Merritt et al v. International Association of Machinists and Aerospace Workers et al

Filing 58

REPORT AND RECOMMENDATION re 37 MOTION for Sanctions under Fed. R. Civ. P. 11 filed by International Association of Machinists and Aerospace Workers, Sandra K. Weber, Robert B. DePace, Air Transport District 143 International Association of Machinists and Aerospace Workers, 35 MOTION for Summary Judgment filed by International Association of Machinists and Aerospace Workers, Sandra K. Weber, Robert B. DePace, Air Transport District 143 International Association of Machinists and Aerospace Workers Signed by Magistrate Judge Paul J Komives. (EBut)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION PATRICIA M. MERRITT, et al., Plaintiffs, v. INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE WORKERS, et al., Defendants. / REPORT AND RECOMMENDATION ON DEFENDANTS' MOTION FOR SUMMARY JUDGMENT (docket #35) and DEFENDANTS' MOTION FOR RULE 11 SANCTIONS (docket #37)
RECOMMENDATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 I. Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 II. Defendants' Motion for Summary Judgment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 A. Summary Judgment Standard . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 B. Timeliness of Plaintiffs' Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 1. The Limitations Period Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 2. a. Claims Relating to Bankruptcy Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 b. Claims Relating to Accretion Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 C. Duty of Fair Representation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 1. Duty of Fair Representation Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 2. Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 a. Accretion Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 b. Bankruptcy Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 c. Plaintiffs Who Failed to Respond to Requests for Admission . . . . . . . . . . . . . . . . . 33 4. Objector Status Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 a. Mootness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 b. Merits of the Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 D. Defendants' Motion for Rule 11 Sanctions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 1. Rule 11 Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 2. Whether Plaintiffs' Counsel Violated Rule 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 a. Improperly Named Plaintiffs, Plaintiffs Not Employed at Relevant Times, and Dues Objector Plaintiffs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 b. Accretion Agreement Claim Barred by the Statute of Limitations . . . . . . . . . . . . . . 44 3. Appropriate Sanction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 III. Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 NOTICE TO PARTIES REGARDING OBJECTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

CASE NO. 2:06-CV-14342 JUDGE STEPHEN J. MURPHY, III MAGISTRATE JUDGE PAUL KOMIVES

RECOMMENDATION The Court should grant defendants' motion for summary judgment and grant in part and deny in part defendants' motion for Rule 11 sanctions. REPORT I. Background Plaintiffs are a group of individuals employed, or formerly employed, by Northwest Airlines as Quality Service Assistants (QSAs). Plaintiffs commenced this action on October 2, 2006, naming as defendants the International Association of Machinists and Aerospace Workers, AFL-CIO ("IAM"); Air Transport District Lodge 143 of the IAM ("District 143"); Robert B. DePace, President and Directing General Chair of District 143; and Sandra K. Weber, General Chair and Lead Negotiator for Clerical, Office, Fleet and Passenger Service Employees of District 143. Plaintiffs allege that defendants have breached their duty of fair representation in a number of respects relating to bargaining on behalf of the QSA employees (Count I) and in handling QSA employee requests for objector status (Count II). The matter is currently before the Court on two motions filed by defendants. On February 1, 2008, defendants filed a motion for summary judgment. Defendants argue that they are entitled to summary judgment because: (1) the claims raised in Count I of the complaint are time-barred; (2) the claims raised in Count I fail as a matter of law; and (3) the claims raised in Count II fail as a matter of law and are now moot. Defendants also argue that, with respect to 19 of the plaintiffs, they are entitled to summary judgment based on those plaintiffs' failures to respond to requests for admissions. Plaintiffs' filed a response to defendants' motion on March 25, 2008. They argue that their claims are timely and sufficient to withstand summary judgment. Defendants filed a reply on

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April 3, 2008. Second, on February 1, 2008, defendants filed a motion for Rule 11 sanctions. Defendants argue that counsel for plaintiffs failed to conduct an adequate investigation into the law and facts prior to filing this action because: (1) it is clear that the claims are untimely; (2) several plaintiffs were not employed as QSAs at all or during the time periods relevant to the claims in the action; and (3) several plaintiffs admitted that they never made a request for objector status or were not union members in good standing at the time they requested objector status. Plaintiffs filed a response to the motion on March 25, 2008, and defendants filed a reply on April 3, 2008. Viewed in the light most favorable to plaintiffs, the evidence submitted by the parties sets forth the following facts. Defendant IAM is a labor organization representing approximately 730,000 members in an array of industries. See Def.s' Br., Ex. A, Decl. of Stephen Gordon, ¶ 2 [hereinafter "Gordon Decl."]. District 143 is an intermediate body within the IAM. See Gordon Decl., ¶ 3. District 143 is the bargaining unit for various classes of employees of Northwest Airlines ("NWA"), including Clerical, Office, Fleet and Passenger Service ("COFPS") employees. See Gordon Decl., ¶ 3. The collective bargaining relationship is governed by the Railway Labor Act ("RLA"). Defendant DePace was the President/Directing General Chairperson of District 143 from 1999 through October 2006. See Def.s' Br., Ex. G, Dep. Tr. of Robert B. DePace, at 10 [hereinafter "DePace Dep."]. Defendant Weber was the District 143 General Chairperson during the same time period. See Def.s' Br., Ex. Y, Dep. Tr. of Sandra K. Weber, at 6-7 [hereinafter "Weber Dep."] NWA created the QSA position in 1984. See Compl., ¶ 13. QSAs perform a variety of passenger service functions at NWA terminals. See Def.s' Br., Ex. H, Dep. Tr. of Lana Dowdy, at 28 [hereinafter "Dowdy Dep."]. As initially created, QSA employees were non-unionized, at will

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employees. Compensation levels were therefore set by NWA, and varied from airport to airport and among employees at the same airport. See Def.s' Br., Ex. C, Decl. of Thomas R. Roth, ¶ 18 [hereinafter "Roth Decl."]; Ex. Q, Dep. Tr. of Patricia Merritt, at 60-61 [hereinafter "Merritt Dep."]; Ex. V, Dep. Tr. of Julie Hagen Showers, at 26 [hereinafter "Showers Dep."]; Dowdy Dep., at 29. Most QSAs were part-time employees. See Pl.s' Br., Ex. B; Def.s' Br., Ex. B, Decl. of Elizabeth A. Roma, Ex. 1 at 311 [hereinafter "Roma Decl."]. In 1999, the IAM began an effort to unionize QSA employees. See Def.s' Br., Ex. U, Dep. Tr. of Marvin Sandrin, at 5-6 [hereinafter "Sandrin Dep."]. At that time, QSAs were paid a flat hourly rate starting at $7.25 per hour, and could earn merit increases up to $10.50 per hour. QSAs also were provided F-3 travel pass privileges, the same level provided to NWA management. See Roma Decl., Ex. 1. Also at that time, QSAs participated in NWA's health care plan with no cost for single coverage, and could receive spousal and dependent coverage. See Pl.s' Br., Ex. C, Dep. Tr. of Cherie Brickey, at 39-40 [hereinafter "Brickey Dep."]. The organizing effort was led by IAM Grand Lodge Representative Marvin Sandrin, who sent a letter to the QSAs which included an authorization card to be used to obtain an representation election. The letter assured the QSAs that they would not pay any dues until they approved a contract. See Pl.s' Br., Ex. D. Plaintiffs claim that several IAM representatives informed QSAs that if they did not join the IAM, they would lose their jobs. See Pl.s' Br., Ex. E, Dowdy Dep., at 34. After collecting sufficient signatures, the IAM applied to the National Mediation Board ("NMB")­the agency tasked with determining representation disputes under the RLA, see 45 U.S.C. § 152­for certification as the collective bargaining representative for QSA employees. The IAM also sought accretion of the QSA employees into the existing certification for the COFPS class of employees. See DePace Dep., at

