County, Municipal Employees' Supervisors' and Foremen's Union Local 1001 (Chicago, Illinois) v. Laborers' International Union of North America

365 F.3d 576, 174 L.R.R.M. (BNA) 2947, 2004 U.S. App. LEXIS 7913, 2004 WL 856564
CourtCourt of Appeals for the Seventh Circuit
DecidedApril 22, 2004
Docket04-1654, 04-8006
StatusPublished
Cited by9 cases

This text of 365 F.3d 576 (County, Municipal Employees' Supervisors' and Foremen's Union Local 1001 (Chicago, Illinois) v. Laborers' International Union of North America) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
County, Municipal Employees' Supervisors' and Foremen's Union Local 1001 (Chicago, Illinois) v. Laborers' International Union of North America, 365 F.3d 576, 174 L.R.R.M. (BNA) 2947, 2004 U.S. App. LEXIS 7913, 2004 WL 856564 (7th Cir. 2004).

Opinion

EASTERBROOK, Circuit Judge.

The Laborers’ International Union sought to put its Local 1001 into trusteeship. Authority to approve trusteeships is vested in an independent hearing officer as a result of a consent decree settling a racketeering suit by the United States. See Serpico v. Laborers’ International Union, 97 F.3d 995 (7th Cir.1996). Concluding that the Local’s leadership had been infiltrated by organized crime, was engaged in financial mischief, and had undermined the Local’s democratic processes, the' independent hearing officer imposed a trusteeship. After the Trustee assumed control, the law firms that had previously represented the Local-filed a suit — in the name of the Local rather than of the ousted officers — in state court. The Trustee promptly fired the law firms (Winston & Strawn LLP and Faraci & Farad) and directed them to take no further action in the Local’s name; mean-while the *578 International removed the suit to federal court on the ground that disputes about trusteeships arise under § 302 of the Labor-Management Reporting and Disclosure Act, 29 U.S.C. § 462.

Still purporting to act for the Local, the law firms filed two motions: first for a remand on the ground that Local 1001 represents only municipal employees and hence is outside the scope of the LMRDA even though the International is a “labor organization” covered by that statute; and second (in the event the first should be denied) for a temporary restraining order that would block the Trustee from exercising any authority over the Local. The district judge denied both motions but certified his decision on the first for interlocutory appeal under 28 U.S.C. § 1292(b). The judge stated that the subject ordinarily would not meet the criteria of that statute but that, as the law firms are entitled to appeal from the order denying their request for a TRO, this court should have the whole dispute before it. The law firms then filed a petition for leave to appeal under § 1292(b) plus an appeal from the denial of the request for a TRO. They concede in this court that denial of a TRO is not appealable — as indeed it is not,.for a TRO is not an “interlocutory injunction” within the meaning of 28 U.S.C. § 1292(a)(1). See Sampson v. Murray, 415 U.S. 61, 86 & n. 58, 94 S.Ct. 937, 39 L.Ed.2d 166 (1974). Instead they argue that the district court’s order is appealable because it has the “effect” of denying an interlocutory injunction. See Gulfstream Aerospace Corp. v. Mayacamas Corp., 485 U.S. 271, 287-88, 108 S.Ct. 1133, 99 L.Ed.2d 296 (1988); Carson v. American Brands, Inc., 450 U.S. 79, 101 S.Ct. 993, 67 L.Ed.2d 59 (1981). But the only reason it might have such an effect would be their own strategy; rather than asking for a preliminary injunction, the law firms immediately appealed. That maneuver cannot be allowed to work. Jumping the gun does not turn an otherwise non-final action into an appealable order. Only when resort to the regular processes of litigation is unavailing, and the judge is unwilling to make a prompt decision even though delay erodes or obliterates the rights in question, does inaction have the “effect” of denying injunctive relief. This district judge has not shown any disposition to dawdle. Thus the premise underlying the district court’s use of § 1292(b) is false. We could deny the petition for leave to appeal on that ground alone, but there is a more fundamental problem: the two law firms have no business purporting to speak on behalf of Local 1001. Both the notice of appeal (No. 04-1654) and the petition for leave to appeal (No. 04-8006) have been filed against express instructions of the litigant purportedly represented.

Article IX § 7 of the International’s constitution provides that a trustee takes full control of a local and exercises all powers that the local’s directors and officers could exercise. This entitles the Trustee to fire the law firms whether or not the LMRDA applies (and, if it does, its provisions give a trustee the same powers; see 29 U.S.C. § 464(c)). A trustee’s powers vest immediately on appointment; judicial approbation is unnecessary. See, e.g., Letter Carriers v. Sombrotto, 449 F.2d 915, 921 (2d Cir.1971) (Friendly, J.). The law firms insist that this would enable the International to prevail even if it acts improperly, for a trustee will block any challenge to his own authority. Yet no trustee can prevent the ousted officers from suing in their own names (as in Serpico) and asking the court to restore them to office. The problem here is that the law firms purport to represent Local 1001 alone. All litigation must occur in the name of the *579 real party in interest, see Fed.R.Civ.P. 17(a), so the judge was obliged to treat this suit as exactly what it purports to be: a claim by the Local rather than by a natural person. Yet these law firms are no longer authorized to speak for the Local.

Responding to the Trustee’s motion to dismiss the appeals, the law firms assert that they have a fiduciary duty to the Local and its members that supersedes any instructions from the Trustee. This breathtaking claim depicts lawyers as ombudsmen authorized to pursue whatever legal remedies they think a client should favor, whether the client agrees or not. It is hard to take seriously. Suppose the board of directors at Alpha Corp. instructs counsel to commence a suit charging Beta Inc. with patent infringement. After a proxy contest in which one issue is the prudence of spending corporate funds on this suit, the directors are thrown out of office, and their replacements direct counsel to dismiss the suit. According to the view advanced by our two law firms, the lawyers could refuse to follow that direction and continue the litigation (presumably at corporate expense) after declaring that they have a “fiduciary duty to the investors” to prosecute any litigation they deem meritorious. Twaddle! The fiduciary duty rests on the directors in our hypothetical, and on the Trustee in the actual events. Counsel’s responsibility is to give good advice and, if unsuccessful in persuasion, to implement the client’s decisions, not to thwart or override them.

These law firms have no responsibility at all, fiduciary or otherwise, for they have been sacked. Clients may dismiss their attorneys for any reason, good or bad, and a fired lawyer has no entitlement — certainly no “fiduciary duty” — to continue acting on the ex-client’s behalf. See generally American Law Institute, Restatement of the Law Governing Lawyers §§ 43, 44 (2000) (collecting authority).

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365 F.3d 576, 174 L.R.R.M. (BNA) 2947, 2004 U.S. App. LEXIS 7913, 2004 WL 856564, Counsel Stack Legal Research, https://law.counselstack.com/opinion/county-municipal-employees-supervisors-and-foremens-union-local-1001-ca7-2004.