Opinion
98 Civ. 1778 (CSH), 97 Civ. 5538 (CSH)
August 3, 2001
JOHN HARKIN AND JOSEPH LAUER AND WILLIAM LEBO as members of the United Brotherhood of Carpenters and Joiners of America, Plaintiffs.
THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, GENERAL PRESIDENT DOUGLAS MCCARRON AND THE SAME LABOR ORGANIZATION Defendants.
MEMORANDUM OPINION ORDER
These consolidated cases are before the Court on a motion by the pro se plaintiffs in 98 Civ. 1778, members of local carpenters' unions, further to amend their complaint against the national union, its general president, and general executive board. Those defendants resist plaintiffs' motion to amend, and cross-move to dismiss the action for failure to prosecute.
Plaintiffs' proposed second amended complaint pleads a number of claims or "counts." Defendants oppose the amendment principally on the ground that prior related litigation bars all but one of the claims, either by res judicata (claim preclusion) or collateral estoppel (issue preclusion). Defendants contend that the remaining claim is barred by plaintiffs' failure to exhaust the national union's administrative remedies.
Although defendants bear the burden of persuasion on each of these contentions, their briefs in opposition to plaintiffs' motion to amend and in support of defendants' cross-motion to dismiss are barebones efforts, sparse and conclusory. The pro se plaintiffs' submissions, while voluminous and certainly energetic, reflect to some degree that lack of legal discipline not uncommon among lay litigants. While assuming the reader's familiarity with all prior opinions and rulings of this Court and the Court of Appeals in this protracted struggle, the Court finds it necessary, in order to resolve the issues posed by the present cross-motions, to review the related actions in some detail.
I. THE RELATED ACTIONS
There are four related actions that must be considered: the seminal civil RICO case the government brought against the District Council of New York City and Vicinity of the United Brotherhood of Carpenters and Joiners of America (the "District Council") and certain of its officers; and three private actions commenced principally against the parent national union (the "UBC") and its General President, Douglas McCarron. I discuss them seriatim. A. United States v. District Council, et al.: 90 Civ. 5722
In September 1990, the government filed a civil RICO action for injunctive relief against the District Council and certain of its officers, including the then District Council President, Frederick W. Devine. The complaint alleged that the individual defendants had engaged in a variety of forms of labor racketeering, and that organized crime had infected the operations of the District Council and its constituent local unions, resulting in these entities being maintained in a corrupt and undemocratic manner. The defendants denied those allegations. Trial commenced and was terminated after several weeks when the parties entered into a Consent Decree.
The Consent Decree permanently enjoined all current and future officers, employees and members of the District Council and its constituent locals from engaging in certain prohibited conduct relating to organized crime. The Consent Decree also, inter alia, required the constituent locals to adopt certain job referral rules and procedures.
To effectuate and implement the terms of the Consent Decree, an Investigations and Review Officer ("IRO"), former federal judge Kenneth Conboy, was appointed by the Court and given a variety of powers, rights and responsibilities. This Court, which endorsed the Consent Decree, also retained certain oversight responsibilities which were specifically defined in the Decree.
One of the IRO's duties under the Consent Decree was to draft rules for and supervise a rank-and-file secret ballot election for the District Council Executive Board, including its officers. That election was held in June 1995, and resulted in the re-election of Devine and several other District Council officers who were defendants in the government's civil RICO action. Finding no violations of the election rules that may have affected the outcome of the election, the IRO certified the results to the Court on October 30, 1995, and the Court accepted them.
The IRO continued his oversight of the District Council in the manners provided for by the Consent Decree. In the spring of 1996, the IRO found evidence of the continuing influence of organized crime over the District Council and financial mismanagement at the District Council. The IRO presented that evidence to General President McCarron of the UBC. McCarron, purporting to act under authority conferred upon him by the UBC Constitution and federal labor law, placed the District Council under trusteeship. District Council President Devine and the four other sitting officers were removed. McCarron appointed Douglas Banes, the First Vice President of the UBC, as supervisor of the District Council.
These events generated the second of the four related actions that I will consider. B. Devine v. McCarron: 96 Civ. 5093
McCarron and the UBC advised Devine and the other District Council officers of the imposition of the trusteeship in a letter dated June 25, 1996. The June 25 letter further advised that on July 10 and 11 a UBC committee would hold a hearing on the imposition of the trusteeship. A hearing in such circumstances was required by the UBC Constitution.
Devine and other District Council officers strenuously resisted the trusteeship. That resistance found public expression in an action in this Court that Devine and Robert J. Cavanaugh, the District Council's elected Secretary, commenced against McCarron and Banes. The complaint was dated July 3, 1996 and received docket number 96 Civ. 5093. I will hereafter refer to that action as "the Devine action" or Devine.
The Devine action sought precisely defined forms of injunctive relief. Specifically, the complaint in Devine prayed for a decree "enjoining the imposition of a Supervisor and enjoining the [UBC] and all persons acting for or with the [UBC] from taking any steps to further such Supervision and enjoining and preventing defendant Banes from acting as Supervision [sic] of the District Council and from taking any steps in furtherance thereof, together with such other, further or different relief as to the court may seem just and proper in the premises."
In support of that prayer, the Devine complaint alleged that in imposing the trusteeship upon the District Council and installing Banes as supervisor, McCarron had violated sections 6D and 10H of the UBC Constitution. Complaint, ¶¶ 1-12. The complaint laid particular stress upon section 10H, which empowers the UBC General President, if satisfied that a Local Union or District Council was acting "contrary to the welfare" of the UBC or required "that supervision should be established over the conduct" of its affairs, to appoint a committee to hold a hearing into the matter, "after due notice to such subordinate body or member." The committee is required to "report its findings and recommendations to the General Executive Board [of the UBC] and to the member or subordinate body involved." Section 10H further provides:
If the General President determines that an emergency situation exists, the General President may appoint a representative to assume supervision over any Local Union or Council pending the holding of a hearing and the completion of the proceedings . . .
McCarron invoked that provision in appointing Banes to supervise the District Council.
The plaintiffs in Devine did not challenge the validity of sections 6D and 10H of the UBC Constitution, or any other Constitution provisions. On the contrary, the Devine complaint assumed the validity of sections 6D and 10H, and alleged that McCarron had violated them. See, e.g., ¶ 7: "The imposition of a Supervisor and the removal of the duly elected officers violated Sections 6D and 10H of the Constitution of the United Brotherhood of Carpenters and Joiners . . ."
In ¶¶ 13-26 of the Devine complaint, the plaintiffs broadened their allegations to charge that McCarron's imposition of a Supervisor on the District Council "is in derogation of the due process rights of the members of the District Council and was not brought in good faith," ¶ 13, and "is inimical to the interests of the District Council," ¶ 14, in various specific ways, including placing "increased pressure on the District Council to increase by 6 cents per hour its contribution to the Health and Safety Fund established by the parent union," ¶ 14 (a).
Plaintiffs in the Devine action sought a temporary restraining order and a stay of the UBC hearing scheduled for July 10 and 11, 1996. That application was heard by District Judge Mukasey, to whom the case had been assigned; subsequently Devine was reassigned to the undersigned, as related to the government's civil RICO case, 90 Civ. 5722. Devine submitted an affidavit verified July 15, 1996 in support of a temporary restraining order. The affidavit challenged the UBC hearing procedures as unfair, defended the District Council officers against the UBC's charges of wrongdoing; and charged the UBC, McCarron, and Banes with wrongdoing of their own. In the last category, Devine criticized the UBC inter alia for renegotiating a contract which "provided for a deduction of 6 cents per hour from the members in a forced contribution to a Health, Safety and Training Fund," ¶ 12.
