basis for review by the Court

at this early stage in the proceedings, Transamerica main-

tains that the decision below directly conflicts with the

Second Circuit’s holding in Texas International (Pet 8-12)

and conflicts “in principle” with every representation dispute

case ever decided under the RLA (Pet. 8, 14-16). As

the court of appeals carefully explained, Transamerica is

mistaken.

1. Transamerica does not (and cannot) deny that fed-

eral courts enjoy subject matter jurisdiction to enforce the

provisions in Sections 2, Third and 2, Fourth of the RLA,

45 U.S.C. §§ 152, Third, 152, Fourth, which prohibit

carrier conduct that interferes with the union’s ability to

function as an effective collective bargaining representative.

See International Ass'n of Machinists v. Street, 367 U.S.

740, 759-60 (1961). In fact, this Court has upheld judicial

enforcement of these central RLA provisions both before

and after Congress amended the RLA in 1934 to create the

NMB as the administrative agency responsible for resolving

representation disputes under the RLA. See Virginian Ry.

Vv. System Fed'n No. 40, 300 U.S. 515, 542-45 (1937):

Texas & N.O. Ry. V. Brotherhood of Ry. & S.S. Clerks,

281 U.S. 548, 567-69 (1930). The courts of appeals, in

turn, have construed Sections 2, Third and 2, Fourth to

prohibit carriers from transfering work or work opportuni-

ties away from the bargaining unit with the intent and effect

of undermining the union. See, e.g., Ruby v. TACA Int'l

Airlines, S.A., 439 F.2d 1359, 1363-64 (Sth Cir. 1971).

In addition, federal courts maintain exclusive jurisdiction

to enforce the status quo requirements established in Sec-

tions 2, First and 6 of the RLA, 45 U.S.C. $§ 152, First,

156, during collective bargaining negotiations. See Detroit

& T.S.L. R.R. v. United Transp. Union, 396 U.S. 142,

150-53 (1969) (“Shore Line”). These provisions require

both parties to maintain “actual, objective working condi-

tions,” id. at 153, while they exhaust the RLA’s elaborate

collective bargaining procedures. See 45 U.S.C. §§ 155,

First, 156; Burlington Northern R.R. v. Brotherhood of

Maintenance of Way Employes, 107 S. Ct. 1841, 1851

(1987). In particular, the RLA’s status quo provisions

prohibit carriers from diverting work or work opportunities

away from bargaining unit members—and thereby achiev-

ing bargaining demands through self-help—during the

RLA’s negotiation period. See, e.g., Southern Ry. v. Broth-

erhood of Locomotive Enginemen and Firemen, 337 F.2d

127, 131-32 (D.C. Cir. 1964); Local 553, Transp. Workers

Union v. Eastern Air Lines, Inc., 544 F. Supp. 1315, 1327

(E.D.N.Y.), aff'd as mod., 695 F.2d 668 (2d Cir. 1982).

The court of appeals found (Pet. App. Al1-A14)—and

Transamerica does not dispute—that ALPA’s complaint

squarely states claims for relief under these RLA provisions

by alleging that Transamerica created and operated TIA

for the purpose of obtaining work actually and historically

flown by Transamerica pilots represented by ALPA. Trans-

america cannot escape judicial scrutiny of these claims

simply by asserting that ALPA’s complaint “only makes

sense” (Pet. 7) as a nonjusticiable dispute under Section

2, Ninth of the RLA, 45 U.S.C. § 152, Ninth, over the

appropriate collective bargaining representative for TIA

pilots. ALPA’s complaint simply does not seek judicial

relief requiring Transamerica or TIA to recognize ALPA as

the collective bargaining representative of T/.1 pilots. Nor

does ALPA seek to bargain over the employment terms of

TIA pilots or to extend ALPA’s collective bargaining agree-

ment with Transamerica to cover those pilots. Instead, the

complaint quite plainly alleges that Transamerica has vio-

lated its RLA obligations to ALPA (and the Transamerica

pilots ALPA represents) by creating a nonunion, replace-

ment carrier to obtain work traditionally and actually per-

formed by Transamerica’s pilots. As the court below ex-

plained (Pet. App. A-11-A12), ALPA only seeks judicial

intervention under the RLA directing Transamerica to

restore the status quo working conditions of Transameria’s

pilots.

