Pease v. Production Workers Union & Vicinity Local 707 , 386 F.3d 819 ( 2004 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 04-1928
CHRISTOPHER PEASE, VINCE VITI,
WILLARD BERGE, and MICHAEL GEAR,
Plaintiffs-Appellants,
v.
PRODUCTION WORKERS UNION OF
CHICAGO AND VICINITY LOCAL 707;
RANDALL INDUSTRIES, INC.; and
RANDALL RENTS OF INDIANA, INC.,
Defendants-Appellees.
____________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 02 C 6756—James F. Holderman, Judge.
____________
ARGUED SEPTEMBER 28, 2004—DECIDED OCTOBER 15, 2004
____________
Before BAUER, EASTERBROOK, and MANION, Circuit Judges.
EASTERBROOK, Circuit Judge. Local 707 of the Production
Workers Union and Local 150 of the Operating Engineers
Union have been engaged in a long-running battle for the
right to represent truck drivers and associated workers at
Randall Industries. The workers have twice voted in favor
of Local 707, which the NLRB has certified as their bar-
2 No. 04-1928
gaining representative; the Board has rejected Local 150’s
contentions that the employer committed unfair labor prac-
tices during the campaigns. But Local 150 has refused to
give up, and the Board has ordered it to refrain from
threatening adherents to Local 707. We have enforced the
Board’s order and held Local 150 in contempt for violating
some of its terms. Still the battle continues. In this liti-
gation four employees (with the aid of counsel furnished by
Local 150) contend that Randall failed to carry out its col-
lective bargaining agreement with Local 707. To succeed in
such an action, the employees first must show that Local
707 violated its duty to represent them. See DelCostello v.
Teamsters, 462 U.S. 151, 163-65 (1983) (discussing the ele-
ments of a hybrid duty-of-fair-representation and contract
action); Vaca v. Sipes, 386 U.S. 171, 184-86 (1967) (same).
The district judge dismissed or granted summary judgment
to Randall and Local 707 with respect to three employees’
principal claims. See 2003 U.S. Dist. LEXIS 458 (N.D. Ill.
Jan. 10, 2003); 2003 U.S. Dist. LEXIS 14751 (N.D. Ill. Aug. 22,
2003); 2003 U.S. Dist. LEXIS 20238 (N.D. Ill. Nov. 7, 2003).
Other claims were submitted to a jury, which rejected all
except one theory advanced by Willard Berge. The district
judge then entered judgment in defendants’ favor as a mat-
ter of law under Fed. R. Civ. P. 50. 2004 U.S. Dist. LEXIS 4055(N.D. Ill. Mar. 12, 2004). All four plaintiffs have appealed, but
their joint brief does not advance any argument on behalf
of Michael Gear. This abandons his claim. And neither
Christopher Pease nor Vince Viti seeks appellate review with
respect to any theory that the jury rejected; their argu-
ments are limited to claims that the district judge resolved
before trial.
Pease appears to be engaged in bankruptcy fraud: he pros-
ecuted this suit simultaneously with a personal bankruptcy
in which he omitted from his schedule of assets the existence
of this chose in action. Although the district judge rejected
Randall’s contention that the trustee in bankruptcy is the
No. 04-1928 3
only entity authorized to prosecute a claim on Pease’s be-
half (and for the benefit of his creditors rather than Pease
personally), Randall has reasserted that argument on ap-
peal. Pease does not meet it on the merits. Instead he asks
us to ignore the point, asserting that Randall’s decision not
to file a cross-appeal forecloses the subject. Not so. A pre-
vailing litigant may defend its judgment on any ground
preserved in the district court. See Massachusetts Mutual
Life Insurance Co. v. Ludwig, 426 U.S. 479 (1976). This
contention was raised in the district court and thus is open
to decision here.
