International Association of Machinists & Aerospace Workers, Afl-cio v. Eastern Airlines, Inc., Appellant, 849 F.2d 1481 (D.C. Cir. 1988)

In July 1987, the District Court issued a preliminary injunction ("July injunction") prohibiting Eastern Air Lines, Inc. ("Eastern") from spinning off its fleet service employees into a wholly owned subsidiary, and ordering it to maintain the status quo until it exhausted the dispute resolution procedures of the Railway Labor Act ("RLA"), 45 U.S.C. §§ 151-188 (1982). In March 1988, the court issued an order ("March order") adjudging Eastern in contempt of the July injunction after the carrier announced plans to spin off its East Coast air shuttle operations ("shuttle") into a majority-owned subsidiary of Texas Air Corporation ("Texas Air"), Eastern's corporate parent.

We decline to consider any claims raised by Eastern regarding the legality of the July injunction because Eastern voluntarily dismissed an earlier appeal from that injunction and agreed to abide by its terms. As for the March order, we first find that the July injunction did not prohibit the shuttle transaction, and that the District Court thus issued a new or modified injunction when it enjoined its consummation. Consequently, we have jurisdiction under 28 U.S.C. § 1292(a) (1) (1982), which permits an immediate appeal from the issuance of a new or modified injunction. We next find that the March order must be vacated because the District Court did not make the factual findings or consider the relevant criteria necessary to support the issuance of a new or modified injunction. The March order shall remain in effect for 10 days after the issuance of this court's mandate, however, during which time the International Association of Machinists and Aerospace Workers ("IAM") may request injunctive relief covering the shuttle transaction.

IAM is the certified representative of 13,000 Eastern employees, approximately 6,000 of whom are fleet service workers who perform such tasks as baggage handling and aircraft cleaning and fueling. For the past 42 years, all of Eastern's IAM employees have been covered by a single collective bargaining agreement, the most recent of which was signed on May 16, 1985. Article 30 of this agreement contains a moratorium provision which reads in pertinent part: "This entire Agreement shall continue in full force and effect through December 31, 1987, and thereafter shall be subject to change as provided for in Section 6 ... of the Railway Labor Act, as amended." Joint Appendix ("J.A.") 25.

On June 23, 1987, Eastern advised IAM of its decision to transfer all of its fleet service employees to Airport Ground Services Corporation ("AGS"), a wholly owned subsidiary of Eastern. The next day, IAM sought declaratory and injunctive relief in the District Court, claiming that the involuntary transfer of IAM-represented employees amounted to an unlawful alteration of the status quo and undermined its ability to represent its members. Following a hearing on June 24, the District Court found that the proposed fleet service transaction created a "major" dispute under the RLA,¹  and it entered an order temporarily enjoining Eastern from changing the status quo and from interfering with IAM as the certified bargaining representative of its fleet service employees. IAM v. Eastern Air Lines, No. 87-1720 (D.D.C. June 24, 1987), reprinted in J.A. 31.

A hearing was held on IAM's motion for a preliminary injunction on July 2, 1987. At its conclusion, the District Court issued the July injunction, in which it ordered Eastern to maintain the status quo as of June 24, 1987, "by recognizing the validity and acting in accordance with all the terms and conditions" of the parties' collective bargaining agreement, "including its moratorium provision." IAM v. Eastern Air Lines, No. 87-1720 (D.D.C. July 2, 1987), reprinted in J.A. 159. The court further enjoined Eastern "from unilaterally changing or modifying the rates of pay, rules, and working conditions of its fleet service employees" until it "exhaust [ed] the procedures mandated by the Railway Labor Act for altering or amending collective bargaining agreements." Id., J.A. 160. Eastern immediately noticed an appeal of the July injunction.² 

Eastern's appeal from the July injunction had been briefed by both sides and was scheduled for oral argument before this court when, on February 4, 1988, Eastern moved for voluntary dismissal, claiming that its appeal was moot because it had decided to abandon the AGS transaction. The next day, Eastern announced that it had entered into an agreement to sell the shuttle's assets to Air Shuttle Holdings ("ASH"), a business entity whose majority owner would be Texas Air, in exchange for $225 million. Eastern indicated that, under the purchase agreement between it and Texas Air, the 865 or so Eastern employees working on the shuttle--including approximately 260 represented by IAM--would not be transferred involuntarily to ASH. Instead, according to Eastern, positions at ASH would be offered to Eastern's shuttle employees in seniority order.³  With regard to those shuttle employees wishing to remain at Eastern, Eastern and Texas Air declared their "intent" that the transaction produce "no loss of employment" and that it have a "minimum impact on the employees of [Eastern]." J.A. 230.