Nothing in the RLA or its legislative history indicates

that Congress intended the NMB’s role in the representation

disputes to immunize such carrier treatment of its own

employees from judicial scrutiny. Indeed, because the NMB

cannot order any of the relief ALPA seeks in this case, see

2 Section 2, Ninth of the RLA directs the NMB to resolve dis-

putes over “whether one organization or another was the proper

representative of a particular group of employees.” Switchmen’s

Union of North Am. Vv. National Mediation Board, 320 U.S. 297,

302 (1943). This Court has inferred from Section 2, Ninth a con-

gressional intent to preclude federal courts from resolving such dis-

putes. See General Comm. of Adjustment v. Missouri-Kansas-Texas

R.R., 320 U.S. 323, 334-37 (1943).

10

Shore Line, 396 U.S. at 158,° Transamerica’s “representa-

tion dispute” defense would effectively permit a carrier to

avoid the RLA’s status quo and recognitional obligations by

transferring some or all of its operations to a formally sep-

arate corporate entity. This Court has consistently rejected

similar attempts to deprive unions of a “remedy to enforce

the statutory commands which Congress ha[s] written into

the Railway Labor Act” by constricting federal subject

matter jurisdiction. Switchmen’s Union, 320 U.S. at 300;

see, e.g., Virginian Railway, 300 U.S. at 545-49; Texas &

New Orleans, 281 U.S. at 567-69. Transamerica provides

no reason to depart from this salutary construction of the

RLA.

2. For similar reasons, the Second Circuit’s decision in

Texas International fully supports federal jurisdiction over

ALPA’s complaint in this dispute. In Texas International,

the relevant carrier, which flew scheduled service in the

southwestern United States, created a holding company

which, in turn, created a second airline subsidiary to fly

completely unrelated passenger service in the northeast

corridor. As the bargaining representative for Texas Inter-

national pilots, ALPA initiated an RLA action to enforce

its collective bargaining agreement with Texas International

against the newly-created carrier. See Texas International,

3 Contrary to Transamerica’s misleading description of the NMB’s

role in genuine representation disputes (Pet. 12-14), the NMB lacks

statutory authority to issue an order directing Transamerica to re-

construct the status quo working conditions existing prior to its

operation of TIA. See Shote Line, 396 U.S. at 158. Accordingly,

ALPA’s petition before the NMB—which does seek ALPA repre-

sentation of the TIA pilot group—does not divest the court of juris-

diction to consider ALPA’s distinct claims under Sections 2, Fourth

and 5 of the RLA. Cf. Railway Labor Executives Ass’n v. Boston

& Maine Corp., 808 F.2d 150, 156-58 (Ist Cir. 1986) (exclusive

jurisdiction of arbitrators over RLA minor disputes does not pre-

clude independent judicial enforcement of Section 2, Fourth), cert.

denied, 56 U.S.L.W. 3245 (U.S. Oct. 6, 1987).

11

656 F.2d at 19. Acknowledging that the case presented a

“close” question, the Second Circuit held that ALPA’s com-

plaint raised a “murky” representation dispute because

ALPA sought to govern the ongoing working conditions

of the pilots employed by the second carrier. See id. at

19-24. Yet the Second Circuit deliberately and explicitly

limited its holding to a case involving “separate corpora-

tions serving different areas and flying over different

routes.” Jd. at 18. The Second Circuit likewise confirmed

that federal courts retain jurisdiction to enforce Section 2,

Fourth against carrier attempts to “transfer existing busi-

ness flown by ALPA pilots to a newly formed corporate

alter ego for the purpose of displacing the work of ALPA

pilots.” Jd. at 19 (citing Ruby, 439 F.2d at 1359).

As the court of appeals explained in some detail (Pet.

App. A9-A11), ALPA’s complaint in this case challenges

precisely the carrier conduct which creates federal jurisdic-

tion under the Second Circuit’s Texas International opinion.

