Appendix — Friendly Society of Engravers & Sketchmakers v. Calico Engraving Co. (No. 744)

INDEX TO APPENDIX

Pace

Decision of Court of Appeals .................c ee eeee 13

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(12)

DECISION OF COURT OF APPEALS

(Argued October 5, 1956. Decided November 7, 1956.)

Before Parker, Chief Judge, Sopecorr, Circuit Judge, and

Bryan, District Judge.

Isadore S. Bernstein and Carl F. Nitto for Appellant and

N. Heyward Clarkson, Jr., and Thomas C. Bradley, Jr.,

(Smith & Bradley on brief) for Appellee.

Parker, Chief Judge:

This is an appeal from an order dismissing an action

instituted by a labor union against an employer to recover

damages on account of ant-union activity on the part of the

employer. The dismissal was based upon the failure of the

complaint to state a claim upon which relief could be

granted.

The complaint sets forth two causes of action. The first

alleges that plaintiff is an incorporated labor union, a num-

ber of whose members have been employed by defendant,

a manufacturing corporation, and that plaintiff has been

certified as the sole bargaining representative of the em-

ployees of the defendant. The gist of the claim for damages

is contained in paragraphs 6 and 7 of the first cause of

action which are as follows:

**6. That since the certification by the plaintiff as

the sole bargaining representative of its employees in

the defendant’s plant as aforesaid, the defendant, its

agents and officers, have wilfully and maliciously inter-

fered with the plaintiff’s contracts and relationships

with its members employed by defendant and have on

numerous occasions stated to the said employees that

they wanted the union to leave the plant and that they

would prefer that the employees leave the union, and

have made numerous threats and promises to the said

members in an effort to compel them to terminate their

membership in the union and to expel the plaintiff from

the plaintiff as the sole bargaining representative of its

the said plant, and have failed and refused to recognize -

employees in the defendant’s plant pursuant to the said

(13)

14 FRIENDLY Soc. oF ENG. AND SKETCHMAKERS, PETITIONER, v.

certification by the National Labor Relations Board;

that the acts aforesaid were in violation of plaintiff’s

rights as a labor union and constitute a wrongful and

unlawful interference with the plaintiff in its relations

and contracts with its members, and the same constitute

unfair labor practices in violation of the Labor Man-

agement Relations Act of 1947.

**7. That by reason of and as a result of the afore-

said wilful and malicious acts and conduct of the de-

fendant and unlawful interference with the plaintiff in

its relations to its members, the said employees became

insecure in their jobs and were compelled to resign

from their employment and have lost, or are about to

lose, their membership in the plaintiff society, as a

result of which the plaintiff lost its recognition as the

sole bargaining representative of the employees in the

defendant’s plant, lost numerous members and has suf-

fered extreme humiliation and loss of prestige as a

labor organization and has been deprived of member-

ship dues and other benefits accruing from its member-

ship and the plaintiff has been otherwise damaged, all

to its damage in the sum of One Hundred Thousand

($100,000.00) Dollars actual and punitive damages.’’

The second cause of action alleges that defendant’s

actions constitute a violation of the right to work statute of

the Staie of South Carolina. Sections 40-46 et seq. 1954

Supplement to the Code of Laws of South Carolina, which

declares it to be the public policy of the state ‘‘that the right

of persons to work shall not be denied or abridged on ac-

count of membership or nonmembership in any labor union

or labor organization.”’

We agree with the court below that neither cause of

action states a claim upon which plaintiff can recover. As

to the first cause of action, plaintiff’s contention is that it is

entitled to recover for malicious interference with contract,

under the doctrine of such cases as Lumley v. Gye, 2 E1.

