Aguinaga v. John Morrell & Co.

112 F.R.D. 671, 124 L.R.R.M. (BNA) 2898, 1986 U.S. Dist. LEXIS 18807
CourtDistrict Court, D. Kansas
DecidedOctober 21, 1986
DocketCiv. A. No. 83-1858
StatusPublished
Cited by23 cases

This text of 112 F.R.D. 671 (Aguinaga v. John Morrell & Co.) is published on Counsel Stack Legal Research, covering District Court, D. Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Aguinaga v. John Morrell & Co., 112 F.R.D. 671, 124 L.R.R.M. (BNA) 2898, 1986 U.S. Dist. LEXIS 18807 (D. Kan. 1986).

Opinion

OPINION AND ORDER

THEIS, District Judge.

This matter is presently before the Court on the motions of the defendants, United Food and Commercial Workers International Union, AFL-CIO/CLC, and Local 340 of the United Food and Commercial Workers (“the unions”) and John Morrell & Company, for review of the magistrate’s order granting plaintiffs’ motions to compel the defendants to produce certain documents. The standard of review applicable to the present motion is set forth in 28 U.S.C. § 636(b)(1)(A), which states that a magistrate’s order shall not be set aside unless it is found to be “clearly erroneous or contrary to law.” This Court has held that “[a]n abuse of discretion can be found ... only if no reasonable person would take the view adopted by the magistrate ... or if the magistrate’s order was arbitrary and capricious.” Devore & Sons, Inc. v. Aurora Pacific Cattle Co., 560 F.Supp. 236, 239 (D.Kan.1983).

I. FACTS

The following facts are essentially agreed upon by the parties, with characterizations or allegations noted as they occur. The defendants, Morrell and the unions, have been involved in collective bargaining with each other or their predecessors since the 1940’s. The Morrell plant at Arkansas City, Kansas, known as the Rodeo plant, was covered by a local agreement until the mid 1960’s when it became part of a multi-plant bargaining unit covered by a Master Agreement. The Master Agreement between the unions and the company governed the terms and conditions of employment at all Morrell-owned plants covered by its terms, which included plants in Arkansas City, Kansas; Memphis, Tennessee; El Paso, Texas; Fort Smith, Arkansas; Sioux Falls, South Dakota; East St. Louis, Illinois; Estherville, Iowa; Cincinnati, Ohio; and St. Paul, Minnesota.

On September 1, 1979, Morrell and the local union signed a new comprehensive collective bargaining agreement, known as the Master Agreement, which by its terms expired on September 1, 1982. By 1981, Morrell, faced serious financial problems. Many of its plants were losing money because Morrell’s labor costs under the 1979 Master Agreement were higher than those of Morrell’s regional competitors. Morrell requested that the unions make wage and benefit concessions and stated that it might be forced to close certain plants if concessions were not made. The requests were rejected, after which Morrell issued notices of closing at several of its plants.

On December 16, 1981, Morrell issued a notice of closing at the Rodeo plant in Arkansas City, Kansas. This notice, which was required by the collective bargaining agreement, allowed Morrell to close the Rodeo plant in six months in the event that formal negotiations proved unsuccessful. At that time, Morrell’s president, Donald Slotkin, asked his general counsel, Ray Gass, and outside counsel to determine the legal ramifications of closing Rodeo. Slot-kin also asked Gass to analyze the legal effect of the collective bargaining agreement on such matters as selling the plants or reopening them at a later date if they could be operated economically.

On May 13 and 14 of 1982, at a negotiating meeting with the union, the company made its only offer for a new wage and benefit package to keep the Ark City plant open. Although representatives of the union were angry about the offer, they presented the issue for a vote to the Rodeo [674]*674workers on May 18,1982. The members of Local 340 voted unanimously to support their bargaining committee’s decision to reject that offer. On June 19, 1982, the Rodeo plant closed as scheduled.

In August of 1982, Morrell asked the union for the right to reopen the plants outside the restrictions and wages specified in the Master Agreement. Morrell proposed to delete sections 100 and 101 of the Master Agreement, which sections could be read to restrict Morrell’s ability to resume operations at the closed plant. Section 100 prohibited Morrell from obtaining production at a closed plant for five years by leasing, selling or contracting the plant out to a third-party producer. Section 101 stated that if the company were to establish a new plant in the Midwest or far West — but not the Southeast, Southwest or Northeast — it would come under the Master Agreement. The unions opposed Morrell’s requests regarding sections 100 and 101. On August 31, 1982, the 1979 Master Agreement expired. The union and the company continued their negotiations concerning a new Master Agreement during the first few days of September.

Initially, Morrell sought to eliminate Section 100 from the Master Agreement and requested a concession that would enable it to reopen all of the closed plants, not just Ark City. Later Morrell softened its bargaining position and suggested that Section 100 could remain untouched, but Section 101 should be interpreted as placing four of the six plants outside the reach of the Master Agreement. All parties agree that these negotiations were the most acrimonious ever held between Morrell and the union. On September 10, 1982, Eugene Cotton, counsel for the union, declared that a fraud suit would be filed if Morrell were to reopen. •

Morrell and the union executed two side letter agreements on September 10, 1982. The first letter stated that for purposes of Section 101, the Fort Smith, El Paso and Ark City plants were in the “Southwest” and the Memphis plant was in the “Southeast,” thereby excluding them from Section 101. The second letter stated that nothing in the Master Agreement precluded Morrell from reopening those plants and, if Morrell did, they would not be subject to the Master Agreement. In essence, the union agreed that Morrell could reopen the Ark City plant without violating the Master Agreement and without any contractual obligation to recognize the former union or rehire any of its members. The unions suggest that their inducement to enter this agreement was the ability to end a strike and preserve over 2,600 members’ existing jobs at Sioux Falls and East St. Louis, on whose behalf the contract was negotiated. It is these negotiations that plaintiffs characterize as the “first conspiracy.” The plaintiffs submit that during the same time frame the union was privately agreeing to allow Morrell to reopen the Ark City plant, the union represented in a newsletter to its members at the Sioux Falls, South Dakota plant that it would be devastating to accede to Morrell’s demands that it be permitted to reopen the Rodeo plant.

On March 24, 1983, the Rodeo plant was reopened by Morrell as the Ark City Packing Company (“ACPC”). The new plant was restricted to a pork kill and cut operation. Morrell hired a new work force, smaller in size than before because of the reduced scope of the plant operation. Mor-rell’s hiring criteria resulted in the hiring of a mix of workers: some people who had not formerly worked for Rodeo and who had not been members of Local 340 and some who were employees and members when Rodeo closed. During the startup of ACPC, the International Union notified Morrell that it represented the former members of Local 340 and asserted that the company was obligated to hire its entire workforce from those former members. Morrell declined to do so.

One week after the Rodeo reopening, the union filed with the National Labor Relations Board (“NLRB”) a charge of unfair labor practices against Morrell, alleging that the company had unilaterally altered the terms and conditions of employment and attempted to avoid its collective bar[675]*675gaining obligations.

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Bluebook (online)
112 F.R.D. 671, 124 L.R.R.M. (BNA) 2898, 1986 U.S. Dist. LEXIS 18807, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aguinaga-v-john-morrell-co-ksd-1986.