Petition for Writ of Certiorari — Segal v. Morrissey

Supreme Court brief1970

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~UPREME COURT, U.S. ..

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Supreme Court, US. .

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Supreme Court of the United

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£. ROBERT SEAVER; CLERK

No. 3 2 8 A

MARTIN E. SEGAL and LEON KARCHMER,; . 6

ee | Petitioners; —

. . v. , .

JAMES MORRISSEY, JOSEPH PADILLA, RALPH oe

IBRAHIM, Individually and on behalf of the Members | : §

of the National Maritime Union of America, . .

Respondents.

PETITION FOR, WRIT OF CERTIORARI TO THE ~~ F

_ UNITED STATES COURT OF APPEALS sis

_ ‘FOR THE SECOND CIRCUIT. ~

©,

Wurtvey Norgu Seymour . . -

Counsel. for Petitioners &§

One Battery Park Plaza . — x

ease a New York, New York Oe ae

Roy E. Reardon Se tole:

James S. Montana, Jr.

Simpson Thacher and Bartlett

Of Counsel,

Tune 29, 1970 ee

reer rnrromtecmmemseniert agen imert gee .

~ — FABLE OF CONTENTS

S eiobsaee Below Paki habseciiobobesnpesdiespe nds snanennerundeidavabnesisaeareoeeries:

Jurisdiction ....... sl 8 EEE RISD DASA nN ERNCEO ieee MTEL S

Questions Presente «d lor PRO onc at genet tec

Statutory Provisions Tryolyed | sastcntens ERD PIED ar

é a - : ; « ‘

Statement’ of the fase toa Poa? SOA sta Det AO Senco ~

- Reasons for Granting the Writ: Reh sk

I. \ The central issue ‘inyolved j in this case—avtiether :

a e = © a federal court ma suit.under 29 U.S.C. $501 -

it - 4) ay substitute ‘its own interpretation ‘oF a

SEN ¢ “won s Spatial for the? reascnable inter

: pretation of ‘the imloi‘s own “oftics ris an

. . is es r? | pas ~

; JSstte ob Uapartanes to teak eri Be pi reviewing

vires #. thd netigns of “NiOn Ofitcers: unde SY

¢ Ma re : Sn eto

eo Kee PUL and te Bee Hak Miaeeenent of mnidns

: throughout the United Siates and is eloso ly

reohats dt toon question pon “witch this Court

srecently grtuited cortioragi on May may f be iy

lutermi@ionial Rrotherhood (ei Boiler: Hurkers,

—Ttrou Shiphuild rs,*Blachsiiviths, Forgers and

se Helpers vo Marde man, No. 1392, Oc toher Term.

’ 1G, a ease arising under 20 U Ae VMAS oa

IT. Since ghe decision by the Court of Appe ae

; . °- affirming the District Court's ‘grant of, suimmary

. judgment to the plaintiffs is ua departure from

ie ‘the principles in decisions of this Court, and

conflicts in: principle with decisions from other -

Wet: Circyits , restricting the use of. summary judge

i As ment. this Court sheild exereisé. its pewer ay

judicial ‘supervision to protect ‘Sic risht of de-

- fendants to a factual RONG fo wie

EE Since defendant Segal was nota party to this

» . +. action at the time plaintiffs made their+motion

i a _for summary: judgment-and at the time of the

hearing of said motion, and the District Court.

subsequently refused him the right to reargue,

a this: Court should, grant certiorari to. remedy

this clear departure roan prenee judicial pro-

eg |) AN a ee entiakenmeat BR CAAA oa eshte

. . ‘ . .

Us =

| 2

Appendix B (Memorandiuny Decision’ of the Disttict

te : il

pe it : : pes ; pet wv " 5 PAGE

‘IV. 'The holding of the Court of Appeals that de-

fendants Segal and: Karehmer, trustees of. the

NMU Pension Plan, are sub jeet tothe fiduei ary .

Cuytte: olen I S.C. 50 eonflicts?di rectly avith

- the -eS press * provision of the? Rabor-Manage”

yet Reporting and oe ee 1950 and -

the dwtent of Congress, sore such holiness if

“allowed to ostoad, chs riotishy hamper the -

proper “eiist reat pew of. union pension plans —

Hireughout the Leiited ie Fs oe SRO CEI? ner eeaaG, . 8

ey ee ( ‘ourt should exercise its power of super:

vision over, the Court of Appeals since that”,

court’ « lei hee Vi one the M@anirements of Rule

(1 ) ae me ffeederal Riles of Appellate Proce :

Heat - Bete fon : aoe biave laneesaisuntvencaasn : 4

Ponpianwt: :..2.o AED A SA sins sSatseaean havcasCiesenaising Seanx

, on ; 5 Ah. ae ee ns

Appendix .& (Text of statutory provisions involved) 1A_

Canyet: 2 San oe Deliney ot |. 1,

Apypendixs C (Order of athe District Court ee

. 7 plaintiffs sum naryegtdentont) igi tec oaens 5?

Appendix DD (Devision-and Order of? the Dietrick

‘ - Court denving reargument) cetesdhiaee 14A.

“Appendix I (Decision “and Order. of ‘the District

“Conrt “denying injunetion) 2.2.2.2... IDA

Appendix F(Opinion eft the Court of Ape als: and.

2 ~ Dissentine OQpinton) 2.22.22. ee 7A

“Appendix G (Judgment of the Court ‘of. oe ) 41A

Appendix #1 (Order ‘of the, Court of Appeals deny-* +

me pet ition’ hor, rehear Wi oe 432A

Ay nlix | (Order? of the Court of es deny-

ing petition for rehearing ap bane) -2.... 44A.

A, J (Order of ‘the Court of ee ay.

ing amotion’ for reconsideration), ie ee

Table ‘of Citations

Cases: / .. Se ee : gk one

iS fee bin SS sonerrom rome ae

DPriivtey x. Barter 225 XC; 691, 36_8.E. 2d 281

(1945) ..... ne SVAN oat rity) enue Roane omar |

Cook County v. IKaly 29 Th: 310, 18 NE. 623 * :

PH a Saree peer ae

Cramcty. Sun Tasurance’ Office, bad. sia F.2d 670 ere

(4th Cir. 1967) aa 14.

Elyin, dd BR, Co. xe Burley 325 U. Ss. 711. (1945) 13

Giannetli Ho oN. McGoldrick i205 N ne. & 208, 66 NE. ‘

2 51 (1946). ._..: Sere Spade Bier Ree NNT IE Lope deem al

Gordon vy. Monaghan 300- N.Y. 306, 130°N.I. 2d 882:

“RSS Sa NOAM STEER TOs pre inte aI Lame eee re} |

Girton Vo APONS 3 3a. F, 23 71 ¢ 9d Cir 1964) +22. 15

Hanshury vole OM U.S. 32 (1940)-s..:0....- eee: 18

Inland’ Steel Co; NLRB 70 F.2d 247 7 7th mote

1948). €ert. de. N, 336 Us - 160 (1949) ems ‘11

a oe Local Union No. 181 31 F.2d 62 2S. (6th; |

r. 1962) gext. den. 373.U. S. 912 (1963)°2:..° 15

“S nnoyer Vv. N¢ff 95 U. S714 CLES ee eee : ee 18

Poller vy. Coliupebia. spapptoel whew Sys tone 568 U. S. ,

We CR Pista tacks JO ER lin aaa eM Ae SR SEN ae et te

Sivlor v. Ark

Severson v. Fleck 251.¥.2d 920 an Cin: 1958) 2... 14

—Socony Mobil Oi Conipany- Tre. “TTumble: oe

Refining Co38ST P20 155. 10th Cir. cy Seeaheans 14)

Spearman v. Williams 415 Pl 2d 597 (Okla. 4 O06) “oh a

Trew ¥. Nirkwood 4? Cal. 2d 602, 268 P.°2d 482°

msas Gas ee 201 1. S, 620.(1943) 13.

U ited States v. Dichold, Incorporated 369 ) U. S.

(1954) 25 SEAN rina te aan take ed 15

> . Pueker v. Shaw 378 F: ad 304 (2d Cik. 967). ai AOE . :

a Tuchér v. Shaw 308 FB. Supp. 1 L(E DN.Y. 1970) . 23

—"

+: Statutes: 2 a . a?

er gets en j ;

Dasihion APU ey It jurtinesane Diselos@e Act

. (97 ‘ :

Ob WI, Act -of ‘ah “al ero hey I, 195 ‘), yar 86 RAY

ree . ° - . oy”? ‘ %

: [itl \ ‘% oT 04s) Stet, PP le ; pee. oe

Séetion.3(q), 20US.C. 5 408(q) 8 ee

yon + & . : ; : hua

Section oO1; 294 S.C. SOp- 00 1) tf Pau

ion SSR SC. 50 20, 2

Section ini Ee 4 gold? .° : 4

Gy iron ope

Rules: : i promens eal |

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Role So Ch) sof the I eval it lax oy Mapettate 4 Ge

tre, 224

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PAGE

fs ps ' in The cet

| Sipreme Cont nf the Huited States

Oc tober Te rn, 1970

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Marnie Mo Seaan and iseex NKarcumMerns. - 7:

Petiti G He fr.

v o. ca -

James Monntssiy, abosein Paniuna, Ratei Terai,’

a Tudividyal! vandon behalf of the Members of the

; - National Maritine U aon of America,

‘ ' * ; ate spond nls,

PETITION -FOR WRIT OF CERTIORARI TO THE -

UNiTED STATES COURT OF APPEALS

FOR. THE SECOND. CIRCUIT.

Petitioners Martin K. Seeal abd: Leon, Karcher

(Neca and “Karebiier’) respectfully pray “that a writ,

‘of certiorari issue to reviely the judge nt of ‘the U nited

“States Court of Appe als! fo ir the Second. Circuit, entered in

the; shove ent! itled ASC on r Drnary 20, 1970.*

* Pefitioncrs Sexal and Karchmef Also support the petition for a

sae at certior: ari COctober Tern n, 1969 No, 1618) which has’ been.

filed by et ttioners Joseph Curran, Shannon Wall, “Williain ry

and Aber: thant Frees hmart on the grounds set forth therein.

Pav eee g

Opinions Below

The opinion. of the Court of Appeals for the’ Second

C ireuit, which Is reprinted in Appendix “Er hereto, is re-

ported at 423 F.ed 393 (1970), The memorandum decision

i the District Court of the Southern District of New York,

Which is reprinted, in Appendix “Bp? ‘ hereto, is reported at

v2 |, Supp. O02 > (1969), |

Jurisdiction fees ;

‘The judgment of the Cotirt of Appe ads for the Scvond

Cireit was conte red Mebruary 20,1970; Timely petitions

far re hearing and rehearingsen bane by detonitants Martin

K. Segal amd etn Karehiner vere denied Ive orders

entered. Mareh Al, 1970, ( The ordets de nying the _petitions

for rehearing and “xohe; aring en Dane are reprinted in

Appendix “HH and S17", respectively, ) Jurisdiction of: this

Court is invoked: under 28 U.S.C, § 1254. (1).

‘Questions Presented ‘For Rgview |

-. -Where in an action Tvought under » 001 of the I Labor- ,

Management Re ‘porting e and’ Disclosure. Act of 19: 09, - 29

U.S:C. $501, against certaiy union officers and trustees of

union pension plan’ for allegedly acting in contravention

of the union's constitution bv ame nding a tmion pension

plan to include as beneficiaries supervisory employees of

the ‘union who were. not otherwise receiving pensions

incident to their employment with the union, while all other

employees ‘oF’ the Wnion and its officers were receiving

such benefits, and where such action was brought ¢ eight:

years after. the pension plan amendments—which were

well-publicized and a matter of publie record—and where

numerous pensions have been awarded under the pension

plan over the past eight vears to supervisory employees

of the union and have accrued for others, and wher there

Ir no evidence that any of the defendants personally bene-

fited from the spaced vension plan vamendments

(A) Did the District Courterr in subttitidting ity

Own internretatie:, oi the union's CCHS ECOL GI, ror

-the reasonable interpretation “ collsis teiithy placed *

Upon the constitition gyvtgoed: fuid cry the? iron's

officers ? |

(B) Did. the. ‘Distelet Cowrt err in granting tiie

intitis’ motion for SUMINAEY Judgment. thus de-

priving the Gefondnnes of m-trial as to«the actual

-- intent of the alrafters of the wmiion cConstilution aad

Hof the unica amend rship, When two inthrpbetatious

of the wnioen's Ons UtIETG Nn we ae reasonally Poss tlle

--one favorable to the plauntifis and the ‘ther: %

the deéfe ndamis——and the union inembeorshin recent

voted ovérwih boimuaghy fo udopt Ute inte hpre Wition ore

the union « Htc ie

(GQ) Did the. Distritt Court err in ee the.

am)

plaintiifs san TMA ae vent when qateral factual.

isstes ot laches ex eu : as to whem phittilis a cane

i ¥ if rs : Ff a9 rh. 1 an a i ;

~ aware ofAhe pei slo y phi Bb amendinents and why thes

Goived bring ti i soa wWesatit until « roa 5 Wa 8 Ney A ld eho ar aR

(he pension pian amendments beexme public knowl-

re?) ¢ * ray Ye 2

(1), Did th Disieict Court err in grantit ne sum-

ef onary jndgine ee against defendant, Martin E, Seal.

ghe of the traste ss ol the yp nsion }} Han, who was not

a party fo. this action at the thie plaintiffs made

t! le troamotion for stimnary judement or at the time

Y the hearing .af said notion, and wag such error

cuved by the. faet che défendant Segal participated

in 2 sithsecite it qotion for Teargument Which was

denied? ; |

(i) Did the Distriet Court err ip holding that

defendants. Segal sind Karelimer. trustees of the

tmion peusion plan whose only connection with’ the

union was? de fined: by the truixt agreement and who

Aa . 4 .

are neither officers nor emplorees of the union, are

subjeet te the fiduciary duties established by .29

Wess. SOL when such trustees are already subject

to the wellestablished fiduciary, obligations posed

on them by their trust agreement and state law?

aie :

(IF) Did the Court of Appeals err in-holding that

, certain amendments to the union's constitution.

Whieh were propesed by the thiiea’s officers dr order

to provide the constitutional weiliorits Which the

District’ Court iad found lnekine. to hrotect the

pension henedits whieh had acceued for some forty

Jsupervisory @mplovees who are telying on ‘the avail

vhility of these funds at. retirement. and to validate

-past) pehsion awards to ‘other eliplovees, were

“exculpatory” within 20 US. 6 501: 2

Hl. Dik the Court ef Appeals for the Seeond Civeuit

Vidlate the procedure established by this Court in Ride

SoA) of the Pederal Rules of Appellate’ Procedure by net

siving.Judee John A. Danaher, Senior Cirenit Jude of |

thie District of Columbia Circuit, sitting -by designation,

the opportunity to reqitest a vote on the suggestion filed

by defendants that « rehesrigg of the ese be held by the

Court of Appeals sitting ov ‘bane, even thouch Jiudge

Danaher was a member of the original three Judge panel

which heard and-deeided the case?

a Statutory Provisions Involved |

The statutory provisions involved are Sections 23(q)

sand SOl(2) and (b) of. the Tabor-Manageinent: Reporting

and Disclosure Act of 1959, 29 T.8.¢. >) 4924), 5O1(a)

Yl (hb): Rule 56 6f the Federal Rules of Civil Procedure;

* Petitioners Se&al and Karchmer incor; poe ge reference, as if

fully set forth hereif, the reasems given at pp. 13-18 of the petition

of petitioners Curran, Wall, Perry and Freedman (October Term,

1969 No, 1618) for the granting of the writ as to this question.

amd Rule 55(b) of the Federal Rules ‘of Appellate, Pro-,

cedure. "Phese provisions are set forth in. Appendix “A”,

* i? -

Stuiement of the Case . tea Cs

In Lot, the Constitution of the Natioginl Maritime Union | -

(NAEU) was amended by approval of the enibership to:

vive the National Couneil of the NMU power, subject to ..

membership approval. to oxtablish the salaries, and pen-

sious OF employees and officers of the. NMU ; ia “Ap-

pendix pp. 2Za-25a)* From 1951 ‘to 160, the National

Council exercised the power provide din ‘Article 15 58 of

the 1951 Constitution by establishing pensions in collective

bargaining agreements with’ other: unions coyeriIng NMU

‘Yank janet’ Oat (Apnendix pp. 28a-29a). Also

mresuant te Art. 15 SS of the TS) Constitution on Decein-

Der 29 “4959. a Trist Nereoment was entered inte between

the N Me and defendant trustees Segal and Karchmer.and

“Herman EB. Cooper (dofondant Abraham EB. Freedman

hein the sueeessor trustee to Cooper), establishing a ‘pen-

‘sion plan for officers of the NMU (*NMU Pension Plan") +

>. (Toint Appendix p. 26a). By 1961, then, only one category —

* The 19351 amendment read as follows:

ARTICLE 15

SALARIES OF Or FICERS ; .