Judge Mukasey denied the Devine plaintiffs' motion for a temporary restraining order and refused to stay the UBC July 10 and 11 hearing. The hearing then took place. In subsequent applications, the Devine plaintiffs contended that the hearing had been unfair to them. Judge Mukasey issued a number of rulings from the bench which amended and expanded the procedures to be followed by the UBC before concluding the hearing. On December 11, 1996, the UBC hearing panel, responding to the Devine plaintiffs' supplemental submission authorized by Judge Mukasey, affirmed its original conclusion that the UBC's supervision of the District Council was justified. Accordingly the trusteeship continued.
The particulars of Judge Mukasey's rulings need not be recited in this Opinion. Those particulars are fully described in this Court's opinion in the Devine case, 96 Civ. 5093, 1997 WL 379708 (S.D.N.Y. July 9, 1997) at *1-*2.
The plaintiffs in Devine took no further steps to press the case. Devine himself was facing criminal charges brought by the District Attorney for New York County; subsequently he was tried, convicted and imprisoned. In April 1997 defendants McCarron and Banes moved to dismiss the Devine action under Rule 41(b) for plaintiffs' failure to prosecute it, and on the additional ground that "the relief requested by plaintiffs is moot, since the [UBC] hearing panel has twice upheld the supervision and, according to defendants, the plaintiffs have received all the procedural safeguards to which they are entitled." 1997 WL 379708 at *3 Plaintiffs resisted that motion, continuing to contend that the UBC's imposition of a trusteeship upon the District Council was unjustified and the procedures surrounding it unfair.
In the opinion dated July 9, 1997, I declined to dismiss the complaint. I concluded that, given Judge Mukasey's rulings and the UBC hearing panel's compliance with them, "plaintiffs received adequate notice of the allegations levied against them and a sufficient opportunity to present a defense." 1997 WL 379708 at *7. That opinion continues:
Since the UBC's supervision over the District Council was imposed in accordance with the UBC Constitution and bylaws and was ratified after a fair hearing, I conclude that the trusteeship is entitled to the statutory presumption of validity for a period of eighteen months from its imposition. See 29 U.S.C. § 464 (c). As a result, plaintiffs can only challenge the legality of the supervision, and succeed in their request for injunctive relief; if they show by clear and convincing evidence that the trusteeship was not established or maintained in good faith or for a legitimate purpose.
The Devine plaintiffs were given additional time to file and serve "evidentiary submissions consistent with these principles, together with a memorandum of law." Id. Plaintiffs made additional submissions, but in an unreported Memorandum Opinion and Order dated October 29, 1997, I dismissed the complaint, on the ground that
plaintiffs' submissions fall well short of demonstrating by clear and convincing evidence that notwithstanding defendant McCarron's articulated and appropriate reasons for imposing the trusteeship, in fact he acted contrary to the union's best interests, acted in his own self-interest, or engaged in conduct so outrageous or unconscionable that it would constitute bad faith, even though arguably in the best interests of the union.
The plaintiffs in the Devine action did not appeal from this Court's dismissal of the complaint.
This judicial vindication of the trusteeship and supervision by the UBC of the District Council brings me to the third related action I must consider in order to resolve the present crossmotions.
C. Local Union 20 et al. v. UBC et al.: 97 Civ. 5538
Having established the UBC's trusteeship over the District Council, McCarron decided to revise and reform the governance and operations of the District Council and its constituent local unions. McCarron drew up a Restructuring Plan whose preamble recited that the District Council "shall be restructured into a Full Service District Council through centralization of administration and oversight." Specifically, "functions previously performed by the various Local Unions will be performed by the Full Service District Council". Those functions were "the referral of workers to jobs, the appointments of job stewards, policing work and servicing the membership, and organizing" which "shall be performed by Business Representatives employed by and responsive to the Full Service District Council." In addition, the Restructuring Plan provided for the merging of a number of local unions into other locals.
The description of and quotations from the Restructuring Plan are adapted from a Memorandum Opinion and Order of this Court dated July 24, 1997 and reported as United States v. District Council, 972 F. Supp. 756 (S.D.N.Y. 1997). The July 24, 1997 opinion, described more fully in text, was entered in the action bearing docket number 90 Civ. 5722, described in Part I.A. of this Opinion.
The Restructuring Plan drew the ire and disapproval of a number of local unions and individual union members. They first petitioned under Rules 24(a) and 24(b), Fed.R.Civ.P., to intervene in the government's initial action bearing docket number 90 Civ. 5722, arguing principally that the Plan violated the letter and spirit of the Consent Decree entered in that case. I denied the petitions to intervene, holding in part that in 90 Civ. 5722 "the Court is concerned only with the proper implementation of the Consent Decree," 972 F. Supp. at 763, and that the Restructuring Plan did not implicate the Consent Decree. I added in a concluding footnote:
Nothing in this opinion is intended to intimate this Court's opinion on any of the issues that might arise if District Council local unions or their members brought a plenary action against the UBC under Federal labor law. This opinion could not intimate such views, since as stated in text, this action does not concern such issues.972 F. Supp. at 765 n. 12.
Predictably enough, a separate plenary action bearing docket number 97 Civ. 5538 was thereupon commenced by nine local unions and individuals who were local union officers, Council delegates, business managers, or rank and file members. The local unions appearing as plaintiffs in that action are numbers 20, 135, 246, 257, 296, 531, 740, 902, 1456, 1536, 1994 and 2287. For the sake of brevity I will refer to this case as the"Local 20" action, after the firstnamed local union plaintiff.
The Local 20 plaintiffs, in their amended complaint dated August 14, 1997, sued the UBC, McCarron, and other UBC officers to enjoin the implementation of the Restructuring Plan, on the grounds that the Plan violated various federal labor and civil rights laws, as well as state and city laws and the UBC Constitution. The plaintiffs were and are represented by the firm of Bisceglie and Friedman (the "Bisceglie firm").
In a Memorandum Opinion and Order dated October 9, 1997, I denied plaintiffs' motion to enjoin preliminarily the implementation of the UBC's Restructuring Plan. Local Union 20 et al. v. UBC, No. Civ. 5538, 1997 WL 630179 (S.D.N.Y. October 9, 1997). I concluded that the Local 20 plaintiffs had failed to show the requisite prospects of success to justify interim injunctive relief. I reached that conclusion with respect to each of the statutes and both the Constitutions (Federal and UBC) that plaintiffs claimed the Restructuring Plan violated. The Second Circuit affirmed that denial of a preliminary injunction by summary order. 131 F.3d 131 (2d Cir. 1997).
The UBC implemented the Restructuring Plan, including the merger of a number of constituent local unions. Following a second series of elections, the UBC trusteeship was terminated. Governance of the UBC is now being directed by its elected officers. There have been no subsequent developments in this case.
D. Harkin et al. v. UBC et al.: 98 Civ. 1778
I now come to the fourth action to be considered. It is in this action that the plaintiffs bring the present motion for leave to file a second amended complaint.
Plaintiffs John A. Harkin, William Lebo, and Joseph Lauer, appearingpro se, filed the first complaint in this action on March 12, 1998. I will refer to this action as "Harkin." Because that complaint did not satisfy the pleading requirements of Rule 8(a), the Court dismissed it with leave to replead. Harkin v. UBC, No. 98 Civ. 1778, 1998 WL 175932 (S.D.N.Y. April 14, 1998).
