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Graniterock wins U.S. Supreme Court ruling in 2004 strike

Santa Cruz Sentinel

WATSONVILLE — In a decision that opens the door for a multimillion-dollar lawsuit against Teamsters Local 287, as well as its parent international organization, the U.S. Supreme Court ruled Thursday that a three-month union-sanctioned strike in 2004 violated an existing collective bargaining agreement with Granite Rock Co.

The decision was hailed by Graniterock and its lawyers as potentially far-reaching because the language in the court opinion strongly suggests that the parent International Teamster union potentially could be held liable under existing law for actions taken by its local chapter.

“They wanted to be able to willy nilly violate a contact and not be held accountable,” said Bruce Woolpert, chief executive officer of Graniterock. “It’s a lawsuit about accountability. They wanted to wipe the slate clean. They used extortion to try to get us to walk away from grievances.”

The case, which the union says is far from over, stems from a labor dispute involving concrete ready-mix drivers represented by Teamsters Local 287 working at the Aromas quarry. The union and the company disagreed about whether a vote regarding a new collective bargaining agreement required employees to recommence work immediately or whether it was merely a straw poll and not yet ratified because the company had failed to drop all strike-related claims against workers.

By the time the case had wound its way through a federal district court trial and appellate decision and landed in the nation’s highest court, there were two main legal issues. The first was whether an arbitrator or a district court should decide the actual date of when the two parties struck a deal on their bargaining agreement, which, in this case, affected whether or not the ensuing strike was legal or not. The second was whether Graniterock could hold the parent International Teamster organization accountable for actions conducted by its local chapter under a new interpretation of federal law.

The court affirmed Graniterock’s argument on the first issue in a 7-2 vote, saying that the district court was the appropriate place to determine the ratification date of a bargaining agreement. Arbitration could not take place until it was determined that both parties actually had an agreement en force, according to the majority of justices.

On the second issue, the court ruled unanimously against Graniterock, saying not that there was no case against the international organization, but that the company should first try existing legal avenues before seeking to create a new federal common-law case of action to sue the parent union. The court’s unanimous opinion “does not mean that we approve of IBT’s International Brotherhood of Teamsters’ alleged actions,” according to the decision. Graniterock “describes a course of conduct that does indeed seem to strike at the heart of the collective bargaining process federal labor laws were designed to protect.”

Calling it an “absolutely fascinating decision,” attorney Garry Mathiason of Littler Mendelson, said the court clearly thought there was merit in two claims against the parent union organization.

“The court really didn’t like what we alleged as conduct of the international,” he said. “They found it was something that couldn’t be tolerated.”

Teamsters Local 287, said in a prepared statement that it was “of course disappointed in the outcome of its dispute” with Graniterock because “labor disputes should be resolved by labor arbitrators rather than by juries and, in that sense, the Supreme Court’s decision certainly is not helpful to the labor movement.” Local 287 said, however, that the remanded issues may still be decided in favor of the union, which “will have the practical effect of reversing today’s decision.”

The international organization, based in Washington, D.C., issued a prepared statement as well saying that the court decision relating to the parent organization was consistent with legal precedent, as well as long-standing legislative intent.

“The International Union was not a party to the contract that is the subject of this lawsuit,” the union said, describing the case as “only a local dispute.”

Woolpert said he was meeting Friday with attorneys at the labor firm, Littler Mendelson, to discuss further litigation and he expected to seek more than $21 million in compensatory damages from the local Teamsters chapter and possibly against the International Brotherhood as an “alter ego” that had pushed the local chapter to pursue the illegal strike. The sum includes unpaid wages for about 450 striking workers. Woolpert said the union should foot the bill, not workers who suffered from lost wages.

“A union occasionally gets it in its mind that some way or another they deserve to have Teflon all over themselves in regard to violations,” he said. “There are certain union officials who say, I will never ever pay a nickel to an employer for my violations.’ Graniterock is not the only company where this has happened,” Woolpert said, adding that dozens of other companies involved in union disputes have been tracking the case.

This article first appeared here.

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This entry was posted on June 26, 2010 by in Business, Law-Related Articles.

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