Overnite Transp. Co.v.Teamsters Local 120

Minnesota Court of AppealsAug 14, 2001
No. C3-01-153 (Minn. Ct. App. Aug. 14, 2001)

No. C3-01-153.

Filed August 14, 2001.

Appeal from the District Court, Anoka County, File No. C1999735.

Douglas P. Seaton, Alec J. Beck, and John Raudabaugh, (for respondent)

Martin Costello, (for appellant)

Considered and decided by Halbrooks, Presiding Judge, Stoneburner, Judge, and Foley, Judge.

This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2000).


This appeal arises from a contempt and injunction proceeding resulting from a labor dispute between the respondent employer and appellant union. Appellant argues that the district court erroneously found that (1) it had an agency relationship with the picketers, rendering it liable for damages caused by their misconduct; (2) the picketers damaged respondent's property; and (3) appellant was responsible for a portion of respondent's increased security costs. After a post-trial order, this appeal followed. We affirm.


In October 1999, Teamsters Local 120 of the International Brotherhood of Teamsters (the union) instituted a labor strike against Overnite Transportation Company (Overnite) at their facility located in Blaine, Minnesota. While the union represented the striking Overnite employees, none of the Overnite employees who participated in the strike were members of the union. The union and the striking employees alleged Overnite engaged in unfair business practices by failing to allow employees to contract with the union.

Almost immediately, both Overnite and the union alleged misconduct by the other in violation of the Minnesota Labor Relations Act. Minn. Stat. § 179.01-.85 (1998). Both sides requested and received temporary restraining orders. Based on the parties' stipulated agreement, the district court ordered a permanent injunction against both parties, enjoining them from committing damaging, injurious, or threatening acts against the other. Subsequently, both parties moved the court for, and were granted, orders to show cause. The matters were then combined for hearing before the court.

After hearing testimony from victims and witnesses and viewing extensive videotapes of the union and Overnite activities, the district court compiled nearly 50 pages of factual findings. The court determined that both parties violated the restraining orders and temporary injunctions, but that the union committed more violations than Overnite. It concluded that an agency relationship existed between the union and the picketers regardless of whether the picketers were union members or striking Overnite employees, and that the picketers deliberately caused damage to Overnite's property. Accordingly, the court concluded that the union was vicariously liable for the damage to Overnite's property. The court also found that both the union and Overnite were responsible for Overnite's increased security costs and ordered the union to pay two-thirds of Overnite's additional security expenses. The union made a motion for a new trial, which was denied. This appeal followed.


Because the district court has the discretion to grant a new trial, we will not disturb the decision absent a clear abuse of that discretion. Halla Nursery, Inc. v. Baumann-Furrie Co., 454 N.W.2d 905, 910 (Minn. 1990).


The district court held that an agency relationship existed between the union and the picketers, making the union vicariously liable to Overnite for damages caused by the picketers. The union argues that the combined circumstantial and direct evidence before the court is insufficient to support its findings of an agency relationship and that the union cannot be held liable for damage caused by the picketers.

Under the theory of respondeat superior, a principal may be vicariously liable for its agent's actions committed within the scope of the agency relationship. Semrad v. Edina Realty, Inc., 493 N.W.2d 528, 535 (Minn. 1992). When the evidence regarding the existence of an agency relationship is conflicting, it is a question of fact to be determined by the trier of fact. PMH Properties v. Nichols, 263 N.W.2d 799, 803 (Minn. 1978); see also Dalager v. Montgomery Ward Co., Inc., 350 N.W.2d 391, 394 (Minn.App. 1984) (whether agency relationship exists is usually fact question for jury unless evidence is conclusive one way or the other). This court reviews the district court's factual findings under the clearly erroneous standard and will not set those findings aside if there is reasonable evidence to support them. Fletcher v. St. Paul Pioneer Press, 589 N.W.2d 96, 102 (Minn. 1999).