The Bisceglie firm, then appearing as counsel for the Harkin plaintiffs, filed an amended complaint on May 26, 1998. The preamble to the complaint recited that it was made "on behalf of John A. Harkin, Joseph Lauer, and William Lebo, as well as on behalf of approximately 12,000 rank and file members, including those from Local Unions 608 and 926" of the UBC. Although the allegations of the complaint are not specific, one may safely assume that Harkin, Lauer and Lebo were members of one or another of the local unions that were parties plaintiff in theLocal 20 action.
The amended complaint in Harkin prayed for the following relief: (1) A declaration that the trusteeship the UBC had imposed upon the District Council was invalid. Plaintiffs based their claim upon the expiration of the eighteen-month period of presumed validity under the Labor Management Reporting and Disclosure Act ("LMRDA"), 29 U.S.C. § 464(c), and the consequent statutory presumption of invalidity. (2) Ordering of "the expeditious scheduling of Local Union and District Council elections." (3) Ordering that "all revisions to District Council Bylaws and trade rules, and all newly written District Council Bylaws and trade rules, be conditioned upon the mutual agreement of the Plaintiffs and the UBC." (4) A declaration that sections 6A, 6D, 10H, 10J, 10K, 15F, 26I, 26I and 62 of the UBC Constitution are void.
Plaintiffs in Harkin moved for a partial summary judgment declaring that the continuing trusteeship imposed by the UBC upon the District Council was invalid under the LMRDA. I denied that motion, No. 98 Civ. 1778, 1999 WL 60084 (S.D.N.Y. February 8, 1999). The UBC had scheduled elections for local union officers, District Council delegates, and District Council officers, although those elections had not yet been held when plaintiffs made their motion to terminate the trusteeship. In denying that motion, I reasoned principally that "[i]t would be particularly unwise to terminate the District Council trusteeship before the elections are held, given the long history of District Council corruption." 1999 WL 60084 at *6. Thereafter the elections were held and the UBC terminated the trusteeship.
II. THE DECEMBER 21, 2000 STATUS CONFERENCE
By Order dated October 1, 1998, the Court had consolidated 97 Civ. 5538 and 98 Civ. 1778 for all purposes. Given the developments describedsupra, the Court scheduled a status conference on the two consolidated cases for December 21, 2000. A number of the plaintiffs' claims and prayers for relief having been mooted, the principal purposes of the conference were to sharpen the focus upon the claims that remained, and to structure the litigation in respect of such remaining claims.
At the conference, the three individual plaintiffs in 98 Civ. 1778, Messrs. Harkin, Lebo, and Lauer, stated that they were again proceedingpro se. Thus Mr. Harkin stated: "Your Honor, we have takes back our cases, pro se plaintiffs Harkin, Lauer and Lebo. We relieved counsel of the case, and we are operating as pro se plaintiffs again without counsel." Hearing Transcript ("Tr.") at 13. Matthew Siebel, Esq., of the Bisceglie firm, confirmed that the firm had been relieved by the three individual plaintiffs, and stated that since "[t]he rank and file members of Local Union 926 are no longer 608 just through attrition," in 98 Civ. 1778 his firm represented only "the members of Local Union 926." Tr. 14-15.
Issues had also been mooted in 97 Civ. 5538, where as noted the plaintiffs, represented by the Bisceglie firm, principally sought to enjoin implementation of the Restructuring Plan the UBC had devised for the District Council. As to that case, Mr. Siebel stated that "the only issue that I would claim to be important or remaining open at this point is its election of the business managers, which is something that was taken away during the Restructuring Plan.... I would be prepared to forgo all of the other relief sought therein to the extent that it already hasn't been mooted and perhaps brief that issue or whatever issues remain." Tr. 20-21.
Reverting to 98 Civ. 1778, Messrs. Harkin, Lebo and Lauer stated at the December 21, 2000 conference that they wished to file and serve a second amended complaint on their own behalf. Because the UBC refused to consent to a further amended pleading, these plaintiffs were required to move for leave to amend under Rule 15(a). That motion has been made, opposed by the UBC, and is now ripe for decision, as is the UBC's cross-motion to dismiss 98 Civ. 1778 for failure to prosecute.
III. THE PROPOSED SECOND AMENDED COMPLAINT
The proposed second amended complaint drafted by the three pro se plaintiffs is understandably somewhat more difficult to parse than the first amended complaint, drafted by counsel. As will appear, there is a partial disconnect between the counts pleaded in the Second Amended Complaint (hereinafter sometimes referred to as the "SAC") and the relief it prays for.
The second amended complaint, sought to be filed on behalf of Harkin, Lebo and Lauer alone, does not purport to be on behalf of any other individual or entity. The pleading contains seven counts, with a prayer for relief accompanying each count. I will consider them in turn.
Count One alleges that although Local Unions 348, 531, 135, 257, 296, 902 and 17, and various unidentified"shop locals" were not officially placed under trusteeship by the UBC, they were in fact placed under trusteeship, without the mandated hearing, in violation of § 304 of the LMRDA, 29 U.S.C. § 464, and § 10H of the UBC Constitution, which in turn violates § 501A of the LMRDA, with the result that they "lost all autonomy, lost control of all funds, duly elected officers of locals were removed and new officers were appointed by the UBC to the merged locals." Count One further alleges that the plaintiffs "have suffered and will continue to suffer irreparable harm if the UBC is allowed to continue to arbitrarily take over local unions or district councils in this matter [sic]" SAC, ¶¶ 24-29.
These allegations in Count One appear to echo the allegations in ¶ 13 of the SAC, one of several allegations of facts "common to all counts," that "[l]ocal unions of the [District Council] have been merged and dissolved without hearings or input from the rank and file members of those locals," in violation of the LMRDA, the United States Constitution, and the UBC Constitution and Parliamentary Rules.
Count One's Prayer for Relief asks for a declaration that the mergers of Locals are null and void.
Count Two alleges that §§ 6A, 6D, 10H, 10J, 10K, 15F, 26H, 26I and 62 of the UBC Constitution, as well as recent amendments made at the 38th UBC General Convention in August 2000, were adopted without notice to the plaintiffs and other rank and file members of the UBC, thereby denying them their right to participate in deliberations, in violation of § 101(a)(1) of the LMRDA, 29 U.S.C. § 411 (a)(1). SAC, ¶¶ 30-35.
Count Two's Prayer for Relief asks for a declaration that the indicated sections of the UBC Constitution and all amendments enacted at the 38th General Convention are void.
Count Three alleges that the sections of the UBC Constitution referred to in Count Two, as well as the amendments enacted at the August 2000 General Convention, make the UBC Constitution one-sided and unfair "because it gives complete dictatorial powers to the General President and General Executive Board with no meaningful or real system of checks and balances," and is "procedurally unconscionable as a contract." SAC, ¶¶ 36-41.
Count Three's Prayer for Relief asks for the same relief as that prayed for with respect to Count Two.
Count Four alleges that "the independent ratification by the UBC of collective bargaining agreements without ratification from the local unions of [the] District Council" violates § 42J of the UBC Constitution, Rule 5 of the UBC Parliamentary Rules, and § 101(a)(1) of the LMRDA, 29 U.S.C. § 411 (a)(1). SAC, ¶¶ 42-47.
Count Four's Prayer for Relief asks that the Court order "expeditious nominations for the office of Business Representative and Business Manager." This is an example of the disconnect between allegations and prayer, noted previously. There is no discernible relation between the allegations in Count Four and the relief prayed for with respect to it. That prayer does seem to relate to the allegations of Count Five. I cannot identify a prayer for relief in the SAC that relates to the allegations in Count Four.
