Carr v. Air Line Pilots Ass'n, International , 866 F.3d 597 ( 2017 )

Case: 16-20578 Document: 00514071129 Page: 1 Date Filed: 07/13/2017
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
July 13, 2017
No. 16-20578
Lyle W. Cayce
Clerk
MICHAEL A. CARR; GREGORY KATHAN; PERRY MEIER; KELLY L'ROY;
CHARLES MULHALL; SCOTT MUND,
Plaintiffs - Appellants
v.
AIR LINE PILOTS ASSOCIATION, INTERNATIONAL,
Defendant - Appellee
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:14-CV-451
Before STEWART, Chief Judge, and WIENER and PRADO, Circuit Judges.
PER CURIAM:*
Plaintiffs-Appellants, Michael Carr, Gregory Kathan, Perry Meier, Kelly
L’Roy, Charles Mulhall, and Scott Mund (“Appellants”), formerly pilots for
Continental Airlines (“Continental”) but now pilots for United Airlines
(“United”), sued their collective bargaining agent, Defendant-Appellee Air Line
Pilots Association International (“ALPA”), on behalf of themselves and all
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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former Continental pilots. Appellants alleged that ALPA breached the duty of
fair representation by interfering with the process of creating an integrated
pilot seniority list (“seniority list”) for all pilots of the two merging airlines,
Continental and United Airlines. The district court granted ALPA’s motion for
a summary judgment and dismissed the Appellants’ suit. We affirm.
I.
FACTS AND PROCEEDINGS
A. Factual Background
In 2010, United and Continental merged, operating thereafter as United.
ALPA represented the pilots of both airlines as their collective bargaining
agent before and during the merger.
ALPA had a preexisting Merger Policy which required it to “provide the
process” when two airlines whose pilots it represented merged. That process
included the integration of the two seniority lists into one. ALPA’s
representation structure before and during this merger included Master
Executive Councils (“MECs”) elected to represent each airline’s pilot group.
ALPA’s role during a merger is limited to providing the Merger Policy and
facilitating the merger in accordance with that policy. In this case, each MEC
appointed a three-member “Merger Committee” to create the seniority list.
Pursuant to ALPA’s Merger Policy, the Merger Committees had “complete and
full authority” to negotiate and, if necessary, arbitrate a “fair and equitable”
and “final and binding” seniority list. ALPA Merger Policy permitted the MECs
and Merger Committees to “fashion their own process” for integrating the
seniority lists, while observing specified “fundamental requirements.”
Ultimately, the MECs and Merger Committees were unable to agree on
a seniority list. ALPA’s Merger Policy specifies that if the pilots are unable to
agree on a seniority list, arbitrators would merge the existing lists. The Merger
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Committees voluntarily agreed to select the arbitrators from a list proffered by
ALPA.
During the course of the arbitration, two discovery disputes arose, and
the Merger Committees chose a separate arbitrator to referee those two
disputes. First, Continental requested that United provide specific W-2 data
showing each pilot’s earnings for a period. The discovery arbitrator ruled that
Continental could discover earnings information from the W-2s, subject to
confidentiality procedures designed to prevent disclosure of the pilots’ seniority
numbers. Second, the arbitrator granted United’s request for Continental
pilots’ defined-benefit plan records and did not subject that request to any
restrictions, even though he acknowledged that the parties had agreed to
protect the confidentiality of the information with respect to those records.
Following 16 days of hearings, during which both sides submitted
extensive testimony, expert witness reports, and documents, each side
presented its proposal for integrating the seniority lists. The arbitrators
subsequently issued an award that integrated the seniority lists into one list.
The arbitrators included a thorough explanation of how they incorporated the
factors required by the ALPA Merger Policy. The arbitrators rejected various
parts of Continental’s and United’s proposals in coming up with the seniority
list. Thereafter, United implemented that list, and the combined groups of
pilots have been working under it ever since.
B. Procedural Background
Appellants filed the instant complaint, alleging that ALPA breached its
duty of fair representation by acting in bad faith. Appellants requested that
the court vacate the arbitration award and order ALPA to start a new seniority
list integration process.
ALPA filed a motion to dismiss on the pleadings. The district court
denied that motion and converted it to a motion for summary judgment,
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allowing “tailored discovery” on the issue of ALPA’s alleged breach. ALPA
renewed its motion for summary judgment following preliminary discovery.
The court granted that motion and Appellants timely appealed.
II.
STANDARD OF REVIEW
“We review a grant of summary judgment de novo under the same
standard applied by the district court.” 1 Summary judgment is appropriate
when “there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” 2 We consider the evidence in the light
most favorable to the nonmoving party and draw all reasonable inferences in
its favor. 3
“Once a movant who does not have the burden of proof at trial makes a
properly supported motion” for summary judgment, “the burden shifts to the
nonmovant to show that [the motion] should not be granted.” 4 To do so, the
nonmovant must “identify specific evidence in the record and . . . articulate the
precise manner in which that evidence supports his or her claim.” 5 Neither we
nor the district court have a duty to “sift through the record in search of
evidence to support” the nonmovant’s opposition to summary judgment. 6
1 Boone v. Citigroup, Inc., 416 F.3d 382, 392–93 (5th Cir. 2005).
2 FED. R. CIV. P. 56(a).
3 See Lawyers Title Ins. Corp. v. Doubletree Partners, L.P., 739 F.3d 848, 856 (5th Cir.
2014).