The announcement of the shuttle transaction prompted IAM to take two actions. First, it opposed Eastern's motion for voluntary dismissal by "strenuously disput [ing] appellants' characterization of [the] appeal as moot." J.A. 335. This court agreed. In an order issued on February 16, 1988, Eastern's appeal was dismissed solely "because the company ... abandoned its claim and ... asserted that it [would] comply with the judgment of the District Court." IAM v. Eastern Air Lines, No. 87-7123 (D.C. Cir. Feb. 16, 1988), reprinted in J.A. 487. Second, IAM asked the District Court to hold Eastern in contempt of the July injunction or, in the alternative, to issue a new preliminary injunction enjoining Eastern from spinning off the shuttle.

A hearing limited to IAM's contempt motion was held by the District Court on February 12, 1988. Nearly a month later, the court issued the March order, in which it adjudged Eastern in civil contempt for violating the July injunction. IAM v. Eastern Air Lines, No. 87-1720 (D.D.C. Mar. 10, 1988), reprinted in J.A. 491. It "further enjoined and restrained [Eastern] from taking any steps to separate" the shuttle "by sale or other means pending exhaustion of the mandatory dispute resolution procedures of the Railway Labor Act." Id., J.A. 492. In a memorandum opinion released on the same day, the court explained that the July injunction "was directed not only to the proposed transfer to AGS but to any substantially similar proposal." IAM v. Eastern Air Lines, No. 87-1720 (D.D.C. Mar. 10, 1988), reprinted in J.A. 503. In its view, the shuttle deal was "not fundamentally different" from the fleet service transaction. Id., J.A. 503. This appeal followed.⁴ 

IAM contends that this court lacks jurisdiction to entertain Eastern's appeal because civil contempt orders are not final orders that are immediately appealable under 28 U.S.C. § 1291.⁵  IAM grounds its argument on a long line of cases stretching back to Doyle v. London Guar. & Accident Co., 204 U.S. 599, 603, 27 S. Ct. 313, 314, 51 L. Ed. 641 (1907), where the Supreme Court held that "an order punishing for contempt made in the progress of the case, when not in the nature of an order in a criminal proceeding, is regarded as interlocutory and to be reviewed only upon appeal from a final decree in the case." See also SEC v. Elmas Trading Corp., 824 F.2d 732, 732 (9th Cir. 1987); Duell v. Duell, 178 F.2d 683, 687 (D.C. Cir. 1949). Although Eastern correctly notes that " [e]xceptions to the rule are plentiful," Drummond Co. v. District 20, UMWA, 598 F.2d 381, 383 (5th Cir. 1979), none is applicable here.

Specifically, this is not a case where an immediate appeal should be permitted because, based "on a pragmatic assessment, it appears that nothing further remains to be done [in the District Court], notwithstanding the lack of formal termination." 15 C. WRIGHT, A. MILLER & E. COOPER, FEDERAL PRACTICE AND PROCEDURE Sec. 3917, at 627 (1976); see, e.g., Peabody Coal Co. v. Local Union Nos. 1734, 1508 & 1548, UMWA, 484 F.2d 78, 84-85 (6th Cir. 1973). To the contrary, IAM filed an amended complaint after the July injunction was issued in which it renewed its earlier request for permanent injunctive relief and a declaratory judgment. IAM also sought to begin discovery. We thus "presume the underlying litigation is still pending in district court, not having been informed otherwise by the parties." Union of Professional Airmen v. Alaska Aeronautical Indus., 625 F.2d 881, 883 n. 2 (9th Cir. 1980).⁶ 

Although no appeal may be taken here pursuant to 28 U.S.C. § 1291, Eastern correctly notes that 28 U.S.C. § 1292(a) (1) permits an immediate appeal from an interlocutory order that grants or modifies an injunction.⁷  Because it believes that the shuttle transaction clearly falls within the broad language of the July injunction, IAM argues that the March order should be construed as a mere interpretation of the July injunction. Eastern disagrees. It claims that the March order must be construed as a new or modified injunction because the July injunction encompasses only the fleet service transaction that was before the District Court in June and July of last year.