Count Five alleges that "defendants have denied the right to local unions to hold elections for business representatives and business managers throughout the Brotherhood in violation of the UBC Constitution Section 31B as amended January 1, 1996." Count Five alleges further that amendments enacted at the 38th General Convention, which deleted provisions upon which plaintiffs rely, violated inter alia the LMRDA, the United States Constitution, and the Voting Rights Act of 1965. Count Five further alleges that "the business representatives should be considered an executive officer and this office should be an elected one" under the LMRDA and accompanying regulations. SAC, ¶¶ 48-54.
Count Five's Prayer for Relief asks the Court to declare "the six cents per hour that the UBC assessed during the Trusteeship to be unlawful and in violation" of the LMRDA. Again, there is a disconnect between the allegations of Count Five and the relief prayed for with respect to that count. The prayer for relief with respect to Count Four would seem to refer to the allegations of Count Five. The prayer for relief with respect to Count Five would appear to relate to the allegations in Count Six.
Count Six alleges that the defendants violated section 303(a)(2) of the LMRDA, 29 U.S.C. § 463 (a)(2), "when they transferred moneys of the [District Council] in the form of the six cents per member worked hour to the UBC supplemental fund . . ." That allegation echoes the allegation in ¶ 23 of the SAC that "[t]he UBC while in it [sic] supervisory position over the [District Council] during the recent trusteeship, negotiated collective bargaining agreements that took six cents per hour out of the rank and files [sic] hourly pay rate and gave it to the UBC supplemental fund without membership ratification and in blatant violation of" the cited LMRDA provision. Count Six further alleges that the contracts in question were "procedurally and substantively unconscionable" because plaintiffs and the rank and file were not allowed to elect bargaining agents, and were not allowed to ratify the contracts, in violation of section 101(a)(1) of the LMRDA, 29 U.S.C. § 411 (a)(1). SAC, ¶¶ 55-59.
Count Six's Prayer for Relief asks for an order directing the UBC to give to plaintiffs and to the District Council "a full accounting of all the moneys collected from the six cents per hour worked assessment and the return of all said moneys to [the District Council]." It will be noted that the SAC's prayers for relief are now back in synch with the counts; the prayers with respect to Counts Five and Six both relate to Count Six.
Count Seven alleges that in 1990, when McCarron led the Southern California District Council of Carpenters, he and the then General President, Sigurd Lucassen, violated LMRDA provisions with respect to campaign funds. The Seventh Count goes on to allege, in conclusory terms, that "the past history of the General Election and Nominations shows abuse by the General Presidents [sic] position as chairman by refusing to recognize legal nominations time and time again," in violation of the LMRDA. Count Seven alleges further that "these procedures for voting unduly restrict free choice among candidates and are forbidden without regard to their success or failure in maintaining corrupt leadership." SAC, ¶¶ 60-65.
Count Seven's Prayer for Relief, which does not seem to track these very broad allegations, asks only that the Court order "that District Board Members be elected by Delegates from their own district only."
IV. DISCUSSION
A. The Propriety of Asserting These Claims in This Court
At the threshold, I note that during the December 21, 2000 conference I asked counsel for the UBC and the government to address in subsequent submissions the question of this Court's subject matter jurisdiction as derived from the government's civil RICO action, 90 Civ. 5722, and the Consent Decree entered in that case. Counsel's submissions are entirely silent on the subject. Perhaps I did not inquire with sufficient clarity.
Specifically, at the conference I reminded those present that any objection of plaintiffs to provisions in the UBC Constitution
does not arise out of the Consent Decree or the government's original action. I am responsible for implementing the Consent Decree. But the UBC was not a party to that litigation or to that decree. The Consent Decree gave me certain responsibilities with respect to the by-laws of the District Council, but the Consent Decree, not surprisingly, says nothing about this court's responsibility to adjudicate the validity of the UBC's Constitution.
Tr. 35-36.
While counsel were requested to discuss "this issue of jurisdiction," Tr. 38, both the UBC and the government contented themselves with making the obvious point that federal district courts generally have subject matter jurisdiction over the sort of claims plaintiffs assert against the UBC and its officers. That truism sheds no light on whether, within the context of the cases assigned to it, plaintiffs' claims against the UBC are properly before this Court particularly.
But even if that question, to which counsel did not respond, were answered in the negative, I conclude that this Court should continue to consider these particular plaintiffs' claims against the UBC, McCarron,et al. The alternative would be to remit 97 Civ. 5538 and 98 Civ. 1778 to the Clerk for reassignment by lot to one of the Judges of the Court. That would not be appropriate in these particular cases because the complaints, when first filed, clearly implicated the Consent Decree and the fate of the District Council thereunder.
Thus 97 Civ. 5538 sought principally to enjoin the Restructuring Plan the UBC intended to impose upon the District Council and its constituent Local Unions. 98 Civ. 1778 principally sought a termination of the trusteeship the UBC had imposed upon the District Council and the scheduling of Local Union and District Council elections. All those significant issues went to the heart of this Court's continuing oversight of the Consent Decree and its implementation. Jurisdiction in this particular Court over those particular claims was accordingly entirely proper. I accepted them as cases related to 90 Civ. 5722, within the meaning of Rule 15 of the Court's Rules for the Division of Business Among District Judges.
In similar circumstances, I accepted Devine v. McCarron, 96 Civ. 5093, as related to 90 Civ. 5722. As noted in text, that case has been dismissed.
To those claims involving the Consent Decree and the District Council, certain plaintiffs appended essentially unrelated claims against the UBC. The Consent Decree issues now having been mooted, the question arises whether this Court should continue to adjudicate the unrelated UBC claims. The situation is analogous to a district court's discretionary exercise of supplemental jurisdiction over state law claims after federal claims have been dismissed. See 28 U.S.C. § 1367(c)(3). I think that the proper course in these cases is for this court to retain jurisdiction. I stress, however, that I reach that conclusion only because 97 Civ. 5538 and 98 Civ. 1778 began as cases clearly implicating the Consent Decree and related to 90 Civ. 5722. While other matters may be sensitive and important, this particular Court does not sit to adjudicate any claim that any local union or individual carpenter within the ambit of the District Council may ever assert against the UBC or its officers, or that any carpenter asserts against a local union. Unless a subsequent action filed by a constituent District Council local union or an individual carpenter asserts a core claim arising directly and primarily out of the Consent Decree and its implementation, I will not regard the action as related to 90 Civ. 5722, and the case will be assigned to a Judge of the Court in the normal course.
I now consider the merits of the Harkin plaintiffs' motion to file a second amended complaint.
B. Standard of Review
The governing Rule is 15(a), which provides that leave to amend "shall be freely given when justice so requires." In the seminal case of Foman v. Davis, 371 U.S. 78, 182 (1962), the Supreme Court emphasized that "this mandate is to be heeded," and went on to say:
If the underlying facts or circumstances relied on by a plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his claim on the merits. In the absence of any apparent or declared reason — such as undue delay,
bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc. — the leave sought should, as the rules require, be "freely given."
Since the Court in Foman followed its general encouragement of amendments with a particularized list of reasons why they should not be allowed, it is not surprising that the commentators' discussions of Rule 15(a) are balanced. Thus 3 Moore's Federal Practice (3d ed. 2000) says at 15-47, 48:
Courts should not dismiss the complaint unless it is beyond doubt that there are no facts to support relief. Similarly, a court should not refuse leave to amend unless the same rigorous standard is met. This proposition is especially true for pro se plaintiffs, for whom the court should grant leave to amend at least once if there is any indication of a valid claim.