Section 1--Salaries and Expenses: :- The National Council

.is empowered, subject to approval.of the membership, to

set from time to time the actual salaries and daily expenses of

all Union officers and emplovees-.

Section & Pénsion and Welfare: The National Council, ‘

subject to approval of the men thership, is empowered to: make’

adequate and appr priate provisions for. pensions, welfare and

- — similar heuefits for officers and employees of the Union.

‘

Se 6

of NMU employee Was by Without any pe nsions--naune ‘ly,

supervisory employees. ae. mt

To remedy. this ae e on October 28, 1961 ~the

Natjonal /Otlice? * authorized an ainendment of the NM

Pension Plan to include within ‘its coverage cight super-

visory cmployees, including defendant Perry (Joint Asp-

pendix pp. “Naela). The: National Office authorized these

ainendments on the hasis of its interpretation of ea. 19GO

Constitutional Amendinent, Art. 8 6 11(a) of the 1960 Con-

stitution,® * whieh had given the National Office full power

to establish all emplovee “salaries” without membership

“approval, concluding that the power to {ix the “salaries” of

employees included the power to establish ‘heir pensions.

(Joint) Appendix p. 292) In 1964 the NMU- Pension

PT] ey 90 ™s. “hy ‘hae sy 1 a | ; Py Vn . f 44 \ a, YT

Plan was’ further amended to ine cin all Cbbagidet

2 aaa cee ae >

“hrthis respect, the stat ment by the Court of bile ls at 423 F.2d

at $93 n.2.¢p.20.\ nla. iufra) is clearly erroneous. There is ample

unecontr wlicted evidence in the record to, show that none of the NMU

supesvisory employees brought under the Plan in 1961 had any pre-

Vious pension coverage in collective bargaining agreements betiveen.

the NAMIU and any other union. .( Joint Appendix pp. 28a-29a, 39a).

his was explicitly recognized by Judge Danaher in his dissent, 423

F.2d at 404, 402 (pp. 30A-3LA, 33. infra). Moreover, any pay-

ments which defendant Perry received ander the NMU Deep Sea

Pension Plan were received by him in his capacity as a seaman and

not in his capacity aS an NMU emplovee. Phe 1 nonévs for the Deép

Sea Pension Plan ave supplied by the 4 ATIOUS sigloters with whom

the NMAC bargains as a collective bargaining agent for its seamen

members, and do, not come out of the phe ei . (Joimt

Appendix p. 84a) y

** The -National Office of the NMU, w hich meets weekly consists

of the National President, National Secrefary, Treasury, three Vice-~

Pre —— and three National Representatives. ; .

** Article 8, $ 11a) of the 1960 Constitution read as follows:

“The National Office... shall fix the salaries of all techni-

cal, clerical and administrative personnel as may be required

for the effective administration of the Union’s affairs.

Ne ees in addition ta those- already: in-

cluded: in boot, (Joint Appendix yp. wa-oVa) The Pen-

Sion Phin amendments of L961 and 1964, as well as annual’

reports on the’ Plan, were filed with the Department of

“Labor-and were a matter of public record and were well-

publici ised among the union membership. (Jodat Appendix

pp. Soa-Sfa) “Under the NMU Pension Phan,-from 1961

to the District Court's order; pension benefits had either

actrued for or been paid out to approximate ‘ly forty-seven’

supervisory guiployees, — (. joint. Appendix ‘pp. 62a-G3a) .

Mar oxsinple, a former exce utive bookkeeper retired in.July

19u8 and—at least bevore the Dis strict Court's order—was

receiving a ‘modest monthly pension from the Plan of

S1OLAt for a ten agar terin; in August, 1964, a former

—amaiitenance: sapervisor retired after 20 years of service

and had beon receiving a ionthly pension of $412.88."

(Joimt Appendix p..Séa) And approximately forty super-

Visory ciiplovees have had their accrued benefits wiped

out by, the District ‘Courts’ order, (Joint a pp.

62a-63a) - ; <8 ; ;

On February 4, 196 0, almost cieht years after the 1961

Pension Plan samendments, the plaintiffs commenced this

Jawsuit under 29 U.S.C. $501 .claiming that the amend-

ments were in violation of the 1960 NMU Constitution and -

secking an accounting, repayment of all moneys and a per-

manent Injunction restraining all. future payments. «(Joint

Appendix pp. 1a. Sa-f2a) eo Lone | 4

On or about Mareh 19, 1969,, nlaintiffs eross-moved for -

emmmary indement, defendants Currane Wall and’ Perry

having previously moved for similar relief, (Joint Appendix

pp. 24a. 41a). The motion and eross-motion were heard

hefore: the Disfriet Contt on March 26, 1969. Defendant

Seeal was not served with a eopy of the stmmmons and

complaint until April 11, 1969, (Joint Appendix p. 2a).

ee = a

On Jiily J I, e909 the atiek boot ranted the eross-

tnetion Gf ae vintifls. for summary judgment against all the

defendants, ineliding defendant Segal after denying the

thotion Of defendants. gctran, Wall and Perry “to reargue

“on aly 3. 1969; (The orders of the District Court entered

on dubs A T9GY ee July 3, 16D are re print ted. as i ala

a “* ee

dices "C™ and “D") respee tively, )

Incenying the motion to re: areue on. July | 3. the District

Court also considered the. alidavit of defendant - Segal

la whieh the Coturt Wye informed that defendant Segal hi vd

Hom oon subject to the Cou rt’s personal jurisdic Lio n al tiie

time of the hearing of the niotion for siummary judge ni

wd the vefore had not had an GPpPoryysy

to present his!

case, (loint Appondix pp. 8n-59e) The PRtrict Court con-

sidered the atidavit but did not grant defendaar Seeal’s

request to reargue, -( Appe ndix “DY fifa) *

man effort to remedy what the’ District Court had at

: he a lack of consti itutional withorization for the 196T

NMU. Pension Plan ame ndiments, to protect the pension

oe whieli had accrued under the Plan since 161 for

supervisory emplovers who were relying on receiving these.

paaaies retiroment and tg validate past pension pay-

remiss the union sect in motioy the steps to amend its con-

stitution expressly to erant pension rights’ to employees

iathuling all-ihose already granted pensions (Joint Appe n=

dix pp. StaSoa).-On ‘hime 4, 1969 the membership over-

whelminely: approved the amie mdments Gfoint Appendix pp.

MaMa) but he fore the amentlmeénts could be imple ine tod

plaintiffs” son seat to have’ them declared Sexe alpators”

within 20 USC: 50M (a). The District Judge tebod Hoek the

- armendyy oe were not exentpatory but obviously liad as |

thetr pur} ose the Inclusion of nomoflicer employees in the

‘Pension Plan. (Appendix “BE” infra)

The defendants appeale ( from the District Court's deci-

sion. holding that the 1961 NMU Pension Plan anrendments

were NOL constitutionally authori ized and alt lintifts appeale :

frond the District Court's determin: ition that the Constitu-

tional amendments: of June 4, 1969 were not exculpatory

Within 29 UIS.C. § 501 (a). Phe Court ‘of Ap ype als ima split

decision affirmed the Di trict Court's de ‘Htormination the ut

the Pe nsion Plan amendiments violsted the NMUC dnstitu--

tion and reversed the District Court's decision that the. -

C ‘onstittt ion 7 anendments were not exe sulpatory. eel re

Danaher dissented on. all erounds. (The judgment of the

Court.of Appeals éntered on F ebruary 20, 1310 1 ix appe nde d

as Appendix eat

On Mareh 13, 1970-defendants Soul and Narehmer filed *

a: petition for rehearing and isto aa banc, both of -

which Were denied on Mareh 31, 1970. (Appendices “11”

and “1 qifra) “a cad voted to grant the petition

for rehearing but, sinee/he was not an active Cireuit.

Audeo of the Second Circuit, he was not given an oppor.

tunity too request a vete on the petition for a rehearme

en bane, On Ayril 9. 1970-the defendants made’ a-motion

for reconsideration on the erounds that: the’ Court of

Appeals’ failure to afford JIndge Danaher this opportunity

Vielated Rule 35¢b) of the BE

Procedure, On April 24. 1970 the Court of Nppeats denied

the motion without opinion. ¢The order de nyving the mo-

tion for reconsideration is yeprinted in’ Aype mdix J"

hereto.) * ; ;

« . P : - fs

1. . : Ors ®

eral Rules of Appellate —

;

10) ; ‘ rae

REASONS FOR GRANTING THE WRIT

ie oe, eet ae

The central issue involved im this caisg whether a’

federal court in.a suit under 29 U.S.C. § 501 nay sub- -

a”

stitute its own interpretation ef a union's ; comslitntina

a . 6

for the reasonable interpretaiton ef the. union’s own

officers is an issue of - importance to. fedcoral courts:

reviewing the actio: is of union officer s unilor 29'U.S.C.

$501. and -to the internal PROM nt .of unions

_ throughout the United States and ts closely related to’

a question upon which this court recently - «ranted

‘certiorari on Mav 25, 1970 in Internationa! Brother-

hood of Boilerinakers, lron Shipbuilders, Blacksmiths,

-Forgers and Helpers y. Hardeman, No. 1292. October |

‘Term 1969, a case arising under 29 U.S.C. 8 SB. Yk

At the heart of this ease is the’ isgae- whether in gan

. ¢ : - . . ie wee

aetion under So0T of, the Lahor Management Reporting

and Disclosure’ Net a federal court) may osubstitite its

own Interpretation of acunien’s constitution for the rensen

cable interpretation of the union's Officers which has been

consistently Tapplied) ly them aver the venrs im a awell-

inte ‘tioned effort to inple nent What they thoueht was the

intent ‘of the membership. fs an issiny QP paamotird

MMportance not only to fe woral eourts tn interpreting union

constitutions under °o0L but its resolution is alse vital

to the administration of the thousands of unions throneh-

ont the United States. These amions are guided by men

;

_who, for the most part. have worked their way upethrough

the ranks to officership:. they are not Tawyers skilled’ in

strict statutery interpretation and construction. «Tf they.

are deprived of the right to interpret their constitutions

reasonably ina manner apparently acceptable to the mem-_

hership over many years, and instead are held retro-

actively to the strict theory of legalistic construction’

Papiplied by the: District ¢ ‘ourt atid aimajority of the Court

of Appeals here, whieh: scoms to “sacrifice intent to an

OXCESSIVE ‘Ly literal reading, this mere seriously impede the.

internal fune tioning of unions Ty a the count Vv and

ereatesextremely unjust results. .

This e&se presents aelenar. e Nanple of this danger. The

union officers here merely amended: gunion pension: plan to

provide pensions for Supervisor vy emplovees W thes snion,

Who were not otherwise receivine pension he nefits. Phas

anion officers authori VA “l such an ame ndiment hase chon their

miterpredt: Mien of fhe constitutional provision vivine them

_power {6 estabtish’ all employee “salaries” without mei:

bership approval: This constrietion is th accord-with ense

law which recognizes that the ferm: “Sakiry” iss broad. and

Smneludes an employee's total sompr nsation for work per-

‘formed, including “pensions” and other frinée “henefite

whieh are in effect deferred payments of salary. See ecg,

Brumley vo Barter 225 NC. 691, OSA, 2d 281 (1945):

Giannellino vy. McGoldeick. 295. N.Y. POR, 212. 66 NE. 2d

DI.59 (1946): Gordon Vv, Monaghan, 309. NLY.-336, 342: 130°

N.I. 2d 882, 885 (1955) 2 Inland: Steel Co. vy NLRB. 170

2d 247 (7th Cir, 1948) cert, den, 226 aa

Moreover, fs Judge Danaher re cognized | 1 his dissent,

the F9GT Pension Plan amendime nts were 4 accord with

the apparent intention-of the. union jnembership.

In adopting this inte pretation of their constitution,

none of the defendant officers personally benefited and. as’

‘for the trustees, Judge Bonsal' specific: ly stated that, the

court was not questioning defendant Segal*s godd faith,

(Joint Appendix ip aa 144. imfra).* Yet soi da this,

* There was in fact no evidence that any of the def fendants acted

in ot Taith. a . Tay

sr _

12°

these defendants find themselves eine. sued. for bree ' ot

fiduciary duties for mere ‘ly extending pension benefits doe. ‘l-

group of employees ii-accordanee with what they reason-

ably eonsidered to he the wishes of the mombershiysaud

what they ‘Teqsom bly: beled they hi: nd the power to do:

“By the erant of SUEY Judgment, til have eon

deprived cof an opportunity ofa {rial of the issues. of.

intent and Jne ‘hes which we as ¢ ‘les arly required on this record,”

A decision by this’ Court is aippropr late to tnake lear that

‘2

in ‘the’ future union ‘oflicers TAS inte rpres their cons stitutions

"yesisoni ably without jeopardy under | 501, and without ‘the

risk of the substitution of the Distriet Court's interpretae

tion for their awn, withont even the opportunity of triétl. .

The Rirportance of such issues has recently sheen recog.

nized by this Court in granting a petitten for a ‘writ of

ce rtiorari in Tite ruational Brotherhood of Boil rivhe Pss-

Tron® Shiphuil lers, Blacksiniths, Ford: rs end We [pers N.

Ge orge W, Hard: man No, 1392, October Term, 1969 on the

issue: “Whether a federal court. in. 2 Neetion a2 [29

U.S.C. S412]. proceeding reviewme an expulsion of a

‘member ba aounien may appiy ao standard af review

- whereby the court substitutes its own factual findings and

Interpret ations of se’ tmion’s constitution and by- aays, For

these of the union.” Tt ix respectfully, subinitted that this

Court shoild er: ant certiorari in this case also oso. that the

“ti ind ari-ol inte rpre Hailtow, 1a he applied unde Trosee ‘tion ao,

as we Hl as Section 12 of the’ Labor Me ann ere nient Re port.

ing and Disclosure Aet of Ft A Wi de more eke arly defined,

the duties of the District Courts i thix eeneral field may

be yerformed awwith reasonable - eonsistoney and-union glli-. ‘4

clals and trustees may he protected in their right to aet

reasonably under their constitutions. tears Olt AY.

. “~ 23 f geri .

Sings the dekigion. By the Court af Appeals ‘ihn.

The the District -ourt’s net of summary judgment

_ to the plaintiffs i is, ag e from

decisions ef this Cia and conflicts in rinciple with

decisions’ from other Circuits, restricting the use Of

summary judgment, this Court should exercise its

_ power of judicial supervision to protect ‘the right of

‘deferdants to a ‘factual hearing. es

This ei in? United. States . Div bold, Licorporat d,

B09 US. 654 11962) condemmed A ey anting Of stm: uy

AE where contrary material inferences could De

drawn from’ the underlying, facts of a dispute: |

2”

“On supers judgement the inferences to ag

drawn fram the unde vivine’ facts. cont: ained., ine scl

materials |: lidavits, exhibits, ete, Tamust he ®eewed -

in the Neht mest favorable. to. the party opposing |

the motion. of Study of the recordi m this light leads

its to believe that iMferences coutrary to those draw w

by fhe trial court might be. pe rnissible.? 369 TLS

at GD5. (empl isisradded) 5” ae oe

Sir sles ID Tin, To E.R. pers Zo U. 8. 7h, -

748 oe »y and Sartor wf) eansas- ‘Gets eae a U.

G20, 7 (1943 ). And im pane Tv. Columbia Broadca ee

, Soe HGS UL S2 464, 467, 475 (1962) this ourt. reversed

oa grant of summary judgement since the ease presented

nrterial issue of intent which could not be resolved ws a |

nuitter of law. Meme, a ‘. .

A. The Factual Issue’ of’ the Intent of ,

Drafters of the Union Constitution and the

Union Membership. eer | Pe

It is well e “ti: ablished in. cases orca other C irenits involv

ine » the construction of written Instruments that when

language of a Written instrument is susceptible to more:

* e ae re

than gne reasonable Interpretation, summary judgment

inust be deyied and a “trial inust be had to determine the

intent of the parties of the instrument. « Sco c.g. Cram vy.

Sin Insurance Office; Tid, 375 F.2d 670; G74 (4th Cw.

1967): Socony MobT Oil Company, Tne. ve Mumble Oil

Rejining Co., 387 Vid t55, 157 (Vth Cire 1867): Sererson

V.. Fleck, 251 F.2d 920,922 (Sty Cir, 18).