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27-29. NWA opposed accretion. See Compl., ¶ 11. On April 4, 2000, the NMB issued a decision finding that the QSA employees should be accreted into the COFPS class. See Roma Decl., Ex. 1. Because the QSA employees were accreted into an existing class, the NMB did not conduct a representation election. See Roma Decl., Ex. 1, at 314. Following the NMB's decision, defendant DePace requested that the parties meet to negotiate an interim collective bargaining agreement ("CBA") for the QSA employees. See DePace Dep., at 34. Because the CBA governing COFPS employees was not open for renegotiation until February 2003, DePace sought an addendum to the existing agreement to cover QSA employees. Also involved in the negotiations were Sandrin and General Chairman Gerry Bernson. See DePace Dep., at 36-40. On July 8, 2000, prior to the start of the negotiations, a group of 84 QSAs sent a letter to DePace complaining that the union had "expressed a blatant disregard for our opinions both in forcing us into the union . . . and in how we are to be accreted into the COFPS agreement." The letter also criticized the IAM for negotiating without QSA input, and stated that the QSAs "expect to be heard. We insist upon it . . . . [W]ithout our full input, the IAM would not be representing or negotiating on behalf of the QSAs." Pl.s' Br., Ex. F. On August 11, 2000, DePace issued a bulletin informing the QSAs that negotiations had begun and indicating that the negotiated addendum to the IAM-UAM agreement would "guarantee the benefits you currently receive." The bulletin also stated that the "accretion agreement is a temporary agreement. There will be no vote. This accretion agreement is just a vehicle to get us to the end of the COFPS agreement. That is when contract proposals are accepted and the membership votes on the contract." Pl.s' Br., Ex. G. Donna Johnson, a Minneapolis-based QSA, distributed a flyer critical of the IAM and the negotiating process. See Pl.s' Br., Ex. J. On August 25, 2000, DePace sent a letter to the QSAs stating that

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there were "anti-union QSAs out there who have been spreading rumors of mistrust and lies." Pl.s' Br., Ex. I; see also, Pl.s' Br., Ex. G, DePace Dep., at 65. The letter also indicated that the QSAs would not be permitted to elect a negotiator for the accretion agreement negotiations, but would be able to elect a negotiator for the new round of bargaining following the expiration of the existing COFPS agreement. See Pl.'s Br., Ex. I. On October 24, 2000, District 143 and NWA entered into a letter agreement relating to QSA employees, referred to by the parties as the "Accretion Agreement." See DePace Dep., at 34-35 & Ex. 2. The Accretion Agreement provided, inter alia, for formal recognition by NWA of IAM as the certified representative of QSA employees; percentage pay increases consistent with other COFPS employees; accrual of vacation for part-time QSAs; seniority based bidding on schedules; just cause protection against discharge; overtime pay; preservation of QSAs' manager-level passes for travel on NWA flights until the expiration of the existing CBA; and application of the COFPS Agreement union security provision, which required QSAs to become members of the IAM as a condition of employment. The Accretion Agreement did not, however, negotiate a definition of seniority, and provided that QSA travel passes would be downgraded to level F5 after February 25, 2003 (the expiration of the then-existing collective bargaining agreement). The Accretion Agreement also provided that all other aspects of QSA employment would be handled consistent with NWA's policies relating to non-contract employees until the next collective bargaining agreement. See DePace Dep., Ex. 2. The IAM distributed the Accretion Agreement to QSAs and held meetings to explain the agreement. See DePace Dep., Ex. 67; Gordon Decl., Ex. 3. Some QSA employees objected to being required to pay dues, and others

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sought unsuccessfully to reverse the NMB's accretion decision.1 Arden Cody, General Chair of District Lodge 143 from 1999-2006, testified that she frequently heard complaints from QSAs concerning the Accretion Agreement, and that she relayed these complaints to DePace. See Pl.s' Br., Ex. K, Dep. Tr. of Arden Cody, at 22, 24 [hereinafter "Cody Dep."]. DePace was displeased with Cody pressing arguments on behalf of the QSAs. See id. at 43. As a result of a number of internal and external factors­including the September 11th terrorist attacks, the growth of low-cost airlines, and economic conditions­the airline industry faced a steep downturn in the early 2000s. Collectively, the major United States based carriers lost $28 billion from 2001 through 2004, and two airlines­United Airlines and US Airways­declared bankruptcy. See Roma Decl., Ex. 2. NWA itself lost $3.8 billion between 2001 and the third quarter of 2005. See Roth Decl., ¶ 7. Against this backdrop, the COFPS CBA become open for renegotiation on February 25, 2003. The CBA governing IAM-represented Equipment Service and Stock Clerk ("ESSC") employees also become open for renegotiation. See Roth Decl., ¶ 5. Under the District 143 bylaws, members elect a negotiating committee from the classes of employees represented by the IAM, and the President/Directing General Chair serves as the chair of the negotiating committee. See Gordon Decl., ¶ 4. Defendant Weber was elected to the committee from the COFPS group, and she and General Chairman Scott Peterson were appointed as lead COFPS negotiators. See Weber Dep., at 28. Thomas Roth, a labor economist, served as a consultant to the union during negotiations. See Roth Decl., ¶4. After negotiations began, the IAM requested that two QSA employees serve as liaisons to assist the COFPS negotiators. See Dowdy Dep., at 43;

Because the issues relating to dues objector status are fact-specific as to each plaintiff, the evidence regarding objector status is not detailed here, but is discussed in part C.4 of this Report, infra. 7