Courts will not grant leave to amend, however, when the proposed amendment is legally insufficient and it would be futile to grant leave to amend. An amendment is futile if it merely restates the same facts as the original complaint in different terms, reasserts a claim upon which the court has previously ruled, fails to sate a legal theory, or could not withstand a motion to dismiss.
In the case at bar, plaintiffs have previously amended their complaint, at a time when they were represented by counsel. In that circumstance, the proposed second amendment will be evaluated, as would any amendment, by the customary considerations articulated in Forman and the Moore treatise.
C. The Merits of Plaintiffs' Motion
In resisting the Harkin plaintiffs' motion to file their second amended complaint, the defendants contend that all but one of the claims pleaded therein are barred by collateral estoppel (issue preclusion) or res judicata (claim preclusion). "Collateral estoppel and res judicata are related but distinct doctrines that may bar a party from litigating certain issues or claims in a subsequent proceeding. Both are affirmative defenses." Epperson v. Entertainment Express. Inc., 242 F.3d 100, 108 (2d Cir. 2001) (citation omitted); see also Rule 8(c), Fed.R.Civ.P. (specifically identifying "estoppel" and "res judicata" as "affirmative defenses.").
Defendants do not urge preclusion as a bar to the second amended complaint to the extent that the proposed pleading attacks the validity of amendments to the UBC Constitution enacted at the 38th General Convention held in August 2000.
In Northern Assurance Company of America v. Square D Company, 201 F.3d 84, 87 n. 2 (2d Cir. 2000), a panel of the Second Circuit stated in a footnote that "[t]he term res judicata . . . is more appropriately defined as encompassing two separate and distinct wings of preclusion law, claim preclusion and issue preclusion," and noted that a leading treatise described cases "acknowledging claim and issue preclusion as separate doctrines within the broader concept of res judicata" (citing Charles A. Wright, Arthur R. Miller and Edward H. Cooper, Federal Practice and Procedure § 4402 (1981 Supp. 1999). Notwithstanding that academic analysis, most Second Circuit cases define res judicata to mean claim preclusion and collateral estoppel to mean issue preclusion.See, e.g., Monohan v. New York City Department of Corrections, 214 F.3d 275, 285 and 285 n. 5 (2d Cir. 2000) (The doctrine of res judicata "is separate from the related doctrine of collateral estoppel, or issue preclusion. . . "). I use those differing definitions in this opinion.
Defendants at bar invoke the doctrines of res judicata and collateral estoppel as grounds for denying plaintiffs' motion to file a second amended complaint. In that context, defendants' conceptual rationale is that the claims sought to be asserted are legally futile, a recognized basis for rejecting an amended pleading. If those claims were stated in an original pleading, the procedural vehicles for defendants' preclusion contentions would be by a motion to dismiss under Rule 12(b)(6) for failure to state a claim upon which relief can be granted; under Rule 12 (c), for judgment on the pleadings; or, if supported by matters outside the pleadings, by the functional equivalent of a motion for partial summary judgment under Rule 56, as required by the last sentence of Rule 12(b).
In support of their preclusion arguments in this complex collection of litigated cases, and in support of their cross-motion to dismiss, defendants have submitted two skimpy briefs containing a total of only 12 pages. Those briefs are sufficient to raise the issues, but of limited assistance to the Court.
Having reviewed the most recent Second Circuit authority, I will first consider res judicata and collateral estoppel in general terms, and then apply these doctrines to the particular claims the Harkin plaintiffs seek to assert in the proposed second amended complaint.
1. Res Judicata or Claim Preclusion: General Principles
Generally speaking, "res juducata bars claims arising out of the same transaction." Rivers v. McLeod, 252 F.3d 99, 101 (2d Cir. 2001). "The doctrine of res judicata, or claim preclusion, holds that a final judgment on the merits precludes the parties or their privies from relitigating issues that were or could have been raised in that action."Monohan v. New York City Department of Corrections, 214 F.3d 275, 284 (2d Cir. 2000) (citation and internal quotation marks omitted).
Stated differently, "upon a final judgment on the merits, parties to a suit are barred as to every matter that was offered and received to sustain or defeat a cause of action, as well as to any other matter that the parties had a full and fair opportunity to offer for that purpose."Bank of India v. Trendi Sportswear. Inc., 239 F.3d 428, 439 (2d Cir. 2000) (citation and internal quotation marks omitted).
To prove the affirmative defense of res judicata, "a party must show that (1) the previous action involved an adjudication on the merits; (2) the previous action involved the plaintiffs or those in privity with them; (3) the claims asserted in the subsequent action were, or could have been, raised in the prior action." Monohan, 214 F.3d at 285 (citations omitted).
"In deciding whether a suit is barred by res judicata, [i]t must first be determined that the second suit involves the same claim — or nucleus of operative fact — as the first suit.... To ascertain whether two actions spring from the same transaction or claim, we look to whether the underlying facts are related in time, space, origin, or motivation, whether they form a convenient trial unit, and whether their treatment as a unit conforms to the parties' expectations." Waldman v. Village of Kiryas Joel 207 F.3d 105, 108 (2d Cir. 2000) (citation and internal quotation marks omitted). It necessarily follows that "while a previous judgment may preclude litigation of claims that arose prior to its entry, it cannot be given the effect of extinguishing claims which did not even exist and which could not possibly have been sued upon in the previous case." St. Pierre v. Dyer, 208 F.3d 394, 399 (2d Cir. 2000) (citation and internal quotation marks omitted); see also Curtis v. Citibank. N.A. 226 F.3d 133, 139 (2d Cir. 2000) ("While claim preclusion bars relitigation of the events underlying a previous judgment, it does not preclude litigation of events arising after the filing of the complaint that formed the basis for the first lawsuit. The crucial date is the date the complaint was filed.") (citation omitted).
2. Collateral Estoppel or Issue Preclusion: General Principles Generally speaking, collateral estoppel "bars a party from relitigating in a second proceeding an issue of fact or law that was litigated and actually decided in a prior proceeding if that party had a full and fair opportunity to litigate the issue in the prior proceeding." Monohan, 214 F.3d at 284 n. 5 (citation and internal quotation marks omitted). "Collateral estoppel applies when (I) the issues in both proceedings are identical, (2) the issue in the prior proceeding was actually litigated and actually decided, (3) there was [a] full and fair opportunity to litigate in the prior proceeding, and (4) the issue previously litigated was necessary to support a valid and final judgment on the merits." Epperson, 242 F.3d at 108 (citation and internal quotation marks omitted). To invoke the affirmative defense of issue preclusion, it must appear that the issue sought to be precluded "was actually litigated or actually decided" in the prior action. Id.The doctrine of mutuality once limited issue preclusion to disputes between the parties to the first litigation. But it is now settled that other parties may assert issue preclusion, either offensively or defensively. See Parklane Hosiery Co. v. Shore. 439 U.S. 322, 331 (1979) (permitting nonmutual offensive issue preclusion); Blonder-Tongue Laboratories, Inc. v. University of Illinois Foundation 450 U.S. 313, 350 (1971) (permitting nonmutual defensive issue preclusion). For example, a company that has failed to prove that it owns a valid patent in an action against one alleged infringer may be precluded from suing other entities for patent infringement. Blonder-Tongue 450 U.S. at 350; see also Stevenson v. Sears. Roebuck Co., 713 F.2d 705, 709 (Fed. Cir. 1983).