We need not get into the subtle question whether there is
any way in which a debtor in bankruptcy could prosecute a
high-stakes claim such as this after concealing it from his
creditors. Compare Morlan v. Universal Guaranty Life
Insurance Co., 298 F.3d 609 (7th Cir. 2002) (claims formally
abandoned by a trustee revert to the debtor even if not
scheduled, though the abandonment may be rescinded if
induced by concealment), with Leon v. Comcar Industries, Inc.,
321 F.3d 1289 (11th Cir. 2003) (employees who conceal con-
tract or other substantial claims from their creditors cannot
pursue them during or after bankruptcy). Pease’s claim be-
longs to his creditors (represented by the trustee); and the
trustee, although notified belatedly, has declined either to
prosecute the litigation or to relinquish it to Pease by formal
abandonment. Pease has forfeited any opportunity to argue
that the trustee did abandon it to him directly or by inaction
after learning of its existence. Not that Pease had much of a
claim to begin with. Local 707 took his discharge to arbitra-
tion and lost, following detection of another fraud: he did not
have the sort of driver’s license that he falsely had told
Randall that he possessed and that was essential to his
employment. None of the criteria for upsetting an arbi-
trator’s award is even arguably satisfied.
Viti was laid off about a month after his hire. As the most
junior employee, he was most exposed to the vagaries of
4 No. 04-1928
business, and it is undisputed that Randall reduced its staff
after demand for its services slackened. Last hired, first fired,
is what the collective bargaining agreement provided. It does
not matter whether Viti had graduated from “probationary”
status under the collective bargaining agreement; he was
still the most junior. That Local 150 continues to argue on
his behalf (and that of Pease) implies that this is vexatious
litigation.
This leaves Berge, who advances several theories. The one
on which the jury voted in his favor is that Randall de-
parted from the collective bargaining agreement when it
laid him off in favor of Roy Walker. Berge was hired in
August 2001 and laid off in May 2002 in order to make
room for Walker, who had more seniority than Berge as a
truck driver but had been working in sales for the previous
seven months. Walker testified, without contradiction, that
he had been promised when he transferred to the sales posi-
tion that he could go back to driving if the new job did not
pan out. Berge insists, however, that the instant Walker
left the bargaining unit he lost all his seniority, so that he
could not displace any other employee. Randall and Local
707 took the view that workers who transfer from one job to
another at Randall do not lose seniority—at least, that such
an internal transfer should be treated no worse than a
layoff, and the collective bargaining agreement provides
that seniority lasts for a year following a layoff. Local 707
therefore supported Walker, and by doing this (Berge insists)
deprived him of the “fair representation” that unions must
provide to everyone they represent. The jury heard evidence
that Local 707 was hostile to Local 150 and its supporters,
of whom Berge was one. It also heard evidence that Local
707 and Randall had an understanding, in place before
Walker bumped Berge, that workers who transferred to
other positions at Randall kept their seniority in the event
of a return to the bargaining unit. It was this evidence,
which the district judge viewed as undisputed, that led to
the Rule 50 judgment in defendants’ favor.