In the instant case, the complaint alleges that

Transamerica, along with its corporate parent, acted

“to devise a second airline subsidiary for [the cor-

porate parent] to operate in Transamerica’s market-

place.” Consequently, the instant case is closer to

the first category noted in Texas International,

were the carrier seeks to “transfer existing business

flown by ALPA pilots to a newly formed corporate

alter ego for the purpose of displacing the work

of ALPA pilots,” id., and, therefore, is an interfer-

ence with representation and organization within

the purview of 45 U.S.C. § 152 Third and Fourth.

(Pet. App. AlQ). Transamerica cannot now avoid the

court of appeals’, actual treatment of Texas International

by protesting that ALPA failed to allege some specific

transfer of work from Transamerica to TIA. (Pet. 11-12).

12

Given the court’s construction of ALPA’s complaint to

assert the equivalent of such conduct, the decision below

simply does not create any conflict with Texas International.

3. Finally, Transamerica’s reliance (Pet. 8, 14-16) on

airline or railroad merger cases and Justice O’Connor’s in

chambers opinion in Western Airlines, Inc. Vv. Internationa!

Bhd. of Teamsters, 107 S. Ct. 1515 (1987), is entirely mis-

placed. In the RLA merger cases cited by Transamerica

(Pet. 8), the union sought judicial enforcement of its col-

lective bargaining agreement after the signatory carrier

had merged with a second carrier which employed a greater

number of employees in the relevant craft or class. In

that unique context, courts have reasoned that judicial

“fe]nforcement of the contract . . . inescapably entail[sj

the continuance of the Union’s role as employee representa-

tive for the minority group” of employees after the merger.

International Bhd. of Teamsters v. Texas Int'l Airlines, Inc.,

717 F.2d 157, 161 (Sth Cir. 1983). ALPA’s replacement

subsidiary claim in this case, by contrast, does not implicate

a “minority” union’s post-merger representational status at

a newly-created carrier. Instead, ALPA challenges Trans-

america’s treatment of its own pilots under the RLA in this

case, see supra pp. 9-10, and thus does not seek judicial

relief that “inescapably entails” judicial enforcement of

ALPA’s status as the collective bargaining representative

for anyone other than Transamerica’s pilots.

For this reason as well, the decision below does not

conflict with Justice O’Connor’s opinion granting a stay in

Western Airlines. Justice O'Connor quite plainly limited

her provisional assessment of representation issues under

the RLA to “disputes as to the effect of collective bargain-

ing agreements on representation in airline merger situa-

tion[s].” Western Airlines, 107 S. Ct. at 1517 (emphasis

13

added). Even assuming that Justice O’Connor correctly

applied the RLA merger cases to the pre-merger successor-

ship issue raised in Western Airlines, those cases do not

govern the present dispute between Transamerica and the

Transamerica pilots represented by ALPA. In any event,

the Court has declined to grant plenary review in the

Western Airlines litigation, see Delta Airlines, Inc. v. Inter-

national Bhd. of Teamsters, 56 U.S.L.W. 3241 (U.S. Oct.

6, 1987) (remanding for consideration of mootness issues) :

as a result, Transamerica cannot bootstrap this case onto

the Court’s consideration of Western Airlines merely be-

cause both involve carrier contentions concerning the scope

of nonjusticiable representation disputes under the RLA.

Il. THE DECISION BELOW IS FULLY CONSISTENT

WITH THIS COURT’S SETTLED CONSTRUCTION OF

THE DUTY TO BARGAIN IN GOOD FAITH UNDER

SECTION 2, FIRST OF THE RLA.

Transamerica apparently offers three reasons for con-

cluding that federal courts lack subject matter jurisdiction

over ALPA’s claim under Section 2, First of the RLA:

(1) that federal jurisdiction over bad faith bargaining

claims during mediation is inconsistent with the RLA’s col-

lective bargaining scheme (Pet. 16-22), (2) that federal

jurisdiction under Section 2, First only extends to cases

involving a carrier’s complete refusal to meet with its union

(Pet. 19-20, 22-23), and (3) that bad faith bargaining

claims under Section 2, First impermissibly require courts

to regulate the substance of collective bargaining proposals

(Pet. 24-26). This Court has already considered and re-

jected each of these contentions.

1. The RLA establishes a virtually endless process of

“negotiation, mediation, voluntary arbitration, and concilia-

tion” to encourage the voluntary adoption or modification

14

of labor agreements in the railway and airline industries.

Shore Line, 396 U.S. at 148-49; see Burlington Northern,

107 S. Ct. at 1850-51 & n.10.* The “heart” of this “major

dispute” collective bargaining process is the obligation im-

posed by Section 2, First

to exert every reasonable effort to make and main-

tain agreements concerning rates of pay, rules, and

working conditions . . . in order to avoid any inter-

ruption to commerce or to the operation of any

carrier growing out of any dispute between the

carrier and the employees thereof.

45 U.S.C. § 152, First. See Chicago & North Western, 402

U.S. at 574; Jacksonville Terminal, 394 U.S. at 377.

In Chicago & North Western, the Court confirmed that

Section 2, First imposes a mandatory legal obligation to

bargain in good faith during the RLA’s major dispute

negotiation process and that Congress intended the federal

courts rather than the NMB to enforce that obligation

through injunctive relief. See Chicago & North Western,

402 U.S. at 574-80; see also Burlington Northern, 107

S. Ct. at 1853-54 & n.15; Virginian Railway, 300 U.S. at

544-48. Although Section 2, First “is central to the effec-

tive working of the Railway Labor Act,” Chicago & North

+ A party seeking to change rates of pay, rules or working condi-

tions under the RLA, must tender advance written notice under

Section 6 of the Act, 45 U.S.C. § 156. The parties must then

negotiate over the proposed changes, id. § 152, Second, and if con-

ferences fail to resolve the dispute, either party may invoke the

NMB’s mediation services, id. § 155, First. If mediation fails, the

NMB proffers binding arbitration to the parties, which can occur

only if both consent. Id. §§ 155, First, 157. An unsuccessful proffer

of arbitration releases the parties from mediation and triggers the

Act’s 30-day “cooling off” period, id. § 155, First, after which either

party can engage in economic self-help. See Brotherhood of R.R.

Trainmen v. Jacksonville Terminal Co., 394 U.S. 369, 377-78

(1969).

15

Western, 402 U.S. at 578, Transamerica maintains that

Congress implicitly intended to divest federal courts of

jurisdiction to enforce Section 2, First while the parties

engage in the mediation phase of RLA collective bargaining.

Instead, under Transamerica’s interpretation of the RLA,

“[t]he NMB enforces the duty to bargain in good faith by

holding a recalcitrant party in mediation (and thus prevent-

ing it from engaging in self-help in support of its position)

until the NMB’s mediator is satisfied that such party has

made every reasonable effort to reach agreement.” (Pet.

18-19).

The Court emphatically rejected this very construction

of Section 2, First in Chicago & North Westeria:

[W]e must consider the Court of Appeals’ position

that the question whether a party had exerted every

reasonable effort was committed by the Railway

Labor Act to the National Mediation Board rather

than to the courts. We believe that the legislative

history of the Railway Labor Act rather plainly

disproves this contention. ... Throughout the hear-

ings on the bill which became the 1926 Act there

are repeated expressions of concern that the Na-

tional Mediation Board should retain no adjudica-

tory function, so that it might maintain the con-

fidence of both parties. . . . In light of these

considerations, we think the conclusion inescapable

that Congress intended the enforcement of § 2 First

to be overseen by appropriate judicial means rather

than by the Mediation Boara’s retaining jurisdiction

over the dispute or prematurely releasing the parties

for resort to self-help if it feels such action called

for.

Chicago & North Western, 402 U.S. at 579-80 (emphasis

added; footnotes omitted); see also Shore Line, 396 U.S.

16

at 158 (concluding that “the [NMB] has no adjudicatory

authority with respect to major disputes’’).