Issue preclusion represents a policy choice in favor of judicial efficiency, sometimes at the expense of correctness. See Gelb v. Royal Globe Insurance Co., 798 F.2d 38, 44 (2d Cir. 1986) ("[J]udicial efficiency demands that there be an end to litigation at some point. Our system resolves the conflict among values by holding that an issue determined in one proceeding normally may not be reexamined. This resolution elevates uniformity and repose over correctness.").
Because issue preclusion requires that the issues in the current proceeding and a prior proceeding be identical, the controlling facts or legal principles must not have changed during the interim. Furthermore, the issue in the prior proceeding must have been actually litigated and decided, and must have been necessary to support a valid judgment on the merits. Issue preclusion does not apply when the party adversely affected by its initial resolution lacked a full and fair opportunity to litigate the issue, although the party seeking to avoid the doctrine has the burden of showing the absence of that full and fair opportunity. See Moccio v. New York State Office of Court Administration 95 F.3d 195, 201 (2d Cir. 1996) ("The second prong of the collateral estoppel test — whether Moccio had a full and fair opportunity to litigate in the Article 78 proceeding the issues he now raises — is also met as to both his federal causes of action. The burden to show the absence of such a full and fair opportunity rests with Moccio."). Other circumstances may exist which militate against invocation of the doctrine. Ultimately the application of issue preclusion in a given case should "rest on the trial courts' sense of justice and equity." Blonder-Tongue, 450 U.S. at 334.
3. Application of the Doctrines of Preclusion to the Claims Plaintiffs Seek to Assert in the Second Amended Complaint
Analyzing the applicability of claim preclusion and issue preclusion to the claims pleaded in plaintiffs' SAC is complicated by the wide variety and partial inconsistency of the claims (or counts), and the lack of coordination between some of the claims asserted and the relief sought.
For example, certain requested relief is stated precisely. Count One prays for a judgment that the mergers of the local unions within the District Council were "null and void" because they were implemented "in violation [inter alia] of UBC Constitution Section 10H." Count Four prays for an order directing nominations and elections for the offices of Business Representative and Business Manager. Counts Five and Six focus solely upon the six cents per hour assessment the UBC imposed on the District Council, praying respectively for a declaration of invalidity and an accounting.
By contrast, Counts Two and Three request broad declarations of the invalidity of a number of sections of the UBC Constitution (including section 10H, which the plaintiffs seemingly rely on in Count One's allegation that the UBC violated its requirements), without tying these allegations and prayers to any particular event or deprivation revealed by the tangled history of the related cases that began with the government's civil RICO action against the District Council.
Notwithstanding these complexities, and contrary to the defendants' broad contentions, it is apparent that the doctrines of res judicata (claim preclusion) and collateral estoppel (issue preclusion) have scant application to the claims plaintiffs wish to assert.
Principally that is because of an absence of final adjudications on the merits in certain of the actions upon which the defendants rely for application of the preclusion doctrines. That is an essential element in each doctrine. Claim preclusion depends "upon a final judgment on the merits." Bank of India, 239 F.3d at 439. The proponent of issue preclusion must show that the issue in question was "actually litigated and actually decided" and "was necessary to support a valid and final judgment on the merits." Epperson 242 F.3d at 108.
Active litigation in the government's civil RICO suit came to an end with the Consent Decree. There is authority for the proposition that a court-approved settlement agreement "is a final judgment on the merits" for res judicata purposes. Monohan, 214 F.3d at 285 (settlement of federal constitutional claims in action brought by police union president precluded subsequent suit on same claims by individual officers). But this avails the present defendants nothing, since in the Local 20 action I denied parties in privity with the present plaintiffs leave to intervene in the government's action on the ground that the validity of the UBC's Restructuring Plan did not implicate the Consent Decree. That ruling constitutes the law of the case. Nothing that has been decided in the government's action can operate to preclude claims or issues asserted in the three subsequent actions with which this Opinion is concerned.
Those three actions are Devine, Local 20, and Harkin. Only Devine has been terminated by a final judgment, the Court having dismissed the case in its October 29, 1997 Order. Accordingly only Devine can furnish grist for the preclusion doctrines' mill. Local 20 and Harkin are still pending. Defendants make much of this Court's denial in Local 20 of a preliminary injunction restraining the implementation of the Restructuring Plan, affirmed by the Second Circuit. But defendants cite no case holding that the grant or denial of a preliminary injunction constitutes that final adjudication on the merits essential to both claim and issue preclusion, and a ruling to that effect would be conceptually flawed: preliminary injunctions, after all, are pendente lite.
The Devine case satisfies the first of the three requirements of res judicata it involved an adjudication on the merits of the Devine plaintiffs' claim that McCarron and the UBC violated the UBC Convention by subjecting the District Council to trusteeship and supervision.
As for the second requirement, that the previous action involved the present plaintiffs or those in privity with them, the Second Circuit said in Monohan, 214 F.3d at 285, that "[i]t is well settled in this circuit that literal privity is not a requirement for res judicata to apply.... Instead, a party will be bound by the previous judgment if his interests were adequately represented by another vested with the power of representation," a principle that has been extended "to preclude workers from challenging consent decrees entered into by their union" (citations and internal quotation marks omitted). Monohan describes United States v. International Bhd. of Teamsters 931 F.2d 177, 185-186 (2d Cir. 1991) as "concluding that IBT subordinate entities — members, locals, joint councils, and area conferences — were bound by consent decree even though they were nonparties to original action where union adequately represented the interests of the collective membership." Id. While Devine and Cavanaugh, the plaintiffs in Devine undoubtedly had personal agendas in mind, they sued as president and secretary respectively of the District Council to enjoin the UBC and McCarron from imposing the trusteeship; and the District Council collectively represented its constituent local unions, of which the Harkin plaintiffs were members. I think those circumstances are sufficient to place theDevine plaintiffs in privity with the Harkin defendants for the purpose of claim preclusion analysis.
Accordingly, if this finding of privity is correct, the Harkin plaintiffs are bound by the adjudication in Devine of the claims that were or could have been asserted in that earlier action. Specifically, theHarkin defendants are bound by the adjudication that the trusteeship and supervision imposed by the District Council were accompanied by a fair hearing and did not violate the UBC Constitution. While as noted theDevine plaintiffs did not challenge the validity of the UBC Constitution, arguing instead that McCarron had violated its provisions, that does not reduce the scope and effect of claim preclusion, which bars claims that could have been raised as well as those that were. TheDevine plaintiffs could have argued in the alternative that McCarron violated the UBC Constitution or, if he did not, that the Constitution itself was invalid.
But it is not at all clear that the Harkin plaintiffs, in their proposed second amended complaint, seek to challenge the validity of the trusteeship. Rather, their principal targets are the changes brought about by the Restructuring Plan, including the merger of local unions; and at this point the claim preclusion effect of Devine breaks down, because the claim of Restructuring Plan invalidity could not have been asserted in Devine for the simple reason that McCarron had not yet proposed it. The Devine complaint was dated July 3, 1996. McCarron's proposed Restructuring Plan was disseminated as Ex. 2 to IRO Conboy's Special Interim Report dated May 30, 1997. The Local 20 plaintiffs attacked the Plan in an amended complaint dated August 14, 1997; see Local Union 20, 1997 WL 630179 at *2-*3. However, the Local 20 action has not resulted in a final adjudication and accordingly cannot form the basis for claim preclusion. Devine is the only case where there has been a final adjudication; and since a previous judgment "cannot be given the effect of extinguishing claims which did not even then exist and which could not possibly have been sued upon in the previous case," Lawlor v. National Screen Service Corp., 349 U.S. 322, 328 (1955), cited and quoted in St. Pierre, 208 F.3d at 400, the Harkin plaintiffs' present claim are not precluded by the earlier adjudication in Devine Nor, for comparable reasons, are those claims subject to the bar of issue preclusion.