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Merritt Dep., at 54. Defendant DePace testified that he decided to appoint QSA liaisons because non had been elected as negotiators and the union desired their input in order to fully integrate the QSA employees into the COFPS agreement. See DePace Dep. at 70-71. Plaintiffs Merritt and Dowdy were selected as QSA liaisons. See Dowdy Dep., at 43; Merritt Dep., at 54. They attended some negotiating sessions and conducted meetings with fellow QSAs, see Dowdy Dep., at 50-56, although they were apparently excluded from other negotiating sessions, specifically those related to QSA pay, see Pl.s' Br., Ex. H, DePace Dep., at 72-73; Dowdy Dep., at 47, 60, 63, 94.2 Cody testified that she argued with DePace about the lack of a bona fide QSA negotiator, but DePace rejected her arguments. See Cody Dep., at 40-41. The issue of QSA negotiators was solely one relevant to the union; NWA did not itself bar Merritt or Dowdy from participating in the negotiations. See Showers Dep., at 30-31. On August 18, 2005, the IAM and NWA signed a tentative agreement. The agreement extended most provision of the COFPS agreement to QSAs, but specified that QSA pay rates were still to be negotiated. See Merritt Dep., at 78 & Ex. 3; Def.s' Br., Ex. K, Dep. Tr. of Karen Fish, at 48 [hereinafter "Fish Dep."]. On September 14, 2005, NWA filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York. See Roth Decl., ¶ 8. At the time of NWA's filing, IAM represented 14,622 NWA employees, including 4,356 Customer Service Agents­the largest group within the COFPS class­and 307 QSAs. See Roth Plaintiff's assert that "DePace did not permit any QSAs to be elected to the negotiation team when negotiations began for the successor COFPS agreement." Pl.s' Br., at 8. However, although it is apparent that a negotiating position was not made for a QSA representative specifically, there is no evidence that DePace did anything to prevent a QSA from being elected as a COFPS representative. Rather, the evidence establishes only that the COFPS class as a whole did not elect any QSAs as a class representative for the negotiations. 8
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Decl., ¶ 10. One of NWA's stated goals in bankruptcy was to cut its labor costs by $873 million per year, including $190 million per year in concessions from IAM-represented employees. See Roth Decl., ¶ 9. On September 26, 2005, NWA presented to the IAM its proposal for reducing labor costs under section 1113 of the Bankruptcy Code.3 NWA proposed a 12.5% pay cut for most IAMrepresented employees, including QSAs, as well as contract changes which would allow NWA to outsource the job responsibilities of approximately 5,000 IAM-represented workers. See Roth Decl.,

In relevant part, section 1113 provides that: (1) Subsequent to filing a petition and prior to filing an application seeking rejection of a collective bargaining agreement, the debtor in possession or trustee (hereinafter in this section "trustee" shall include a debtor in possession), shall­ (A) make a proposal to the authorized representative of the employees covered by such agreement, based on the most complete and reliable information available at the time of such proposal, which provides for those necessary modifications in the employees benefits and protections that are necessary to permit the reorganization of the debtor and assures that all creditors, the debtor and all of the affected parties are treated fairly and equitably; and (B) provide, subject to subsection (d)(3), the representative of the employees with such relevant information as is necessary to evaluate the proposal. (2) During the period beginning on the date of the making of a proposal provided for in paragraph (1) and ending on the date of the hearing provided for in subsection (d)(1), the trustee shall meet, at reasonable times, with the authorized representative to confer in good faith in attempting to reach mutually satisfactory modifications of such agreement. 11 U.S.C. § 1113(b). The section goes on to provide that the bankruptcy court may approve a petition to reject a collective bargaining agreement if the court finds that: "(1) the trustee has, prior to the hearing, made a proposal that fulfills the requirements of subsection (b)(1); (2) the authorized representative of the employees has refused to accept such proposal without good cause; and (3) the balance of the equities clearly favors rejection of such agreement." 11 U.S.C. § 1113(c). Finally, subsection (e) provides for interim emergency relief as a supplement to the relief provided in subsections (b) and (c): If during a period when the collective bargaining agreement continues in effect, and if essential to the continuation of the debtor's business, or in order to avoid irreparable damage to the estate, the court, after notice and a hearing, may authorize the trustee to implement interim changes in the terms, conditions, wages, benefits, or work rules provided by a collective bargaining agreement. Any hearing under this paragraph shall be scheduled in accordance with the needs of the trustee. The implementation of such interim changes shall not render the application for rejection moot. 11 U.S.C. § 1113(e). 9

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¶ 11. NWA filed its section 1113(c) petition in the bankruptcy court, and the matter was set for hearing on November 16, 2005. See Roth Decl., ¶ 12. In the interim, on November 7, 2005, NWA filed a motion for interim relief under subsection (e), requesting a 19% cut in pay for all IAMrepresented employees. See Roth Decl., ¶ 13. The bankruptcy court, agreeing with NWA that the relief requested was necessary to avoid liquidation, entered an order on November 16, 2005, authorizing the 19% pay cut. In light of this relief, NWA postponed the hearing on its § 1113(c) application until January 17, 2006. See Roth Decl., ¶ 13. The IAM and NWA continued to negotiate the matter, including an intensive negotiating session on January 9-13, 2006. These negotiations culminated in an agreement for an overall percentage pay cut of 11.5% for IAM-represented employees. See Roth Decl., ¶¶ 14-16. Although the parties had discussed the possibility of varying the pay-cut percentage for different classes of employees, it was ultimately agreed that an across-the-board cut was most equitable. See Showers Dep., at 22; DePace Dep., at 116-17, 133. In light of this agreement, Roth and NWA finance representative Patrick Clay worked to create pay scales reflecting the pay cut, taking into account the general agreement that all employees were to have their pay cut by 11.5%. See Roth Decl., ¶ 17; Showers Dep., at 21-22. This presented a problem with respect to QSAs, however, as QSAs did not have an existing pay scale; rather, QSA pay varied widely as a result of their past status as atwill employees. See Roth Decl., ¶ 18. Because QSA pay was not based on years of service, a uniform pay scale could not be created without increasing the pay of some QSAs and decreasing the pay of others. See Roth Decl., ¶ 18. Roth and Clay therefore developed a pay scale based on the then existing state of QSA compensation. Under this scale, the pay rate of each QSA was reduced by 11.5%, and then the employees were placed on a progressive pay scale at the next level up on the

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scale. See Roth Decl., ¶ 19. According to defendant, this resulted in QSAs receiving an average pay cut of only 8.9%. See Roth Decl., ¶ 20; Showers Dep., at 38. Although DePace and Showers were the lead negotiators for the parties, the pay scales were developed solely by Roth and Clay, and then reviewed by Showers and DePace before being presented to the IAM membership. See Showers Dep., at 20-21. Showers testified that as long as the $190 million reduction in labor expenses was realized, NWA did "not care how [the union] met the target." Id. at 22. NWA did not during the negotiations take the position that no employee could receive a pay raise under the contract. See id. at 23-24. Showers further testified that although she would have had some concern about the "equitable aspects" of such an outcome, the IAM could have proposed a pay scale that resulted in some employees receiving a raise so long as the $190 million target was met. Such a result would not have been contrary to NWA's bargaining objectives. See id. at 25, 51-52. Plaintiffs contend, and the testimony of Showers and DePace supports to some extent, that the pay scales developed by Roth and Clay are contrary to the actual language of the COFPS agreement and the historical practice of slotting employees in a pay scale. See id. at 44; DePace Dep., at 123-24, 154; Weber Dep., at 86. DePace also testified that the pay scale issue could have been taken back to NWA, and that the issue could have been resolved by taking the raise that a small number of QSAs would have received under the traditional senioritybased pay scaling and spreading it over the 14,000 IAM members. See DePace Dep., at 115-16, 133. Although the IAM and NWA did not reach agreement on other matters, the IAM agreed to present NWA's last best offer on the pay reduction to the union membership for vote. NWA's last best offer also included the August 18, 2005, tentative agreement regarding QSAs. See Roth Decl., ¶ 21; Merritt Dep., at 89-90. On January 19, 2006, the IAM posted NWA's proposed Bankruptcy