4Ragas v. Tenn. Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir. 1998).
5Id.; accord RSR Corp. v. Int’l Ins. Co., 612 F.3d 851, 857 (5th Cir. 2010).
6 Forsyth v. Barr, 19 F.3d 1527, 1537 (5th Cir. 1994) (quoting Skotak v. Tenneco Resins,
Inc., 953 F.2d 909, 915 n.7 (5th Cir. 1992)).
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III.
ANALYSIS
A. Breach of the Duty of Fair Representation
1. Applicable Law
The duty of fair representation requires a union “to serve the interests
of all members without hostility or discrimination toward any, to exercise its
discretion with complete good faith and honesty, and to avoid arbitrary
conduct.” 7 The fact that a union decided a dispute in a way that favored one
group’s interests over another is not sufficient to show a breach of that duty. 8
Unions have broad discretion in resolving internal disputes, and their
actions are judged by a “wide range of reasonableness.” 9 A breach of fair duty
occurs only when the union’s conduct is “arbitrary, discriminatory, or in bad
faith.” 10 Here, Appellants allege only bad faith.
Bad faith occurs when a union acts with a “motive to harm” a particular
group, and turns on the subjective motivation of the union officials. 11 Bad faith
is a “demanding standard” met only by “sufficiently egregious” union action. 12
To prove that ALPA violated its duty to fairly represent all members by acting
in bad faith, Appellants must show that the union acted intentionally to harm
them by “seriously undermin[ing] the integrity of the arbitral process.” 13 Even
if a member shows that his union breached its duty, he must also show that
the breach “contributed to the erroneous outcome of the . . . proceedings.” 14
7 O’Neill v. Airline Pilots Ass’n, Int’l, 939 F.2d 1199, 1201 (5th Cir. 1991) (quoting Vaca
v. Sipes, 386 U.S. 171, 177 (1967)).
8 Id.
9 Id. at 1204 (quoting Ford Motor Co. v. Huffman, 345 U.S. 330, 338 (1953)).
10 Id. (quoting Vaca, 386 U.S. at 190).
11 Id. at 1204.
12 Id. at 1203 (quoting Alicea v. Suffield Poultry Inc., 902 F.2d 125, 130-31 (1st Cir.
1990)).
13 Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 567 (1976).
14 Id. at 568.
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2. Analysis
Appellants allege that underlying ALPA’s bad faith was its preference
for United pilots. 15 We address Appellants’ supporting contentions in turn.
a. Richard Harwood’s Participation
Appellants assert that ALPA acted in bad faith by not barring – and
allegedly encouraging – the participation of Delta Airlines pilot Richard
Harwood (“Harwood”) in the merger proceedings. Harwood was hired by the
United Merger Committee as a consultant and testified in the arbitration
proceeding on the longevity factor. Then, after the hearings ended, Harwood
worked as a member of the arbitration panel’s technical assistance team. That
team consisted of technical experts designated by both Merger Committees to
help the panel members obtain data required to generate the seniority list.
Appellants focus on the fact that ALPA rules state that an MEC is
prohibited from hiring “active member pilots” as consultants and that Harwood
was an active member pilot. However, a separate ALPA rule in the Merger
Policy gives the Merger Committees “complete and full authority” to act on
behalf of the pilots they represent. That authority would include the hiring and
paying of consultants of its choice, thereby making Harwood’s participation
completely consistent with ALPA policy. It is unclear how these provisions are
meant to interact, but a union’s interpretation of its own governing documents
is entitled to deference unless the interpretation is “patently unreasonable,” 16
which ALPA’s interpretation is not. The Merger Policy vests broad discretion
in the Merger Committees to create seniority lists, and the provisions of ALPA
15 After the two airlines merged, the United pilots were in the majority and could vote
to decertify ALPA as its collective bargaining agent. This would significantly decrease
ALPA’s membership and thus membership dues it would receive.
16 O’Neill, 939 F.2d at 1206 (quoting Newell v. Int’l Bhd. of Elec. Workers, 789 F.2d
1186, 1189 (5th Cir. 1986)).
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policy that prohibit active member pilots from consulting specifically limits
this prohibition to MECs: It does not apply to Merger Committees.
Appellants also allege that ALPA encouraged – or at least did not
discourage – Harwood’s participation in the arbitration process. However, it
was the United Merger Committee, not ALPA, that had the authority to hire
Harwood as a consultant and did so. Appellants adduced no evidence to show
that bad faith motivated ALPA’s decision not to prevent Harwood’s
participation.
