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MASSEY v. INTERNATIONAL BROTHERHOOD OF TEAMSTERS

May 1, 2003

ALBERT MASSEY, ROY DENNIS, LORETTA BYRD, ARMANDO FOSCO, AS EXECUTIVE BOARD MEMBERS, AS WELL AS ON BEHALF OF THEMSELVES AND ALL SIMILARLY SITUATED MEMBERS, OF LOCAL 738 GROCERY & FROZEN FOOD PRODUCTS, PROCESSORS, CANNERIES FROZEN FOOD PLANTS, SUGAR PROCESSORS, CONFECTIONARY & CANDY MANUFACTURERS & DISTRIBUTORS, COFFEE VENDING, MISCELLANEOUS DRIVERS & SALESMEN, WAREHOUSEMAN & RELATED OFFICE EMPLOYEES UNION, AND TEAMSTERS LOCAL 738, PLAINTIFFS, VS. INTERNATIONAL BROTHERHOOD OF TEAMSTERS, JAMES P. HOFFA IN HIS CAPACITY AS PRESIDENT OF THE INTERNATIONAL BROTHERHOOD OF TEAMSTERS, TERRANCE J. HANCOCK AND WILLIAM COOPER, IN THEIR CAPACITIES AS TEMPORARY TRUSTEE AND ASSISTANT TRUSTEE OF LOCAL 738, I.B.T. DEFENDANTS


The opinion of the court was delivered by: Joan Humphrey Lefkow, United States District Judge

MEMORANDUM OPINION AND ORDER

Before the court is the motion of plaintiffs, Albert Massey ("Massey"), Roy Dennis ("Dennis"), Loretta Byrd ("Byrd"), Armando Fosco ("Fosco") and Teamsters Local 738 (collectively "plaintiffs"), for a temporary restraining order and/or a preliminary injunction against defendants, International Brotherhood of Teamsters ("IBT"), James P. Hoffa ("Hoffa"), in his capacity as President of the IBT, and Terrance J. Hancock ("Hancock") and William Cooper ("Cooper"), in their capacities as temporary Trustee and Assistant Trustee of Local 738 (collectively "defendants"). This court has jurisdiction over the claim under the Labor-Management Reporting and Disclosure Act ("LMRDA"), 29 U.S.C. § 401 et seq. For the reasons stated below, the motion is denied.

BACKGROUND

______On March 28, 2003, without any prior hearing, Hoffa appointed Hancock as temporary trustee and Cooper as assistant trustee over the affairs of Teamsters Local Union 738, thereby relieving Massey, Dennis, Byrd and Fosco of their positions on Teamsters Local 738's Executive Board.*fn1 Hoffa exercised this power pursuant to Article VI, Section 5(a) of the IBT International Constitution, which provides, in pertinent part,

If the General President has or receives information which leads him to believe that any of the officers of the Local Union or other subordinate body are dishonest or incompetent, or that such organization is not being conducted in accordance with the Constitution and laws of the International Union or for the benefit of the membership, or is being conducted in such a manner as to jeopardize the interests of the International Union or its subordinate bodies, or if the General President believes that such action is necessary for the purpose of correcting corruption or financial malpractice, assuring the performance of collective bargaining agreements or other duties of a bargaining representative, restoring democratic procedures or preventing any action which is disruptive of, or interferes with the performance of obligations of other members or Local Unions under collective bargaining agreements, or otherwise carrying out legitimate objects of the subordinate body, he may appoint a temporary Trustee to take charge and control of the affairs of such Local Union or other subordinate body; provided, however, that before the appointment of such temporary Trustee, the General President shall set a time and place for a hearing for the purpose of determining whether such temporary Trustee shall be appointed; and further provided that where, in the judgment of the General President, an emergency situation exists within the Local Union or other subordinate body, the temporary Trustee may be appointed prior to such hearing, but such hearing shall then commence within thirty (30) days and decision made within sixty (60) days after furnishing of the transcript of testimony; and further provided that in all cases the Local Union or other subordinate body shall be advised of the reason for the appointment.
(Pl. Mot. Ex. C)

Hoffa explained the reasons for the imposition of the trusteeship over Local 738 in a Notice to officers and members of Local Union 738 dated March 28, 2003 (the "Notice"). The Notice stated that complaints had been received concerning the ability of the officers and agents of Local 738 to effectively represent the Local Union's members. Specifically, Hoffa stated that the IBT had received information indicating that,