and B1. 216, 118 Eng. Rep. 749; Chitwood v. McMillan, 189

S. C. 262, 1 S. E. (2d) 162; and Keels v. Powell, 207 S. C.

97, 34 S. E. (2d) 482. We do not think, however, that the

action of an employer in seeking to eliminate union member-

ship on the part of his employees falls within the ambit of

wa

CALICO ENGRAVING Co., RESPONDENT—APPENDIX 15

these cases. Certainly there was no action at common law

for such anti-union activity on the part of the employer,

who might require of his employees as a condition of em-

ployment that they not be members of a labor union. See

Hitchman Coal & Coke Co. v. Mitchell, 245 U. S. 229; Cop-

page v. Kansas, 236 U. S. 1; Adair v. United States, 208

U. S. 161. This was changed by the National Labor Rela-

tions Act amended by the Labor Management Relations

Act. 29 USC 160 et seq., which recognized the rights of

laboring men to organize and to bargain collectively and

made it the duty of the employer to recognize such rights

and to bargain with the duly chosen representative of the

employees. The National Labor Relations Act and the

Labor Management Relations Act, however, provided ex-

clusive remedies for the protection of the rights thus recog-

nized; and the parties complaining of the violation of such

rights may not go into court for their vindication but must

pursue the remedies that the acts provide. Amazon Cotton

Mills v. Textile Workers Union of America, 4 Cir. 167 F.

(2d) 183. As said by this court in the case cited:

‘*It is perfectly clear, both from the history of the

National Labor Relations Act and from the decisions

rendered thereunder, that the purpose of that act was

‘to establish a single paramount administrative or

quaso-judicial authority in connection with the develop-

ment of federal American Law regarding collective

bargaining’; that the only rights made enforceable by

the act were those determined by the National Labor

Relations Board to exist under the facts of each case;

and that the federal trial courts were without jurisdic-

tion to redress by injunction or otherwise the unfair

labor practices which it defined. H. Rep. No. 447, 74th

Cong. Ist Sess. p. 24; S. Rep. No. 573, 74th Cong. Ist

Sess. p. 15; Agwilines, Inc. v. N. L. R. B., 5 Cir., 87 F.

(2d) 146, 150, 151; Blankenship v. Kurfman, 7 Cir. 96

F. (2d) 450; Myers v. Bethlehem Shipbuilding Corp.,

303 U. S. 41, 58 S. Ct. 459, 82 L. Ed. 638; Newport News

Shipbuilding & Dry Dock Co. v. Schauffler, 303 U. 8.

54, 58, 58 S. Ct. 466, 82 L. Ed. 646; Amalgamated

Utility Workers v. Consolidated Edison Co., 309 U. 8.

261, 265, 266, 60 S. Ct. 561, 84 L. Ed. 738; National

16 Frrenpiy Soc. or ENG. AND SKETCHMAKERS, PETITIONER, v.

Licorice Co. v. N. L. R. B., 309 U. S. 350, 362, 365, 60

S. Ct. 569, 84 L. Ed. 709. * * * For the same reason that

plaintiff may not maintain the suit for injunction to

restrain the unfair labor practice, it may not maintain

the action to recover damages on account thereof.’’

In Garner v. Teamster’s Union, 346 U. S. 485, the Su-

preme Court dealt with the granting of an injunction to

restrain peaceful picketing in aid of an organizing effort

by the union. In holding that the National Labor Relations

Board had exclusive jurisdiction with respect to the mat-

ter and that the courts were without jurisdiction in the

premises, the court said:

‘*Congress did not merely lay down a substantive

rule of law to be enforced by any tribunal competent to

apply law generally to the parties. It went on to confide

primary interpretation and application of its rules to

a specific and specially constituted tribunal and pre-

scribed a particular procedure for investigation, com-

plaint and notice, and hearing and decision, including

judicial relief pendng a final administrative order.

Congress evidently considered that centralized admin-

istration of specially designed procedures was neces-

sary to obtain uniform application of its substantive

rules and to avoid these diversities and conflicts likely

to result from a variety of local procedures and atti-

tudges toward labor controversies. * * * A multiplicity

of tribunals and a diversity of procedures are quite

as apt to produce incompatible or conflicting adjudica-

tions as are different rules of substantive law. The

same reasoning which prohibits federal courts from

intervening in such cases, except by way of review or

on application of the federal Bcard, precludes state

courts from doing so.’’