Defendants look to the Devine case for preclusion of additional claims the present plaintiffs assert. They contend that "[t]he plaintiffs' attack on the ratification of collective bargaining agreements during the course of the trusteeship, which is the subject of Count Four of the proposed amended complaint, and the $0.06 assessment, which is the subject of Counts Five and Six, were similarly heard and determined by this Court in Devine v. McCarron 1997 WL 379708." Letter Brief dated July 11, 2001 at 1. That contention considerably overstates the issues that the Court "determined" in Devine. It is true that in an affidavit verified July 15, 1996, seeking to head off the trusteeship, Devine included a litany of perceived villainies on the part of McCarron. See Ex. C to Sklaroff Affidavit in Opposition to Motion to Amend dated January 10, 2001. Neither Judge Mukasey nor I adjudicated or "determined" any of these claims. This Court determined the Devine case on the grounds that McCarron had not violated the UBC Constitution in imposing the trusteeship, the trusteeship was ratified after a fair hearing, and theDevine plaintiffs had not shown that McCarron acted in bad faith in imposing the trusteeship and supervision. Claim preclusion and issue preclusion do not extend to claims the present plaintiffs seek to assert but which were peripheral to and played no part in the Court's adjudication in Devine.
It follows that the only claim subject to preclusion is that claim adjudicated in Devine namely, that McCarron's initial placement of the District Council under trusteeship and supervision in 1996 was invalid. It is not clear from the plaintiffs' proposed pleading that they even wish to challenge that initial validity and in any event, the trusteeship has been terminated.
4. Additional Considerations
The limited applicability of the preclusion doctrines to the proposed SAC does not mean that there are no other sound objections to some of plaintiffs' claims, which will be discussed in turn.
(a) The Merger of Local Unions
The first Count of the SAC prays that the mergers of certain District Council constituent local unions be declared "null and void." Plaintiffs clarify that request for relief in a further brief dated June 28, 2001, which acknowledges that a Court order at this time dissolving the mergers previously accomplished under the Restructuring Plan "may have the adverse effect of throwing said locals into undue chaos." Id. at 12. Instead, plaintiffs wish to ask "that this Court order these merged locals to hold a rank-and-file vote, to find whether or not the members wish to remain as they are or divide said locals back to the way they were." Id. Plaintiffs properly recognize the organizational and functional difficulties inherent in undoing the mergers and destroying the merged local unions that the Restructuring Plan created. But those difficulties are not fully addressed by the special referendums plaintiffs suggest. The merged locals have been in existence for several years. "Undue delay" and "undue prejudice to the opposing party" are recognized reasons for denying an amendment. Foman 371 U.S. at 182. Both factors are present.
As for delay, the plaintiffs in Local 20 did not press their objections to the mergers after losing their bid for a preliminary injunction against the Restructuring Plan. The UBC then implemented the mergers. TheHarkin plaintiffs' first amended complaint, drafted by the Bisceglie firm as plaintiffs' counsel and dated May 26, 1998, did not ask that the mergers be undone. That pleading seemingly accepted the existence of the merged unions that had been created; ¶ 13 alleged that "[t]he UBC is currently implementing a Restructuring Plan, under which several of the local unions under the District Council have been merged and interim officers for the local unions appointed." Plaintiffs' only complaint at that time with respect to the merged locals was that "the scheduling of local union elections have not been accomplished," going on to allege at ¶ 13 that "29 C.F.R. § 452.14 mandates, in the case of merged labor organizations, that elections be held within a reasonable time after the organization begins to function," and praying that the Court order "the expeditious scheduling of Local Union and District Council elections." First Amended Complaint, Demands for Relief at ¶ C. Those elections were subsequently held. Over two and a half years after the first complaint in this case was filed, in a proposed second amended complaint dated December 19, 2000, these three individual have plaintiffs, having discharged counsel, seek for the first time in this case to undo the mergers of the local unions. In that regard the proposed amendment is untimely. Moreover, the distractions and turmoil that the referenda plaintiffs wish the Court to direct would be unduly prejudicial to the governance of the local unions and the District Council.
Quite apart from these considerations, the plaintiffs' underlying claim, that McCarron and the UBC could not validly merge the local unions, is not viable in law. This is a separate point from claim or issue preclusion. "Futility" of a proposed amendment is an additional ground for refusing it, and a claim is futile in this context if it could not withstand a motion to dismiss.
As previously noted, the merger of a number of local unions formed a key part of the Restructuring Plan that the UBC, under McCarron's direction, devised for the District Council following the imposition of the trusteeship upon the District Council. The Local 20 plaintiffs moved for a preliminary injunction to bar implementation of the Plan, including the mergers. I denied the preliminary injunction. The Court of Appeals affirmed.
This Court's opinion in Local 20 began with the observation that many local carpenters' unions around the country had sued to enjoin being merged under various reorganization plans devised by McCarron as General President of the UBC, and that the courts had rejected every such effort. See cases collected in 1997 WL 630179 at *3-*4. The last case cited in that collection was the opinion of Chief Judge Henderson of the Northern District of California in Pile Drivers, Divers, Carpenters, Bridge, Wharf and Dock Builders Local Union 34, et al. v. Northern California Carpenters Regional Council and UBC, 992 F. Supp. 1138 (N.D. Cal. 1997), aff'd, 139 F.3d 905 (2d Cir. 1998). Judge Henderson, after a comparable review of circuit court cases, said:
These cases make it plain that, absent bad faith, General President McCarron has the authority to order a local to affiliate or merge with a regional council. Under the terms of the UBC Constitution, the affected locals do not have a right to vote on the matter, and may in fact be dissolved if they resist a reorganization directive.992 F. Supp at 1142 (citations omitted).
In Local 20 I then considered at length whether any of the legal theories advanced by the plaintiffs in that case to bar the mergers, including the plaintiffs' conclusory allegations of McCarron's bad faith, required a different result, and concluded that they did not. See 1997 WL 630 179 at *5-*18. I denied the Local 20 plaintiffs' motion for a preliminary injunction because plaintiffs had not shown a likelihood of success on their claims of merger invalidity, or a sufficiently serious question on the merits of those claims to make them a fair ground for further litigation.
It is of course the fact that the Local 20 opinion did no more than deny an injunction pendente lite on the then-existing record; the ruling did not constitute a final judgment on the issue, and therefore cannot support either claim preclusion or issue preclusion. But the basis for the denial was entirely one of law, derived from unbroken lines of authority, from which the Harkin plaintiffs demonstrate no present reason to depart.
For the reasons stated, the Court will not allow the plaintiffs to include in a second amended complaint a claim that the local unions were unlawfully merged and a prayer that might lead to a reversal of the merging process.
But it is right to add that this denial is conditional, for the reasons stated in Part IV.C.4(b). infra.
(b) The Validity of the UBC Constitution
The cases cited in the Local 20 opinion and the three cases in this Court related to Harkin all assumed the validity of the pertinent provisions of the UBC Constitution. The plaintiffs in Devine for example, did not contend that the UBC Constitution was invalid or unenforceable for any reason; they alleged that McCarron's imposition of the trusteeship violated its provisions.