1. Monthly trustees reports and other financial records for Local 738 show that the Local Union's net assets have declined from more than $2.2 million at the end of 1997 to slightly more than $764,000 at the end of February 2003, with a low of approximately $684,000 at the end of December 2001. Over the same period, the Local Union's membership has declined from approximately 4,100 to slightly more than 3,000. Many of these members have been lost as the result of the closure of the Brach's Confectionary Candy Company's Chicago facility. of approximately 3,000 current members, 771 are listed on TITAN as employed at Brach's Candy. The Local Union has been notified that all remaining members at Brach's will be laid off by November 1, 2003.
2. Local 738 was awarded a $100,500 grant from the City of Chicago to retrain laid off Brach's Candy employees. The Local failed to segregate and account for these funds and has failed to establish or conduct any training program for the Brach's Candy employees. The funds have been deposited to the Local Union's general fund and apparently have been used to support the Local Union's routine operations.
3. The Local Union has lost members and has failed to organize any new members apparently as the result of inability to represent them and negotiate and conclude reasonable contracts. The Local Union won a representative election at a company called Metal Matic two years ago, but has yet to conclude an initial labor contract. The Local Union successfully organized a unit at Edy's Ice Cream but never obtained an initial labor contract and that unit decertified. Members in units with expiring labor contracts at Central Grocers (180 members) and Sysco Food Service (150 members) have filed petitions with the International Union complaining of distrust, incompetency, and poor representation by Local 738.
Labor contracts expire at four other food warehouses involving almost 500 more members in March and April. Failure to negotiate good contracts at these facilities will adversely affect members represented at those facilities and employers by other Locals in the Chicago and Midwest area. Contracts will expire soon at three other facilities involving approximately 600 members.
4. On March 11, 2003, after the Local Union officers were questioned about the use of the City of Chicago grant funds, principal officer Julio Lara resigned.
(Pl. Compl. Ex. C.) The Notice also asserted that
It further appears that an emergency situation exists because of the status of current negotiations, the contract scheduled to expire during the next several weeks, growing complaints by members about the quality of representation, and the abrupt resignation of the Local Union's principal officer.
(Id.)

Since the trusteeship was imposed on Teamsters Local 738, plaintiffs allege that defendants have failed and refused to bring back the plaintiffs to resume negotiating sessions. Plaintiffs allege that defendants are unaware of what they are doing and are unprepared to proceed with negotiations on behalf of Teamsters Local 738. According to plaintiffs, at the time the trusteeship was formed Teamsters Local 738 was involved in ongoing collective bargaining sessions concerning expiring contracts and was engaged in the administration of grievances for its members.

On April 9, 2003, Hoffa issued a notice that the trusteeship hearing, as required by the IBT Constitution, was to be conducted on April 22, 2003, and that all Union members were invited to attend. Just one day prior to this notice, on April 8, 2002, plaintiffs filed a "Verified Complaint to Dissolve Trusteeship" asking the court to (1) declare the trusteeship over Teamsters Local 738 in violation of Title III of the LMRDA; (2) restrain and enjoin defendants from exercising any control or supervision over the affairs of Teamsters Local 738 and order defendants to immediately restore plaintiffs to full possession of the offices, equipment, records, funds, and all other assets and property of Teamsters Local 738; and (3) order defendants to reimburse plaintiffs for all expenditures and disbursements made by them under the trusteeship for salaries and expenses of defendants or any other officer or agent of IBT and all other improper expenditures of funds belonging to Teamsters Local 738. The plaintiffs contend that the trusteeship imposed on Teamsters Local 738 violates section 302 and 304(c) of the LMRDA,*fn2 and have now moved for the entry of a temporary restraining order and/or a preliminary injunction dissolving the trusteeship imposed.

On April 16, 2003, this court held a hearing on plaintiffs' motion, wherein counsel for all parties presented argument. At the conclusion of the hearing the court denied plaintiffs' motion. This opinion serves as the court's reasons for its decision.

DISCUSSION*fn3

In order to grant a motion for preliminary injunctive relief, the court must find: (1) the plaintiffs have at least a reasonable likelihood of success on the merits; (2) the plaintiffs have no adequate remedy at law and will be irreparably harmed if the injunction does not issue; (3) the threatened injury to the plaintiffs outweighs the threatened harm the injunction may inflict on the defendant; and (4) the granting of a preliminary injunction will not disserve the public interest.*fn4 Adams v. Attorney Registration and Disciplinary Comm'n of Supreme Court, 801 F.2d 968, 971 (7th Cir. 1986), citing Fox Valley Harvestore, Inc. v. A.O. Smith Harvestore Prods. Inc., 545 F.2d 1096, 1097 (7th Cir. 1976); Roland v. Air Line Employees Ass'n Int'l, 753 F.2d 1385, 1392 (7th Cir. 1985).

When examining these factors, the court must bear in mind that plaintiffs do not wish the traditional remedy afforded by injunctive relief, that being to "preserve the status quo." Roland, 753 F.2d at 1391. Instead, plaintiffs seek dissolution of the trusteeship in its entirety, what the Seventh Circuit has referred to as "a most unique remedy." Id. ("In the present case, the plaintiffs ask not that the status quo be preserved (i.e., maintain the trusteeships), but that the trusteeships imposed . . . be dissolved."). To justify this unique remedy, plaintiffs would have to prove that IBT failed to comply with its own constitutional provisions for the emergency imposition of a trusteeship and, through clear and convincing evidence, that it acted in bad faith or for an improper purpose.*fn5 International Bhd. of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers, and Helpers, AFL-CIO v. Local Lodge 714, Int'l Bhd. of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers, AFL-CIO, 84 ...


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