As we watch construction and other companies try to move to non-union work and survive, please note you can’t sue in state court on an anti-trust theory to be left alone by the other unions.
Editor’s comment: As hourly rates and benefits continue to soar in construction and other unions, a number of companies are trying to go non-union to survive. Once the effort is made, one may expect the unions to counterattack—the problem for litigators is what to do when that happens.
In Smart v. Local 702 Int’l Bhd. of Electrical Workers, Local 702, (07-4088, issued April 7, 2009) the Seventh Circuit Court of Appeals ruled a state antitrust claim against local union by sole proprietor of nonunion electrical contractor was completely preempted by Federal law.
The Federal appellate court found an Illinois Antitrust Act claim by the sole proprietor of a nonunion company who contracted to perform electrical work for the construction of a sports complex, against the local union whose coercive tactics allegedly caused the complex owner to terminate its relationship with that company, was subject to Garmon preemption.
The specific ruling held:
1) Plaintiff’s stated antitrust claim was preempted by federal law;
2) The Federal District Court properly dismissed Plaintiff’s unwarranted prosecution claim as he had already failed to prevail in the underlying actions; and
3) The Federal District Court properly dismissed Plaintiff’s legal malpractice claim as he did not have an attorney-client relationship with Defendant’s counsel.
The Court noted the activities described in the complaint were arguably prohibited by the National Labor Relations Act (NLRA) section 8(b)(4) prohibiting secondary boycotts. While Garmon alone did not provide a basis for complete preemption, Congress had, in a separate statute, provided a means of redress in federal court with respect to injuries resulting from a secondary boycott. The case was remanded in part for further evaluation where Plaintiff’s complaint includes allegations of secondary boycott activity for which relief is available under 29 U.S.C. sec. 187.
The link to the ruling is: http://www.ca7.uscourts.gov/tmp/MM0L9QTE.pdf <http://www.ca7.uscourts.gov/tmp/MM0L9QTE.pdf> . If you have thoughts and comments, please send them along.