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Agreement on the Internet. The IAM also mailed the proposed agreement to members. After seeing the proposed agreement, a number of QSAs apparently believed that they would be placed on the pay scale according to years of service. See Def.s' Br., Ex. Z, Dep. Tr. of Kim Zitzloff, at 26 [hereinafter "Zitzloff Dep."]. On February 1, 2006, NWA labor relations officer David Driscoll issued an e-mail addressing the QSA pay scale. See Compl., ¶ 26; Def.s' Br., Ex. O, Dep. Tr. of Mary Lou Ketland, at 20-23 & Ex. 5 [hereinafter "Ketland Dep."]. The e-mail indicated that "[a]ll QSAs would be subject to the same 11.5% pay cut applicable to all IAM employees," and further stated: "It IS NOT the case (as apparently many QSAs believe) that an 8-year QSA who is currently making $8.00/hr. will go, on the date of signing, to the 8th year pay step ($11.00) and, in effect receive a 35% raise." The e-mail explained that all QSA salaries would be cut by 11.5%, and then each QSA would be placed on the pay scale reflective of that pay rate, regardless of the QSA's actual years of service. See Ketland Dep., Ex. 5. The Driscoll e-mail was widely circulated among QSAs in Detroit, Minneapolis, and Memphis, NWA's hub cities. See Ketland Dep., at 20-22 & Ex. 5; Merritt Dep., at 99-101; Weber Dep., at 60; Zitzloff Dep. at 25-26. The circulation in Memphis and Detroit occurred on February 2, 2006, the day prior to the ratification vote in Detroit. On February 6, 2006, Minneapolis-based QSAs Kim Zitzloff and Karen Fish met with defendant Weber regarding the pay scale. Weber told them that she had spoken with Roth, who explained that his understanding of the pay scale was the same as Driscoll's understanding. Weber also indicated that DePace had spoke with Driscoll, and that Driscoll had again explained to DePace that every employee was going to be subject to an 11.5% pay cut. See Zitzloff Dep., at 34; Fish Dep., at 62-63 & Ex. 6. Zitzloff and Fish distributed the memorandum regarding their meeting with Weber to fellow Minneapolis-based

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QSAs prior to the ratification vote at that location. See Zitzloff Dep., at 40-41. Plaintiffs contend that after the COFPS letter of agreement was signed several IAM officials, including defendant Weber, expressed their opinions that the union had mistreated the QSAs. See Cody Dep., at 52-53; Dowdy Dep., at 111; Sandrin Dep., at 24-25; Pl.'s Br., Ex. V. On March 7, 2006, the IAM announced that the COFPS membership had ratified the Bankruptcy Agreement by a vote of 67% to 33%. See Compl., ¶ 24. A number of QSAs subsequently requested dues objector status. Gordon was elected President/Directing General Chair of District Lodge 143 in June 2006. In August, Gordon met with several QSAs and their counsel regarding their concerns. See Gordon Dep., at 28-29. Gordon told the QSAs that he would meet with NWA management once he took office to discuss the issues raised by the QSAs, but did not do so after he took office on October 1, 2006. See id. at 39-40. Gordon testified that he believes the QSAs are being paid properly under the Bankruptcy Agreement, and that he has not investigated whether the pay scale issue presents a grievable issue that could submitted to arbitration. See id. at 93, 117-18. In addition to this time line of specific events, plaintiffs have presented evidence of animosity between DePace and other IAM officials and the QSA employees. According to Cody, DePace was frustrated with QSA complaints, and stated that the QSAs were "trouble." See Cody Dep., at 25. DePace also told Cody that he wished the IAM had never accreted the QSAs, and that he could "give them back" to NWA. See id. at 26. DePace also referred to the QSAs as a bunch of "whiners." See id. at 36. On December 11, 2006, plaintiff Merritt sent a letter to IAM President R. Thomas Buffenbarger stating that Secretary-Treasurer Tareia Harris refused to let QSAs pay past dues at a December 2006 meeting in order to be eligible to vote in officer elections, even though she

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had taken steps to make sure that employees besides QSAs could pay past dues so they could vote. See Pl.s' Br., Ex. L. QSA Mary Buckley testified that she contacted General Chair Bill Holloway in Memphis to inquire about the status of a grievance she had filed, but that Holloway had told her he was too busy to look into "QSA problems." Holloway did not again contact Buckley concerning the grievance. See Pl.s' Br., Ex. N, Dep. Tr. of Mary Buckley, at 47-49. QSA Elizabeth Fawaz testified that at a union meeting in 2006 she attempted to discuss some complaints they had with the union, but were told by union leadership at the meeting that "QSA business would not be discussed." See Pl.s' Br., Ex. O, Dep. Tr. of Elizabeth Fawaz, at 9. Memphis-based QSA Cherie Brickey testified that she filed grievances in 2000 and 2006, but that the grievances were not addressed by the union , and that the IAM "never took the QSAs seriously." Brickey Dep., at 29-30, 56. Plaintiffs commenced this action on October 2, 2006. Plaintiffs are 179 individually named current or former QSA employees. See Compl., Ex. A. In Count I of their complaint, plaintiffs allege that defendants violated their duty of fair representation in connection with the negotiation and implementation of the various agreements which affect the QSA terms of employment. In Count II of their complaint, plaintiffs allege that defendants violated their duty of fair representation by failing to properly honor plaintiffs' requests for dues objector status. II. Defendants' Motion for Summary Judgment Defendants move for summary judgment with respect to both Counts of the complaint, on a number of bases. With respect to Count I, defendants argue that plaintiffs' duty of fair representation claims are barred by the statute of limitations, and that the claims fail as a matter of law on the merits. With respect to Count II, defendants argue that plaintiff's claims are without merit, and that the claims are moot in light of the IAM's offer to afford retroactive dues objector

14

status to plaintiffs who make a proper request. Finally, in addition to these arguments, defendants argue that they are entitled to summary judgment with respect to the claims of 19 plaintiffs who failed to respond to their requests for admissions. A. Summary Judgment Standard Under Rule 56, summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." FED. R. CIV. P. 56(c). "An issue of fact is `genuine' if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Hedrick v. Western Reserve Care Sys., 355 F.3d 444, 451 (6th Cir. 2004) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). "A fact is material only if its resolution will affect the outcome of the lawsuit." Hedrick, 355 F.3d at 451-52 (citing Anderson, 477 U.S. at 248). In deciding a motion for summary judgment, the Court must view the evidence in a light most favorable to the non-movant as well as draw all reasonable inferences in the non-movant's favor. See Sutherland v. Michigan Dep't of Treasury, 344 F.3d 603, 613 (6th Cir. 2003); Rodgers v. Banks, 344 F.3d 587, 595 (6th Cir. 2003). "The moving party has the initial burden of showing the absence of a genuine issue of material fact as to an essential element of the non-moving party's case." Hedrick, 355 F.3d at 451 (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). To meet this burden, the moving party need not produce evidence showing the absence of a genuine issue of material fact. Rather, "the burden on the moving party may be discharged by `showing' -- that is, pointing out to the district court -- that there is an absence of evidence to support the non-moving party's case." Celotex Corp., 477 U.S. at 325. "Once the moving party satisfies its burden, `the burden shifts to the

