Ninth Circuit Affirms Compensatory Damages Award to Employer for Union's Continuing Unlawful Picketing | Practical Law

Ninth Circuit Affirms Compensatory Damages Award to Employer for Union's Continuing Unlawful Picketing | Practical Law

In Ahearn v. International Longshore & Warehouse Union, the US Court of Appeals for the Ninth Circuit affirmed in part and reversed in part a district court decision finding a picketing union liable for compensatory damages. 

Ninth Circuit Affirms Compensatory Damages Award to Employer for Union's Continuing Unlawful Picketing

by Practical Law Labor & Employment
Published on 10 Jul 2013 • USA (National/Federal)
In Ahearn v. International Longshore & Warehouse Union, the US Court of Appeals for the Ninth Circuit affirmed in part and reversed in part a district court decision finding a picketing union liable for compensatory damages.
On July 5, 2013, the US Court of Appeals for the Ninth Circuit issued an opinion in Ahearn v. International Longshore & Warehouse Union, affirming in part and reversing in part the district court's opinion below. The Ninth Circuit held that the district court did not abuse its discretion when it found the union in contempt of a temporary restraining order (TRO) for its conduct during picketing of a grain terminal operator, and awarded compensatory damages to the picketed employer. However, the Ninth Circuit found that the district court abused its discretion by awarding compensatory damages to government agencies and private parties that were not charging parties in the underlying NLRB action.
A grain terminal operator (EGT) refused to recognize the collective bargaining agreement (CBA) between the Port of Washington (Port), from which EGT was leasing land, and the Port's union. Union members picketed EGT demanding it hire union members under the CBA, and repeatedly engaged in conduct the NLRB characterized as assault and destruction of property.
EGT filed a unfair labor practice charge alleging that the union through threats and harassment was coercing third parties not to perform work for it and sought injunctive relief. The NLRB issued a ULP complaint and sought interim injunctive relief in federal court against the union under Sections 10(j) and (l) of the NLRA. The district court:
  • Granted a TRO requiring the union to stop picketing.
  • After the picketing persisted, held the union in contempt of the TRO.
  • Awarded $250,000 in compensatory damages to be apportioned between the NLRB, EGT, the local police department and other private parties affected by the union's picketing.
The union appealed, arguing that the district court abused its discretion by awarding compensatory damages based on the contempt finding against the union, to:
  • EGT because EGT should be limited to damages awarded under Section 303 of the Labor Management Relations Act (LMRA).
  • Government agencies and private parties that were not charging parties in the underlying NLRB action.
The Ninth Circuit:
  • Noted that:
    • under Section 303 of the LMRA, a private employer may sue rather than must sue to recover damages from unlawful picketing conduct;
    • the LMRA does not specifically bar civil contempt damages or state that §303 provides the exclusive remedy to recover damages from unlawful picketing conduct; and
    • a decision from the US Court of Appeals for the Second Circuit (NLRB v. Local 3) not to award civil contempt damages to third-parties, who were not charging parties in the underlying NLRB proceeding or parties in a related Section 303 action, was inapposite, as that case does not support the proposition that employers who are eligible to seek remedies under Section 303 cannot separately receive civil contempt damages for injuries related to unlawful picketing conduct; and
    • the NLRA does not expressly permit courts to award damages to non-parties to NLRB proceedings.
  • Held that:
    • Section 303 of the LMRA was not EGT's exclusive remedy for collecting damages;
    • EGT's participation in the contempt proceedings did not exceed the limited role of charging parties in injunctive proceedings brought by the NLRB in federal court;
    • civil contempt awards, in part, ensure that the prevailing party, as EGT would be under the NLRA, receives compensation for the contemptuous actions; and
    • awarding non-parties civil contempt damages does not serve the purpose of compensating prevailing parties.
  • Affirmed the compensatory damages award to EGT.
  • Vacated the compensatory damages award to the government agencies and private parties that were not charging parties in the underlying NLRB proceedings.
Court documents: