Justia Contracts Opinion Summaries

Petitioner sought review of three decisions of the National Labor Relations Board (NLRB) affirming in part and reversing in part the ALJ's findings with respect to allegations that AM Property Holding Corporation (AM) participated in a scheme with two successive cleaning contractors to avoid a bargaining obligation with petitioner after AM purchased a certain building. At issue was whether the NLRB erred by finding that: (1) AM was not a joint employer with either contractors; (2) the NLRB was precluded from determining whether one contractor was individually a successor employer to Clean-Right, the in-house cleaning division of the former owner of the building because the General Counsel had not litigated a violation based on that theory; and (3) petitioner was not entitled to additional remedies. The court rejected the first and third claims of error, but concluded that as to the second, the NLRB misunderstood its authority to determine whether one of the contractors was individually a successor employer to Clean-Right. Therefore, the court remanded so that the NLRB could reconsider this issue.

Defendant Four Rivers Packing Company operated an onion packing plant and hired Plaintiff Stuart Mackay as the company's "field man." Plaintiff had been in the onion business for decades and knew many onion farmers. Four Rivers through its general manager Randy Smith (Smith) offered Plaintiff a job that involved purchasing enough onions to keep Four Rivers' packing shed stocked at a price that Smith would set. Plaintiff contended that Smith offered him a long-term employment contract. From 2000 to 2002, financial and managerial setbacks made it difficult for Four Rivers to operate its business, and for Plaintiff to acquire onions at prices set by Smith in order to keep the sheds stocked. In 2003, Four Rivers laid Plaintiff off. Plaintiff filed suit in 2004 alleging breach of the employment contract. At trial following a remand, Four Rivers contended that the parties had not entered into an employment contract for any specified term. A jury would return a verdict in favor of Plaintiff. In a special verdict form, the jury found that the parties had entered into a long term contract of "up to ten years, or such time as the Plaintiff retired." Four Rivers timely appealed, challenging jury instructions given at trial and the sufficiency of the evidence. Upon review of the trial record, the Supreme Court found that the trial court properly instructed the jury and that the evidence presented was sufficient to support the verdict. The Court affirmed the trial court's judgment against Four Rivers.

The National Treasury Employees' Union (Union) sought review of an adverse ruling by the Federal Labor Relations Authority (Authority) where the Union filed a grievance alleging that the IRS was processing its members' dues revocation forms without following contractually-mandated procedures. After the parties filed exceptions to the arbitrator's award with the Authority, the Authority denied the parties' exceptions and confirmed the award in its entirety. The Union petitioned the court for review. The court held that because the Authority's decision upholding the arbitrator's award was not arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law, the court had no warrant to disturb the Authority's decision.

Defendants engaged in discovery misconduct that was sufficiently egregious to cause the district court to enter an order of default against them. Although defendants subsequently challenged the default order as erroneous, defendants did not challenge the order of default by way of a Federal Rule of Civil Procedure 55(c) or 60(b). At issue was whether Judge Real, a district court judge, had the power to impose default as a sanction for discovery misconduct and assuming such power, whether Judge Real abused his discretion by imposing default rather than lesser sanctions. The court held that defendants' failures to comply with orders of the court provided Judge Real with the power under Rule 37(b) to impose sanctions sua sponte, up to and including default and that Judge Wilson appropriately revisited previous orders of the court when he replaced Judge Real after Judge Real recused himself. The court also held that the district court possessed the power to impose the sanction of default and that the district court did not abuse its discretion by doing so. Accordingly, the judgment was affirmed.

This case stemmed from the collective bargaining activities of the International Longshore and Warehouse Union, Local 142 (Union) and the Pacific Beach Hotel (Hotel) where the Union filed numerous unfair labor practice charges with the Regional Director of Region 20 of the Board (Director). At issue was an injunction issued pursuant to section 10(j), 29 U.S.C. 160(j), of the National Labor Relations Act (Act), 29 U.S.C. 151 et seq. The court must determine whether the injunction should be affirmed on its merits and whether the district court had the power to issue the injunction in the first place. As a preliminary matter, the court held that the appeal was not moot because its resolution was crucial to a pending claim for retrospective monetary relief sought by the National Labor Relations Board (Board) against the Hotel in a civil contempt proceeding. The court held that the text of the Act, reinforced by the Board's longstanding practice under section 10(e), allowed the Board to assign the General Counsel final authority in deciding when to petition for injunctive relief under section 10(j) in particular unfair labor practice cases pending before the Board. The three other circuits that have addressed this question agreed that the district court could entertain section 10(j) petitions approved by the General Counsel pursuant to the authority granted him by the Board in December 2007. Although the court's reasoning differed somewhat from that in those cases, the court's conclusion with regard to the validity of the Board's 2007 delegation of litigation authority under section 10(j) was identical. With respect to the Board's power to file petitions under section 10(j), it was sufficient that a quorum of the Board in 2007 decided to assign decisions as to individual petitions to the General Counsel. Under the distinction explained in New Process Steel, L.P. v. NLRB, nothing in the Board's quorum requirement would cause the General Counsel's ability to file section 10(j) petitions to lapse after the Board's membership fell below a quorum. As for the merits of the injunction, the court concurred with the district court's assessment that the Board was likely to determine, and be affirmed by the court in so determining, that the Hotel engaged in violations of section 8(a)(1), (3), and (5) of the Act by refusing to bargain in good faith and excluding five union activists from the workforce. The district court likewise did not abuse its discretion in concluding that the other requisites for section 10(j) relief were met. Accordingly, the court affirmed the injunction.