The National Office of the Union ‘interpreted its power

“as established in Art. 8. 6 11(2) of the 1960 Constitution

to set employee.“ salaries” ats ine nding the power to, estab-

lish pensions and on that basis anrended the NMU Pension

“Plan to include “supervisory” employees. . As discussed

above, seep, 11 supra, this interpretation is unply sup-

ported by cas® law and avas also snpported by the past

practice of the NMU in providing pensions to offcers and

non-supervisory NMU employees pursuant. to. Article 15,

8, of the 1951 Constitution.* ’ :

The District Court and the Court of ‘hie als aeknow!-

edged that the word “salaries” as used in Article 8 £112)

of the 1960 Constitution could) he interpreted ” include’

“pensions” but stated that a “careful distinction” was

made between: the terms “pensions” and “salaries” in. the

NMU Constitution merely beenuse Article 14 of the 1960

_ Constitution, whieh incorporated both terms, was labelled

“compensation”, rather than “salaries” 423 F.2d at 397:

302 F.Supp. at 35- (pp. 7A-SA, 244M jifra). Towever,

_Artiele 14 of the 1960 Constitution was far removed from

Artiele 8. and dealt with an entirely, different subject

matter.** ? ay x

*Tt is unreasonable to conclude that the NuMU membership would

choos se hy deprive St pervisory NMU CH} Tovee S of DPEMISTOnS while at

the same time giving its officers and 1 ant ee file NMIU employees

these benefits. 7

** Article & dealt with the power’ of the National Offiee and:

Article 14 was concerned with the compensation of officérs.

. % .

Moreover, given the loose and unskilled manner in. which

union constitutions are often drafted. it is highly unreal-

istic to conclude that the drafters of ix NMU constitution

intended.to make such nice distinctions mercly by labelling

an Article with one word rather than another. F inally.

since-“salaries” and “compensiition” are synonymous, Tre

. Kirkwood, 42 Cal.-2d 602, 268 Pe 2d 482. ASG (1954) :

ars v. Williams, 415 P. 2d 597 (Okla. 1966) +-Cook

County v. Healy, 222 Tl. 310, 78 Nag. 623 (1906), the us

of one rather than-the other indie: ites at most the person)

predilection of one of the drafters and certainly does not

deserve the far reaching significance accorded to it by the

lower courts here, As Judge Danaher said in his dissent, |

if there he a danger in a too literal r ading of Congres-

sional statutes, how much more eaut}on should he applied

to the inartfnl expression of union drafters. More i lnpor-

tantly, if union officers are to be held to‘such a strict con-

struction of their constitutions, it could seriously endanger

the internal workings of unions by. placing impossible: bur-

‘dens on their officers, which clearly was not the intent of |

Congress, as this Court warned in Wirtz vy. Botilr Blowers

Assn., 389 U. S.. 463, “il text, n. 10 (1968). See —

Gurton v. Arons, 339 F. 2a 371, 375 (2nd Cir. 1964).

The recent NMU -constitutional amendments, validating

all past and future pension payments to NMU employees

and passed by an ov erwhelming vote of the membe rship

(Joint Appendix pp. 95a-96a), also support the reasonable-

ness of the interpretation of tlre National Office. Similar

relianee on practical construction as an aid in deterthining.

intent, (See e.g. Pekar y. Local Union No. 181. 311 F wd

628, 636 (6th Cir. 1962) cért. di n. 373 Uz S. 912 (1963))

“points. in the same direction. The overwhelning vote by

_ the NMU membership for the adoption of the recent

amendments indicates that it has heen the consistent intent

‘ ; 16

“01 the Inemborship to provide Pensions for alh NMU om

Ploveds no matter what. their statis, Amd the apparent

ATCC Le Seen Iny the memberships todelenadsaie Interpreter

flons over dian Mets. antl plaintilts’ ehatlenee. stronety

Supports that conchision. | :

Ht is Clear Hierefore that there Were saflicient faets under

IMiner this dispute Crom Which the lower courts comld hive

drawn the infeience that the Interpretation of the National

Oles was retsonable, AO trial of the issues was thus

clearly required ceed Summa Jide fent was Heapreper,

Phe decision below thiseontlie(s In principle with the ees

statis ol this Court and those Inother Cirenits, cited hove.

‘It would SOOM desirable in the Interests: af cou, Isfenes in

the application of provisions for the useful but Hiinnitend

remedy of sumuntry judeinent hot to deny the right ton

Tull trial of iMpertant isstes” of (he. sort invelved here.

Where the rights ofpny Union menibors smd CHIP TOVCES gre

stivectly atveeted and. the riehts of Inaiy others many he

imal reel I\ 7 fected,

B. The Facttal Issues of Plaintiffs’ Laches . si

There are material laetual issues as to ‘the plaintiffs’

laches. whieh the Court of) Nopeals idenered in aflirmine

summary judement. There is tbundant evidence that pre.

dice has resulted from ‘the echt vear delay of plaintiffs

in- bringing this stit. Pension benetits aeerume over the

“Venrs for Qpproxtnintely forty enmplovers of the NAV whe

have relled on these henmefits tn Mannine for retirement will

wiped ont and hionevs whieh are beine paid oitt umder

the Pension Plan on a monthly basis te 2 number of NMU

cemnploversy whe rely on these pavinents to finance modest

retire mn nts. have stopped. (loint Appendix pp, 62a-68a,

sna), . .

Moreover, it is reasonable to asenme that plaintiffs,

henge active members of the NMT,. have lone known of

the NMIl™ Pension Plan amendments. Tndeed, plaintiff

Padilla. himself. has reeeived Inmp sum payments under

the Plan (oint Appendix poeta) md, as Judee Deriaher

noted an his dissent. the orierrmal Plan and each oot its

subsequent giacaedtients sad wanted reports dinve been

. : ; e -

ted with the Department of tadbor ao have been matters

of publte reeare avaliable to the. o plaintiffs. 425 We: Pd at

401, 400 (pr. SA, ON fra) Chain Appendix po Sha Stay,

7 j : F ey = ~

Phere are, therefare, raiberisal pclae issHes fo be re

solved on the isste Ob plaitiis? laches concerning the:

time at whieh (Meso: pleintilfs heeame awere Of the jimelu-

ston of non adficeers | tinder the Plan end, if they deliyved

after Having aeqitired Wiis knowledom as tothe reasonable

ness of their delay: _ :

Phe majority. o nnion in the Court of Aq eas peqeetod

ay Y oO} | ee

defendants’ defense of Inehes One the wrounds thiert

the matter of proper pavinents of union bunes fo pep.

ssons not entitled to Cherm isa confine fen so and ennnet

herr ane tajumetion:: te prevent’ contimed poavinents or an

recounting for all of the mata PL xa if ipa: 4

abo (Cp. PSA Gufia) Bat while te defense of laches may

not barvan injunetion to prevent equting loaavinents. ales

4 ! ere re eae

Mvolved here gre moness that have otpe iN been add oat

fo NMU emplovecs, ae Whtelmentys the Court of Ay

peals-has intimated that the defendants may be peg onal by

linble, 423 7%. 21 at 399 (), 274 snfra)

Sines there ate win rial faetuel pecres ny ent here con

corning the jitert of the NAP Inetnbershin and the dy

the 1969 Constitution. as well fs with respect te’ 4

Waintifts’ laches, this Cont. shonld erant corti rend. te

ensure that defendants linve, the faetual d. fer nation

Which they are entitled. As Jude. Danaher sthted in dis

dissent: ,

it xeoms to es a hearing, at least on this

aspect of the case Faches), was clearly in ariler. 7

r As Iw'ge Danaher noted jn his his action wwa's com-

oe dugine the edurse of an NUIT Téction in which plain;

Morrissey pa Pada were <oun Hy Pe 423 F. at

(Joint Appendix p..64a: p. 30\ nfra)

Sea ee

Fail to see how the Judge could have faulted the

dele adants as haying. tmade no. showing that they

have been prejudiced by the delay’ Po what extent

that conclusion of the Distr ied Jidee entered tite his

determination that-siminary Judgmeny was in ord

we_de not know, But we do know that de spile ms

ahise HEC of ( rirenste eri lee both: City ilies pout aud

with respect to what was in‘faet the inte sa of the

; Cnion, simmary judgment for the. plaintiffs was

direct d, l/ SHIM T} jit pane REe-owere nob io be

cide re doi far Or af fhe de fe ndants for. fhe LPOOSOIS

previously advance deat lhe Feory least accarding to

wry appraisal ofthe record here there should have

boon a hearing, There was error on account of lial

fadure if for no olher reason.” 423 2d at 405 (p.

LON feira) (Mimphasis added) :

Since defendant Segal was not a party to this

action at the time plaintif ts made their motien for

summary judginent and at the time of the. hearing

ef said motion, and the District Court subsequently

refused him the right to reargue, this Court should

grant certiorari to remedy this clear departure from

proper Judicial Brocemne:

It isa Fatah ‘ntal te i of due process that one ean-’

Hot be bound bya judgiaent a personam resulting from

litigation in which he was not desienated ‘a party or to

Which he has not-been made a party by service of process,

Hansbury ve Lee ms U.S. 32, 40 (1940): Pennoyer vy, Neff

wo UL S. 714 (1878 This rule was violated in this ease

sinee defendant aie Was neta party at the time of the

hearing of plaintitts” motion for stunmary judgement (Mareh

26, 1969) and, therefore? to the extent that the judgment

of the District Court: ai tOchim, it scems ¢! learly void,

vet the Court of Appeal ees his fundamental defect.* "4.

This ch eC WAS Ol CUE! i hay ihe fet that. defendant

Segal submitted an affidavit. in support of the inotion of

derendants Curran, Wall and Pe hey to reargue Inasmuch

as the Distriet Court refused to grant the motion to re-

argue as to defendant Seoalseven though it was aware that

he was aot a party ai the hearjne of the motion Yor sum-

mary Judgment. (p. PL fufray (toint Appendix pp. oSa-

Oa) In.a very real sense “the motion to reareue as to

defendant Segal was. iisnomer, see he was im effect:

asking the District Court for the right to present his ense

for the first thne—a right whieh the court denied hin.

iV. ay

The hola ng of the Court of Appea's that defendants

Segal and Karchricr, trostess af the NMU pension

2 E

plan. ave subject t0 The due’ ary duties of 29-U.S.C.

8501 directly conflicts with the express provisions

~ a 2? *

, oS whew

; the Ecbex Mina cen Repertins end Disclosurr

ct of 1959 and’ the inte-t of Congress. and such

holding. a allowe to stend, w: HM seriously hamper the

proper .adininisivation of wuton pension plans through.

out the United States

oe "The Intent of Congress -

Defoe nits Seeal and Karchmer were named as defend-

ants hi this proceeding beeatise of thei activities as trus--

>) tees of the NEU Pension Plan, They he ‘cane trustees of

the Penston Plan pursuant to an agreement and deelara-

tion of trust. entered into. in December 1952 (Joint. Ap-

* The Court of Appeals iNohided this issue among “the remaining

points raised by the defendants [which] do not merit’ discussion.”

(p. 29 infra) .

~— . 20

€

pendix p. Ga). "Phis* trust agreement clearly sets forth

their duties and obligations to the NMU and to the bene-

litlaries of the Plan. + oo .

LY USGL S501 (a) imposes a fidue! lary duty upon “offi-

eers, agents, shop > He wards, aud other representatives of a.

“labor organization.” These terms are datined ir 29 ULS.C,

»F02(G) as including:

» «+ cleeted officials and key administrative per-

sonnel, whether eloeted oF appointed (such as bust-

ness agents, heads of departine nts, or major. units

or organizers whocexercise substantial inde pendent

authority), but does not include salaried non super-

Visory professional stall, stenographic and service

. per sonnel.”

Clearly, defendants Segal and Karehiner do not fall within

these categories and are, therefore, not proper parties to

this lawsnit. Their coniiestion with the NALU was created

and.detined by the trust agreement. They have vo other

union duties or obligations and do not exereige any other’

independent author ity w ith the NMU, 2

AO further analysis of the statutory provisions as well

as their legislative history clearly indicates that Congress .

did notsintend to include trustees of union pension plans,

such as defendants Segal and Karchmer, under the pro-

Visions of * 501, . Ate D

First. § 501 (a) fixes the fiduciary duties of union officials

and does not specifeally Inention trusts or trustees, whereas

502. whieh establishes a be nding" oblieation for certain

named individuals, specifically refers to representatives “of

a trust in which adabor organization ix interested.” Thus.

the fact that trusts are: specifieally_inelided i $502 but

not in * 501 indicates <a Congressional a 2 exclude

trustees and trusts from the fiduciary dities established,

in S501. . oa ;

‘ a &>

Moreover, when’ Congress intended to control trusts. in

other federal legislation, it did so in explicit terns. Thus,

29 U.S.C. $$ 301 ff, “The Welfare and Pensions Plans Dis-'

clostire Act” explicitly requires the publication, disclosure

and reporting of union pensien ‘and welfare plans.. “Simi-

larly, 29 U.S.C. § IS6(e) explicitly grants District Courts

dase in suits to restrain payments by cinplovers to

trust funds under certain circumstances. Seen against a

hackeround of explicit reference. in other statutes, the.

absence of the mention of. trusts in [SOL and the specific

reference im > 502 eives even stronge : support to the con-

clusion that trusts or trustees’ were not intended to be

Peovered im. d01.* a |

The legislative listory of $501 also indicates clearly that

Congress did net intend to ie. pes trusts or trustees under .

its mandate, Senate bill S. 1585 as passed by the Senate on

April 25, 1959 contaiifed a section which provided: —

“Every officer, agent, or other representative ofa

labor organization engaged in an industry affecting

commerce, or of a trust in which such organization

is interested, shall, with respect to any money or

“* Recent amendments to,the “Welfare and Pensions: Plans Dis-

closure Act” proposed by President Nixon also indicate that Congress

Hd not imend to reach trusts or trusieé’ under $501. These pro--

posed amendments, see Senate Congressional Record (daily ed.

Mareh 13,1970), 3636-3674. would provide a Federal standard of

condugt—the “prudent man” rule——for all administrators of em-.

plovee benefit funds incliding trustees such as defendants Segal and

warehmer. Thus, if the fiduciary duties of trustees of unien pension

plans such as the ohe involved here -were intended to’ be’ estab-

lished under $501, it would haye been totally unnecessary to propose

“these amendments to the Welfare and Pensions Plans Disclosure Act.

Moreover, it is significant to note that the amendments to the Welfare

amd Pensions Mians Disclosure Aet proposed by the Nixon admin-

istration were introduced on -the Senate ‘floor by Senator Jaeob

Javits who, took an active part in the formulation of the Tabor-

Management. Reporting and’ Disclosure Act of 1959. SOSe 4.3.

Code Cong. and Admin, News 2421. j

other prope rty in its custody or possession by virtie.

Of his position as such ofiicer » agent or representa-

tive, have a relationship of trast to any such labor

organization ande the members thereol, or fo any

such tristand the bi He fic lartes thereof, and shall be

responsible ina fiduciary capacity for such money

or other “property, notwithst: andine av CNY au patory

=. ¢lause or action ur porting toexe ingot hin Prom sueh

fod” responsibility.” T Leg. His, LMRDA (NLRB) pp.

MOTT (han phasis, added), a tx :

The emphasized language Was omitted from < BOL (a) of

House DHL TL. Re S342 as subsequently reported, | Lee. THis, ue

LMRDA (NLRB) PP. 030-731, and the lang ie OFS DOL ( a)

of H.R. 8342 was subsequently enacted as the present stat-

ute. Thus, explicit: language Including trusts and trustees

under the tiduci ary duty Imposed under S501 was proposed

and then rejeeted in ongress, indicating a deliberate deci .

sion to exe lude trustees from the fiduci ‘lary Tuties ereated

In SOOT,

i urthe ‘rimore, the very purpose of the Aet demonstrates

that Ceangress did not intend to cover trusteos (oF Hilton

pension Plans. By onacting the fiduciary, Obligation of

SOOL Congress. hoped to clarify. the fiduei: UY responsibil.

‘ties of union officials to their me inbers in view of the CNist-

ing uncertainty about their logal résponsibility, Tt was

‘feared that absent such legislation, union Inembers might

have no remedy for official misconduct. See Senate Report.”

No. 187, Minority Views,:- 1950-7). S.. Code Cong. and

Admin. News 2376-2977: House Report’ No. 741, Supple-

mentary Views, 2479-2480, | . 7

As a-result of the Trust Agreement, defendants Soe: at

and Karehmer were plainty fiduciaries unde 2 state Taw,

There is no doubt that they had’ fiduciaiey responsibilities

* Cita ation refers to a two volume exh: wstive compilation and sur-

vey of the legislative history of the Labor-Manavement Reporting

and Disclosure Act of 1959 prepared by, the N; ational Labor Rela-

? fions Board. :

: 23

and may be ytted ina state procecding for breach of such

duties. Obviously, 6501 was not intended to cover them.

