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FERRARA v. PACIFIC INTERMOUNTAIN EXPRESS COMPANY

June 27, 1969

FRANK FERRARA ET AL., PLAINTIFFS,
v.
PACIFIC INTERMOUNTAIN EXPRESS COMPANY, A NEVADA CORPORATION, AND LOCAL 705, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, ETC., DEFENDANTS.



The opinion of the court was delivered by: Decker, District Judge.

MEMORANDUM OPINION

In May 1966 two trucking companies merged. All States Freight, Inc., became a part of the surviving Pacific Intermountain Express Company. Both before and after the combination, truck drivers for the companies were represented by Local 705 of the International Brotherhood of Teamsters. Under the respective collective bargaining agreements, each company had its own seniority list which defined the truckers' rights vis-a-vis the other drivers employed by that corporation. After the merger, these two lists had to be integrated in some manner.

The surviving corporation and Local 705 negotiated extensively concerning the seniority issue. Unable to reach a consensus, they then submitted the question to arbitration and to a Joint Grievance Committee. Concluding that the corporate acquisition was a "buy out" rather than a "merger," both the grievance committee and the arbitrator placed the entire list of All States' drivers below the drivers for P.I.E. The All States drivers therefore instituted this suit, claiming that (1) P.I.E., as the successor to the liabilities and duties of All States, breached the collective bargaining agreement between the drivers and All States, and (2) the union violated its statutory duty of fair representation.

Both the employer and Local 705 have now moved for summary judgment, maintaining that the testimony and exhibits adduced before the Joint Grievance Committee establish that there is no genuine issue for trial. F.R.Civ.P. 56(e) provides that when such a motion is made,

  "an adverse party may not rest upon the mere
  allegations or denials of his pleading, but his
  response, by affidavits or as otherwise provided in
  this rule, must set forth specific facts showing that
  there is a genuine issue for trial."

Since plaintiffs have failed to furnish detailed facts or other evidence supporting their allegations, summary judgment is appropriate. See, e.g., Crest Auto Supplies, Inc. v. Ero Manufacturing Co., 360 F.2d 896, 902 (7th Cir. 1966); Balowski v. International Union, United Auto, Aerospace and Agr. Implement Workers of America (U.A.W.), 372 F.2d 829, 835 (6th Cir. 1967).

Two successive collective bargaining agreements are involved. An initial contract governed labor relations from January 1, 1964 to March 31, 1967, while a later one, executed about July 18, 1967, determined the parties' relationship between April 1, 1967 and March 31, 1970. The aggrieved drivers rely upon the 1964-67 agreement, emphasizing article 8, section 1 which stated that:

  "Employee seniority * * * shall prevail for all
  purposes and in all instances. Seniority shall be
  broken only by discharge for just cause, voluntary
  resignation or more than two (2) years layoff."

Although the corporate combination was consummated in May 1966, the drivers' seniority rights were not affected until the terminals were physically merged in September 1967. Plaintiffs' causes of action therefore accrued during the 1967-70 collective bargaining agreement and are subject to its provisions. Article 8, section 7 of the current contract specifically provides that:

  "When operations of bought-out company are merged
  with operations of the buyer: In the event an
  Employer buys out another Employer and merges the
  operations of the bought-out Employer into his own,
  those employees of the bought-out Employer who are
  employed by the acquiring Employer will begin to
  accrue seniority with the new Employer and the
  beginning of such employment."

By industry practice, trucking firms' combinations are classified as either "buy-outs" or "mergers." In the latter type of acquisition, seniority is dovetailed on a one-for-one basis,*fn1 but in a "buy-out" the drivers of the acquired company uniformly go to the bottom of the seniority list of the acquiring firm. In cases of disagreement, both the 1964-67 and the 1967-70 collective bargaining agreements established a two-step arbitration procedure. First, the disagreement is submitted to one representative of each side. If not settled, the controversy is then considered by a Joint Grievance Committee composed of five employer representatives and five union representatives. The decision of the committee is "final and binding upon the parties."

Initially, P.I.E. contended the acquisition was a "merger," and Local 705 claimed it was a "buy-out." Unable to agree at their meeting, the parties submitted the controversy to a single arbitrator, Judge Joseph Burke, who decided against the plaintiffs. The Joint Grievance Committee then met and ratified Judge Burke's holding on March 17, 1967.*fn2

Since the union had not supported their position, the plaintiffs instituted this lawsuit. In April 1969, immediately prior to trial, P.I.E. and Local 705 agreed to present again the controversy to a Joint Grievance Committee. Accordingly, the committee met on April 1, 1969. Notice of the meeting was given to all interested drivers. Assisted by counsel, both plaintiffs and defendants called witnesses and introduced evidence.*fn3 The committee unanimously ruled that the acquisition was a "buy-out" rather than a "merger."*fn4

Since the Joint Grievance Committee's decision is binding on P.I.E. and Local 705, the employer's motion for summary judgment must be granted. Obligated to enforce arbitration awards, the federal courts may not substitute their judgment for that of the arbitrators. See, e.g., United Steelworkers of America v. Enterprise Wheel and Car Corp., 363 U.S. 593, 596, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960); I.A.M. District No. 8, A.F.L.-C.I.O. v. Campbell Soup Co., 406 F.2d 1223 (7th Cir. 1969). Each of the plaintiffs' contentions was thoroughly considered by the committee. After hearing all the evidence, the arbitration committee determined that the acquisition was a "buy-out," that the 1967-70 collective bargaining agreement governs the drivers' dispute, ...


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