The resolution of this dispute⁸  obviously turns on the scope of the July injunction--"a question of law to be determined by the independent judgment of this Court." Drummond, 598 F.2d at 385. We are guided in our inquiry by Washington-Baltimore Newspaper Guild, Local 35 v. Washington Post Co., 626 F.2d 1029 (D.C. Cir. 1980), and section 9 of the Norris-LaGuardia Act, 29 U.S.C. § 109 (1982),⁹  which together stand for the proposition that injunctions in cases involving or growing out of labor disputes must take a rifle-shot, rather than a shotgun, approach. In Washington Post, a union successfully sought an injunction requiring its employer to arbitrate grievances relating to employee discharges. The union later sought to have the employer adjudged in contempt of this injunction for refusing to arbitrate grievances relating to matters such as cost-of-living increases. This court affirmed the trial court's refusal to hold the employer in contempt, even though the injunction stated that the employer had to arbitrate "all grievances." 626 F.2d at 1031 (emphasis added). In so doing, this court emphasized that the trial court had "only discussed arbitration as it applied to the then pending employee discharge disputes" when it issued the injunction. Id. at 1030. The injunction's reach had to be limited, therefore, to transactions "of the same character that were factually before the court at that time." Id. at 1031; see also Drummond, 598 F.2d at 385 ("the injunction must be interpreted in light of the accompanying findings of the district court regarding the subject matter of the grievance underlying the work stoppage"); New York Tel. Co. v. Communications Workers, 445 F.2d 39, 50 (2d Cir. 1971); Fed. R. Civ. P. 65(d).

With these principles in mind, it is clear that the July injunction applies only to the AGS transaction, even though the injunction--like the order at issue in Washington Post--"is, on its face, unlimited in ... scope." Drummond, 598 F.2d at 385. There is nothing in the record from June and July of last year to suggest that the District Court had before it any transaction other than the one involving the fleet service employees. See id. at 387 ("No pattern of repeated work stoppages was submitted by the Company at [the] time [the injunction was issued] from which the court might have concluded that future strikes were likely.").¹⁰  Indeed, the District Court's oral findings of fact and conclusions of law, see J.A. 152-54, were properly limited to that specific transaction. Virginian Ry. v. System Fed'n No. 40, 300 U.S. 515, 563, 57 S. Ct. 592, 607, 81 L. Ed. 789 (1937) ("The evident purpose of [section 9 of the Norris-LaGuardia Act is] ... to confine the injunction to the particular acts complained of and found by the court."). Eastern was not on notice, therefore, that the shuttle sale would be encompassed by the July injunction. See Common Cause v. NRC, 674 F.2d 921, 927 (D.C. Cir. 1982) (an injunction must "give adequate notice ... of the nature of the prohibited activity"); United States Steel Corp. v. UMWA, 519 F.2d 1236, 1245-46 (5th Cir. 1975), cert. denied, 428 U.S. 910, 96 S. Ct. 3221, 49 L. Ed. 2d 1217 (1976). For these reasons, when the District Court enjoined the shuttle transaction in the March order, it necessarily modified the July injunction or issued a completely new injunction. It is immaterial that the court characterized the March order as a finding of contempt. " [A]n injunction does not cease to be appealable under section 1292(a) (1) merely because it is contained in an order for civil contempt." Szabo v. U.S. Marine Corp., 819 F.2d 714, 718 (7th Cir. 1987); see also I.A.M. Nat'l Pension Fund Benefit Plan A v. Cooper Indus., 789 F.2d 21, 23-24 (D.C. Cir.), cert. denied, --- U.S. ----, 107 S. Ct. 473, 93 L. Ed. 2d 417 (1986). Accordingly, we have jurisdiction over Eastern's appeal under 28 U.S.C. § 1292(a) (1).¹¹ 

Eastern voluntarily abandoned its initial appeal from the July injunction and agreed to abide by its terms. As a result, it may not challenge that order in this appeal. See Szabo, 819 F.2d at 718; Bethlehem Mines Corp. v. UMWA, 476 F.2d 860, 863-64 (3d Cir. 1973). We thus assume for the purposes of this appeal that the July injunction is valid.