They were not officials about whose responsibility some

uncertainty existed; their fiduciary duties were clear.*

B. The Importance of the Issue

| The question whether trustees of-ainion pension plans

are, proper parties within $501 has not been decided by.

this Court and is an iaportant issue to the proper admin-

istration of union pension plans. Trustees, such as Mexsrs,

Segal and Karchmer, who have no connection with unions

except for their djties as trustees of pension plans, as-

_ punt well-define substantiztl fiduciary duties under’ their

7 trust agreements and the applicable body of state law. As

‘spat_result of the decision of the Court of Appeals, they are

now also fiduciaries under a relatively new federal law and

have the added burden. of examining unfamiliar union.

-constitutions, which are frequently poorly drafted,, to de--

termine whether there is constitutional authorization for

the action of the union officers with whom they deal. This

is clearly an unreasonable burden to impose on trustees

who, at least before the decision of the Court of Appeals,

had their duties and obligations defined . only. by trust

’ eels

*'The Court of Appeals rejected the claim of .defendants Segal

and “Warchmer. that they were not proper parties under. 29 U.S.C.

$501 on the basis of Tucker y. Shaw, 378 F.2d 304; 308 (2d Cir.

1967). (p. 28A infra) But the Court in Tucker had specifically

stated that it was not deciding whether trustees of a pension fund

are proper parties, 378 F.2d at 307, and in a later decjgion in the

same case, the District Court of the Eastern District of4New York,

recognizing that the-issue was still open, granted-a motion by the

trustees. to dismiss for’ lack of subject matter jurisdiction, holding

after an exhaustive study, of the Congressional reports and debates.

that trustees of union pension plans were not intended to be covered

eunder 29 U.S.C. ¢ 501 and that the doctrine of pendent jurisdiction

did not apply. See Tucker v. Shajy 308 F.Supp. 1 (E.D.N.Y-

1970). : oP aoe ga

. zs e

3 ’ oe

ae ° 24

agreements and state law. The hok thes of the Court io

Appeals therefore tan have a detrimental elfeet on the:

adininistration of Union pe nsion plans by discouraging: re-

sponsible and highly repute thle experts in the. field of em-

ployee benefits, such as Martian Es Seenl, and responsible

; ep

" necountants, such ax Leon Karehmer, from even alering

their servieés in. the administratiowof union pension plans.

This Court should exercise its” power of supervision

over the Court of Appeals since it clearly violated the

requirements. of Rule 35(b) of the. Federal Rules of

Appellate Procedure. ;

Rulp 35(b) of the Fede ral Rules of Appellate Procedure

clearly SRN:

Ja votet will not he taken. to eh aps whether

theseause shallebe heard or rehearel.j 1 bane unless

a judge in regular. active service or a judge acho

was a member of the panel that rendered a decision

songht to be reheard. requests a’ vote on such a sue

“gestion made by iu party.” (Emphasts nse

The rule inakes it Clear the aterery meniber the panel

that rendered if decision— ho matter what his status— shall

have a right to-crequest a vote on a suggestion for-are-

hearing ‘ey bane. Cle arly if this Court had intended th it

only active judges on the form Cireuit could request a

vote, it would not have ndded the Taneuage emphasized

ahove, Tlewever, contrary to the plain meaning ‘of the

Role Indge John A, Danaher, § Senior Circuit Judge of the:

1)j~ triet of ( ‘ohunbia © irenit, sitting by desienation on the

three-judge panel that rendered the deeision, was not

Poe a

ox *

afforded an opportunity to request a ‘vote on defe ndants?

sugeestion (See Appendix d infra)*

Moreover, Ai: Ht pt Judge Danaher’s x strong dissent

and his vote to vrant the petition: for a rehearing (See

Appendix “HY infra), de fendants: have been se riously prez

Judiced by the court’s action, Assuming : a request for a

8 vote by Judge Danahe vy it is-conce ivalde that a imi jority of —

the members of the Second Cireuit would have, voted for |

t-rehearing | en -bane. At least. if should not be left to

cae ition what action the Tudeos of” the Seeond Cirenit:

would have taken had the retirements of Rule 36(b) been

followed. Tn- the Cxeredec of its: supemviston over lower

federal courts, this Coirt should erant irate to insure . |

a *

proper compliance with this Rule. * *-

CONCLUSION -

For the reasons stated, the petition for a writ of

certiorari should be granted.

Respertfudly submitted,

Ce Wairsry Nort Srymorn

Counsel for Petitioners

One Battery Park Plaza

New = ork; New Y ork

Roy Ti. Rearnow

‘James S. Montana. Tr.

Simpson Thacher and Rartlett,

Of Counsel,

June. 29. 1970 ae . x

* The defendants made a motion: for reconsideration of die-tenial

of the petition fora rehearing en hance on this Basis but the motion *

‘was denied without comment. (See Appendix i ing Fi: as Sh

hve

APPENDIX A

Text of Statutes

Federal Rules of Civil Procedure

Rule 56. Summary J udement

“(@) Motion and Proceedings Thereon. The motion

shall be served at least 10 days before the time fixed

for the hearing. The adverse party prior to the day

of hearing may serve opposing affidavits. The judg-

ment sought shall be rendered forthwith if the plead-

ings, depositions, answers to interrogatories, and ad-

missions on file, together with the affidavits, if any,

. Show that there is no genuine issue as to any material

fact: and that the moving party is entitled to judg-

ment as a matter of law... .” | |

Federal Rules of Appellate Procedure

~ Rule 35. Determination of Causes by. the Court in-bane.

“(b) Suggestion of a Party for a Hearing or Re-:

hearing in Bane. A party may suggest the appro-

priateness of a hearing or rehearing -in bane. The

elerk shall transmit any such suggestion to the judges

of the court who are: in regular’ active service but

a vote will not be taken to determine whether the

cause shall be heard ox rehears in bane unless a judge °

in regular active settle or « judge who was a mem-

ber of the panel that rendere? % decision sought.to he

reheard requests a vote on such a suggestion made

by a Party.” — ;

Labor-Management Reporting and

Disclosure Act of 1959

29 U.S.C. §402(q) . oe

a “Officer; agent; shop steward, or other representa-

tive,” when used with respec: to a labor organization,

Appendix A

includes elected oflieials and. key administrative per-

sonnel, whether elected or appointed (such as business

agents, heads of departments or major qwnits, and ar-

manizers «who exeveise substantial independent an

thority), but does not include salaried: Non-supervisory

professional stall, stenographic, and serviee person.

nel ;

LO ULS.C. S501 (a)

Phe officers, agents, shop'stewards, and other repre.

sentatives of a liber organization occupy positions of

trust invrelation to such organizations. and its mem-

hers as agroup. Ht ist therefore, the duty of each such:

person, taking into account the special problems and

funetions of a labor organization, to hold its money and

property solely for the benefit of the organization and

its members ane too manage, invest, and expend the

Satie im accordance with its constitution and by-laws

and any resolutions of the governing bodies adopted

thereunder. to refrain from dealing with such organi-

zittion as an adverse party or in behalf of an adverse

party in any matter connected with his duties and

frent holding or acquiring any peenniary or personal

interest which confliets with the interests of such or-

ganization, and te account to the organization for any

- - profit received by him in whatever capacity in connee-

tion with transactions conducted by him or under his

direction on behalf of the organization. A general ex-

eulpatory provision in the constitution and by-laws of

such a labor organization or a general exculpatory

resolution of a governing body purporting to relieve

any such person of Hability for breach of the duties

declared by this section shall be void as against public

poliey.

Appendix A

29 U.S.C. §501(b)

When any officer, agent, shop, steward, or represen-

fative of any labor organization is ‘alleced. to have

violated the duties declared in subsection (2) and the: > |

- labor organization or its governing board or: officers

refuse or fail to sue or recover damages or secure an

accounting or other appropriate relief within a reason-

able time after being requested.to do so by any mem-

ber of the-lahor organization, such member mav sne

such officer, agent, shop steward or representatite in

any district court of the United States or in any state

eourt of competent jurisdiction to recover damages

or secure .an_aceonnting or other appropriate relief

for the benefit of the labor organization. No such

proceeding shall be brought exeept upon leave of the

court obtained upon verified application and for good

eause shown which. application may be made ex parte.

The trial judge may allot a reasonable part of the

recovery in any action under this subsection to pay the

fees of counsel proscenting the suit ‘at the instance

of the member of the lahor organization and to com.

pensate such member for any expenses necessarily’

paid or incurred by him in connection with the

litigation. oe eae

APPENDIX B

Memorandum Decision.

UNITED STATES DISTRICT COURT

SourHeERN Distrrer oop New ‘York

[Same Terris]

MimMoranxpun

Bonsat, 2). de. . ss

e innate ane three me mibe Ss of the N; ational Maritime

Union of Ameriea (NMC ): ‘defendants Curran and Wall

Ure efected office ‘rs of the NMUsdefendant Perry was an

employees of the: NMU and ‘Assistant to the President:

and defendants Segal, Freedman. and Karchmer are trus-

tees of the NMU Ollicers’ Pension Plan {the Pension

Pian). — | 5 7

Plaintiffs instituted this action in February 1969, The

complamt allewes that defendants allowed the Pension

Plan to be ame ded in 1961, so as to indude as partici- -

pants designated employees. of the NMU, who were not:

elected “officers of the NMU (non- officers), 1h Viol: ition of

“the NVA onstitution then in effeet: and that the amend-

tent was designed to siphon NMU funds to the non-officers

Who were. nog authorized to receive them. Plaintiffs seek

an accounting and money damages from the defendants

ae te eae

sigan B

responsible : an in june fiom enjoining the. T rustees from pav-

Ing any he nefits to non-officers ; ane costs, disbursements,

and attorneys* feos, under 29 U .& CC. §501(b).

-- Defendants Curran’ Wall. and Perry (moving de-

fondants) move for an/order, pursuant to Rule 12, a I.

V. P., dismissing the action: or, iv the alternative. for an

order, pursuant to Rule 56, FL R, Civ. Py. for summary

judgement on their behalf. PlaintiffS eross-move for sum-

mary judgement as against all defendants,

In 1951, following the amendment of the NME Con.

stitution, Arti¢le 15, entitled Step sof Officers.” pro-

vided, in part, as follows: > .

Section I~ Salarivs and Earp MNOS? The , Na-

tional Couneil . ... is empowered, subject to approval

of the membership, lo set from time to time the

actual salaries and daily expenses of all Uuion officers.

and-employees,

. Sec, 8—Pension anid Welfare: The Natianal

Council, subject to approval of the membership is

empowered to make adequate and appropriate pro-

Visious for persionse welfare, and =tiiitet benefits for

officers “ave cmployces of the Union” (Enaphasis

added. ). ep

6 On December 29, 1952, an Agreement and Declaration

of Trust (the Trust Agreement) was entered into Inetwou 7

the NMU and three Trustees, including defendants Seal

and Karchmer, granting to the Trustees authority to

establish the, Pension Plsin.

On February 16, 1953; the Trustes promulgated: the

Pension Plan, which provided that “officers” Who had at-

tained a certain age and had credit for a certain mumber

Appendix I

ear ceb Secevered emplowment 7 were elrerble to recene

petetam benedits. 0

ba teed. the NALD Constitution was acai substantially

reviced and alnew. Aptiele Thy entitled ‘SCompensation of

was substituted for Article fo of the [ob Con

‘

ts ‘* -

Vrocles EE provided. in relevant park:

“\ Ie

hon bk. Salaries: ta) The National Counert

shall tin theoscdartes feral officers of the Unton, sub

* geet toe approval as provided by this Constitution,

. \

eet ts feof! s MES C Ae ofhive rs shail by elrathls for

fie Ne RIS forthe NUL Oh, ers’ Peasion Phan, subject

tecsueh rules and regulations as the 'Prustees of the

Plan oriasy establish.’ (iaiagplasis added. 7

Vrticle Soentitled *' National Oee. was also amended.

mo Ted toe provide that the National Oihee was ‘responsible:

doshall px the salaries? of: stall, personel oF the

9 \ peur S141 ‘ N as let | it es. So lace | Perbtarny

; Hinde Ce ; '

. ’ po oshalbomeant a persed holding anyv-one

. " : ] — “é os

y\ Poothees “in adeeordatiee with othe provisions ot

. 4

. » eM@itictnon

‘ Prestdert

sal Seeretarv °

j » eines AP rt Comnnttee Member ; os

aaetch Wart if .

Paes oe *

i fiat < iy i ~ i one ’ besa

NATE

3 9A

A ppe nidiax RB

NAG, inehidine the non offieer © and Chall yevotiate colle

° * e =

five baresdpnrie agreement for the employee. of the NVC:

On Oetober 28) 2901, the Trait Nereement of 1952 was «

amended ooo as toomake eligible for penton benefit. non.

officer. hholdine the Pobhowaape pe ities ‘ “und thie Pen ater

Plan wa amended aecordinel ys .

Assictaut tocthe Pre ident ;

“Oreanizer pe

$ 5 ; ‘ . me z 6

Maintenanes SH pPervirar i: Foe

Doollecpine Sapervi or ;

Reeords said Supplies Sripers SOEs

Mxeceutive meeredary : :

Pubhieity. Director

loditor ot eA Ties, Priat”?

Plaintiffs contend that the defendants viglited the Leg

Constitution hy hlowine Hay! offieep- try re inehiderd nT the

Pension Plan. On the other hand, the moving defendant.

assert that they were aeting under thei p power ia Aptiefes

to fix salaries and bareain collectively for NMU ensulo ve:

and? that this power ineluded the pels ve provide wens=jo

Deyefits under the Pension Plan dor non Officers, af

oF ie i - : “ ‘ . ES i é

Artiele 1 -of the 195] Con-titition Gripowered, the

National Couneil “to make... Provisions for pehsjomws .. >

for officers and CMP OVees OF the TVirton.*? Artieds 14 of

tlie

1960 Cens<titution (ledeted-the word “eniplovecs.** «<+ ;

ing that ‘All ollicers: shali be efarble for Vere: Ineder

the

not

continue the authority to inelude tap, Ofticers mm the

Pension Planj.? Thus. the 19¢u Const

Pension Plan.’ .

While the term ‘salaries’ may include **pensjons,°

as delayed pavinents of salary, Brinley a a ACER Secbaees a AS

we ihe authority te provide pensions fr emnic.eec ie see ies]

Constitution was not, exercised By the’ N° f Pls a

between, 1931 and 1960 included officers

Appendix B

CL 691,36 S. i. 2d 28h (1945), see Inland Steel Co. &.

N |

N. LR. B., ATOR, 2d 247 (Th Cir. INS), cord, denied, 336

S. 960° C1949), the T9GO Constitution « carefully distin-

guished between the two, Using the term ‘Seompensation’?

‘in the tithe of Article Tt to encompass ‘salaries’? in see

“fion Toand ‘nensions” in section 7. In the previous

Constitution, the-word ‘salaries ”’ Was used in Article 15

to cover both. Moreover, a‘rending of Article 14 of the

1960 Constitution makes a clear arian between officer

and emplovees. ‘Thus, seetion d, with refere mee to ey

speaks of Stan officer or © mplovee,* and see tion.6, relating

fo Severance pay, again speaks of ‘tan offieer or mployee, ra

‘While “seetion 7, déaling . with pensions, speaks of ‘all

officers." - ta ;

Since the 1960 Constitution did not authorize the dp-

clusion Ot the non officers ino the Pension Plan and it is

not denied that funds of the NMU hive been paid to the

Trustees-tor disbursal to the non-oftice ‘rs under the Pension

Plan, pl: Lintitt’s are entitled to re ‘lie Funder 29 U.S.C. $501,

Plaintitts ar gue that they are entitled to summa? y jude-

ment since the only Issue in the case, the construction of

the 1960 Constitution, has been resolved in their favor.

On the other hand, movine defendants sav that there are

contested issues as-to which of the individual de ‘fondants

Were responsible for the amendment including non-officers :

in the Pension Plan: Whetherndoption of the amendment -

Wasa breach of tiduciaty dutw; and whether ‘plaintiffs’

action is: barred by ‘laches, - In addition, defendant’ Karch-

mer asserts that he- was not, timely served- by plaintiffs

with their eross- motion for summary judgment and that

he is nota proper party defendant under’ 29 U.S. €. § 501.