Appellants further claim that they were misinformed as to the nature of
Harwood’s participation in the arbitration proceedings. They claim that they
were led to believe that Harwood would work only in a technical capacity, yet
he also testified on longevity. Appellants did not object to Harwood’s testimony
or service at any point during the arbitration. Moreover, the arbitrators had
full authority to exclude Harwood if they believed that his testimony was
inappropriate or that he lacked credibility, but they did not do so.
Appellants finally insist that ALPA violated its policy by paying
Harwood. ALPA policy provides that “ALPA shall not, under any
circumstances, pay any legal or consulting fees incurred by pilot groups
involved in merger activity between any two ALPA represented carriers.”
Rather, such fees must be paid from a fund maintained by the MEC, and
ALPA’s annual report for 2012 reflected a payment to Harwood. However, the
record clearly shows that checks to Harwood were drawn on United’s Merger
Assessment Fund, strictly in accordance with ALPA policy: ALPA insists that
the inclusion of this payment on the 2012 annual report was a mistake. Thus,
Harwood’s participation, testimony, and payment does not constitute a breach
of the duty of fair representation by ALPA.
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b. Discovery Disputes
Under its Merger Policy, ALPA was required to obtain discoverable
records from both United and Continental and to provide those records to the
pilot groups during arbitration. Appellants contend that ALPA helped United
win discovery disputes. This claim relates to the arbitrator’s denial of
Continental’s request for United pilots’ W-2s and the arbitrator’s grant of
United’s request for the dates on which Continental pilots joined the airline’s
defined benefits plan.
Appellants maintain that ALPA’s decision to send a representative to the
hearing on Continental’s request for United pilots’ W-2s supports this
contention. Appellants allege that inappropriate ex-parte communications took
place between the arbitrator and ALPA’s representative at the hearing,
ultimately leading the arbitrator to deny Continental’s request. However, the
record shows that the ALPA representative engaged only in pleasantries with
the arbitrator and did not discuss any substantive matters. In addition, the
arbitrator’s award at least partially favored Continental’s position because he
concluded that parts of the W-2s were necessary and appropriate. He simply
ordered that the request for pay data must be subject to narrow restrictions to
address privacy concerns.
On the other hand, ALPA did not send a representative to the hearing
on United’s discovery request, which was granted. Appellants contend that this
too is evidence of bad faith. As stated by the district court, however, “[t]he
differences between the discovery sought in each of the two production requests
and the limits on the documents produced to protect individual pilot privacy
while allowing each side to obtain needed information, are amply
demonstrated in the record.” ALPA’s duty to facilitate and obtain discovery
between the parties is not as sensitive when requesting for the date a defined
benefits plan started as it is when requesting specific pilot income and tax
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information from a pilot’s W-2. Appellants have adduced no evidence that
ALPA acted with bad faith regarding the discovery disputes.
c. Ex Parte Communications
Appellants also assert that ALPA’s director of representation, Bruce
York, engaged in ex parte communications with one of the arbitrators. These
communications include: (1) an email from York to the arbitrator stating “we’ll
soon see all three photos on the wall in the U.S. Post Office,” (2) an email from
the arbitrator to York stating “Will call you when I can give you a progress
report on how things are going,” (3) a statement by the arbitrator to York that
the panel was on schedule to issue the award and that he had “more later” to
say, and (4) a statement by the arbitrator two days before the award was issued
that “one of these days I’ll tell you some stories.” Such utterances might be
unprofessional, but Appellants adduced no evidence to support their claim that
ALPA was acting in bad faith with regard to these statements. Appellants only
speculate that there is an underlying scheme in which the arbitrators are
concerned about political consequences for ALPA because they want to
continue to serve as ALPA arbitrators in future disputes. As Appellants fail to
make a connection between these statements and bad faith on the part of
ALPA, they do not meet the standard necessary to avoid summary judgment.
Appellants have also failed entirely to show that any of ALPA’s conduct
“contributed to the erroneous outcome of the . . . proceedings.” 17 The seniority
list created by the arbitrators contains a full explanation of the factors that
were considered in creating that list, including all of the factors that were
required by the ALPA Merger Policy. The panel’s seniority list is supported by
ample evidence and by testimony that the way in which the arbitrators
considered various factors to create the list is the best approach. Appellants
17 Hines, 424 U.S. at 568.
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have raised no material fact issue that any alleged breach of the duty of fair
representation on the part of ALPA affected the arbitrator’s award in any way.
The district court did not err in granting ALPA’s motion for summary
judgment.
B. The District Court’s Focus on Fairness Versus Bad Faith
Appellants also contend that the district court erred by improperly
focusing on the establishment of “a fair process for determining seniority” in
the creation of a seniority list which, they argue, is to be limited to cases in
which there is an alleged to be breach of the duty of fair representation through
discrimination. The district court did discuss fairness in its opinion, but
Appellants are completely wrong in asserting that the court did not adequately
analyze ALPA’s conduct in light of the allegation of bad faith. To the contrary,
the court’s opinion is replete with analyses of bad faith.
IV.
CONCLUSION
We AFFIRM the district court’s judgment dismissing Appellants’ action
with prejudice.