U.S. Supreme Court Rules in Favor of Graniterock Against Unions
By Tina Grady Barbaccia, News and Digital Editor
The U.S. Supreme Court ruled in favor of Graniterock in a 7-2 vote, a decision that refused to dismiss from the case a local union that went on strike and held it responsible for disregarding a “no-strike” clause contained in the union’s most recent collective bargaining agreement.
The strike forced more than 450 Graniterock employees from their jobs, which effectively “harmed hundreds of [company employee] families, the company’s customers, and the company itself,” Graniterock notes in a written statement. Now the company is seeking “significant strike cost reimbursement, including back pay” for Graniterock’s 450 team members that the company said were forced from their jobs.
In Granite Rock Company v. International Brotherhood of Teamsters & Teamsters Local 287 (Case No. 08–12140), Graniterock took the union to court after concrete ready-mix drivers represented by Teamsters Local 287 went on strike against Graniterock in June 2004.
“The Teamsters Union decided to hold Graniterock team members hostage and use blackmail to escape responsibility for what they did,” says Tom Trainor, a preventative maintenance manager who attended the Supreme Court’s oral argument, in a written statement. “The Court obviously values the promises made in collective bargaining agreements and does not believe that those promises should be easily forgotten or broken.”
Trainor says this ruling means that “unions will now be held responsible for their conduct because of the Supreme Court’s decision, and the payment of damages will push their repugnant actions into the light of day.”
The company and the union settled the strike on July 2, 2004, and the union agreed to go back to work immediately.
However, even after ratifying a collective bargaining agreement that contained the no-strike clause, the union wouldn’t allow its members to return to work unless Graniterock agreed to release the union for damage claims and unfair labor practice charges that occurred during the strike. The union demanded the release to benefit the union locals as well as the International Brotherhood of Teamsters. However, Graniterock refused to release the union so the strike continued for an additional two months.
Graniterock then filed a lawsuit against the local and international unions in the U.S. District Court in San Jose. The suit alleged that Local 287 violated the no-strike clause of the newly ratified agreement, and that the international union was orchestrating the continued strike for its own benefit — i.e. in order to obtain the release.
“Graniterock sought to enforce its labor contracts which the union had violated,” says Tom Squeri, Graniterock general counsel, in a written statement. “During the strike, the union misleadingly stated publicly that it was embroiled in a labor contract dispute with the company over health care and other contract terms…the actual fact was that the union used its own members in a deliberate scheme to escape financial liability.”
The court dismissed Graniterock’s claims against the Teamsters and ruled that the claims were preempted by federal labor law, but the jury unanimously reached a verdict in favor of Graniterock that the bargaining agreement had been ratified. The local union appealed the jury verdict, challenging whether the ruling that the contract had been ratified should have been heard in arbitration instead of by a jury. The Ninth Circuit Court of Appeal ruled in favor of the unions. Graniterock appealed the court’s dismissal of its claims against the Teamsters and petitioned the Supreme Court for review of the Ninth Circuit Court’s ruling.
Graniterock’s case was selected for review by the Supreme Court in June 2009, one of 75 selected from 10,000 cases annually considered for review. Graniterock and the union appeared before the Court in oral argument in January 2010 and the final ruling came on June 24, 2010.
The Supreme Court upheld Graniterock’s 2008 jury verdict against the local union that the collective bargaining agreement was in fact valid after having a jury rule on it instead of an arbitrator. Additionally, the Supreme Court held that federal law does not provide a shield for an international union that uses its influence over a local union to injure an employer.
Although the Supreme Court would not recognize a new federal tort cause of action, it held that it “does not mean that we [the Supreme Court] approve of the IBT’s alleged actions.” The court also ruled that Graniterock may still seek its damage claims from the 2004 strike and described several avenues that the company could pursue against the International Teamsters — such as seeking strike reimbursement.
In the Supreme Court’s opinion, it stated: Graniterock describes a course of conduct that does indeed seem to strike at the heart of the collective bargaining process federal labor laws were designed to protect.
Bruce Woolpert, Graniterock president and CEO, adds in a written statement about the ruling: “There is simply no reason to have a labor contract if the terms and promises in that contract cannot be enforced.”
The U. S. Chamber of Commerce, the National Association of Manufacturers, the Associated General Contractors of America, and the Center for National Labor Policy submitted amicus curiae briefs to the Court with legal arguments supporting Graniterock’s position. The AFL-CIO submitted an amicus brief supporting the Teamsters Union.
For the full Supreme Court decision, go to
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Knife River Minnesota Division hosts Bolivian Dignitary
Knife River Corp.’s Central Minnesota Division hosted Bolivian Governor-elect Santos Tito of the Oruro Province, at its Isanti ready-mix plant in mid May.
The tour, arranged by Minnesota Gov. Tim Pawlenty’s office and guided by Eden Prairie-based EVS Inc., offered Gov. Tito the opportunity to meet with Minnesota companies to identify potential partners for several infrastructure projects he has planned in his province.
Knife River – Central Minnesota’s East Region General Manager Steve Semrau said it was an excellent opportunity to showcase the company’s ready-mix operations and demonstrate Knife River’s environmental commitment.
The Isanti plant, headed by Tim Vidor, has underground feed bins for aggregate to control dust at the site. Employees take great care to reduce additional dust and pollution on the plant site.
“We take great pride in our work, and I think we showed Governor Tito how to operate a well-maintained ready-mix plant,” Semrau said in a written statement.
EVS executive Andy Kim notes that some of the projects Gov. Tito is interested in include concrete and cement plants, airports, highways and bridges, and heath care facilities.
“The Bolivian president has a strong stance on environmental protection, and it was an excellent opportunity for the governor to see and learn about the benefits of the unique Knife River facilities,” Kim said in a press release.
Case supports annual ‘Rockin’ for the Troops’ fundraiser
Case Construction Equipment continued its support of Illinois military families and veterans with its sponsorship of the fifth annual “Rockin’ for the Troops” concert, July 17, at Cantigny Park in Winfield, Ill.
Operation Support Our Troops – Illinois, is a volunteer-based organization that produces the fundraising event. The organization supports the Hines Veterans Health Administration Hospital and multiple military-related causes, including providing care packages for U.S. troops deployed overseas. Through its first four years, “Rockin’ for the Troops” raised $1.5 million on behalf of eight service organizations.
“As a manufacturer who provides backhoes, skid steers, wheel loaders, and forklifts for the U.S. military, the support from Case for our troops runs deep,” said Pat Hunt, director, Strategic Accounts, Case Construction Equipment, in a written statement from Case.
“We’re proud to co-sponsor this event and aid the great work Operation Support Our Troops provides.”
Case recently announced the production of several thousand military skid steers and compact track loaders as part of a $160 million contract with the U.S. Army TACOM that could span 10 years. The equipment is manufactured in Wichita, Kan.
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