_, There-is no genuine issue of fact as to the responsi-

bility of the defendants. If is admitted that defendant

Curran, as President of the NMU; and defendants Karch-

mer, >» Segal, and F#tedman, as eis 5 of the Pension

st naa 2

Appendix B

Mund, were “responsible for authorizing the amendment

including the non-officers in the Pension Plan. Defe ‘ndant

Wall, as Seeretary- Treasurer, is responsible for the, finan-

cial affairs of the NMU , and under the 1960 ( onstitution

he and Curran are ‘directed to pay all obligations in-

curred by or on be half of the Union,”’ ine hiding payments

to the Pension Plan. Defendant P erry, formerly Assistant

*to the President, was a non- officer who: by the amendanent

Was ‘made eligible to receive pension benefits under’ the,

Pension Plan. |

Under 29 IULS. C2 6501, defe dante Curran, ‘Wall, —

Perry owe a fiduci ‘ary duty to the NMU wand its members

‘to -hold its money and property solely for the benefit

of the organization and its me ‘mbers and to manage,

Inv est, and expend the same in accordance With its con-

stitution... and. . - to refraim.. . . from holding or

acquiring any pecuniary - + . Interest which conflicts

with the interests of such orgdnization . . a

Defendants Karchmer, Segal; and Fre edman owe the same

fiduciary duty to the NMU and its me mbe TS as T rustees of

the office rs’ Pension Plan.

Plaintiffs’ action for bres ach of: defendants’ fiduciary

‘duties is not barred by laches. - The amendment; in@uding

the non-officers in the Pension Plan was adopted in: 1961,

and-less than seven’ years later plaintiffs requested the

NMU for an accounting and for a return of moneys con-

tributed to the Pension Plan. In an action based on breach:

of fiduciary duties, the defense of laches is. carefully seru-

tinized,. Libby v. L. J. Corporation, 247 F’. 2d.78, 82 (D.C.

Cir. 1957 ), and in this case defendants have made no show-

ing that they have been prejudiced, by the delay, é

Although it appears that plaintiffs did not timely serve

thYir cross-motion for summary judgment, see. Rule 06(¢ iP

| F. R. Civ. P., the court will consider = cross-motion, inas-

‘ F 5 * *

{ ar: OA “~ ‘

Appendix Bo eg,

mich ae ie could: enter inde ment tor plvintetts on dis own

motton, Bel co Warde riven Comimusstone rok Nod. tarber,

ISS FL Supp. arcs. DON SY 1960), afd 270 td Sos (2d

"Our BOYS Seo alse Wodliaies re Meward dolnsonts Ine.

Of Washinaton Ben eld LON TOE | De Cir Wad sO Moore,

Be deral Brach ec te RT (2d ed. E08). i | ‘

. Nccordine ly, defendant’ metion to dismiss qaarmiutbs’

netion oor, in the alternative, for Summary judement, 1s

denied. Mlamtifis* notion tor Sumnary Jidicnentis ranted,

and judement il be etitered in ta orof plarmtits, directing:

defendants fo qecennb: enjomine defendant “Trastees: frome.

’

paying any benefits under the Pension Plan te non officers ;

and directing the Prustees te return to the NARUC all moneys

’

PecewWea

vithe Frustees for the benetit of rion-ofticers, with

interest Prem the dates the moneys were received. ~ Plain

ex: ,

«40 }

sare entitled to costs.alisbursements and-attorneys” fees

come et the amounts returned by the Trustees te the NAIEE,

in suely amounts as may beappreved by the court.

Settle order on notice.

* Pated: New York, NW, : ;

- May 23. 2988. |

Depney BR. Bosxsan

So.

’

. ¥

-™_

a -

| 11A

_ APPENDIX C

Order.

UNIT ED STATES DISTR 17 COURT:

SOUTIEERN Disviier OF NE Yor -- siege

[Same Tren |

Upon. reading the complaint and the annexed exhibits

thereto, the answe rs of defendants Abraham I. Freed sian

and. Leon K; archmer, the Noties of Motion of defendants

Joseph Curran, Sleannon Wall said William Perry, (' ‘mov-

Inge defendants?) dated February 27,1969, for an order,

pursuant to Rule 12. of the Federal R ules - of Civil Pro-

ecdure, dismissing the: complaint, or, in the alternative,

for aw order, pursuant to Rule 56 of the Federal BR es:

of Civil Peicvdnie: granting Summary judgment On the ire”

behalf, the affidavit: of defendant Shannon W all.sWworn to

on Pobiehiy: ye i 1969 and the C hibithaittelied | there to in

support. ther ‘cof, the Notice of Cross- Motion. dated Marek.

19,1969 for an order pursuant to Rule 56 of the Federal

Rules of Civil Procedure, granting Summary Judgment in :

favor of plaintiffs, the affidavit of Arthur I. -Mednerney,:

Nsq. sworn to M: irch TS, 1969 in Opposition to defe neeants’

motion and in ‘support of pl; uintitfs* CFOss- motion, the affi-

davit of Charles Sovel, Esq. SWOrn. to March 24, 1969,

submitted om behalf of moving de fendants and 4 IN Opposition

to plaintiffs’ eross- motion, the affidavit of Roy L. Reardon,

desq. sworn to Mareh 24.1969 vhd othe eShibit. attached

thereto submitted on *belialf of defendant. Lean Kare hrayer.

and in connection with the imétion. of defendants Jose ph

Curran, ee W all and Willian: Perry, and in op Post.

127A

Appendix C

tion to plaintiffs’ eross-motion, and the Court having. heard

oral argument on March 26, 1969 by «Charles Sovel, sigs,

of counsel to Abraham EB. Freedman, ‘Ksq., on belr lf of’

moving defendants in support of their motion to dismiss

the complaint, or, in the alternative, for summary judgment

against the plaintiffs and m opposition. to plaintiffs” cross-

“motion for SHIM judgment, and by Arthur FE. Me-

Inerney, Esq... of counsel to Messrs.:Duer & Taylor, on

behalf of plaintiffs in support of plaintiffs’ cross-motion

for summary judgment ja favor of plaintiffs and. in ‘Op-

_ position’ to defendants? motion, and defendants Joseph

*. Curran, Shannon Wall, Ww illiam: Perry, Abraham E. Freed-

man and Leon Karchmer having been served with process: es

and having appeared by counsel prior to the hearing on

said motion and cross-motion on March 26, 1969, and the

‘Court having rendered a decision in writing dated May 25,

1969 , andalso filed on that day, arid the defendant Martin

Segal havi ing been served herein; and having filed an allt.

davit in support of defendants’ motion for reargument.

Now, on motion of Simpson Thatcher & Bartlett, at-

_. tor ney s for defendant Leon Karehmer st ie,

‘apes. ihe defendants’ motion. to dismiss the com-

plaint, or, in the alternative, for summary Judgment, be

denied, and it is further |

Or 2DERED, that. plaintiff's motion for summary judgment

is granted and that the Clerk of the Court enter judgment

granting plaintiffs’ cross-motion .for ‘summary Judgment ;

directing defendants to account ; enjoining. defend: int Trus-

tees from paying any benefits under the Pension Plan to

non-officers; and directing the Trustees to return to the

NMU all moneys received by the Trustees for the Ddenefit

of non-officers, with inter est from the dates the moneys were

received; and it is further ees oe

18k. , Pea

2, Appendix C

OrvereED, that plaintiffs be gr

and: attorneys’

Trustees to the

by the Court.

anted costs, disbursements

fees out of the amoiiits returned by the

NMU, in such amounts as may be approved

Dated: New York, New York

» July 11, 1969

in aie Duptry B. Boysat,’

United States District Judge

Judgment entered 718/69

JouHNn Livincston

Clerk

14A

APPENDIX D <r

Decision and Order on Motion for Reargument.

Detondants motion for ciseniiasiacied so demied. Phe in

: ferpretation of the meaning of “salaries sought by defend

ants would net chanee the hholelins that only Officers were

electble for benefits under the NMU Offeers’ Pension-Plan,

for the reasens stated in the Memorandum filed May 23,

Io) Therefore the tmelusion of non oficers in the Plan

Was net attherted by the NMU Constitutionas revised in

HO Sanee such inelusion was be ‘yond =the power of the

defendants, pl: maeat fhe are entitle (oto appropriate relief,

Consideration has been ive note the aflidavit of the de

fondant Martin Segal dated June 01, 1969, which was filed

iInsuppert of the defendants’ motion for reargument. Mr.

Seeal is ene of the trustees oT the NVWU Olivers” De nsion

Plan. who appeared in the aetion and tiled his answer on

May 1. stig, The court does not question Mr. Segal'’s wood

faith cas trustee. Hewever, the plaintiffs are entitled to

obtam the return te SMU of the monies paid te the lund

Jen behalf of nonoffcers since their inelusion was not

antherived. . ee

It is so-ordered. :

1) ated: New York: x: x.

duly ree Tea . -

Penney Bo Boxsa

Lik. B. 2.

eres. the

| APPENDIX £

Decision and Order on Motion for an Injunction. |

The amendments to the NMU Constitution are nat ex

culpatory provision: prohibited hy he Aa es Pet Tana | Wiahloe Ree N

purpose is obviously to ineliide pon officer cin playere in the

NAMEU Offieers? Pen ion Plan. Accoreipe lo the Certification

of the Honest Ballot 4 sociation, dated Sine 4, 1659. the

Pollowine amiendinents Were adapted by a votoeof 1g

le 1GSi .

“Mid the follow ine paragraph to Article s, Seetion

?<:

e :

(al) The National Offices Shall have the authority

fa provide Pens ton. for all prast and present eri plovegs

of the Unfon and 1 protect! the pension riehts of all

Past sned present Cmiployvers Of the Inion.

‘Amend A riicle 14, Seefion 7 to raid as Follows :

"Pensions: Ad officers and sued eriplovees as the

National Office May designate shall be eligible for bene.

fits under the NVU Officers’ Pension Plate subject ty -

“such rules and resulations as the Trastows of that Plan

mavestably<h, The Nations! O)thies ied] Haye the my thor

Wy to validate retroactively all pensions hevetafore rete

-under the Plan?

While it is stated flict 12.040 members obtained a ballet.

itis not stated how many menihers of NAT were elisihile

to vote. The amendment te A riigle I. Section 7 Provides

that ‘the National Offiee shall have the authority to validate.

retroactively all pensions heretofore paid wnuder the Plan.*

However, it: does hot appear that the National Ofte hus

exercised this autherity,

16A *

Appendix E | é

. Plaintiffs’ motion is denied, without. prejudice to the

plaintiffs seeking further relief by appropriate application

if the defendanys should violate the order of the eourt.

It is so 4rdered.,

Dated: New York, N. Y.

July 3, 1969.

Duptey B. Bonsau

Ue Bd...

ITA

APPENDIX F

— -

UNITED STATES COURT. ()}° APPEALS

Mon THE Secon y Thee

Nos, 309-312 September Porn, ae,

(Argued November 19, 1969 | Deeided’ February 20,

Docket Nos, Sass4, $3918, 82919 and 23987

James M. Morrissey, Joseru Papa, Racer Lerag

iM. In

dividually and on behalf of the menibers of the National

Maritime Union of Anieriea, : x

Plamtiffs- Appell esd ppellants,

—_vV _—-

JosePi CURRAN, SUANNOX Want. Winniam Penny.

KM. Seca, Aprauam KE. Preepaas and Leon Kay

Dr Ie nelanls Apy Waits. Ap

Before: ey -

Li wpann, Chief Ludac,

DANAHER® and. ANDERSON, Circuit Sudaes,

_——__

Appe: Hx from a denial of de fi andl” 4 Inetion for

mary judgment and a granting of plaatrity cr

for, summary judgment, but denial of Pidintitt

for an injunction, by the United “States District

Southern District of New York: Dudle woB. Bonsal,

holding: that pension payments made to ce Plain en

of National Maritime Union ‘of America were, un

Manrix *

CCTIMER,

fe ll es

stadia

mofo

petition

Court,

Sadige,

plove oe

due thi.

. ye * 26 r a : 2 eee

* John AL Danaher, Senior Cireuit ludgé of the Distrtet. of

Columbia Circuit, sitting -by designation.

1970) >

ISA.

Appendix F

Pinion’ con-tetition, improperly aiade. Afirmed in par

and reversed and remanded in part,

CHARLES Sovens Isc. New York, N.Y. (Abraham

Ki. Mreedman, lisq., New York, No Y.,.on the

brief for Defendants Joseph Curran, Shannon

~Wallsand William Perry), for Defendants

Appellants Curtan, Wall, Perry and Abrahan’

Le. berecdiman,

Rov LL. Reanpox, Esq... Simpson, Thacher & Bart

lett; New York: N.Y. for Def ndants. Appel

lants Mardin ie Sedat avd daeon Narchmer,

Anrireny . Melyenneyy Ksq., New York, N.- Y,

“(Duer & Taylor, New York,-'N. Y., on -the

briel),, for Plaintiff Appellees, eth

Yxpenson, Coreuit Judae:

This ease arises under $501 of the Labor Management -

Reporting and Disclosure Act of iter ci. -. o. § oO

(1I%ee). and concerns the propriety of certain pavinents -

made nto the Officers’ Pension Fund of the National Mari-

time Union iNMU).- The plameitfys, Aames M, Morrissey,

Joseph Padilla, and Ralph [brahim have been members in

sood standing of the NMU since approximately 1950. The

defendant Joseph Curran is the national president and the

defendant Shatinon Wallis the national secretary-treasurer

of the NMU, both electiqe positions. ThE defendant Wil-

liam Perry is the recently

retired assixtant to the president °

tive: position.” The defendants

artin MH. Segal, aid Leon Kareh

i@ NMU Officers’ Pension Plan.

NMU and the powers and thties of

cits officers and-various internal governing bodies are Set’

ef the Unien. a non-ele

Abraham EB. Freedman, |

ner are the trustees of

* The structure of the

fe 9A

_— — Appendix F .

out in the Union's constitution. Tt makes provision for

three governing -units which have nation-wide jurisdiction,

The ultimate wufhority. is¢vested in the National Conven

“tion, Which meets triennially and is composed of thie elected

delegates from various ships and ports, When the Na-

tional Convention is not in session, the Union Is Poverned®

by the National Council, Wyeh holds regular annual meoct-

ines and consists of the elu ‘ted national officials and cer-

fain other delegated representatives. “When the National

Council is not in session, governing authority rests in the

National Office, made up ofthe national president, Scere

tary-treasurer, three vice presidents, and three national

representatives: This body is primarily responsible for the

day to day, internal administration of NMU-. affairs.

In 1951 the NMU constitution was amended to permit

the National Council, subject. to membership approval, to

provide pension benefits for all NMU_ officers and = em-

ployees.' On December 29, 1952, pursuant to this author-

ity, the National Council entered into an Agreement and

I. The pertinent provisions of the 1031 N MU constitution read

as tollows: |

“ARTICLE 150 SALARIES OF OFFICERS ri

SECTION 1—-SALARIES- AND EXPENSES: The National Coun:

cH, considering the’ financial state of the Union, is empowered:

subject to approval of then cimbership, to set from ‘time t6 tine

the acniai salaries and datiy expenses of all Union officers and

employees.

The National Council: shall pay all salaries, approved by the

membership, of all Union officers and emplovees.. .

* * *

Sec. 8—PENSION AND WELFARE: The National Councif,

subject to approval of the membership is empowered ta make

adequate and appropriate provisions for pensions, welfare. and

similar benefits for officers and employees of the Union.” °

Between the 1951 amendment to the constitution and 1966 pension

plans were adopted for the employees pursuant to collective bargain

ing agreements. ~ i 3 :

20A a .

Appendia F |

Declarccon of Trist, with three-trustees which gave them

the authority tu establish a pension plan. On February “16,

Ios, the trustees adopted a plan Whereby pension rights

aeerned to the: Various elected officials of )the Union, in- .

cliding the president, secretary, treasurer, vice-president,

national port conimittee: member, branelj agent, field pa-

trofman, and -patrolman. No nen-elected. employee of the

Union was included under its coverage. The majority of

the administrative employvees’of the NMU were represented. .

by ‘this ‘or other unions in their eutployment relationship

withthe NMU and had been granted pension rights, as per-

mitted by the 1961 NMU constitution, asta part of their

Fespective collective bargaining agreements.)

On October 28,1961, the National Office (as opposed to

the National Council) authorized an amendment. to the

é * . * orn ~~ . .