In Weber v. Anhauser-Busch, Inc., 348 U. S. 468, the

Supreme Court held that a state court might not grant an

injunction on the basis of state law to restrain certain un-

fair labor practices. In the course of the opinion the court

said: ‘‘It is perfectly clear that had respondent gone first

to a federal court instead of the state court, the federal

court would have declined jurisdiction, at least as to the

CaLico ENGRAVING Co., RESPONDENT—APPENDIX 17

unfair labor practices, on the ground that exclusive primary

jurisdiction was in the Board. As pointed out in the Garner

case, 346 U. S., at 491, the same considerations apply to the

state courts.’’ After distinguishing the case of United

Construction Workers v. Laburnum, infra, and adverting

to situations in which jurisdiction might properly be exer-

cised by state tribunals, the court said: ‘‘But where the

moving party itself alleges unfair labor practices, where

the facts reasonably bring the controversy within the sec-

tions prohibiting these practices, and where the conduct, if

not prohibited by the federal Act, may be reasonably

deemed to come within the protection afforded by that Act,

the state court must decline jurisdiction in deference to the

tribunal which Congress has selected for determining such

issues in the first instance.”’ ;

See also Bowen v. Bricklayers, Masons & Plasterers

Int. Union, 225 S. C. 29, 80 S. E. (2d) 348, in which the

Supreme Court of South Carolina said that the jurisdiction

of the labor board would be exclusive in a case such as this

where interstate commerce is involved.

Where Congress intended that a right to sue in the

courts should exist with respect to any of the rights created

by the act, it made express provision to that effect, as in

the case of injuries resulting from boycotts or other unlaw-

ful combinations. See 29 USC 187(a) and (b), construed

and applied by this court in United Mine Workers of

America v. Patton, 211 F. (2d) 742

United Construction Workers v. Laburnum Construc-

tion Company, 347 U. S. 656, is not to the contrary. That

case dealt with the right to recover damages on account of

a common law tort actionable in the absence of statute, not

a mere unfair labor practice with respect to which no action

at common law existed. Of course tortious action such as

assault and battery does not cease to be actionable because

it may constitute an unfair labor practice; but it does not

follow that an unfair labor practice is actionable at law

because forbidden by statute. As pointed out above, where

the statute which forbids it provides at the same time a

remedy for its redress without providing a right of action

in the courts, the remedy so provided is exclusive. To alow

a

actions at law to be maintained with respect to unfair labor

practices, which do not give rise to actions at common law,

would not only burden the courts with a flood of unneces-

sary litigation, but would hamper the National Labor Rela-

tions Board in the performance of the duties confided to

it and would breed endless confusion in labor litigation.

Nothing of the sort was intended by Congress; and for the

courts to sanction such litigation would retard and not ad-

vance the purposes for which the National Labor Relations

Act came into being.

For like reason, we think that the complaint states no

claim upon which relief may be granted under the South

Carolina ‘‘right to work’’ act. That statute was clearly in-

tended to preserve the right of laboring men to employment

notwithstanding closed shop agreements entered into be-

tween employers and labor unions, not to confer upon labor

unions the right to recover damages from employers be-

cause of unfair labor practices. If, however, it be construed

as attempting to confer such right upon labor unions, it is

clear that the attempt must fail in cases such as this, where

exclusive jurisdiction with respect to the conduct involved

has been vested by Congress in the National Labor Rela-

tions Board. Weber v. Anhauser-Busch, Inc., supra, 348

U.S. 468; Garner v. Teamsters Union, supra, 346 U. S. 485.

Affirmed.

ORDER OF DISTRICT COURT

This is an action for damages brought by a labor union

against the employer of some of its members. The part of

the complaint designated as the first cause of action alleges

that defendant, on numerous occasions, stated to its em-

ployees that it wanted plaintiff to leave its plant and pre-

ferred that its employees leave plaintiff, that it made

threats and promises to its employees in an effort to cause

their withdrawal from plaintiff, and refused to recognize

plaintiff as the sole bargaining representative of its em-

ployees. The part of the complaint designated as the second

cause of action alleges that defendant interferred with

members of plaintiff in the exercise of their right to work.