15

nonmoving party to set forth specific facts showing a triable issue.'" Wrench LLC v. Taco Bell Corp., 256 F.3d 446, 453 (6th Cir. 2001) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)); see also, FED. R. CIV. P. 56(e). To create a genuine issue of material fact, however, the non-movant must do more than present some evidence on a disputed issue. As the Supreme Court has explained: "There is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party. If the [non-movant's] evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Anderson, 477 U.S. at 249-50. (citations omitted); see Celotex Corp., 477 U.S. at 322-23; Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986). Thus, "[t]he existence of a mere scintilla of evidence in support of the nonmoving party's position will not be sufficient; there must be evidence on which the jury could reasonably find for the non-moving party." Sutherland, 344 F.3d at 613. B. Timeliness of Plaintiffs' Claims Defendants first argue that plaintiffs' claims are untimely. The Court should agree, and should grant defendants' motion for summary judgment on this basis. 1. The Limitations Period Generally

Plaintiffs' duty of fair representation (DFR) claims are brought pursuant to the Railway Labor Act, 45 U.S.C. §§ 151-188, which governs labor issues involving air carriers. See 45 U.S.C. § 181. The RLA does not itself impose a duty of fair representation on labor organizations, but the Supreme Court implied such a duty in Steele v. Louisville & N.R. Co., 323 U.S. 192, 202-03 (1944). The Court later implied such a duty with respect to labor organizations governed by the National Labor Relations Act and the Labor-Management Relations Act, noting the similarities between the

16

Acts and the RLA. See Del Costello v. International Brotherhood of Teamsters, 462 U.S. 151, 164 n.14 (1983). Because neither the NLRA nor the RLA provide an explicit cause of action for breach of the duty of fair representation, neither act likewise explicitly provides a limitation period for such claims. Noting the need for federal uniformity in the area of labor relations, and noting the similarities between DFR actions under the NLRA (and hybrid DFR/employment contract claims under the LMRA) and unfair labor practice actions under § 10(b) of the NLRA, 29 U.S.C. § 160(b), the Del Costello Court adopted the six-month limitation period set forth in § 10(b) of the NLRA as the limitation period governing DFR claims under the LMRA. See Del Costello, 462 U.S. at 169-71. The courts of appeals have uniformly concluded that the reasoning of Del Costello applies equally to DFR claims under the RLA, and that a six month limitation period therefore governs DFR claims brought under the Act. See Bensel v. Allied Pilots Ass'n, 387 F.3d 298, 304 (3d Cir. 2004); Spaulding v. United Transp. Union, 279 F.3d 901, 908 (10th Cir. 2002); Landry v. Air Line Pilots Ass'n, 901 F.2d 404, 410-14 (5th Cir. 1990); Welyczko v. U.S. Air, Inc., 733 F.2d 239, 240 (2d Cir. 1984). The Sixth Circuit has likewise reached this conclusion. See Ratkosky v. United Transp. Union, 843 F.2d 869, 873 (6th Cir. 1988). "As a general rule, the limitations period begins to run when the potential plaintiff knows or should have known of the union's alleged breach of its duty of fair representation." Ratkosky, 843 F.2d at 873; see also, Schoonover v. Consolidated Freightways Corp., 49 F.3d 219, 221 (6th Cir. 1995). In general, with respect to DFR claims based on a contract, the plaintiff knows or should know of the union's breach, and thus the limitation period begins to run, on the date that the contract is signed or ratified. See Spaulding, 279 F.3d at 908; Gvozdenovic v. United Air Lines, Inc., 933 F.2d 1100, 1106 (2d Cir. 1991); United Independent Flight Officers v. United Air Lines, Inc., 756

17

F.2d 1262, 1273 (7th Cir. 1985). 2. Analysis

Plaintiffs' complaint was filed on October 2, 2006. Thus, under the six-month limitation period any claims which accrued prior to April 2, 2006, are untimely. a. Claims Relating to Bankruptcy Agreement With respect to plaintiff's claims related to the Bankruptcy Agreement, at first glance these claims appear to be barred by the six-month limitation period. It is undisputed that the COFPS letter of agreement negotiated in the bankruptcy context was ratified by the COFPS membership no later than March 7, 2006. See Compl., ¶ 24. Under the general rule noted above, plaintiffs' claims relating to that agreement accrued upon ratification, and thus the claims are untimely. Plaintiffs, however, press two arguments to the contrary. First, plaintiffs argue that their claims based on the Bankruptcy Agreement did not accrue until that agreement was approved by the bankruptcy court, which occurred on August 1, 2006. The Court should disagree. In the first place, it is not clear that approval of the bankruptcy court was even a condition necessary to the execution of the contract. Certainly nothing in § 1113 required bankruptcy approval. In its entirety, § 1113 provides: (a) The debtor in possession, or the trustee if one has been appointed under the provisions of this chapter, other than a trustee in a case covered by subchapter IV of this chapter and by title I of the Railway Labor Act, may assume or reject a collective bargaining agreement only in accordance with the provisions of this section. (b)(1) Subsequent to filing a petition and prior to filing an application seeking rejection of a collective bargaining agreement, the debtor in possession or trustee (hereinafter in this section "trustee" shall include a debtor in possession), shall­ (A) make a proposal to the authorized representative of the employees covered by such agreement, based on the most complete and reliable information available at the time of such proposal, which provides for those necessary modifications in the employees benefits and protections that are necessary to permit 18

the reorganization of the debtor and assures that all creditors, the debtor and all of the affected parties are treated fairly and equitably; and (B) provide, subject to subsection (d)(3), the representative of the employees with such relevant information as is necessary to evaluate the proposal. (2) During the period beginning on the date of the making of a proposal provided for in paragraph (1) and ending on the date of the hearing provided for in subsection (d)(1), the trustee shall meet, at reasonable times, with the authorized representative to confer in good faith in attempting to reach mutually satisfactory modifications of such agreement. (c) The court shall approve an application for rejection of a collective bargaining agreement only if the court finds that­ (1) the trustee has, prior to the hearing, made a proposal that fulfills the requirements of subsection (b)(1); (2) the authorized representative of the employees has refused to accept such proposal without good cause; and (3) the balance of the equities clearly favors rejection of such agreement. (d)(1) Upon the filing of an application for rejection the court shall schedule a hearing to be held not later than fourteen days after the date of the filing of such application. All interested parties may appear and be heard at such hearing. Adequate notice shall be provided to such parties at least ten days before the date of such hearing. The court may extend the time for the commencement of such hearing for a period not exceeding seven days where the circumstances of the case, and the interests of justice require such extension, or for additional periods of time to which the trustee and representative agree. (2) The court shall rule on such application for rejection within thirty days after the date of the commencement of the hearing. In the interests of justice, the court may extend such time for ruling for such additional period as the trustee and the employees' representative may agree to. If the court does not rule on such application within thirty days after the date of the commencement of the hearing, or within such additional time as the trustee and the employees' representative may agree to, the trustee may terminate or alter any provisions of the collective bargaining agreement pending the ruling of the court on such application. (3) The court may enter such protective orders, consistent with the need of the authorized representative of the employee to evaluate the trustee's proposal and the application for rejection, as may be necessary to prevent disclosure of information provided to such representative where such disclosure could compromise the position of the debtor with respect to its competitors in the industry in which it is engaged. (e) If during a period when the collective bargaining agreement continues in effect, and if essential to the continuation of the debtor's business, or in order to avoid irreparable damage to the estate, the court, after notice and a hearing, may authorize the trustee to implement interim changes in the terms, conditions, wages, benefits, or work rules provided by a collective bargaining agreement. Any hearing under this paragraph shall be scheduled in accordance with the needs of the trustee. 19