Agreement and Declaration ot Prust, the effect-of which

Was to-extend its coverage to certain executive and super-

Visory employees of the Union who, held appointive rather |

than elective positions, such as the assistant to the presi-

dent, orginizer, executive secretary, publicity director,

li. The last sentence of Article S(a) of the 1960 constitution

Which concerns technical, clerical agd acdininistrative personnel. at-

tached to or under the National Offfte. provides .

| Whenever possible, such empM@yecs shall be members of the

~NMU or of appropriate AFL-CIO. affiliates:” *

Wigh nothing shown to the contrary, it may be assumed: that all-of

the'few non-elected émployees, arbitrarily breught under the Officers’

Pension Plan by: the National Office. already had pension coverage

under collective bargaining: agreements applicable to them, It must

be emphasized that the present case “nothing whatever to do with

such pension coverage, nor do the plaintiff in any way challenge’ or

seeks to distufh those pension rights of the administrative employees.

Rather, in the present -action, the¥ are questioning only the awards

to the special few non-elected emplovees who have been granted the

lucrative “pension rights” under the Officers’ Pension Plan. For

example, one of these special employees,’ the defendant, Perry, who

incidentally already had coverage under the NMU Deep Sea Pension

Plan, resigned as assistant to the president, January 16, 1969, atid, as:

a. specially created, beneficiary received over $100,000 under the

Officers” Pension and Plan alone. « 02

21A

Appendix F ,

‘editor of the Pilot (the union house organ), and super-

_visors over maintenance, _bookkeeping,.- records and sup-_

plies.” _ a it

Prior to the adoption of the amended Declatation of

Trust, however, the NMU constitution had been subjected

to an extensive revision whereby, along with other. changes,

the authority vested in the National Council to fix the sala

: Ties of certain employees was shifted to the National Office

and the requirement for membership approve! thereof way.

-deleted* This revision became effective on. December 2,

1960... Peaeas

. —_—---<

‘2. Three years later, in 1964, the Officers Pension Plan was

again extended to include additionai administrative personnel not

covered by collective bargaining agreements. ;

3. The amendment applicable to this case read, in pertinent

part, as follows: _ ae

7 “ARTICLE 8 NATIONAL OFFICE Y

| 7 > | : * *

Sec. 11—EMPpLoYEEs OF THE Uyion: (a) The National Office

shall be resporsible for and shall fix the silarics of all technical,

clerical, and administrative personnel as may be required.for the

.eflective, administration of the Union's affairs. Wherever pos-

“able, such employees’ shall be members of the NMU or of ap-

propriate AFL-CEO affiliates

(bs Collective bargaining agreement. the, ting eniplovees

of the NMU > shall be negotiated by the National Oftiee-or such

officer ort officers as. it may designate iprovute! that ne such.

agreements” shat be made withgur speaine approval by the

National (-ffice.” es

“ARTICLE 14 ComPENS TION oF OFFICERS

Section 1—Salaries: (a) The National Council stall fix

the salaries for all officers of the Union, subject to approval as

provided by this Constitution. Be

, * * *

~* Sec. 7—Pensions: All officers shall be ‘eligible for benefits

under the NMU Officers’. Pension Plan, subject to such rnles

and regulations as. the Trustees of that Plan may establish.

Sec. §—Welfare: All officers shall he eligible for benefits

under the Officers’ Welfare Plan. The National Council, sub-

ject to membership approval, is empowered * to improve the

benefits under said Plan.” -

= a - : @

“

‘

a * . 22A °

Appéndia F

- 8

The pl: aingjtts ‘ onte nd that tie. 1961 aniendments to the

Hee ae of Prust, by the National Office, permitting

benetits to be paid to: non-elected employees “under the

Officers” Pension Plan-were not authorizeoby and were

in comfravention of tye. NMU. constitition, ; as amendéd i

1960. After Union-officials refused to take any action, as

reqae "sted, to obtaim the return or funds paid into the Trust

fund for the benefit of non-elected employees: under’ the

revised Plan, the plaintitts filed a compl: ‘int in the district

courte seeking an ACCOUNTING, a money ‘Judgment for any

di AnAgES Suffered: by the U nion or-the Trust fund, and an

Injunction against turther payments to non-elected em-

plovees, . te

‘2 On Mebraary 4, 1969, the divertes court (Bryan, Judge )

granted leave, pursuant to 29 ELS. «. » 001(b), to com-

SInence this action. Defendants Curran. Wall: and Perry

uoved> fo dismiss the eomplaint imder Rule 124b) (5),

FL R.Civ-P., or in the alternative Jor summary judgment

under Rule 66. The plaintitfs filed ‘a cross-motion. for

Summary judgmegt against all defendants. Oral argument

was heard on both motions on Mareh 26 (Bonsal, Judge),

and oon May 25 the defendants’ motions were denied and

plaintiffs’ cross-motiow® was granted. 302 F.Supp. 82.

(SR: ae X,Y: 1969), “The court held-that the defendants

should account for and repay pension funds acerued and

par te non-cleeted Union “tmployees, that the defendant

trustees ae enjoined froin paving out of the Officers’

Pension Plan flmd farther benefits to non -officers and the

plaintiffs should recover. costs and attorneys’ fees,

‘Thamedintely following the district court decision, the

National Couneil ofS the Union’ convened. and) proposed

amendments to the constitution which gave: the National

Oflice of the NMU the authority, whieh the trial ecourt-had |

found if did not have under the 1960 amended constitution,

‘to designate certain non-elected employees to he eligible. .

i ee

| _ Appendiz F

for benefits under the Officers’ Pension Plan as well as the

authority ‘‘to validate retroactively all pensions heretofore

paid under theglan.’? The approval of these atuendments

was voted on June 24, 1969. The plaintiffs promptly moved

‘to have the June Mth »amendments deelared valid as

exculpatory, and therefore void, under » 901(a)* and to en-

join any implementation of them. The rehefsseught was

denied without prejudice on July.3, 1969.. The defendants

moved that the entire action be dismissed as moot on the

ground that the new amendments remnoved any question of

the power of the defendants to et as they did.

Meanwhile, on June 2, 1969, defendants Curran, Wall

and Perry filed a motion for Téargument of the May 23

decision. ‘On June 6 the plaintiffs filed a motion to enjoin

the defendants from being vepresented by counsel retained’

by the Union, to seuitede Angas to pay their own conn-

sel from funds not belonging to the Union, and to enjoin the

_Implementation of- the proposed amendments to the NMU

constitution on the ground thaf they were exculpatory and.

therefore vord under 29 U.S. C. $501 (a). On June lla

motion for reargument was filed on behalf of “defendants ©

Segal and Karehmer. In separate orders entered on duly

3, 1969, these motions were denied, except for the motion

relating to representation of defendants by Union counsel,

which was not ruled upon. | att ofa a,

The defendants have appealed from the district court

decision granting sumniary\ judgnient to the plaintiffs,

denying, their own similar motion and their motions for

reargument. ‘The plaintiffs-have filed an interlocutory ap-

: : é

4. The pertinent language of the statute provides :

“. . . A general exculpatory provision in the constitution and.

bylaws of such a labor organization or a general éxculpatory

resolution of a governing body purporting: to relieve any such

person of liability for breach of the duties declared by this section

shall be void as against public policy.” Bains +

“ i Appendix a ae

peal from the trial court’s denial of thei air motion to.declare-

invalid and enjoin the use of the June. 24 amendnie thts to

the NMU constitution. * The magor dis <pute on these appeals

concerns the proper interpretation of the- provisions for

establishing employee ‘pension funds under the. 1951 NMU

‘constitution, as amended.in 1960." 3

Defendants argue that the. 14G0 sane neinents were’ de-

-signed to shift the’ responsibility for the establishment of

employee salaries from. the National Couneil to the Na-

tian Office and’ did’ not limit in any way the power of the

‘ NationalOttice to establish smployvee pension funds. They

assert | that the terms ‘“salaries,"* as used in Apticle & 8,6 11,

must ‘be -construed ‘to include pensions, from which they

Claim it follows that the National Office was acting within

its authority When it amended the Officer's Pension Plan

in 1961. ° In support of this position - they rely upon such_

eases as Brundey vy Barter, 225 N.. 691, 56.8. FE. 2d 281

(1945), and Baisuciic: Saar ay N. Y. 208, 66

Ni Bi, 2d 7 (1946), which iat I that pensions are comipensa-

‘tion for past SPrVICES as opposed ‘to gratuities, and in that

‘sense, are jicluded within the term ** salary.’ > But-as the

district court pointed out in its opinion, the framers of the

NMU cGonstitytioni; whe ‘ndrafting the 1960 revision, ele arly’

had in niind a distinetion between sataries. and pensions,

as evidenced by: the use’ of the term ‘compensation’? in

Article 14 to jnclude both types of remuneration. The NMU

constitution, as amended in 1580, was cleitr and explicit |

With regard to the persons covered by the pension pro-

Bs Isions, and in the lichi of the history, context and wording

of those provis ions, the distriet court’s rejection: of: the

defendant ’s claim is correét. .There was no genuine Issue

~~ _ of material fact corice ring the charge of a breach.of duty

favor of the plaintiffs should be affirmed. -

on the part’ of the defendants, and summary judgment in

mesh

% ee PS Beane © =

In snpport of their-claim that the 1969 ame bidbae mts * to

the NMU constitution, made | immediately following the dis-

trict courd decision, are exeulp: tony avd that their applica-

tion should be enjoined: the plaintiffs rely on Highway

Trick Drivers aid Wi pers Lor al Tor 6. Cohen, 182 F. Supp.

GOS (14. 1). Par. ), aff d, DS4 BF. Od 162 (3 Cir, 1960), cert, de--

‘nied, 365 U. S, 833 (1961). and High we: ay Track ei: “Ors aud

Helpers Local wr *, Colien, g1a-F. Supp. JOS (B.D. a5

1963), afid, 334 F.2d 378-43: «ir.); cert. denied, 3o19 U~

321. (1964). In the first of these two CASES. the district oon

found that, it was improper for the loeal unign to pay the |

attorney fees of union officers who were under eriminal in-

dictment. These. fees were to be paid pursuant toa resolu.’

tion of the local whieh permitted such payment, and tleat

resolution was declared Invalid because it authorized ‘690.

tien beyond, the powers of the union: as derived from its

~ constitution “and Was inconsistent with the aims and pur-

poses of the Labor- Matagement Reporting : and Disclosiire

Act.”’ R84 F. 2d at 164, . The international - union then

mended ‘its constitution to permit such authorizations.

Thereafter in the seeond Cohen ease the union officers

claimed that the payments were valid as the amendment

purported to che retroactive. In rejecting: this claim the

Third Cireuit said:

The following is-the full text of those amendmen Its:

+ aende Article 8, Section 11 to add the following paragraph :

The National Office shall Have the auth ority to provide pensidns

for all past and present émplovees of the Union and ‘e protect

the pension rights of all past and present employees of the

Union.

Ameitd Article 14, Section 7, as follows:

Sec.\¢—Pensions : All- officers and such emplovees as the Na-

tional Office may designate, shall be eligible for benefits under

the NMU_ Officers’ Pension Plan, subject to such rules and

regulations as the Trustees of, that Plan may establish. The

National Office shall have the - authority to \; alidate retroactively

all pensions heretofore paid under the Plan.”

' er, es al eee eee

. a) ; - : _ e : : i > ve =

That abortive cattempt to validate: the Hiegal 19

‘resolution, could not of course in LGBT Te iti niatize the

1959 payments “whieh have been held to. have heen

wronetult.. And the nelion ot the Tite ‘Td. ition: il. Wits it ist

ot |

as inconsistent with See tion SOL Gf the Lahon Mi en

ment Act as was the Local's AT caneepvedd re wolntion.

334 F. Jd at 38h, 2 a

The defcudanis in the present case, however, assert that

the etses cited actually support the defense. Tt is their

contention that the trial court heldtin thd. AYO Kei case”

that a resolution authozing an expenditure of nnion finds.

Was not an exculpatory provision. in- violation of ~ DOL 624)

and, in the 1083) Colom case, that 2. constitutional amend-

ment authorizinie oxpenditeees tends: incurred “was Wot >

exculpatory untess the. expenditures themselves were in

they ‘argue that the court below did_not-find that the pay-

ments into the Officers’ Pension Plan for the benetit: of

any subsequent’. constitutional provision, purporting tO:

validate the past payments cannet be exculpatory within,

defendants. conveniently overlook the fet that the trial

court did find that they had breac hed their duties heeause

‘the expenditurés in question were not authorized Or fis

of the Aet. Inthe Cohen eates the® tri: W court was affirmed -

because .the foen! ynion nuthorized actions beyond its

powers as derived. ee constitation and beeause ity:

effort to pay attorneys’ fees for offieers wha had been:

> -derelictin their duties was ia paraneisien with the aims sn d

purposes of the Labor Management Reporting and. Dis,

closure “Net? We agree ith the positron taken hy {fem

Third Cite nit. Otherwise the provisigus of. § 501 Wenld be:

complete ‘ly omaseulated if, every time a.court, atthe behest

_ from which #he Y necded to be Sexe ‘ulpated,’

Appendix F :

of complaining members of a union. ‘found bl feet. the. office Ts

had rvs ached theik dh ities. the officers could find saretay ry

by putting through ti coustitutional amendment or hy lav:

retroactively to lewitingitize the} ir former derelictions , of

duty. ;

a3 The de s ndants also argue that the district court ‘has

not, imposed any persenal Halbility. pon ine defendants

but we do “not

agree with this argument, /Mhe district court ordered. the

defendants ‘to account for all moneys paid indo the Officers?

Pension Plan andéretirn to the \MU all moneys received

‘by the tritstees for the he ne ‘tit of non-office ‘rs with interest,

It follows that if they are unable ta recoup Uiatt—-anoney;

they inky he HEMT personally liable, . a

The trial court's decisou, however, on the plaintiffs?

motion for an injunetion, that the purpose -of the 169

mie? idments to the YMU constitution Was to include nous:

officer eniplayees in the N MU: offieers* pre sion eplan amd that

the amendments were, there fore, not exe ulpatory* provisions

prohibited hy ° 901, is at odds with its" “holding. that there

was an-obvious breach of duty-on the part- of the defend.

Wits in causing union fuhds to. be paid out to persons who

were not entitled to then® ° Tis CONC fusions might have heey .

correct if the provisions: were . prospeetive only. in .their

appheation but the amendment to Article 14, ‘7 provides-—

In part: ‘*the N Nationa Offiee shall have tie authority to

Validate Metroactively al pensions he retofore paid) under

the plan.” This is cle arly gxeulpatory in Stent’ and leuny-

CHALE, The NMU exercised Its authority under the 1969

amendments to attempt fo validate retroactively all the.

amendments we rennet exenl MtOrV is reversed and will be

onstde res | on. E ie & mand,

The defendants raise ac number of. s additional miner

ixsuesy several of whieh Will be commented pen They

“™

eons inst paid. The determination that the 1969)

‘

Appendix F . i Raa aan

have throughout pressed the defense of laches. But the

Inattor of improper payments of union funds te persons

net entitled te them 1s aconfinting off8nise and eanaos bar

aun Injunetion to preye nt continy® “| ys iwine nisorian aceount

ine: for al} of the Hilawlul expenditures,

The dete ‘idants Seealtand, Warehiner ela th: 7 the

ltimate . order issued ly Judge Bonsil exceeded + the *

court” "Ss qugisdietion because ‘tis their contention: that the

eourt’s jurisdiction is: fixed by the order issued ‘hy Judo

Bryedion pl: utils” application: for Teave to bring: suit on

February 4, Hi, “This is an. incorreet Inferpretation of

SOOT EDA Plre purrpose of re quiring permission to bring an

detion as acsafeguard to protect the unidn officers trom

Vena tous Suitssand onee given is not .te be treated gas a

stricture ou jurisdiction, Horner Ferre, 362 Fe 2d pated

papi Seo ‘ir.). cert, den, 88) USL 95S | 1966), Aissue was”

also raised. that Judge Rincat had ine power to erant

summary judgment on plaintiffs’ motion ‘bevanse of in

. e .

adequacy of notice to some of: the defendants. ° The trial

court, however, had power-on its own motion to enter

summary jidement against/the party Who was the coriginal

mover. 6 Moore: oder: al Pr: ACTICO, OG42 at 224 (2d ed.

Moo), While some of the de Tendants had only a. bryef

opportunity’ to prehare for the aresument om the plaintiffs’

motion, there is nothing whatever to indieate that any party

Was at all prejudiced. Stein Oshiusky, OS BL Dab 999,

1000 ‘i (2 Cindy certo den, 382 ULS, O97 C10).

Defendants also wrgue that the trustees of the. Officers’

_Pensiin Plan’ do net come within the definition of those.