No. 04-1928 5
According to Berge (and Local 150), the jury was free to
disbelieve the sole witness who testified about this under-
standing, which had not been reduced to writing. And if the
jury could disbelieve the testimony, Berge insists, then it
also could find that Berge had the superior right to the
position, for he had eight months’ seniority and Walker had
none. The argument is half right. Juries can reject testi-
mony, but doing so is not the same thing as evidence to the
contrary. See, e.g., Krist v. Eli Lilly & Co., 897 F.2d 293 (7th
Cir. 1990). That’s an old, and very important, ingredient in
the law of evidence. A jury’s decision to disbelieve a witness
(or conclude that the witness did not have an opportunity to
observe or learn what happened) is consistent with that
witness’s proposition being true. Someone else may have had
better knowledge, or better memory, or better ability to
relate and thus to persuade. And if there is no other
witness—as there was none in this case—that leaves a hole
in the record. We do not know whether the proposition is
true or false. (The wrinkle noted in United States v. Zafiro,
945 F.2d 881, 888-89 (7th Cir. 1991), affirmed on other
grounds, 506 U.S. 534 (1993)—that disbelief of a criminal
defendant’s exculpatory testimony can imply consciousness
of guilt and thus, like flight to avoid prosecution, add to the
evidence in support of conviction—is not applicable here,
and we need not discuss how far this proviso extends. See
Stallings v. Tansy, 28 F.3d 1018 (10th Cir. 1994); United
States v. Zeigler, 994 F.2d 845 (D.C. Cir. 1993).) When the
record is silent, all turns on who had the burden of persua-
sion (better, the risk of non-persuasion) with respect to the
point. See EEOC v. G-K-G, Inc., 39 F.3d 740, 746-47 (7th
Cir. 1994); NLRB v. Cutting, Inc., 701 F.2d 659, 663 (7th Cir.
1983).
So let us throw out the testimony about prevailing prac-
tices and see what happens. The answer is that Berge, as
the plaintiff, is no better off, for a plaintiff bears the risk of
non-persuasion. The collective bargaining agreement is
6 No. 04-1928
silent about how internal transfers affect seniority; it is not
as if Randall needed to show that there had been an oral
modification of the agreement. Transfers are un-pro-
vided-for situations—and unless something requires trans-
ferees to lose their seniority, then they retain it.
Given the lack of provision in the collective bargaining
agreement, it is impossible to see how Local 707 could be
deemed to have abandoned its duty of fair representation
when it took the position that Walker retained his seniority.
Unions regularly fight tooth and nail to establish seniority
systems and avoid forfeitures of that benefit, which favors
longer-term workers (and longer-term members!) over
newcomers. Local 707 behaved according to expectations.
Had the union instead supported Berge, then Walker would
have had a much stronger claim that it had violated its
duty.
Solving intra-workplace conflicts by seniority and nego-
tiation is a principal function of labor unions. Federal law
encourages the sort of thing that Local 707 did. Conflicting
claims are worked out amicably between unions and employ-
ers, not in litigation that puts the law of the shop to a jury
that may know little about the participants’ reasonable ex-
pectations or the exigencies of industrial relations. Federal
labor law ensures that disputes of this kind are resolved by
the affected parties over the bargaining table, or by arbitra-
tors knowledgeable about the business, rather than in
court. That’s why a hybrid contract/DFR suit does not get to
first base unless the worker shows that the union has
abandoned him to the wolves.
Welcoming support—Local 707 naturally thought better
of those who favored its role and opposed Local 150’s efforts to
oust it—differs from abandoning anyone. Many a union (or
public agency, for that matter) faithfully protects its politi-
cal opponents—often from a sense of duty, and if that is
lacking from a desire to improve its prospects of reelection.
No. 04-1928 7
Recall that Local 707 took the Pease discharge to arbitration
despite the claim’s weakness. Local 707 had a temptation to
disfavor Berge, but did it yield to temptation? In the
language of criminal law, where’s the actus reus? Of that
there is no evidence. Berge does not contend that, when the
roles were reversed—when a supporter of Local 150 moved
from one job to another—Local 707 contended that the trans-
fer stripped the employee of seniority. Nothing in this record
so much as hints that any defender of Local 707 has been
treated better than Berge under similar circumstances. So
the case should not have gone to trial. No reasonable jury
could find that Local 707 failed to afford Berge objectively
even-handed representation. That it resolved a conflict
between two workers is not a reason to hand the ultimate
decision to a panel of six laymen. A union can be mistaken
in its understanding of the collective bargaining agreement
without departing from its duty of fair representation; other-
wise every claim of error would lead to a jury trial, and the
need to show a denial of fair representation would merge
into the merits.
Plaintiffs’ other arguments have been considered and
need not be discussed.
AFFIRMED
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—10-15-04