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05/10/94 LESTER D. ANTRIM v. UNITED TRANSPORTATION

May 10, 1994

LESTER D. ANTRIM, TOM M. BELL, WENDELL BOLLINGER, PHILIP A. DOUGLAS, RICHARD L. FERZELY, JOHN R. GREGORY, OLIVER F. HOOD, JOHN R. HYMES, WAYNE J. KIGHT, MORRIS H. LANCASTER, JR., DONALD EUGENE LOOKER, GEORGE ROBERT MIDDLETON, RICK D. MITCHELL, J. KENNETH PHELPS, KENNETH A. ROBERTSON, DAVID A. SHRUMANSKI, RICHARD D. ZILLION, INDIVIDUALLY AND ON BEHALF OF THEMSELVES AND ALL PERSONS SIMILARLY SITUATED, PLAINTIFFS-APPELLANTS,
v.
UNITED TRANSPORTATION UNION, DEFENDANT-APPELLEE.



Appeal from the Circuit Court of Madison County. No. 89-L-856. Honorable A.A. Matoesian, Judge Presiding.

Chapman, Goldenhersh, Maag

The opinion of the court was delivered by: Chapman

JUSTICE CHAPMAN delivered the opinion of the court:

The issue presented for review is whether the circuit court erred in holding that the plaintiffs' complaint, which claimed tortious interference with a valid business expectancy, was collaterally estopped by the prior adjudication between the parties in Antrim v. Burlington Northern, Inc. (C.D. Ill. Aug. 25, 1987), No. 84-3375, aff'd (7th Cir. 1988), 847 F.2d 375, cert. denied (1988), 488 U.S. 891. We affirm.

Plaintiffs are, or were at times pertinent here, conductors, brakemen, or firemen with the Burlington Northern Railroad (Burlington) and were represented in collective bargaining under the Railway Labor Act (45 U.S.C.A. 151 et seq. (West 1986)) by the United Transportation Union (the Union). In anticipation of a merger between Burlington and St. Louis San Francisco Railroad in March 1980, the Union and Burlington entered into a "Merger Protection Agreement" to protect levels of pay of Burlington employees who would earn less due to a diversion of traffic as a result of the merger. The plaintiffs were covered under this agreement. The anticipated merger took place on December 1, 1980.

In December 1980 and thereafter, plaintiffs, along with other Burlington employees who are not parties here but were represented by the Union, filed grievances complaining that their earnings had declined due to loss of work because of diversions of traffic as a result of the merger. Burlington denied all such claims and contended that any loss of work or earnings was due to the normal ebb and flow of traffic and not to diversions of traffic as a result of the merger. The Union referred several claims to arbitration before the Public Law Board No. 3160.

On September 20, 1982, the arbitrator, David Dolnick, ruled that there had been a diversion of traffic due to the merger, but he concluded that he did not have sufficient information upon which to make a conclusive decision on the individual employees' claims to monetary protection under the merger protection agreement. Dolnick remanded the matter to Burlington and the Union but retained jurisdiction for 120 days, within which time the parties would either advise that they had reached an agreement to resolve the claims or wished to return to the arbitrator for a final ruling.

Thereafter, the Union and Burlington entered into two agreements which were to resolve all issues between plaintiffs and Burlington and which waived the rights of the plaintiffs under the merger protection agreement and under the Public Law Board decision of September 20, 1982. These agreements determined which trainmen and firemen were to be "affected" employees entitled to monetary recoupment. One agreement, dated January 31, 1983, was entered into by the Union with Burlington and covers all of the plaintiffs except Wayne Kight. The Union and Burlington entered into a second agreement dated September 26, 1983, that pertained to Wayne Kight. None of the plaintiffs were included in the group of "affected" employees entitled to an award.

After entering into the agreements, the Union took additional claims to arbitration before the Special Board of Adjustment No. 918. That board denied the claims on the basis that they were already resolved by the award of Public Law Board No. 3160 and the agreement of January 31, 1983. The plaintiffs did not have knowledge or notice of the extent of the agreements of January 31, 1983, and September 26, 1983, until the decision of the Special Adjustment Board No. 918 on August 28, 1984, which ruled that the January 31, 1983, agreement terminated all claims for merger protection.

On September 19, 1984, plaintiffs brought an action in the United States District Court for the Central District of Illinois. Plaintiffschallenged the Union's handling of their grievance claims for monetary benefits under the 1980 merger protection agreement. Plaintiffs complained, inter alia, of a breach of the duty of fair representation by the Union under the Railway Labor Act based on the manner of the Union's handling and settling of their grievance claims under the merger protection agreement. By order of August 27, 1987, United States District Judge Mills granted the Union's motion for summary judgment as to plaintiffs' Federal cause of action against it for the intentional breach of its duty of fair representation. Since the court had decided the case on the basis of the Federal claim, it relinquished jurisdiction over the pendent State law claims based on Graf v. Elgin, Joliet & Eastern Ry. Co. (7th Cir. 1986), 790 F.2d 1341. The district court's order was upheld by the United States Court of Appeals for the Seventh Circuit. Antrim v. Burlington Northern, Inc. (7th Cir. 1988), 847 F.2d 375.

Plaintiffs filed the present action on August 18, 1989, alleging tortious interference with a valid business expectancy. Plaintiffs' complaint alleged in pertinent part:

"The right of the plaintiffs to enter into agreements with Burlington for compensation as a result of plaintiffs becoming 'affected' individuals as a result of the merger between Burlington and Frisco railroads is a valid business relationship or expectancy of the plaintiffs. The defendant and Burlington had knowledge of that relationship or expectancy of the plaintiffs yet having such knowledge the defendant intentionally interfered with such valid business expectancy by entering into the agreements of January 31, 1983 and September 26, 1983 settling all rights of the plaintiffs for merger protection at a time when Burlington and defendant had knowledge that the plaintiffs were 'affected' employees."

The Union filed a motion to dismiss, which alleged that plaintiffs' claim was preempted by Federal law and barred by the doctrine of res judicata. The Union also contended that any claim of intentional deprivation of plaintiffs' merger protection agreement rights by the Union's conduct was barred by the doctrine of collateral estoppel. On June 25, 1993, the circuit court dismissed plaintiffs' complaint on the basis of collateral estoppel.

The doctrine of collateral estoppel provides that an issue which has been addressed by a court of competent jurisdiction cannot be relitigated in a later action between the same parties in the same or a different cause of action. ( Simcox v. Simcox (1989), 131 Ill. 2d 491, 496, 546 N.E.2d 609, 611, 137 Ill. Dec. 664.) The doctrine applies if (1) the issue decided in the prior adjudication is identical with the one presented in the current suit; (2) the prior suit was terminated with a final judgmenton the merits; and (3) the party against whom the estoppel is asserted was a party or in privity with a party in the prior suit. In re Nau (1992), 153 Ill. 2d 406, 424, 607 N.E.2d 134, 143, 180 Ill. Dec. 240.

It is undisputed that the parties to the instant case and the former Federal action are the same. The plaintiffs contend, however, that the issue of intent in the Federal court case is not identical to the issue of intent they raise here. Consequently, they claim they did not have an opportunity in the Federal case to litigate the issue raised here, and they claim the Federal court did not adjudicate the intent issue. In the prior action, plaintiffs' complaint contained counts: (1) alleging a Federal cause of action against Burlington for breach of the merger protection agreement; (2) alleging a Federal cause of action against the Union for intentional breach of the duty of fair representation; (3) alleging a Federal cause of action against the Union for negligent breach of the duty of fair representation; (4) alleging a State law cause of action against the Union for negligent intereference with plaintiffs' contractual rights; (5) alleging a State law cause of action against the Union for the intentional interference with plaintiffs' contractual rights; and (6) alleging a State law cause of action against the Union for the knowing and willful inducement of Burlington's breach of contract. The district court determined that counts III and IV were preempted by count I, the Federal law claim of breach of the merger protection agreement. The court further determined that counts V and VI were also preempted by Federal law.

Plaintiffs argue that the prior Federal adjudication that the Union lacked the requisite intent to sustain the Federal claim for intentional breach of the duty of fair representation (count II) is not identical to the issue of intent in the present action. In particular, plaintiffs maintain that, although the district court determined that they failed to show deliberate misconduct by the Union (count II), the court did not decide the issue of whether the Union's conduct rose to the lesser level of intent necessary to sustain a cause of action for the tortious interference with a valid business relationship or expectancy (count V).

Plaintiffs contend that the Federal cause of action for breach of the duty of fair representation requires a showing of spite or ill will, and that the malice involved in the State claim for tortious interference with a business relationship is the intentional doing of a wrongful act without just cause. Plaintiffs cite Republic Gear Co. v. Borg-Warner Corp. (7th Cir. 1969), 406 F.2d 57, 61, for the proposition that as to the State claim ill will toward the person harmed is not essential; rather, the essential thing is the intent to cause the result. Plaintiffs contend that because a higher level of intent was necessary to sustain the Federal claim and the district court declined to hear the State claim, the question of whether a lesser level of intent can be shown to establish the State claim has not been adjudicated.

The Union contends that both the Federal and State claims include allegations of actual malice and unjustifiable conduct intentionally committed. We agree.

Plaintiffs' State court complaint sets forth the alleged factual basis upon which the State law ...


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