The implementation of such interim changes shall not render the application for rejection moot. (f) No provision of this title shall be construed to permit a trustee to unilaterally terminate or alter any provisions of a collective bargaining agreement prior to compliance with the provisions of this section. 11 U.S.C. § 1113. By its terms, section 1113 merely requires bankruptcy approval before a debtor may unilaterally reject a collective bargaining agreement. The statute itself contemplates a negotiated settlement which would not require the involvement of the bankruptcy court, as it requires a debtor to first negotiate in good faith with the collective bargaining representative. Thus, "[t]he plain language of § 1113 . . . make[s] clear that these provisions are inapplicable where union . . . representatives agree to a debtor's proposal." In re Kaiser Aluminum Corp., 456 F.3d 328, 340 n.8 (3d Cir. 2006). It is true, as plaintiffs suggest, that at the point the Bankruptcy Agreement was executed NWA's previously filed "application under section 1113 to reject the agreement entered a state of suspended animation," In re UAL Corp., 443 F.3d 565, 568 (7th Cir. 2006), but this does not mean that the Agreement itself was without any effect. On the contrary, in the absence of any requirement for court approval, plaintiff offers no reason to conclude that the Agreement was not effective upon its execution and ratification. As noted above, nothing in § 1113 required court approval for the parties to mutual agree to the newly negotiated CBA. Plaintiffs point to no case law nor provision of the Bankruptcy Code requiring such approval. Section 363, which is not cited by plaintiffs, does require approval for certain transactions outside the ordinary course of approval. See 11 U.S.C. § 363(b), (c). However, the Bankruptcy Agreement was the culmination of the parties' negotiations for a new CBA to replace the agreement that had expired in 2003. As such it was a contract entered into in the normal course of business for which approval was not required under § 363. See In re

20

Hillard Dev. Corp., No. 90-27588, 2004 WL 1347049, at *1 (Bankr. S.D. Fla. Apr. 16, 2004); In re Illinois-California Express, Inc., 72 B.R. 987, 991-92 (D. Colo. 1987); In re DeLuca Distrib. Co., 38 B.R. 588, 592-94 (Bankr. N.D. Ohio 1984).4 In any event, plaintiffs have offered no case law to support their claim that, even if court approval was required, the limitations period commenced any later than the execution and ratification of the Agreement. Assuming that court approval was required, this requirement is nothing more than a condition precedent. And plaintiffs have cited to no case suggesting that the existence of condition precedent alters the ordinary rule of accrual for DFR claims. As noted above, the consistent rule applied by the courts is that a DFR claim accrues "when the potential plaintiff knows or should have known of the union's alleged breach of its duty of fair representation." Ratkosky, 843 F.2d at 873. In the case of DFR claims based on collective bargaining, this occurs when the CBA is executed. Notably, it is irrelevant whether plaintiffs knew the precise effects of the CBA, see Propst v. Association of Flight Attendants, 546 F. Supp. 14, 21 (E.D.N.Y. 2008), or had begun to feel those effects, see Clift v. International Union, United Automobile, Aerospace & Agricul. Implement Workers of Am., 818 F. 2d 623, 629 (7th Cir. 1987) ("The claim does not wait to accrue until the time at which the contested provisions of the agreement are enforced."), vacated on other grounds, 488 U.S. 1025 (1989). Here, there is no dispute that plaintiffs knew of the union's resolution of the seniority scale issue at the time the Bankruptcy Agreement was ratified, or that this agreement itself constitutes the actionable breach of the union's duty of fair representation. As one court has explained, the execution of a new CBA is outside the ordinary course of business and requires approval under § 363 only if the CBA provides "something extraordinary, such as giving the union a lien on the debtor's property . . . ." In re Leslie Fay Cos., Inc., 168 B.R. 294, 303 (Bankr. S.D.N.Y. 1994). However, "[i]f the scope of the agreement is consonent with its predecessors and does not offend any fundamental bankruptcy policy, the debtor does not need to provide notice and a hearing" or obtain court approval. Id. 21
4

Accordingly, the claim accrued and the six month limitation period begun to run when the agreement was ratified.5 Plaintiffs also claim that their claims relating to the bankruptcy agreement are timely under the so-called "rays of hope" doctrine. Under this doctrine, as explained by the Third Circuit, where a "union purports to continue to represent an employee in pursuing relief, the employee's duty of fair representation claim against the union will not accrue so long as the union proffers `rays of hope' that the union can `remedy the cause of the employee's dissatisfaction.'" Bensel v. Allied Pilots Ass'n, 387 F.3d 298, 305 (3d Cir. 2004) (quoting Childs v. Pennsylvania Fed'n Brotherhood of Maintenance Way Employees, 831 F.2d 429, 434 (3d Cir. 1987)). Plaintiffs argue that the rays of hope doctrine is applicable here for two reasons. First, in the June 30, 2006, edition of the IAM's newsletter, defendant Weber wrote that she and DePace had met with NWA in an effort to rectify the "big injustice to the QSAs in their pay scale." Pl.s' Br., Ex. V. Second, Gordon met with several QSAs and their counsel in August 2006, at which time he indicated that he would pursue the QSAs' issues with NWA management once he took office as President in October 2006. See Gordon Dep., at 28-29, 39-40. The problem with plaintiffs' argument, however, is that the "rays of hope" doctrine is confined to the Third Circuit. No court outside that circuit has adopted the doctrine, at least as stated by the Third Circuit in Bensel. On the contrary the Sixth Circuit, along with the other circuits that have considered the matter, have held that while the limitations period may be tolled while a

For the same reasons, plaintiff's argument that the claims did not accrue because the Agreement was not effective until NWA had negotiated CBAs with other bargaining units is without merit. As with the assumed requirement of bankruptcy court approval, the successful negotiation of CBAs with other bargaining units simply constitutes a condition precedent which does not affect the accrual of plaintiffs' claims. 22