The Harkin case is different in that regard. The first amended complaint, drafted by counsel, alleges in Counts Two and Three that sections 6A, 6D, 10H, 10J, 10K, 15F, 26H, 261 and 62 of the UBC Constitution are void because they were invalidly adopted, ¶ 32, are "completely one-sided and shockingly unfair to the rank-and-file members because it gives dictatorial powers to the General President and General Executive Board with no system of checks and balances," ¶ 36, and are "unconscionable," ¶¶ 36-37. The first amended complaint prays for a declaration that these sections of the UBC Constitution are void. These allegations and this prayer are echoed in the second amended complaint that the individual pro se plaintiffs wish to file.
I will allow that amendment. The claims that these sections of the UBC Constitution are void and unenforceable are not barred by either preclusion doctrine. Defendants will not be unfairly prejudiced if the individual plaintiffs are allowed to assert these claims because the claims are in the case already; counsel from the Bisceglie firm made it plain at the December 21, 2000 status conference that the firm continues to represent at least one local union.
The Court's denial of leave to the plaintiffs to attack the merger of local unions directly is conditional because if plaintiffs in eitherLocal 20 or Harkin obtain a court judgment striking down the enumerated sections of the UBC Constitution, it may be necessary to revisit the issue of the mergers. I put the proposition no higher than that, and intimate no present view on the effect, if any, that such a judgment might have in the area of local union mergers.
(c) 38th General Convention Amendments to the UBC Constitution
The plaintiffs' proposed second amended complaint specifically attacks as invalid certain amendments to the UBC Constitution that were proposed and adopted at the UBC's 38th General Convention, held in August 2000.
Defendants do not argue that this claim of invalidity is barred by claim or issue preclusion; nor could they, since the operative facts occurred after the related cases were filed and, in the case of Devine, finally adjudicated.
Instead, defendants contend in a footnote to their July 11, 2001 letter brief that "plaintiffs have failed to pursue, much less exhaust, as they must, internal union remedies to seek redress for their complaints," citing for that proposition Maddalone v. Local 17. United Brotherhood to Carpenters and Joiners. 152 F.3d 178, 187 (2d Cir. 1998). But that case does not support the defendants' contention that plaintiffs should not be allowed to amend their complaint to assert this claim. In Maddalone a carpenter sued his local union and the District Council, claiming that he had been dismissed as a shop steward and fired from a job in violation of the federal labor statutes. The district court dismissed the action, one of the grounds being that plaintiff first was required "to exhaust his remedies under the union's grievance procedures." 152 F.3d at 186. The Second Circuit reversed that holding in part. The court recited the factors militating against application of the exhaustion doctrine:
First, whether union officials are so hostile to the employee that he could not hope to obtain a fair hearing on his claim; second, whether the internal union appeals procedures would be inadequate either to reactivate the employee's grievance or to award him the full relief he seeks . . .; and third, whether exhaustion of internal procedures would unreasonably delay the employee's opportunity to obtain a judical hearing on the merits of his claim.Id. (citation and internal quotation marks omitted). The Second Circuit then observed that "[t]he union bears the burden of establishing that its procedures meet these requirements," id., and held in part:
We are not convinced, however, that Maddalone could have received adequate relief on his LMRDA claims through resort to section 53(G) [of the UBC Constitution]. Under the LMRDA, Maddalone may seek both compensatory and punitive damages. Local 17 and the District Council have produced no evidence as to what remedies the General President has at his disposal. Accordingly, the union has failed to establish that its procedures could have "fully redressed" Maddalone for his alleged injuries under Title I of the LMRDA.152 F.3d at 187.
In the case at bar, the defendants' passing footnoted remark does not try to make the showing Maddalone requires for application of the exhaustion doctrine. Accordingly the plaintiffs may include this claim in their second amended complaint. The defendants, if so advised, may attempt to support a failure to exhaust argument in a motion to dismiss or other dispositive motion.
(d) Election of Business Representatives and Business Managers
According to the plaintiffs' submissions, prior to its 38th General Convention, the UBC's Constitution provided that union business representatives, agents or managers (the words appear to be synonymous) "may be elected" or appointed, at the option of local unions or district councils. The Constitution was amended in August 2000 at the 38th General Convention, so that business representatives are now appointed by the District Council. The fourth prayer for relief in the SAC asks that the Court order "expeditious nominations and elections for the office of Business Representative and Business Manager."
In their main brief at 7, defendants say that this issue was decided contrary to plaintiffs' contention "in both the Local 20 action and in the various proceedings that attended the UBC's enactment of revised District Council bylaws." If that argument is one of claim or issue preclusion, the Local 20 litigation will not suffice in the absence of a final adjudication. Defendants give no details with respect to their conclusory reference to revisions of the District Council bylaws.
In addition, defendants cite a number of cases from other circuits which uphold district council bylaws granting exclusive control over the selection of business representatives to a district council, and rejecting the argument that doing so violates the UBC Constitution. These cases may be considered in deciding whether to refuse the amendment on the ground of legal futility. However, given the broad attack plaintiffs wish to make upon the UBC Constitution, I will allow them to include the business representative election claim in their second amended complaint. The defendants may, of course, respond with an appropriate motion. I intimate no present view on the outcome of such a motion if made.
The election of business representatives is also a claim pressed by Local Union 926, a plaintiff in the Local 20 action, 97 Civ. 5538, for which the Bisceglie firm still acts as counsel. As noted in text, at the December 21, 2000 status conference Mr. Siebel of that firm stated that in Local 20 the remaining local union plaintiff regarded as an open question "its election of the business managers, which is something that was taken away during the Restructuring Plan." Tr. 20. Since the conference McCarron and the UBC have not sought to dispose of the claim, by motion or otherwise.
At the end of the status conference, following a colloquy between the Court, Mr. Siebel and Mr. Lebo, I said that "in the case which bears docket number 98 Civ. 1778, there are three plaintiffs and three plaintiffs only, and that is these three pro se plaintiffs." Tr. 47. That was based upon Mr. Siebel's statement that his local union plaintiff pressed its business representative claim in the Local 20 action, and not in the Harkin action. Tr. 20. Accordingly the Local 20 action will go forward on the basis of the pleadings in that case, and the Harkin case will go forward on the basis of the second amended complaint which this Opinion and Order grants leave to the pro se plaintiffs to file.
The pro se plaintiffs in their submissions have suggested that the Court's order consolidating 98 Civ. 1778 with 97 Civ. 5538 be rescinded. I decline to do so. The administrative advantages of consolidation remain apparent, and consolidation works no prejudice upon any party.
Plaintiffs may also include the claim in Count Seven, as defined and clarified in their June 28, 2001 brief at 53, that District Board Members should be "elected by Delegates from their own district only." That claim appears to be based upon the UBC Constitution amendments enacted at the 38th General Convention, and for the reasons stated I will allow plaintiffs to challenge the validity of those amendments. Bu the Court will neither take evidence on nor consider historical events occurring ten years ago, to which plaintiffs refer in their proposed pleading. The validity of the challenged UBC Constitutional provisions, including the 38th General Convention amendments, will stand or fall upon present conditions and circumstances.
IV. CONCLUSION
For the foregoing reasons, the plaintiffs' motion further to amend their complaint in 98
Civ. 1778 is granted. Plaintiffs are given leave to file and serve a second amended complaint in a form consistent with this Opinion. That means that plaintiffs may include the claims which the Court has allowed them to include, and no others. Plaintiffs should also achieve a greater degree of coordination between the allegations in the several counts and the relief requested with respect to them.
Plaintiffs may make service of the second amended complaint upon the attorneys who represent the defendants. See Rule 5(b), Fed.R.Civ.P. Defendants are to answer or otherwise move within the time specified by the Rules.
Defendants' cross-motion to dismiss the complaint in 98 Civ. 1778 is denied.