‘having a fiduciary 1 responsjbility as set forth in 22 U.S. ren

4020G).° This court has sspecitically. rejected this: claim in

Tucker v. Shaw. 378 F.°%d- 204. S08 (2 Cir, 1967), The trial

eourt was correet in finding that all of the defendants were

In a postdofer trust and responsibility’ in relation” to the

mowie ~ charged to have been unlaw fully expended and all

’

| ee ee

: = _ AppendinF . - |: .

Muda dtity to see that it wae restored to the Union

ad .

1 PaSUery,

The remake ne points raised>hy tlie defendants do not .

merit discussion, 9 ‘. ieee

ae ;

We affirny denial of he defe nidants* motion for sum-:

“ ‘inary judement and’ ass entry of SMmnmary judgment in

‘faxor of the plaintiffs, As the June 24, 1969, ame ‘ndments

fo the NMC constitution are’ clearly exculpatory as pro-

ibited by OOTP we reverse the 6 denial of plaintiffs?

fnation to have these cinendments_ dar) void, and re

mand to the «dis Ariel ¢ Sort for appropriate action declaring

the ‘mendments to be without effeer gind enjoining: Aefend-

nts: from veting i reliance pon the tm. As the district court.

ap ymearently did tot pass on) sotmueh of! plaintiffs’ dt ion

Hs reqs Aol that ede ‘Tonglants hi enjoined from re Aainite

counsel paid or-to be paid with Union funds, “this que stion

Hold: also be defermined on remand. PE he controlling.

casescon this point are Tuckersr, Shaw, supra, and [kolde

man &. Sheldon SAL B22 (2 Cir 1! OZ), iw hich we held

That all that is nece at hy for enjoining of the de ‘fondants: in

1 OOD etion bs that the pl: uintitt eur aa reasonable sh

imse thaat het ix likely to succeed.’ We also note that the.

listriet: court miatint: Nik continuing ‘jurisdietion Prisare

that the decotmtine and retin of funds, to the. Union

Preasury proceed tas orde red, amd, of course, it: retains the-

power to issue the necessary orders to assure full com-

Affirmed im part, reversed j I parts and remanded for

further proceedings in compliance With, this opinion,

o .

ea ee a -

DANAHER, Senior Cirenit Judge (dissenting):

Adthough- according great respect for Me Views of amy

colleagues and for those of the able District, Judge, Honor-

; " B3OA

‘ P e a — . «

Appe ndix F

able Dirdtey iH *Borsal, 1 nonetheless fear that error dias:

oceurred, Phe 2 a

Phe National Maritim Vnionof Ameren (hereinatter,

NAME) was Tounded 4 NIST. Some fourteen years ater,

the still voune A nion adopted a € Oust tution whieh, Sof: ir

sis Shere pertinent, provided that Soonsiale rine the finan.

— state ie the Union. the Union's National Conneil ! was

empowered | make adequite and ap propriate provisions

SYor pensions, welfare and sin ir bene Hits for officers ani

cetiplovees ot {lita Union. Th: at power Wils Hever pese inded,

I Sugeest, but was later transferred: to the N; ational lice,

ANgreeably to sue h authori ation, effective as of Febru

ary, Ios the NMU ada harn Posing Plein Wits adopted,

the Teove ring all ole weted olicers ot \ AL. he ra hi Is. he ‘On:

no challpnee-here 4o the waltdity ot that P lain. as

. NMU+in the manage met of its propertiesy i die ade

ministratow or its far thine busine ‘ss guia in ne rance of

Is plirposes.: utilized’ the services of stall of lawyers,

‘economists, peusion administrators, st: WF experts in Wash

inetot, Aloe loks. aid Sapervisossy stalls of Union owned real

estate” Par the iv protectton as well as to further‘its own

-nterest gu their” retention in-its serviee, NMU nevotiated

with ¥ arious unions ef whieh its employees were members.

for the estab lishment of pension and welfare pl ins. As an

emplover, NMU was bonud to bargain respecting hours, «

Wates dnd? conditions of emplayinent, Althoueh clearly

authorize to dooso, NMU had pot until the events here.

: .

Pw wNational Couneal was authorized to act : eee ;

nether entity. Known as the National Office. wis

mk power’ i those reposed in the National ‘Counce,

sed in the morg equent meetin gs Mt the National Office.

; 2 SII TE MNS ef the mation sche SCOPE “ot “the « Oper tions off

NM otay be gleaned from the \are ful Ny-detathed tinggngs of District

I Mietley outlined in Wied zF. * National. Maritine Union of

America, 284+ F° Supp. 47° (S. D. “L968 ) ; affirmed by this °

Court 3094F, 2d 344 (1968). _

-. extended: in. 1958.

pee o Appendic FP 7 tga tie, we 2

. ‘ea. | raed

dE dssue, Setups at, sry he ha for i, fewof its stipe rVMISOry .

personnel, got. le ‘ected officers and not-re pre se nted by SOMe &

unioi. : Gree }

Some. SEXLOCD ye ‘ies after the orteingd Play had bee Orme

etfeetive, tine poli tintifts hove itleae d threat Without authorized

bieni 2 lan sunrbenetii® baal been accorde « ty the dete dant,

“Vere Follow ine his POST MgtTOn as fixe itive Assist tant to

ihe Nations President, }? Urporting 40 base-the ae tion upon

35 (1. CSO by the pi: ‘intiffs hi; idesoucht an. accounting, a.

money deent agajnat He defo ndants, and an injunetion

le restre, th the Trustee Pie paying Honetits to Perry. or

avy other none ‘Tecteil eraplayees hes NMG The Union was’

WO aati dy panty, Mader datece * May 25, 1969, the District

Juedes fded ay Opinion gta, “OnE PSN thi: it: thie re!

Wits novantlrority | Por cs CEN non employcés into the Plan, :

and odie erantod summary judgment for the plaimtity He

ordered the de end: mints to necount 4 enjorned the 'T rustees ,

. e -

nefits unde the? Plan fo non- oftic ‘ers; ‘and

lL the o bustees to return to NARUC , With inter. =

rece ived by the Pritstees for the, henefit of

Prouy prev Tie |

ficrt her at rect

est, all money;

nonofficers, ' i: P . et

Parr ae wg

a: x

Meanwhite, Congress ddopted thes Welfare ‘and Pen.

sion Plats Dise! ‘osure Act,’ effec tive as of Janu: AY a a

which Ue semis ain * ‘omploses pension beielit plan “ i) nican

r The ortginal py ian had specifics uly provided that the Trustees

mi ther discretion might make a lump-sum pavinent In heéu of Sa

otherwise. provided. Indeed, tite” “uthorization Was amends and

re eee moana

i ,

4. There was no evidenive that the- officer defendants or the

Trustees. person: lly benefited vin any way or otherwise acted" unlaw.

tully, or that they had vere gee bad “faith. . Ct. Bakery and C Onfec-

5. ae) SC A § 301 oe seq... PL 88- 83% as amended by PL

"87-420, 76. Shai. 35. hick: vastly increased the authority. of the

- Secretary of Labor to supervise and to administer the disclosure: re--

quirements: ot the earlier Act. =

" ad o*..

—_ a « a

cst oe ;

. “any plan, fund or progragn w hich j Is communicate tor”

+, its benefits dese ‘rihedjin-writing to the emplgyees,. and

whieh was he reetofore: ‘or is hereafter -establishe d ity an

employer or by an Ginployee bre canization, or by beth,

» + for the-purpose or providing: tor its participants

ares refireme nt: be ne fits para rery. P.

: re r.% ~ i

‘And the Net furthe vr ‘ defined thir term ‘partic ipant to

mean | : BL lee ae , /.

“any: employee or former employee af an employer or

any member of ane inployeesorganization. who is or may~

become eligible to receive a benefit of any type From 3 an

employee we Uti are or Pens sion henefit plam 2.0. 0.7"

xt Decame bound to submit aunivally to the Seere ti inv

of Labor a’re port deseribing the’ P lan, an. annual financial

stateme nt and ‘further information in such form afd de-

- ytail as the Seer ‘retary. might prese ibe. oNME sr arte “ with

‘those-requirements.®

So it was in-part, and with the Labor Ma ani iwement Re-

| “orting and Disclosure Act of 1959 (LMRD. \)? hy this time

on the statute hooks, the 1951 Constitution: Was. Te vised at:

an NMU Convention held in Qetoher, 1960, with ratification

bythe membet rship after a sae re ndunt vote conchided an

December of 1960.00 50. . : eee ie ees

T deem i anthinkable that the NMU oldseeban <"p-

posed fer a wo nt that the amended Constitution wi as

intended to wipe out whate ver rights to COVErALE hal been

aeqnired since 1952. There was no repealer clause in. the

1960 revision. To me, it is inconceivable that the clgibility

established. in 1952, followed by ood faith reliance ander

6.29 U SoA. “$$ 3 08-. 307. NMU furthermore avas heend

, to report in detatl to the Bure: nut at Inte rnal Revenue and annaally

~ + did so. a!

7 29 U. s:€. A: ap ree

m ae = Appendix F Ba Solin _

‘eermed bliteratad + I orajoet Panes dec aa, |

stitution, as revised: had par: weal the 3 at) site im

Prien do provide pois) Eis 3 ot eek. .

y ‘ whether fhey bie eleetod nthieers or erin S zs rae "

therrstafus.. ° : sag 5

- On the’ ont ary the J960 Consti'y sfictns even hrondene c

be nefits to-be actorde’ to me mbers bee ene aoe

-— “viously ; acerned, as for exaniple hire Mee ware

a Vas s¢f), Sei that mémbers) sy oe vine

“re eceiving ae morithiy pension sinde v ‘ the. “MIL Welfare

yee Pension Plan of the NYE Officers: Pension Plan -

shall not be required to pay dues and shall he regard

- ds Breas embers | pa }

Pe .

. . e

Keuinst: sie ‘h hy ackgrownd: Tae king reqmesertatiay

any employe e ufion ane not possessing the status of elected

officers, a few noy- elected ermpboyees wepe hyoverht ifyth thes

5 i lan. Perry-eas Assist: amt ta-the Pre side ut awas inelnde.

ny éertain others being identified AS Ore: anor. AMititanan:

Supervi sor, Rookkew per “Super i sor, + = } : tT “ a Fe

Supervisors, Bxeentive See retary, Publicity “rectors 60,

the Editor of the. NMG official News. Organ. | 1

Tu'sum, my reading of the Peeard. nid am Sete tie tit

of the yME Constitution ea eip oe hy alee en v

always he en the plein iyite bis st ahi Union as 7

‘sions for both officers fyi eompleveos bo Snit Fine

nent, that the power to ostablish: “AV PS Laps had he

1 1951, with continuing authert: Za vion) te. amendowhot 3

: 2 CEMA SRO Neth

8. The Constitution in Article L3. Section i. i

Nz ational ‘Pesident that: ee ees

Office may de termine, appoint a meniher, of gheaers..

Unign-to assist him in the exercise ef o> Iyer ctr ite,

~ . Hons; ‘provided that*such ass}stant or sistisf.snt ata tin

; ar act in an exeeutive capacity. ‘ : pan, Ee

i ‘ : |

3 }

e | P.

plan

Arti

sett tae

Cron

thyet a

| ae

Appendix FP ee ee ae

Ve ‘ ‘

, eae i 2s af : -)

Mats ate thereupon bie established. Soe, foreoxsunple

. ‘ . a - 4 . . me oa se . en

: ee AP Section Sof the Constittwtion, ratified a LQot, -

Whieh

Perches: ~ : ° as

A 4 . oer ' . ee

he National Conner subjeet to approvab of te: NON iw:

ership. is etnpowered to make ndequitte atch appre’

Ah Go ig OSE PPVOVESIOLS top: PMCTISTONS, welfare, | whe sinaflar

enefits Por otheesys snd eniplovees of the: Unidn,

° “4 *.

Nit ine to de discerned fren the revised! Constittttion,

Gell He 2 Be . Vi weirs pak S's

bead Deceniber ree AAT Getrneheed “ore whit brote thievt

var eid via . . } Reng sot

rity. hither, Posneewost. the later révision must be

With the -fortiern. Pheoonly ditferenee in eitine elect

e . . ; Fate . ° bd % “s

COMLUNIINS intent of the Union menibershipswas-that

the TYGO ps ‘igton, Tho antheigiy te aet was tratisferred

Hie National Comneit te the National Office. | cone ‘lade

Ven avibifoutdnore tit mw umalysis suggests, th e Dis.

triet Judes erred aT conshiding that oat the time tie chal

lomerod aetkom was take a. there ‘hy ui heen a lack of auth lority

Tor pope

the |

ae 1 Ce tS! LOvyys? forall PMISt? ¢ sired’ present employers of

Hien, lee. ae :

Lis

But there Walls reowe. Atte? the release of Judge Bon- %,

sal’s

toorerte

t .

Ltd Ses

‘

re GG ike § i

prose.

Nee

al bieore

May 23. 1969 Opinion, the Union promptiv took ster

rate the NMC intention. Pt the jadee could be heard

the NM had fatled to make cleat it- intention. two

Uhetiis ta the Constitution Were mhimediately Ree

he atmiendiie nts by referendum were forthwith i

approved bay the iembership by an overwhelming vote. }

dinghy, the revised 1960) Con&titution Was further a

be hy the addition to Artiele’ - Section 11. OF the: :

Lollow ity

cd) The National Office shalk have the authority:

foo ppevrde penstons tor all past and present employes

| , : 25 .

A ¢ .

° \ e

_DFavisie ms prolibited by 204°. 5° ¢. eee d

to include nbn-officer ¢ employees nt] ¢ NAT “Otfcers Pension Pt

in (d)—-The* National Office shal

aie 35A . : ;

Appendix F

of the i tion and to proteet the, pension rights of all

past and present employees, of the Union.

The we nibers hip furthes anende a \rticle 14. Section

, to read as follows: .

Pensions: AL officers and stich eniplovees as the

National Office aN, cdestenate shall be eligible: ‘for

hene Hits under the NMU Officers Pension Plan! subject

to suck rates ane: reculations, asthe Trustees of that

; Plan inay est; ibhish, The National oft cosshall have the

iuithority to Validnte: ri Troe tive ‘ly AU pensions Tereteo-

fore paid under the Plan. 7 | °

“These plaintiffs then-cattacked-the drendiments as

Culpators within the meaniieot 20 Cos.

OOD and they

sought an Tnjunetion. The Distriet Judee Heatly and

correctly rejeetod tat contertion and ruled Cisat the

amendments “were not exculpatory provisions mrohibited

by pas U. '. a “aQd, The iy PUP fiose is ahri TON: eT) Jo /}} elite

HOn-o ice Lae mployers s- ee AT 5 NAT 4 Ohi CE: Plan.

tapes added. Sl 4 Ae,

ee IRION ANT) ORDER s)

ON Morton vor ancdxpese TION

The an endme ‘nts.to the NAIL Constitution “aul

Their .puryp tse Is aby Matis]

‘Accord yer ‘ y the ( eripficciey

Wat the Pieonest Pell Vssoetition

lomted By a vote ot

ble“

iV Ge Rents were ‘ac

‘ folowing -paracraph, to Article &. Section }]

have the A SLs to opi

yide LCtistorts for al} pasted present Crap len cf CH tlie i

}

and to Protecy thre Pension MIgnts Ot; 1 past ch ind present employees 5

wt the (nic, . :

~° “Amend Article 14. Section 7 to. read as lollows:

Pens si6ns: All officers and such emplovees ;

is*the National

()ftice may designate shall “he Cligih le for

benefits under the

NALU Office Peusion Tarr, subject to csuch rites and regula-

tiens as the Fry stees of that Plan orm: Iv establish, The National -

P e

“a . ee

. ‘

A ppendix F

eo tens ttution Had validly | bees

aneyded, the istrict Jide 's July 2) 1969 Memorancdun,

obey reed, = It does net appear that.the National Offies ha:

exe reised this thority .

meocuer that oth

Lorond finn to he saving? TP do not perceive that the

Myeessary autiority existed to inchide ‘von-oflieers at the

time they Were covered inte the Plant But now NMU has

conterred that suthoritv. Even) so as of this moment, the

National Office has not se far exereised its power.’ And

necordingly he couelided ovly that -sinte the anelusion of

non-ofticers “was beyond the power of the defendants,

phamnuitts are‘entitied to appropriate relief 2°!

o eoont'd } .

Office shall have the anthoritv ta validate retroactively all pen

sions heretotore pard under the Plan.”