5

potential plaintiff pursues formal contractual grievance procedures, the period is not tolled by informal attempts to resolve an issue or by general promises by union officials to resolve the issue. See Long v. General Motors Corp., 19 Fed. Appx. 200, 202-03 (6th Cir. 2001); Darden v. Local 247, International Brotherhood of Teamsters, No. 95-1453, 1996 WL 692095, at *2 (6th Cir. Nov. 26, 1996); Adkins v. United Mine Workers of Am., No. 93-6386, 1995 WL 441630, at *4-*5 (6th Cir. July 25, 1995); see also, Myers v. Southern Cal. Gas Co., No. 98-56599, 2000 WL 831812, at *1 (9th Cir. June 27, 2000); Spaulding, 279 F.3d at 911; Christiansen v. APV Crepaco, Inc., 178 F.3d 910, 916 (7th Cir. 1999); Follin v. Safeway, Inc., No. 97-2398, 1998 WL 808374, at *2 (4th Cir. Nov. 23, 1998). Here, there is no evidence that plaintiffs pursued any formal contractual remedies within the limitations period so as to toll their claims, and defendants' alleged assurances that they were working on the issue are insufficient to toll the limitations period. See Long, 19 Fed. Appx. at 202. For these reasons, the Court should conclude that plaintiffs' claims relating to the Bankruptcy Agreement are barred by the sixth month limitations period applicable to DFR claims. Accordingly, the Court should grant defendants' motion for summary judgment with respect to those claims. b. Claims Relating to Accretion Agreement With respect to plaintiff's claims based upon the negotiation of the 2000 Accretion Agreement, the claims are untimely. The accretion agreement was executed on October 24, 2000, nearly six years prior to the commencement of this action. Under the general rule noted above, plaintiffs' claims with respect to the Accretion Agreement accrued on the date the agreement was executed, and the limitation period with respect to any claims based on the Accretion Agreement

23

therefore commenced on October 24, 2000. Plaintiffs claim that any claims based on the Accretion Agreement are timely because that agreement was a temporary, interim measure, and that the effect of their DFR claim "accrued and could only accrue when Northwest Airlines actually implemented the contractual agreement negotiated by the IAM and Northwest Airlines on August 1, 2006." Pl.s' Br., at 26-27. It is not clear, however, why the Accretion Agreement should be tied to the Bankruptcy Agreement in this manner. Plaintiffs suggest that "[t]here was no contract provision that applied the non-seniority based pay scale to the QSAs until Northwest implemented the Bankruptcy Court approved Letter of Agreement." Id. at 26. This is true, but irrelevant. Whatever claims plaintiff may have arising from the Accretion Agreement, they certainly do not include the pay scale issue which was not at all a part of the Accretion Agreement. Plaintiffs offer no argument as to the connection between the issues addressed by the Accretion Agreement and the Bankruptcy Agreement, nor do they offer anything to suggest that they were not well aware of any breaches of the union's duty of fair representation in connection with the Accretion Agreement. On the contrary, by their own accounts plaintiffs immediately and repeatedly complained about the terms of the Accretion Agreement after its execution. And, in any event, tying the Accretion Agreement claims to the Bankruptcy Agreement claims does not aid plaintiffs, because as discussed above the Bankruptcy Agreement claims are themselves untimely. Accordingly, the Court should conclude that plaintiffs' claims relating to the Accretion Agreement are untimely, and that defendants are entitled to summary judgment with respect to these claims. C. Duty of Fair Representation Defendants next argue that, regardless of whether plaintiff's DFR claims are timely, they are without merit. In the event that the Court disagrees with my recommendation regarding the statute

24

of limitations, the Court should nevertheless grant defendants' motion for summary judgment on this alternative ground. 1. Duty of Fair Representation Generally

As noted above, the RLA does not explicitly impose on unions a duty of fairly representing its members. However, as the Supreme Court has held with respect to both the RLA and the NLRA, "[w]hen a labor organization has been selected as the exclusive representative of the employees in a bargaining unit, it has a duty, implied from its status . . . as the exclusive representative of the employees in the unit, to represent all members fairly." Marquez v. Screen Actors Guild, Inc., 525 U.S. 33, 44 (1998); see Steele v. Louisville & N.R. Co., 323 U.S. 192, 202-03 (1944). Thus, "a union must represent fairly the interests of all bargaining-unit members during the negotiation, administration, and enforcement of collective-bargaining agreements." International Brotherhood of Elec. Workers v. Foust, 442 U.S. 42, 47 (1979). In other words, "the duty of fair representation requires a union `to serve the interests of all members without hostility or discrimination toward any, to exercise its discretion with complete good faith and honesty, and to avoid arbitrary conduct.'" Marquez, 525 U.S. at 44 (quoting Vaca v. Spikes, 386 U.S. 171, 177 (1967)). "[A] union breaches the duty of fair representation when its conduct toward a member of the bargaining unit is arbitrary, discriminatory, or in bad faith." Marquez, 525 U.S. at 44; accord Foust, 442 U.S. at 47; Vaca, 386 U.S. at 190. "This is a tripartite standard; a court should look to each element when determining whether a union violated its duty." Griffin v. Air Line Pilots Ass'n, 32 F.3d 1079, 1083 (7th Cir. 1994); see also, Marquez, 525 U.S. at 44; Air Line Pilots Ass'n v. O'Neill, 499 U.S. 65, 76-77 (1991). "Therefore, the three separate levels of inquiry under this standard are as follows: (1) did the union act arbitrarily; (2) did the union act discriminatorily; or (3) did the

25

union act in bad faith." Griffin, 32 F.3d at 1083 (internal quotation omitted); see also, MoralesVallellanes v. Potter, 339 F.3d 9, 16 (1st Cir. 2003). Thus, "[i]n order to successfully defend against a motion for summary judgment on a duty of fair representation claim, the plaintiff must point the court to record evidence supporting any one or all of these elements." Griffin, 32 F.3d at 1083; see also, Morales-Vallellanes, 339 F.3d at 16. With respect to the arbitrariness inquiry, the Court has explained that "Congress did not intend judicial review of a union's performance to permit the court to substitute its own views of the proper bargain for that reached by the union." O'Neill, 499 U.S. at 78. "Any substantive examination of a union's performance, therefore, must be highly deferential, recognizing the wide latitude that negotiators need for the effective performance of their bargaining responsibilities." Id. Further, "the rationality of a union's decision" must be evaluated "in light of both the facts and the legal climate that confronted the negotiators at the time the decision was made." Id. "The duty of fair representation does not require that a union achieve absolute equality among its members. Rather, because a union by necessity must differentiate among its members in a variety of contexts a showing that union action has disadvantaged a group of members, without more, does not establish a breach of the duty of fair representation." Haerum v. Air Line Pilots Ass'n, 892 F.2d 216, 221 (2d Cir. 1989) (citing Ford Motor Co. v. Huffman, 345 U.S. 330, 338 (1953)); see also, Steele, 323 U.S. at 203. Finally, "[e]stablishing that the union's actions were sufficiently `arbitrary, discriminatory or in bad faith,' is only the first step toward proving a fair representation claim. Plaintiffs must then demonstrate a causal connection between the union's wrongful conduct and their injuries." Spellacy v. Airline Pilots Ass'n, 156 F.3d 120, 126 (2d Cir. 1998). This generally requires a showing that,