The standard of review on an appeal from a finding of civil contempt is whether the District Court abused its discretion. Afro-American Patrolmen's League v. City of Atlanta, 817 F.2d 719, 723 (11th Cir. 1987). Having based jurisdiction on 28 U.S.C. § 1292(a) (1) in this case because the District Court issued a new or modified injunction in enjoining the shuttle transaction, we are constrained to conclude that the District Court abused its discretion in simultaneously holding Eastern in contempt of the July injunction.¹²  We reject the Seventh Circuit's view that, even though jurisdiction is based on 28 U.S.C. § 1292(a) (1), an appellate court may nonetheless conclude that the actions cited in a civil contempt order fall within the terms of an earlier injunction. See Motorola, Inc. v. Computer Displays Int'l, Inc., 739 F.2d 1149, 1155-59 (7th Cir. 1984). Even if we were willing to entertain this analytically perplexing approach in some cases, we would not do so in the labor area, where the Norris-LaGuardia Act mandates that injunctions are to be construed in a narrow fashion.

This is not to say, however, that the District Court lacks jurisdiction to consider a request for an injunction barring the shuttle sale. IAM's original complaint is sufficiently broad to encompass the shuttle transaction; thus, if the union renews its request for injunctive relief covering the shuttle deal, and if there are adequate factual, equitable and legal grounds to support such an injunction, the District Court may fashion appropriate relief. See Southern Ry. v. Brotherhood of Locomotive Firemen & Enginemen, 337 F.2d 127, 133-34 (D.C. Cir. 1964). Our sole point is that, in issuing the March order, the District Court did not weigh the relevant criteria, nor did it make the factual findings, necessary to support the issuance of a new or modified injunction. We thus remand to the District Court, where IAM is free to move for a new or modified injunction.

In considering IAM's request for a new or modified injunction, the District Court should be mindful of several points that could loom significant: (1) the decision as to whether the shuttle sale raises a bargainable issue must be made in light of the principle that the "scope of bargainability" under the RLA is "extremely broad" and "has comprehended fields frequently reserved to management in other industrial contexts," Brotherhood of R.R. Trainmen v. Akron & Barberton Belt R.R., 385 F.2d 581, 601 (D.C. Cir. 1967), cert. denied, 390 U.S. 923, 88 S. Ct. 852, 19 L. Ed. 2d 983 (1968); see also First Nat'l Maintenance Corp. v. NLRB, 452 U.S. 666, 687 n. 23, 101 S. Ct. 2573, 2585, n. 23, 69 L. Ed. 2d 318 (1981) (RLA is "not coextensive with the National Labor Relations Act and the Board's jurisdiction over unfair labor practices"); (2) if the shuttle sale is analogous to the closing of a hub, the abandonment of a route or the sale of assets, then a question may be raised whether, under the parties' established bargaining tradition, the proposed action is subject to bargaining, see United Indus. Workers of Seafarers Int'l Union v. Board of Trustees, 351 F.2d 183, 191 (5th Cir. 1965) ("what carriers must legally bargain about is affected by what is in fact bargained about in the railroad world"); and (3) if the shuttle sale raises only a "minor" dispute, then the union's grievance may be subject to mandatory arbitration, see IAM v. Eastern Airlines, 826 F.2d 1141 (1st Cir. 1987), in which event, of course, this action should be dismissed.

IAM will have up to 10 days after the issuance of this court's mandate to request a temporary restraining order (precedent to a preliminary injunction) covering the shuttle transaction. If no temporary restraining order or injunctive relief is granted before the eleventh day after the issuance of this court's mandate, then the March order shall dissolve.¹³  If a temporary restraining order is granted, the District Court shall allow discovery and conduct a hearing pursuant to the requirements of the Norris-LaGuardia Act and the federal rules to determine whether to issue a preliminary injunction.

The judgment of contempt is hereby vacated, and the case is remanded for further proceedings consistent with this opinion.

So Ordered.