Transamerica offers no reason to disturb this holding in

the context of the present dispute. While Chicago & North

Western arose after the NMB had released the parties from

mediation, neither the language of Section 2, First nor its

legislative history suggests that radically different considera-

tions apply to bad faith bargaining claims during mediation.

To the contrary, Section 2, First by its own terms requires

good faith bargaining in “ali [RLA] disputes” without sug-

gesting any exception for RLA disputes subject to mediation.

See 45 U.S.C. § 152, First. Congress thus understood that

“the legal obligation [stated in Section 2, First] is imposed,

and... the deliberate violation of that legal obligation

[can] be prevented by court compulsion”—without regard

to the point at which a carrier violates Section 2, First.

Hearings on H.R. 7150 before the House Committee on

Interstate and Foreign Commerce, 69th Cong., Ist Sess. 91

(1926) (statement of Donald Richberg).° This Court, too,

has recognized that judicial enforcement of Section 2, First

is “of the essence” precisely because “[t]he strictest com-

pliance with the formal procedures of the Act [which include

mediation] is meaningless if one party goes through the

motions with ‘a desire not to reach an agreement.’ ” Chicago

& North Western, 402 U.S. at 578 (quoting NLRB v. Reed

& Prince Mjg. Co., 205 F.2d 131, 134 (1st Cir.), cert.

denied, 346 U.S. 887 (1953) ).

5 As the Court has often noted, the 1926 RLA consisted of an

agreement negotiated between representatives of railway labor and

the carriers which Congress subsequently enacted into law. Sce

Chicago & North Western, 402 U.S. at 576; Shore Line, 396 U.S.

at 151 n.18. As the labor spokesperson for that agreement, Rich-

berg’s statements in the congressional hearings “are entitled to great

weight in the construction of the Act.” Chicago & North Western,

402 US. at 576.

17

Transamerica’s unprecedented view of Section 2, First

is also flatly inconsistent with the overall structure of the

RLA. Congress deliberately intended “to make the ex-

haustion of the Act’s remedies an almost interminable

process,” Shore Line, 396 U.S. at 149, in an attempt to

encourage negotiated agreements and to prevent the dis-

ruption of the transportation industry. See Brotherhood of

Ry. & S.S. Clerks v. Florida E.C. R.R., 384 U.S. 238, 246

(1966): Burlington Northern, 107 S. Ct. at 1854. Not-

withstanding this clear congressional design, Transamerica’s

interpretation of Section 2, First will encourage parties

to seek a premature termination of major dispute collective

bargaining. Where, as here, a carrier refuses to exert rea-

sonable efforts to reach an agreement during negotiations,

the union’s only remedy under the RLA wi!l be to seek a

release from mediation that triggers the RLA’s cooling-off

period and the onset of self-help. Transamerica’s construc-

tion of the RLA will thus operate to accelerate self-help

and increase the likelihood of wasteful strikes in the trans-

portation industry—precisely the results Congress sought

to avoid by requiring the parties to bargain in good faith

throughout a lengthy and ordered major dispute process.

See Chicago & North Western, 402 U.S. at 581 & n.14:

Shore Line, 396 U.S. at 148-53.°

© As the court below explained (App. A6-A7 & n.2), moreover,

Transamerica’s parade of horribles concerning the prospect of civil

discovery in Section 2, First lawsuits (Pet. 22-23) does not provide

any basis for divesting federal courts of subject matter jurisdiction

over bad faith bargaining claims during negotiations. Congress ex-

pressly intended the federal courts to resolve such claims, and dis-

covery is a necessary incident of that federal jurisdiction. Cf. Vir-

ginian Railway, 300 U.S. at 549-50. In any event, district courts

retain substantial authority and discretion to prevent any discover.

abuses through appropriately-framed protective orders. See Fed.

R.Civ.P. 26(c), 26(g).

18

2. Similarly, Transamerica cannot seriously maintain

(Pet. 19-21) that the RLA does not permit judicial

scrutiny of bad faith bargaining claims under Section 2,

First once the parties meet and confer during mediation.