When determining whether an agency relationship exists, "the question of whether the specific acts performed were actually authorized or subsequently ratified shall not be controlling." 29 U.S.C. § 152 (13) (1994); see also NLRB v. Local Union No. 3, Int'l Bhd. of Elec. Workers, 467 F.2d 1158, 1159 (2d Cir. 1972) (stating that actual authorization or subsequent ratification is not required to hold union responsible for act of member as agent). Instead, "[a] union is responsible for the acts of its authorized pickets even if not specifically authorized or indeed specifically forbidden." Soft Drink Workers Union Local 812, 307 NLRB 1267, 1272 (1992).

The first issue is whether the facts are sufficient to create an agency relationship. Just as in the criminal law context, circumstantial evidence, standing alone, may be sufficient to prove a union's condonation and ratification of picketer misconduct "so long as the totality of the evidence [is] substantial enough." BE K Constr. Co. v. NLRB, 23 F.3d 1459, 1469 (8th Cir. 1994) (holding that combined direct and circumstantial evidence proved union ratified its members' unlawful acts where local's officers paid the attorney fees, bail, and fines of members who were arrested in connection with a riot, did not disavow riot, and attempted to hide participation and approval) (quotation omitted); see also Rausch v. Aronson, 211 Minn. 272, 274, 1 N.W.2d 371, 371 (1941) (stating that existence of agency relationship may be proven circumstantially by evidence that shows course of dealing between two parties). Here, the court was presented with both circumstantial and direct evidence of the relationship between the union and the picketers.

While most of the picketers were non-union Overnite employees, from time to time members of the union and members of other local unions also acted as picketers. In addition to the picketers, several union agents acted in a variety of supervisory capacities, including (1) negotiating on the strikers' behalf; (2) coordinating the unions' efforts to appoint members; and (3) managing, coordinating, and supervising daily picketing activity. These duties required the union agents' consistent and regular presence on the picket line. The union also assigned three Overnite employees to act as stewards on the picket line and to carry out the union's instructions regarding the picket line. Thus, each person — from the non-union employee picketers, to the non-union employee stewards, to the union agents — was connected to the other by a reporting chain. See Soft Drink Workers, 307 NLRB at 1268 (finding agency relationship existed between union and picketers where union and picketers linked by reporting chain).

The district court acknowledged that the union engaged in some disciplinary action against picketers and union agents and instructed picketers regarding the court's order. Nevertheless, the district court also concluded that the union did not do enough to deter its picketers from causing harm and damage. In Soft Drink Workers the court held that

[w]hen a union authorizes a picketline, "it is required to retain control over the picketing." If a union is unwilling or unable to take the necessary steps to control its pickets, it must bear the responsibility for the misconduct.

Id. at 1272. In the present case, the evidence indicates that while the union was aware of the picketers' repeated acts of misconduct, it was either "unwilling or unable to take the necessary steps to control its pickets." See id.

Based on witness testimony and the record, the district court made extremely detailed findings and explicit judgments regarding the witnesses' credibility. The court determined that the union (1) initiated the picket line, and was responsible for its day-to-day operations; (2) initiated the ambulatory picketing; and (3) was responsible for both the initial and ongoing training of picketers. We find that the district court carefully analyzed the evidence, made specific findings regarding the witnesses' credibility, and drew reasonable inferences from the evidence. Thus, its conclusion that an agency relationship exists between the union and the picketers is not clearly erroneous. As a final note, we commend the district court for being thorough and detailed in both its findings and memorandum.


The union next argues that the district court's finding that the picketers caused the damage to Overnite's property was clearly erroneous. The union claims the incidents of property damage were not linked to specific, identifiable picketers, and, therefore, the damage could have been committed by anybody. We disagree.