Former employees of defendants participated in the Capital Accumulation Plan, under which they received portions of their earned commissions in the form of Citigroup stock, received at a 25% discount and on a tax-deferred basis. The stock was subject to a two-year vesting period during which transfer was restricted and rights would be forfeited if the employee resigned. Plaintiffs alleged that the CAP forfeiture provision violated the Colorado Wage Claim Act, Colo. Rev. Stat. 8-4-103 and Louisiana's labor statute, La. Rev. Stat. 23:631(A)(1)(a), 23:634(A) and breach of employment contracts, breach of the CAP contract, conversion, and unjust enrichment. The district court dismissed, based on a previous decision involving similarly-situated plaintiffs. The First Circuit affirmed. The Colorado law applies only to compensation that is "earned, vested, and determinable." The Louisiana law does not apply because the stock was not "then due" when the plaintiffs resigned. There was no breach of contract, hence no conversion; the claims of unjust enrichment failed because of the existence of a contract.

This case stemmed from a Mutual Strike Assistance Agreement (MSAA) that was entered into by defendants (grocers) where the MSAA included a revenue-sharing provision (RSP), providing that in the event of a strike/lockout, any grocer that earned revenues above its historical share relative to the other chains during the strike period would pay 15% of those excess revenues as reimbursement to the other grocers to restore their pre-strike shares. At issue was whether the MSAA was exempt from the antitrust laws under the non-statutory labor exemption, and if not, whether the MSAA should be condemned as a per se violation of the antitrust laws or on a truncated "quick look," or whether more detailed scrutiny was required. The court held that the MSAA between the grocers to share revenues for the duration of the strike period was not exempt from scrutiny under antitrust laws and that more than a "quick look" was required to ascertain its impact on competition in the Southern California grocery market. Given the limited judicial experience with revenue sharing for several months pending a labor dispute, the court could not say that the restraint's anti-competitive effects were "obvious" under a per se or "quick look" approach. Although the court concluded that summary condemnation was improper, the court expressed no opinion on the legality of the arrangement under the rule of reason. Accordingly, the judgment was affirmed.

After being diagnosed with fibromyalgia, chronic pain, anxiety, and depression, plaintiff was awarded long-term disability benefits under an employee benefit plan issued and administered by defendant. Benefits were discontinued about 24 months later, when defendant determined that plaintiff had received all to which she was entitled under the planâs self-reported symptoms limitation. Because plaintiff had retroactively received social security benefits, defendant also sought to recoup equivalent overpayments as provided by the plan. The district court dismissed. The Seventh Circuit reversed in part and remanded for reinstatement. The self-reported symptom limitation violates ERISA, 29 U.S.C., 1022; the policy sets out that long-term benefits will be discontinued after 24 months if disability is due to mental illness or substance abuse, but does not mention that the time limitation applies if a participantâs disability is based primarily on self-reported symptoms. The Social Security Act does not bar recovery of overpayments occasioned by receipt of social security benefits.

Plaintiff appealed from a judgment of the district court dismissing his complaint against his former employer, seeking monetary and equitable relief for alleged age discrimination in violation of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. 621, et seq., and state law. At issue was whether the separation agreement between the parties was unenforceable because its provisions did not comply with the requirements of the Older Workers Benefit Protection Act (OWBPA), 29 U.S.C. 626(f), and applicable Equal Employment Opportunity Commission (EEOC) regulations, that the separation agreement be written in a manner calculated to be understood. The court held that the separation agreement was written in a manner calculated to be understood by the relevant employees of defendant. The court also rejected plaintiff's argument that summary judgment should have been denied because there were genuine issues of fact to be tried and that the separation agreement was unenforceable because plaintiff was not advised in writing to consult with an attorney. Accordingly, the judgment was affirmed.

This case stemmed from a collective bargaining agreement executed in 1998 by the Federal Bureau of Prisons and the American Federation of Government Employees, Council of Prison Locals No. 33. The Bureau petitioned for a review of a decision of the Federal Labor Relations Authority holding that the Bureau had a duty to bargain over its implementation of a "mission critical" standard for staffing federal correctional institutions. The court held that because the Authority unreasonably concluded the mission critical standard was not "covered by" the collective bargaining agreement between the Bureau and its employees' union, the court granted the petition and vacated the Authority's decision.