This Court has long held that Section 2, First requires the

parties not only to meet and confer but also “to make

reasonable efforts to compose differences” during negotia-

tions. Virginian Railway, 300 U.S. at 548. As the Court

explained in Chicago & North Western:

As one leading commentator has said, . . . “[i]t was

not enough for the law to compel the parties to

meet and treat without passing judgment upon the

quality of the negotiations. The bargaining status

of a union can be destroyed by going through the

motions of negotiations almost as easily as by

bluntly withholding recognition.”

Chicago & North Western, 402 U.S. at 574-75 (quoting

Cox, The Duty of Bargain in Good Faith, 71 Harv. L. Rev.

1401, 1412-13 (1958)); see also Elgin, J. & E. Ry. v.

Burley, 325 U.S. 711, 721-22 n.12 (1945); cf. NLRB v.

Katz, 369 U.S. 736, 747 (1962) (applying these principles

under Section 8(a)(5) of the National Labor Relations

Act (“NLRA”), 29 U.S.C. § 158(a)(5)).

As the court below concluded (Pet. App. A7-A8),

ALPA’s complaint squarely alleges that Transamerica has

violated this standard of conduct by refusing “to exert rea-

sonable efforts during the negotiation process to reach an

agreement.” Trans Int'l Airlines, Inc. v. International Bhd.

of Teamsters, 650 F.2d 949, 962 (9th Cir. 1980), cert.

denied, 449 U.S. 1110 (1981). Transamerica’s apparent

denial of this allegation (Pet. 20-21) creates an issue for

trial, not a basis for dismissing ALPA’s complaint. See

Chicago & Northwestern, 402 U.S. at 584.

19

3. Finally, the decision below will not in any sense

impose particular bargaining terms on carriers or regulate

the substance of the collective bargaining agreements

reached in negotiations. (Pet. 24-26). The longstanding

remedy for a Section 2, First violation is a bargaining order

—an injunction directing the carrier to exert every reason-

able effort to reach an agreement through negotiations with

the union. See, e.g., Virginian Railway, 300 U.S. at 540.

This Court has consistently recognized that such relief

promotes successful labor negotiations without trenching

on the substantive content of bargaining proposals or

eventual agreements. See Chicago & North Western, 402

U.S. at 578-80; NLRB vy. Insurance Agents’ Int'l Union,

361 U.S. 477, 488 (1960). Federal courts have enforced

an untold number of such good faith bargaining orders

under both the RLA and the NLRA without imperiling the

collective bargaining scheme established in the federal labor

laws. Accordingly, federal jurisdiction to entertain bad

faith bargaining claims under Section 2, First could not

possibly undermine “the whole institution of collective

bargaining in the railroad and airline industries” (Pet. 23)

as Transamerica now claims.

20

CONCLUSION

For these reasons, the petition for a writ of certiorari

should be denied.

Respectfully submitted,

MICHAEL E. ABRAM

JAMES L. LINSEY

(Counsel of Record)

STEPHEN PRESSER

COHEN, WEISS and SIMON

330 West 42nd Street

New York, New York 10036

(212) 563-4100

Attorneys for Respondent

Al

APPENDIX

RAILWAY LABOR ACT, 45 U.S.C. § 151 ET SEQ.

§ 156. Procedure in changing rates of pay, rules,

and working conditions

Carriers and representatives of the employees shall give

at least thirty days’ written notice of an intended change

in agreements affecting r ‘es of pay, rules, and working

conditions, and the time and place for the beginning of con-

ference between the represeniative of the parties interested

in such intended changes shall be agreed upon within ten

days after the receipt of said notice, and said time shall be

within the thirty days provided in the notice. In every case

where such notice of intended change has been given, or

conferences are being held with reference thereto, or the

services of the Mediation Board have been requested by

either party, or said Board has proffered its services, rates

of pay, rules, or working conditions shall not be altered by

the carrier until the controversy has been finally acted upon,

as required by section 155 of this title, by the Mediation

Board, unless a period of ten days has elapsed after termina-

tion of conferences without request for or proffer of the

services of the Mediation Board.