                                                                                                                           Opinions of the United
2003 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


6-10-2003

Taylor Milk Co Inc v. Intl Brhd Teamsters
Precedential or Non-Precedential: Non-Precedential

Docket No. 02-3461




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                                                        NOT PRECEDENTIAL

              THE UNITED STATES COURT OF APPEALS
                     FOR THE THIRD CIRCUIT

                              ___________

                              No. 02-3461
                              ___________

          TAYLOR M ILK COMPANY, a Pennsylvania Corporation,
                                         Appellant
                             v.

     INTERNATIONAL BROTHERHOOD OF TEAM STERS, AFL-CIO, an
                 unincorporated association and labor organization;
INTERNATIONAL BROTHERHOOD OF TEAMSTERS, DAIRY CONFERENCE -
          USA AND CANADA, an unincorporated association and labor
   organization; SERVICE PERSONNEL AND EMPLOYEES OF THE DAIRY
     INDUSTRY TEAMSTERS LOCAL UNION NO. 205, an unincorporated
                        association and labor organization

                              ___________


       ON APPEAL FROM THE UNITED STATES DISTRICT COURT
          FOR THE WESTERN DISTRICT OF PENNSYLVANIA

                        (D.C. Civil No. 95-cv-01663)
              District Judge: The Honorable D. Brooks Sm ith

                              ___________

                Submitted Under Third Circuit LAR 34.1(a)
                             May 23, 2003

 BEFORE: SCIRICA, Chief Judge, SLOVITER, and NYGAARD, Circuit Judges.




                          (Filed June 10, 2003)
                                        ___________

                                OPINION OF THE COURT
                                     ___________


NYGAARD, Circuit Judge.

              Taylor Milk Company appeals from an order of the District Court

determining that Taylor did not suffer cognizable damages from an illegal secondary

boycott orchestrated by the Appellees, International Brotherhood of Teamsters, et al. On

appeal, Taylor argues that the District Court erred in its interpretation of the collective

bargaining agreement and abused its discretion by failing to allow additional damage

evidence regarding the profitability of alternative plans. We have plenary review over the

District Court’s interpretation of the bargaining agreement and we review the

determination to prohibit reopening of the record for abuse of discretion. Finding no fault

with the decision of the District Court, we will affirm.

                                              I.

              The issue of damages has been before a panel of this court previously in

Taylor Milk Co. v. International Brotherhood of Teamsters, 248 F.3d 239 (3d Cir. 2001)

(Taylor I). In Taylor I, we addressed both the issue of IBT’s liability for the secondary

boycott and whether the District Court’s award of $50,000 in damages was correct. After

affirming the District Court’s determination that IBT was liable for damages resulting

from the secondary boycott, we turned to the proper determination of damages. In


                                              2
reversing the District Court, we noted that “[o]ur review of the record reveals that the

District Court did not commit clear error insofar as it found that TMC had failed to prove

the profitability of Plan B and Plan C.” Id. at 247. We were concerned, however, that the

District Court had erred in its evaluation of the profitability of Plan A by failing to

consider the viability of the Plan as it related to the collective bargaining agreement. In

remanding, we gave specific instructions to the District Court:

                      If, upon remand, the District Court determines that
                      TMC would not have prevailed at arbitration and
                      maintains its determination that Plans B and C would
                      not have been profitable, it is clear that TMC could
                      have suffered no damage from IBT's actions, as the
                      loss of TMC's right to purchase the Borden plant
                      would have placed it in no worse of an economic
                      position than if it had purchased the plant. In other
                      words, If TMC could not have profited from
                      purchasing the Borden plant, there can be no basis for
                      awarding TM C damages.
Id. at 249.

              On remand, the District Court reaffirmed its previous decision as to Plans B

and C, and acknowledged the need to determine if the language of the collective

bargaining agreement prohibited the implementation of Plan A. Focusing on a no-

transfer clause in the collective bargaining agreement, the District Court found that Plan

A could not have been successfully implemented via arbitration. We agree. The no-

transfer clause in the bargaining agreement states:

              No work or services presently performed or hereafter assigned
              to the collective bargaining unit with the exceptions listed
              above, will be subcontracted, transferred, leased or assigned,

                                               3
               in whole or in any part to any other person, firm or
               corporation or non-unit employees unless otherwise expressly
               provided in this Agreem ent.

Article II, Section 6(a), at App. 70. As Plan A will transfer work done by Appellees to a

new facility, Taylor must avoid this provision to demonstrate a likelihood of success at

arbitration.

               There are two possible exceptions built into the provision. First, Taylor

could avoid the no-transfer clause by showing that the product to be transferred was

found in “the exceptions listed” in the preceding paragraph. This option is unavailing,

however, because Plan A involved transferring fluid milk production and fluid milk is not

one of the enumerated exceptions in the preceding section.1 The second exception to the

no-transfer clause is when such action is “otherwise expressly provided” in the bargaining

agreement. The District Court correctly found that all the provisions identified by Taylor

failed in one material respect—none of the provisions “expressly provided” for the

transfer of fluid milk production. On appeal, Taylor cites a portion of section 6(d), which

provides that “[n]othing in this Section shall be interpreted as limiting the Employer’s

right to sell or merge its business or go out of business in while or in part.” Taylor now

argues that the “real intent of Plan A” was to effect a merger, which would satisfy the




1.      The paragraph referenced by the no-transfer provision lists the following as the
only exceptions: “ orange juice, dips, sour cream, cottage cheese, yogur t, butter, oleo,
eggs, sterile products, nutrish and cultured products, novelties, ice cream mix, Weight
Watchers ice cream, and diet ice cr eam. ” Art. II, Sec. 6(a).

                                              4
“expressly provided” exception to the no-transfer clause. Taylor’s reliance on this

provision is misplaced. Plan A clearly contemplates the outright purchase of the Borden

facility, not a merger of operations with Borden. Expanding a business by purchase of a

new facility is not a “merger” contemplated by section 6(d). Thus, Taylor has failed to

identify a provision in the collective bargaining agreement that expressly provides

authorization to transfer production of fluid milk to the Borden facility and, therefore,

cannot demonstrate the profitability of Plan A.

              Taylor also alleges that the District Court abused its discretion by failing to

reopen the record and admit additional expert testimony regarding the alternative plans.

This argument does not withstand scrutiny. In reaching its decision, the District Court

correctly applied the factors we enunciated in Rochez Brothers, Inc. v. Rhoades, 527 F.2d

891, 894 n.6 (3d Cir. 1975). We see no reason to disturb the substantial discretion

afforded to the District Court to reopen the record after a remand.

                                             II.

              For the foregoing reasons we will affirm the order of the District Court.




                                              5
_________________________


TO THE CLERK:

           Please file the foregoing opinion.




                                          /s/ Richard L. Nygaard
                                          Circuit Judge




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