26

but for the union's breach of its duty, "the company would have acceded to the union's demands." Ackley v. Western Conference of Teamsters, 958 F.2d 1463, 1472 (9th Cir. 1992); see also, Brown v. International Union, United Automobile, Aerospace & Agric. Implement Workers of Am., 689 F.2d 69, 71 (6th Cir. 1982). 2. Analysis a. Accretion Agreement Other than general assertions that the union, particularly through DePace, exhibited hostility to the QSAs, plaintiffs do not raise any argument in their brief or point to any particular facts demonstrating that the union breached its duty of fair representation with respect to the negotiation of the Accretion Agreement. Plaintiffs' brief addresses specifically only the pay scale issue arising from the Bankruptcy Agreement. See Pl.s' Br., at 27-31. In any event, there is no genuine issue of material fact to suggest that the union's negotiating decisions were arbitrary under the first prong of the tripartite standard. With respect to the Accretion Agreement, plaintiffs essentially claim that the union should have obtained an agreement with NWA which would have provided QSAs with the same benefits provided in the then-existing COFPS agreement, most notably a seniority-based pay scale and holiday pay. As defendants note, the existing COFPS agreement did not automatically apply to the QSAs simply by their accretion into the COFPS class, see Association of Flight Attendants v. USAir, Inc., 24 F.3d 1432, 1437-38 (D.C. Cir. 1994), and the COFPS agreement itself was not amendable until its expiration on February 23, 2003. Defendant DePace testified that NWA concluded it was not in its interest to reopen the contract and thus refused to do so, see DePace Dep., at 25-26, and plaintiffs have pointed to no evidence in the record to contradict this assertion. Thus, the union had no real bargaining

27

leverage to use, and was left to negotiate the best deal that it could. And although the union was unable to obtain the full application of the COFPS agreement that it sought, see DePace Dep., at 25, the Accretion Agreement did provide several benefits to QSAs that they had not previously enjoyed, including percentage pay increases consistent with other COFPS employees; accrual of vacation for part-time QSAs; seniority based bidding on schedules; just cause protection against discharge; overtime pay; and preservation of QSAs' manager-level passes for travel on NWA flights until the expiration of the existing CBA. See DePace Dep., Ex. 2; see also, Merritt Dep., at 59-65. Plaintiffs have made no argument in their brief, much less pointed to evidence demonstrating, that the union acted arbitrarily in negotiating and executing the Accretion Agreement. Nor have plaintiffs pointed to any evidence of bad faith or discrimination with respect to the Accretion Agreement. With respect to discrimination, the QSAs were the only ones subject to the Accretion Agreement. As noted above, the Accretion Agreement resulted in QSAs being treated differently than other members of the COFPS class, but this was only because the COFPS contract did not apply to them and because NWA refused to reopen that contract. Nor is there any evidence of bad faith in connection with the Accretion Agreement. Plaintiffs' evidence regarding the union's animus all post-dates the Accretion Agreement. Indeed, the evidence suggests only that the union officials' alleged animus arose after the accretion decision and the execution of the Accretion Agreement, and as a result of the QSAs' reaction to those decisions. Thus, even if there was animus directed toward the QSAs by union leadership at some point, there is no evidence of such animus at the time the Accretion Agreement was negotiated and executed. In short, plaintiff's have failed to make any argument, or point the Court to any evidence, demonstrating that defendants acted arbitrarily, discriminatorily, or in bad faith in deciding to

28

accrete defendants to the COFPS class or in negotiating the Accretion Agreement. Accordingly, the Court should conclude that defendants are entitled to summary judgment with respect to plaintiffs' DFR claims premised on the Accretion Agreement. b. Bankruptcy Agreement With respect to the union's representation of QSAs in the negotiation of the COFPS agreement after its expiration in 2003 and in the eventual negotiation and execution of the Bankruptcy Agreement, plaintiffs' claim focuses on the discrimination and bad faith prongs of the tripartite test. The Court should conclude that defendants are entitled to summary judgment on plaintiffs' DFR claims relating to the Bankruptcy Agreement. Plaintiffs argue that DePace admitted in his deposition that the pay scales applied to the QSA employees did not comport with the historical practice, and that by agreeing to the pay scales the union sacrificed the interests of the QSAs to those of the more traditional employees of the COFPS class. However, the evidence submitted does not support this argument. It is true that the QSAs were subject to the pay scales based on their then-existing salary, rather than being put into the pay scale based solely on seniority. There is no evidence to dispute, however, that this was solely based on two factors: (1) the historical treatment of QSAs by NWA, which resulted in QSAs being compensated inconsistently and based on factors other than seniority; and (2) the union's desire to spread the entire cost of NWA's mandated cuts in personnel costs evenly across all employees in the COFPS class, and indeed across all employee classes represented by the union. See Showers Dep., at 22; DePace Dep., at 116-17. Based on these factors, Roth and Clay agreed to place the QSAs on the seniority scales based on their existing pay, rather than on their years of service, so that QSAs would be subject to the same 11.5% cut in pay as all other IAM-

29

represented employees. See Roth Decl., ¶ 19. Thus, in one respect the QSAs were treated differently with respect to how they were placed on the pay scales, but this was only to insure that in the end the QSAs were treated the same as all other employees. It is true, as plaintiffs suggest, that NWA did not require the union to spread the wage concessions across-the-board (although NWA considered that to be the most equitable approach), see Showers Dep., at 25, 51-52, and that the union could have placed the QSAs in the pay scales based on seniority and spread the cost among the other 14,000 COFPS employees. Plaintiffs do not, however, offer anything to show that the union's decision to essentially treat all employees equally with respect to wage cuts was arbitrary or discriminatory. Rather, they argue only that the union, by essentially treating them the same as all other employees with respect to wage concessions, sacrificed their preferred interests to those of the majority of COFPS employees. However the union's reasoned decision to do so­based on the economic realities of NWA's financial condition, the inexact fit of QSAs into the existing pay scales, and the desire to spread the cost of the wage concessions evenly­does not constitute a breach of the duty of fair dealing. See Spellacy v. Airline Pilots Ass'n, 156 F.3d 120, 126 (2d Cir. 1998) ("[A] union's reasoned decision to support the interest of one group of employees over the competing interests of another group does not constitute arbitrary conduct."). As the Sixth Circuit has explained: Negotiation means compromise. Neither employees as a whole nor particular groups of employees emerge from bargaining with all their wants satisfied. Often unions can achieve more for some of their constituents only by accepting less for others. "Inevitably differences arise in the manner and degree to which the terms of any negotiated agreement affect individual employees and classes of employees. The mere existence of such differences does not make them invalid. The complete satisfaction of all who are represented is hardly to be expected. A wide range of reasonableness must be allowed a statutory bargaining representative in serving the unit it represents, subject always to complete good faith and honesty of purpose in the exercise of its discretion." 30

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