The damages claimed in each of the two designated causes

18 FRIENDLY Soc. or ENG. AND SKETCHMAKERS, PETITIONER, v.

CALICO ENGRAVING CO., RESPONDENT—APPENDIX 19

of action are the same, that defendant’s complained of acts

caused plaintiff to lose members, membership dues, pres-

tige, and recognition as bargaining representative of de-

fendant’s employees. ©

I have for consideration defendant’s motion to dismiss.

I do not feel that it is necessary to consider all of the

grounds urged, for in my opinicn, the complaint quite

clearly fails to state a claim upon which relief can be

granted.

In the first cause of action, plaintiff does not rely upon

any statute, State or Federal, but urges that defendant’s

acts as alleged are wrongful at common law in that they

constitute a wrongful interference with plaintiff’s con-

tractual relationships with its members. The decisions cived

in plaintiff’s brief (Keels v. Powell, 207 S. C. 97, 34 S. K.

(2d) 482, and Chitwood v. McMillan, 189 S. C. 262, 1 S. E.

(2d) 162) do not support plaintiff’s case. It would serve

no useful purpose to discuss the many distinguishing

features. It is sufficient to note that here the defendant has

a legitimate business interest which it may protect by any

lawful means. I am aware of no authority that characterizes

the acts attributed to defendant as violative of any common

law principle.

Plaintiff asserts that the second cause of action alleges

a violation of a recently enacted South Carolina statute

commonly known as the ‘‘Right To Work Act,’’ Sections

40-46 et seq., 1954 Supplement to the Code of Laws of South

Carolina, 1952, the pertinent parts of which read as follows:

Section 40-46.6. ‘‘Interference with right to work;

compelling labor organization membership; picketing;

etc., unlawful.

‘*Tt shall be unlawful for any person, acting alone

or in concert with one or more persons:

‘*(1) By force, intimidation, violence or threats

thereof, or ‘violent or insulting language, directed

against the person or property, or any member of the

family of any person (a) to interfere, or attempt to

interfere, with such person in the exercise of his right

to work, to pursue or engage in any lawful vocation or

business activity, to enter or leave any place of his

20 FRIENDLY Soc. oF ENG. AND SKETCHMAKERS, PETITIONER, v.

employment or to receive, ship or deliver materials,

goods or services not prohibited by law, or (b) to com-

pel or attempt to compel any person to join, support

or refrain from joining or supporting any labor organi-

zation. * * °’’

Section 40-46.7. ‘‘Appeal to court when rights ad-

versely affected.

**Any person whose rights are adversely affected

by any contract, agreement, assemblage or other act

or thing done or threatened to be done and declared

to be unlawful or prohibited by this chapter may apply

to any court having general equity jurisdiction for

appropriate relief.’’

Section 40-46.8. ‘‘Same; relief court may grant.

**The Court, in any such proceeding, may grant

and issue such restraining, and other, orders as may

be appropriate, including an injunction restraining and

enjoining the performance, continuance, maintenance

or commission of any such contract, agreement, as-

semblage, act or thing, and may determine and award,

as justice may require, any actual damages, costs and

attorneys’ fees which have been sustained or incurred

by any party to the action, and, in the discretion of the

court or jury, punitive damages in addition to the

actual damages.’’

The South Carolina Supreme Court has not yet had

Occasion to construe the Right To Work Act, but in my

Opinion, the Act as a whole clearly manifests the intention

of the Legislature to protect individual employees. Where

Section 40-46.7 employs the words, ‘‘Any person whose

rights are adversely affected,’’ the Legislature undoubtedly

had in mind the purpose of protecting the right of every in-

dividual to seek and accept employment. The Act cannot

be legitimately construed as one for the benefit of a labor

organization to which an employee might belong. Other-

wise, churches and other organizations to which an em-

ployee belonged and to which he customarily made contri-

butions or paid dues might also have causes of action

CaLico ENGRAVING Co., RESPONDENT—APPENDIX 21

against employers who refused to employ or threatened to

discharge any person belonging to such church or other

organization. :

The action should be dismissed. It is so ORDERED.

This 30th day of March, 1956.

(Signed) GEO. BELL TIMMERMAN,

United States District Judge.