While it is stared that T2040 »

tated how mans members of

lembers obtained a ballot, it is not

NAIL were ‘chigabile to vote The

uifendment to Article 14, Seetion 7 provides that “the Nationtd Office

Hall have the authority to validate retroactively all pensions -herete-

sre paid usrder the Plan.” However, it -does« net appear that the

National Office fas exercised this authority. ie

Plaintiffs’ motion is denied,

Meher

without prejudice to the plaintiffs

further relief by appropriate pplication af the defendants

bgeld violate the order oft the comrt. <s

. P A —

[rt iy ordered. ; 2 A a 7

ated New York, NY

tuly 3, 1960-

; Drorey Bo Poxsar

. : Sa ee ae |

10. DECISION AND OrpeR Ox Moros FOR REARGUMENT

_ Defendants” motion for reargument is denied. The interpreta-

on ot the meaning of “salaries” sought by defendants would not

ange the holding that only officers wete eligible for benefits under

@°NMU Officers’ Pension Plan. for the reason. stated in the

lemerandum filed May 23, 1969. Therefore the Nelision af wer-

fteers in the Plan was not authorized by the N MUL Constitution’

Tevised in 196. Since such ifielusion wat bevond the power of

e defendants. plaintiffs are ‘entitled to appropriate relief.

Consideration has been given to the affidavit «ft the tlefendant

artin Segal dated June 11, 1969) which was filed in support of the «

tenants’ motion for reargument. Mr. Segal is one of the trustees

the NM Officers’ Pension Plan, who appeared in the action and

Appendix F

% rp ‘ eee ee \ oe eee

bere el ; Phereupon ater such PromQuiue, Us lie pecore By

bana the anne Othice acted to Iuplement the wate rity >:

has . cently: eaffirmed. — It adopted a resolution tiiased |

‘ capers

desire of the National Office “to confirm the pension righ

of all eniployees of the Union, both re troactively aid: jn

ie Teste ‘bie

the » spectively.” The, text appears in the? ware

has °

the.

the

. Right the ‘hand the re, having been advised ay ty

ises, the assumed omission havi ity s been cubed bY NMI

Mined = SSP reny canteen gee oe ‘

orn 10 (cont'd) :

ot tied his answer on May 1, 1969. The eiiat tles hace sti

nts. Segal’s good fatth as trustee. Pa wever. the Ghani

: to obtain the return to NAIU of the myesk Wt t

oo. ~ behalf of non-otficers, since ae eth Wis t oatitinviize

_ dts so ordered. 5 hiye nt =o :

en- Dated | New York. N.Y" \

"yi rv July 3, 1969 F

F x +) 14 H

not. : a.

The

tice Hl “Now, Thereti re be at Resolved :

ote- : ~*s tT) All pensions jiereteiure pail bv-the NAMI Oni

the , Pension Plan are hereby validated) arid appren

“i « : (2) Al PaBliveces of the rijon except a9 those alt

oe : covered by gollective bargamine agreemen} \

E Is thie cmplover, which collective area : Cl

n for the sehen eniplovees |. . shall be ehgible tor je

4 teen the N NAPUS Officers Persie Whee

P (3+ Payments on the NME Offierr’ esis |

vide for the foregoi we henefits.are here ate bag ed ‘

j paviients by the Lnton to the NA 69 aon ‘

= hereby rietaties! cout: ppraves |.” *

Pursuant titreto. the Plan (identified as tint whi

ta- hve as of February lo, 190530! #> amended) Was ag’ :]

wt Article T, Section 8 to define. more specifically. the term obasrtic

ler _ to mean ages

he “an Officer, Representative. Si pervisor or Professiag

ae all other emplovees of the Union exce pt cad any emplovee whose

on Se eT ARTOR, hours of work: ¢ Or cone hee: of employment sre

of * : determined | by collective bargaining with a recegnized bargain-

ng AL etna ae

nt And Section 9 defines aka i Constanion” to mean

he @ “the Constitution of the NMU in. farce and efiect at the time of

a the adoption of this Pension’ Plan [1953] together’ with any

id sea i thereto.” ;

a - *

a sees Appendix F ets

~ ~Pistric tJudge should have entered sums MeN paderne nd in

. a .

iat OF the defendants, this retiderime: miaot Whatever

. _ .

Cladins Tad pryytonsdy io lbged upon the Court by these.

piaintelis. Pa ike amv other VIEW. as the seems tome. i tol

only todeuy NMU its right to manage its ow stibarrs. Dat

View of tle rectification of whatever oversieht the dudes

in * . G ‘ : . . ee

“ex thoueht he had deteeted, the thembership clearly Restated

2 it: . . Pe | , } . ! fea cee. 5 ore nak? : .

Hs app rovad ob tine autnoritn of the Natiogal Ottee anelat

the Prustees to provide petisions fer all otheers sad. alb

etipdlovees. | . ;

- . . s =:

° ~~ xe n ~ mica Se ete ta

. 1 the Supreme Cor ri has recognized tk unionsin the view of

Sg Tess ane to be jecorded: ervar Tantude juan ~Wing their own

iturmed comtroversies,. if gr; UTS TIE ey cick HE kt | lth ae Be

( i ~ te ee ae Wy 4 ct }? y) . , Del SRE TT OVCOS. oO]

a ey a eee re ae

PME ON AOD OF ¢ PO) a ee

ef — « . : . -

an anne ] ‘ ‘ j ‘ 73 ’ ° + + ; : t¥a

ome # si ie onan SO yay ae the cbocuimMents Delore ws principles aQnahovots !

tor | SES VOCTUTEA SETULODS Construction. we sore slectanie! tes 1¢" i tiger

tosethers Certanh repeals tiv iuplication are not favored. and te-

- 3 a 5 ™ 1 ?

‘ Vere CA te scem. that the Too Consttitien repeaicd the varhier,

Soh Ursin Where thre PO Ve pret ret thre f ORDO Gr on 1 1s fut fielia-

jetted Wat the’ rule is to eve ef cet to beth pos ale dled Sta

‘ Ne SS i Wie BE PANS, JON ( 193944 : ;

be kingugee betore us mist be mterpreted ta the Hight of reason

_ eb retandme ter teach the. results mitered bv ihe abt kos eit

se Mennots omleche tesmective Constitutions which retfleer the membei

stp. sipped Wathen nited Slation Gan (eS! ty TO

we,

; LOs5 ; fa

ae le Cauiae inst at diter reading et co wakes tonal legislation”

’ 11h sty Pome Blowers issn, si] PYG GOS. how much

‘ tceediou he cep pole ! Top dae ge! A enough

, r tiles lilan = dradtsmien Kecoenit onal the

cL ARR Hives sottght- te he nelues ed diy NA sliould provide.

“He Kev -totas recA mention Of all leved deaabts

é te Aa ~

bs , COPEL SANT. fhieers of the toniei were nay Loprer

- ee sp $

. { Cie I Hn i d H clyes | bites | ae We Pit te Ors | 2

. Mie by, indeed. the dudge found no tack pl syne

ut ie tritstes “f ct, Coleiitan ibe Protherhood ty Nay’-

; ap CO eRRS Tits BAO EG aA ot ate ne y

wi the trustees had undertakey 1% do preetsely, weliat the ( qiten

“iO ov ney i CCT] j lish: E

. .

z J

. . .

4 . . .

Ayipendia FF.

. J ‘ . e ‘ * e

ri A ay “welt “yo 2

Phe piirpese and the intend Of the Union emeraed ean-.

clusively. I respectfully. submit. and the comberred author

WILY Was exercised.

. Hie “9

Having in mind that the Distdes Federer conelsidee) Ghat

SUI opelomnent was iy ord Pe perhaps it will aot be

iiss f0: Ties baak bo fits Mean 28 1969 Vietnorandir

Deeispor, There he coneduded that the ‘hl Untiits* getion ,

Nosy bretis I at lefendants” Heluciaary diitios I~ that Ng red yy

liehes.S Pheseoy Hitiaed thi 1 “in this cuse defendants have

trade Pa shawn rie three Hey Hatve deen prefidiced by the

UN, STG Saree eos

Jude Mothes fount’ in Wrt> 2 National VMerritiinve

Uuivn of bine ried, ee ft, thi papa, bi. ats { LOGS). wheat tlieade

Pendant Wall in the 1atg Corton tur National Seerenarye

Treasurer lind dk feale d the Cyelaina iti Marrisses by a Vote on

the order af two iy alte: The poainriey Pacditde recerpyved the:

deust Humber of Votes nti im show th Suilite ratio its he:

sought clection as one-ot the View 4 residents. Those plain

rift thien liad 1 ithedt ies Ot, ntecardinen Wilh the

PrOVESTON a} the Constitution, anil alter the “protests hia

heen heard ane rejgeetod the Cg soueht the Intervention of tie

Seeretary of Labor The did et do se here! and Iotiay

yes noticed tlisit the See ett Vis shia] cofiplaining, COPED

° hres the Presse hit mse Patton: ott he histel bee hy hepa tilornied

through the annund line of the reports required bathe

2 Disclosure ake1s; a ar Sas ae

Now, some eight aparss aller the aetioti< we have bea)

discussing, we find these plaiutits OKI Gany accounting

and aretinn OL inenevs « ontribute tothe Pension Plan Ut

Theos dn Juisstiig 1 Visa ke aad at e briters

Servite had yeqtired NAL to amenel the beady :

all emplovees, atthe ‘ers, as well as Tonite mire IF

sO tine nadled, Was ap) proved bythe Pyireau Of Paternal Revenue

Appendia Fr

. .

nes ar : ee: : ‘ as

ay Pos eed ei bref these defendants vider ,

LHe TE Woe born|d Hidividtually to return to NMU

ill; syst tieretotove gaad-or acerued for.the benefit, of

Co eerhelpatss itis difhealt to, see Wwhiy the de.

ea Sol ot have beeit prejudiced -by the delay.”?

a sacs % ‘ : . ‘ . .

Surel Pits netion had Carlier been Commicnced and cou-

able that la-

Moreover, cor

Kes Pesult. it would Set ei

‘tA Lisateel Would eave been limited,

Moreally voqured, could at once have heen

the cid that the Unien’s concern for eligrble par

be satistied. ‘ 5% ie.

Crins to me that a hearing. uitglesist on cthis aspect

e. Wais'e] aiiy lil orde 1, ob fad to seU how: the Judge

lheemIVe bftulted thy defendants as fiaying ‘‘made no

S that thes have heen prejudiced hy the delay.’’" To

utestent that conclusion of the Distriet- Judge entered

his determination tliat sunnary Judgement was in

ecdery we do not know. But we do know that despite thie

boschee Gl extiiisic evidence doth on this point and with -

respect to what was in fact the iitention of the Union, 2 |

inary jidgwinent for the Hlaintitls “was directed: if

ulimMary judgment were net tobe ente red ty fi avor of the -

‘cndants. for the reasons previously ‘advanced, at the

very least according to Miy appraisal of the reeord here

there shoulel have’ been a hearing. There Was error On

count of that failure if fee no other reason, -

IV.

word @ndaly. protract this exposition of my views

vere L to go int further detail. Sounding : again the note

m which [Topened? I respectfully submit my observations

PF iy

4 the greatest regard = those of my — — and

hudge Bonsal. ' 4

IS. Ci. United States v. Diebold, Inc., 369 U. S. 654, 655

4? ) “ ‘ . ai

ie. 3

“41A

"pa

APPENDIX G

‘A PPKEALS

UCNTPED STATES COURT OF

Por tie Seconp Cirévar

At a St: ited Perm of the U ate States Court of Ap--

poals, inand forthe Second Cireuit, held at the United States.

Courthagse in the Citw of New York, on the twentieth day

of I: aioe iny, one thousand nine-hundred and seve nty

Present : Hox. J. Eowarn Lu mparn,

i Chicf Judge ;: :

’ = Wats =

as Hon. Jounx AL Daxatien,

2 * e P :

Hlox. Robert PL ANpersonx® . ;

Circuit Judges.

a AMES M.

Morrissey, Josepa Papua, Rateu [pranin

“DIVIDUALLY AND THE MEMBERS OF

AMEnic ee

a eee

ON BEHALF oF

THE

7 Nationa Maritime U NION OF

a ; ioe oy Plaintif's. Appellants,

~, ; 5 v.

Joseph CURRAN, Sti ANNON

Ie.

> Wiis Pi ERRY, MARTIN

SEGAL, hie AHAM Kk. F REEDMAN AND Leon Karciumer,

. ; Defendauts-A ppellants,

(AND } Over Cases)

Asie from the United States Distriet Court for the

Southern District of New York. . 7

This cause came on to be heard on the transcript of

record from the United States District Court for the South-

ern District. of N

yew York, and was argued by counsel.

Appendi« G Gq

» ON ConsipeRation W HERKOE, it is ngs herehy ordered,

ad juilyed, and decreed that’ the orders and judement OF said

Distriet Court be and they are hereby athirmigd in part and.

reversed in part and that’ the aetion he and it hereby is re

manded for further proceedings in Comnplinee With the

opinion of this eourt with costs to be taxed against the

» defendants-appellants, i

; AL DAs ren esano,

; Clerk.

. ies

mae APPENDIX H |

UNITE D STATES COL ork TOF APPEALS

3% Sreoxp Cinet

o i ate

: Nos. 388845 B89 78. 19. ede deds

f —_ ; | : . 3

James M. Morrissey. Josepis Pavinna, Raver Ibeanin. Tx.

DIVIDUALLY AND-ON BEHALE OF Tit Mi: MBERS OF THE

Narionan Marivime Usxiox op AMERIC ‘Ay :

ae ei Plaintiffs SA ppellants,

Joskpi Curran, Ginnie W ALL. WIL. LAM Prrny, Marris

I, SEGAL, ABRANAM: I. MREEDMAN AND Leon Kane HMER,

5 : ; Defi ndautss Lppellauts,

A petition fora rehearing having been file d heii by

counsel for defendants-appellants. Martin Segal and Leon

Karchmer, hag .

“Upone onsideration thereof, it ‘Ts

Ordered that said’ petition he and if iereliy ix demied,

J. Mowanrp, Leann.

Roperr PL ANbERSOx?

Coreiuit Silay S,

: .

veto to grant:

March 31.1970,

doun A, DANAVER,

See ‘ . . : t!

ore APPENDIX

- : . e PN. fo

UNITED STATES COURT OF APPRALS e

‘ Secdxp.Cirevrr- 5 a - fe

‘i seems

Nos. 33884, 33918 1D, 838937 _ —_

_ James M, Montussey, sloseen Papinua, Raveu Terai, Fx

Nariovan Maritime Ustox or A MERICA, go>.

; “ “en, 25 Plaintiffs-A ppedlants, .

oases ca es. ;

” - v] e m e ie,

Josep CurnaN, Suaxnox Wat. Wintiam. Perry, Marrix

_ BE. Seca, Arana EK. FreepMAN anp Leon Karcumer.

Defendants-Appellants,

- (ann 3 OTHER Cases).

A petition fora rehearing containiig a suggestion threat.

the action be-reheard in bane having been filed herein by

counsel for defendants-appellants Martin Segal and Leon

. Karchmer and no active ¢ircuit judge having requested

that. a vote be taken on said suggestion, Sint Na) a,

é Part eee as vice ; 4

Upon eonsideration thereof, it is ce |

Orderéd that said’ petition be and it hereby is denied,

J. Eowarp Lumparp,

° eat Ta eae. Chief Judge.

~ Mareh 31, 1970. a oe ; )

—_———

4 °

404

oie ot AP Oa APPENDIX: J.

| “APPEALS

UNITE] STATES: Capi of }

aah SFOS, Cingerr

. a Stated ‘Tern ‘of ee Unjted States Court of

“Appel als, in and for the Second Circuit, held at the Unitéd

States Court. House, in the City of New York, on the 24th

day of April, one thousand nine hundred, and 70 i

= - r : P ‘

dlostpu M. Morrissry,: Joserrn Papra; RALPH ‘Tekan, .

INDIVIDUALLY AND @N BEHALF OF THE “Menpers™¥r THE

NATIONAL, MaritiMé nion oF AMERICA, vis

Plaintiff s- Appeltants, ‘a

Josep. Curran, SuHannon Watt, WittiaM Perry, Martin

‘Te. Seear, ABRAHAM FE. FreepmMan, aNp-Leon KarncHMER,

Defendants- Appellants,

(AND 3 Bde Cases).

a ee ae

Wag ¢

i ~ e

s ?

It is. he reby ‘ordered that the motion made herein by

‘counsel for the appellants Martin E. Segal and Leon _

Karchmer to reconsider the order of the court filed March.

31, 1970 denying the petition for rehearing and rehearing |

in bane he and hereby: is denied. ‘

e. é

LAA eO EER ALE ERO OESOE DORE T EET E EEE H Hes eee eee eee

| J. Epwarp Lumparn,

ot : : BERT P. ANDERSON,

Circuit Judges

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