Service Employees International Union v. National Union of Healthcare Workers

598 F.3d 1061, 187 L.R.R.M. (BNA) 3569, 2010 U.S. App. LEXIS 5337, 2010 WL 891286
CourtCourt of Appeals for the Ninth Circuit
DecidedMarch 15, 2010
Docket09-15855
StatusPublished
Cited by25 cases

This text of 598 F.3d 1061 (Service Employees International Union v. National Union of Healthcare Workers) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Service Employees International Union v. National Union of Healthcare Workers, 598 F.3d 1061, 187 L.R.R.M. (BNA) 3569, 2010 U.S. App. LEXIS 5337, 2010 WL 891286 (9th Cir. 2010).

Opinion

BRIGHT, Circuit Judge:

When a continuing dispute over policy matters resulted in a final breakdown between the plaintiff Service Employees International Union (“SEIU”), and the leaders and officers of a local affiliate United Healthcare Workers (“UHW”), SEIU imposed a trusteeship over UHW. In response, the leaders and officers of UHW immediately resigned and organized a rival union, National Union of Healthcare Workers (“NUHW”), to compete with UHW for the representation of approximately 150,000 California healthcare workers. SEIU, UHW, and others immediately brought suit seeking injunctive relief to obtain restoration of its properties it alleged were illegally taken by the former officers and leaders of UHW. Defendants-appellants (the former officers, leaders, and NUHW) appeal from the issuance of a temporary restraining order (“TRO”), asserting that the district court lacks jurisdiction in these proceedings under section 301(a) of the Labor Management Relations Act (“the Act”), 29 U.S.C. § 185(a).

For the reasons explained below, we conclude that the TRO is an appealable interlocutory order in the nature of a preliminary injunction, that this appeal is not moot, and that the district court possessed jurisdiction under section 301(a). We therefore affirm.

I. Background and Procedural History

A. Background

Plaintiff-appellee SEIU is an international labor organization with approximately one-hundred-fifty local affiliates and two million members. Plaintiff-appellee UHW is a local labor organization affiliated with SEIU that represents approximately 150,-000 healthcare workers. UHW has been a part of SEIU since the 1930s.

In recent years, the leaders of SEIU and UHW disagreed over various policy *1065 matters not germane to this appeal. As a result of those disagreements, SEIU decided to impose a trusteeship on UHW pursuant to the SEIU constitution, under which SEIU would take full charge of the affairs of UHW. Relevant to this appeal, Article VIII, Section 7 of the constitution provides:

(c) Upon the institution of the trusteeship, all moneys, books and property of the Local Union or affiliated body shall be turned over to the Trustee.
(e) The Trustee shall take possession of all the funds, books, papers and other property of the Local Union or affiliated body.

In the weeks and months preceding imposition of the trusteeship, the then-leaders of UHW, who are the individual defendants-appellants in this suit, commenced a strategy to vigorously resist the trusteeship, disrupt union operations, and undermine the ability of any trustee to govern. For example, some individual defendants established a shadow email system through which they discussed how UHW should and would resist imposition of the trusteeship. In short, the leaders planned to orchestrate an ungovernable situation.

Once the trusteeship was imposed on UHW in January 2009, the trustees relieved the individual defendants of management responsibility. Several of the individual defendants departed their offices knowing that the offices were occupied by stewards and rank-and-file members who had barricaded themselves inside to resist the trusteeship. The district court found credible evidence established that those remaining inside removed or destroyed records and information. Further, although the individual defendants may not have expressly ordered or participated in the havoc, they anticipated the likely course of events and expected havoc to ensue. UHW information and property was removed or hidden with the tacit approval of the individual defendants. After being relieved of management responsibilities, the individual defendants resigned from UHW completely and formed a new union, defendant-appellant NUHW, to compete with UHW.

B. Procedural History

One day after imposition of the trusteeship, SEIU, UHW and others 1 brought an action in federal court against NUHW, the former officers of UHW, and others. 2 In the first of seven claims, 3 SEIU sought injunctive relief under section 301(a), which provides:

Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any dis *1066 trict court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.

29 U.S.C. § 185(a).

SEIU’s section 301(a) claim complained that the individual defendants “obstructed the effectuation of the trusteeship” in violation of the SEIU constitution. SEIU alleged that the individual defendants refused to turn over to the trustee moneys, books, and property of UHW as required by Article VIII, section 7, of the constitution, and wrongfully retained or destroyed UHW records and property. SEIU sought temporary and permanent injunctive relief restraining appellants from “obstructing the effectuation of the trusteeship,” and from “destroying, retaining, using, sharing, or failing to return or protect UHW’s property,” including confidential information. SEIU also sought relief requiring certain individual defendants to vacate their positions as trustees of an SEIU benefit fund.

In March 2009, SEIU filed an ex parte application for a TRO along with an order to show cause. Both sides briefed the matter. Appellants disputed the district court’s jurisdiction under section 301(a) to enjoin the individual defendants. On April 9, 2009, following a two-day evidentiary hearing, the district court granted the TRO. The district court determined that SEIU established a likelihood of success on the merits of their section 301(a) claim as well as a likelihood of irreparable injury if relief was denied. These conclusions are not challenged in this appeal. The district court rejected appellants’ jurisdictional challenge, determining that a section 301(a) claim may be asserted against individual defendants so long as only injunetive relief is sought. In the alternative, the district court issued the TRO pursuant to its authority to manage civil discovery.

The TRO required appellants to (1) preserve UHW property within their possession, custody and control; (2) return to UHW all non-electronic UHW information; (3) duplicate all electronic information on any electronic storage medium; and (4) catalogue any withheld material. The TRO required compliance with the majority of its provisions within one week, but contained no expiration date. Instead, the TRO required compliance with its orders “pending resolution of the motion for a preliminary injunction,” which had not yet been filed. On April 27, 2009, appellants timely appealed the TRO.

Meanwhile, the attorneys for both sides set to work, filing a deluge of motions and memoranda.

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598 F.3d 1061, 187 L.R.R.M. (BNA) 3569, 2010 U.S. App. LEXIS 5337, 2010 WL 891286, Counsel Stack Legal Research, https://law.counselstack.com/opinion/service-employees-international-union-v-national-union-of-healthcare-ca9-2010.