"A union may even be liable for the actions of unidentified persons if the circumstantial evidence persuasively shows that the actions were taken in conjunction with the union's picket line activity." Soft Drink Workers, 307 NLRB at 1268; see also Amidon v Traverse Land Co., 181 Minn. 249, 251-52, 232 N.W. 33, 34 (1930) (stating that relevant facts may be proved by either direct or circumstantial evidence). And the district court may draw inferences from circumstantial evidence when the evidence reasonably supports the inferences. Illinois Farmers Ins. Co. v. Brekke Fireplace Shoppe, Inc., 495 N.W.2d 216, 221 (Minn.App. 1993); see also International Fin. Servs, Inc. v. Franz, 534 N.W.2d 261, 266 (Minn. 1995) (noting that fact finder may make reasonable inference from cumulative effect of circumstantial evidence). In any event, the district court did not rely on circumstantial evidence alone; it had direct evidence to consider as well.

The record contains numerous examples of threatening verbal assaults, reckless and dangerous behavior, and property damage committed at the picket line, where the union had the most control. Many of the incidents involved identifiable picketing Overnite employees or union members. Additionally, witnesses and victims testified regarding numerous threatening and damaging incidents that occurred away from Overnite's facility during the strike.

As noted by the district court, the supreme court stated that

[w]here two opposing inferences can be drawn with equal justification from the same circumstantial evidence, it cannot be said that one preponderates over the other, and in that event the party having the burden of proof must lose.

Dille v. Knox Lumber/Division of Southwest Forest, 452 N.W.2d 679, 681 (Minn. 1990). Nonetheless,

[i]f the evidence as a whole provides a reasonable basis for an inference [that the fact claimed occurred] * * * direct proof is unnecessary; provided, however, that such inference is based, not on mere conjecture and speculation but on known facts consistent with the theory [of the claim.]

Burke v. B.F. Nelson Mfg. Co., 219 Minn. 381, 385-386, 18 N.W.2d 121, 123 (1945). Furthermore, "if different inferences can justifiably be drawn from the evidence in the case, the inference drawn by the factfinder will not be disturbed." Dille, 452 N.W.2d at 681.

In its memorandum denying the union's motion for a new trial, the district court noted that there was

overwhelming circumstantial evidence linking the property damage to the pickets. The Union had organized ambulatory picketing, where pickets followed trucks along their routes for two purposes; to educate Overnite customers about the strike and to encourage them not to accept deliveries in support of the strike. Many of the incidents of shot-out windows occurred while drivers were making deliveries to their customers.

(Citations to record omitted.)

Based on these facts, the district court found that either union members or non-union members under union supervision conducted injurious, threatening, and damaging acts to further the union's goals. Because of the cumulative, substantial, direct, and circumstantial evidence supporting the district court's finding that picketers caused the damage to Overnite's property, the district court's findings on this issue are not clearly erroneous.


Finally, the union argues that the district court erred in finding that Overnite incurred additional expenses for security. The union argues that Overnite hired additional "security" for surveillance of the picketers and not for security. The union asserts that, since there was no evidence that the union or its agents engaged in any misconduct necessitating surveillance, the union should not be held liable for the additional costs.

There is, however, sufficient evidence showing the union and its picketer agents engaged in threatening, injurious, and damaging behavior during this period. Consequently, the court's findings that any security costs Overnite may have incurred or maintained above its usual need were due to the strike and the picketers are not clearly erroneous. The district court correctly found that the union should be held at least partially liable for Overnite's increased security costs.

We are, however, somewhat troubled by the district court's abbreviated findings and summary conclusion that the union is responsible for two-thirds of Overnite's security expenses. Nonetheless, based on the record and the district court's detailed analysis, we cannot say the court's apportionment is clearly erroneous.

In sum, the evidence reasonably supports the district court's findings that (1) an agency relationship existed between the union and the picketers; (2) the picketers damaged Overnite property; and (3) the union is responsible for two-thirds of Overnite's increased security expenses. Because we find that the district court's factual findings were not clearly erroneous, the district court did not abuse its discretion. Thus, the district court's judgment and order denying a new trial are affirmed.