HALL v. COLE
Legal provision: Labor-Management Reporting and Disclosure
Argument of Howard Schulman
Chief Justice Warren E. Burger: We'll hear arguments next in number 72-630, Hall against Cole.
Mr. Howard Schulman: Mr. Chief Justice, and may it please the Court.
Although arising within the context of a internal labor matter, and it could arise in many variety of contexts, the fundamental issue present here is whether courts may fashion and utilize the extraordinary remedy of awarding counsel fees in statutory actions to successful litigants, notwithstanding that Congress which provided the right and remedy has not expressly authorized counsel fee awards.
The facts very briefly as found by the trial court, was that Mr. Cole, the respondent was a member of the petitioning Union and his Union for many years, scores of years, scores of years, in fact, competed with another Union for membership and job rights for American unlicensed seamen, these two unions represented generally all American unlicensed seamen.
The other Union in late 1950 and early 1960s, a repetition of conduct which had been going by both sides competing for jobs, attempted to take the employment opportunities in particular fleets, away from the petitioning members in their Union.
These activities was found, they are successful would seriously adversely effect, both the employment rights, pension rights, welfare, vacation rights.
Of the members of the petition Union, and the petitioner here then acted to repel these raids, and pursue certain activities.
In connection with the activities of his Union, Mr. Cole was supposed to, had proposed a resolution at a Union meeting, condemning his Union's defense against such raids, and the activities and the methods that used resorted to defend against it and there was two fundamental reasons for it as he expressed.
Firstly, it infringed upon his employment rights, which in the Maritime industry is called, shipping rights.
Secondly, it was contrary to what he had expressed.
It was his dread general trade Union concepts that Union people should not fight with each other.
He then to implement this philosophy, introduced a resolution at a Union membership meeting which was overwhelmingly rejected by his fellow members.
In fact, just two votes were cast for it, his own vote and someone who seconded it.
As a consequence of these activities, which the Union felt threatened its very existence, charge -- internal Union charge was filed against Mr. Cole.
He received notice, a hearing was held, he participated, and I must say contrary to the ACLU amicus brief, he participated, and that's the testimony.
The trail body, the internal trial body recommended his expulsion, it was sent to the general membership, and their membership meets in a peculiar matter of meetings, not one meeting, there are meetings held all over the country because of the nature of the calling, both in Huston and the west coast and various places, and the membership concurred in the decision of its trial body, as a consequence of that he appealed, his appeals were denied.
About a year later, in fact, I think the last appeal was in February, in December he commenced the action, Mr. Hall commenced the action for it.
A motion was made for temporary injunction, opposition, District Court sat on it and I think close to four months, three-and-a-half, four months, and then issued an injunction, reinstating Mr. Cole a membership.
Appeal was had as a consequence, and the decision was affirmed.
The complaint was amended and in 1965, this is almost three years already, an amended answer was interposed.
The general counsel for plaintiff failed to observe the local court rules, and the case was marked off the calendar in 1966.
Restored to the calendar sometime in the middle of 1968, and tried in January 1970.
On trial, which lasted several days, the District Court made some significant findings.
Number one, the court found that as contented by this Union, the respondent’s activities, the court said, maybe resulting in a decrease of the number of the jobs available to his fellow Union members.
It may very well reduce the Union treasury, and the membership, nevertheless, as the court said, Mr. Cole’s activity were protected under the Act, and that the proviso which is in Section 101 (a) (2), which says that each member of the Union shall have the responsibility toward the Union as an institution.
The court said in this particular case, that proviso was inapplicable as the same was not intended to discourage Mr. Cole’s activities merely because the ultimate result would not benefit his Union.
The court further found no evidence to support the trial committee’s findings that the respondent violated the Union constitutional provisions as charged.
An I may submit, this was prior to this courts decision at Hardeman and the district court found that respondents to say no damage at all, as a result of his exposure, that every one of his rights prior to the temporary injunction at almost 14-month period between expulsion and injunction, each and everyone his rights were assured, his employment.
His insurance and welfare befits remain unpaid and in fact, in 1967 Mr. Cole retired, and is presently receiving a pension, $250 per month from the joint Union Management Pension Fund.
And his wife as a trial, shall have receive -- just by the time of the trial, almost $4,500.00 in some welfare medical payment, she had been seriously ill.
Chief Justice Warren E. Burger: What about the period between the time of his termination and time of the district court judgment?
Mr. Howard Schulman: Everything he overwrites, Your Honor.
Chief Justice Warren E. Burger: I mean he was a --
Mr. Howard Schulman: He was accorded every single right, and that's the court --
Chief Justice Warren E. Burger: Not good at back payments.
Mr. Howard Schulman: I don't understand.
Chief Justice Warren E. Burger: I am trying to say he has been receiving a pension.
Mr. Howard Schulman: He retired in 1967, and since 67 to date, he has been receiving a pension.
Prior to that he had been actively employed.
Chief Justice Warren E. Burger: He would not have received that absent that district court judgment, is that correct?
Mr. Howard Schulman: No, he would have received in anyway.
Chief Justice Warren E. Burger: He would have received it any event?
Mr. Howard Schulman: Yes, in any event he would have received it.
In other words, there was no discrimination against him in any shape, manner or form, and that's what the court found, that all --
Chief Justice Warren E. Burger: What do you say, the court's relief consisted of?
Mr. Howard Schulman: The courts relief -- the court went on to make – if I say some very significant findings.
The court went on further and said that all the defendants in this case acted in good faith, and believed they had a right to do what they did to protect their organization.
The court further concluded there was no malice at all, absolutely no malevolence by any of these officers.
The court in fact did not find as the Third Circuit Decision in Gartner on which the court relied upon for the award of attorney's fees.
In this case the court did not find that the plaintiff acted in good faith.
A significant finding in the Gartner case, but had found on the contrary that his complaints and his grievances and his accusations were in fact motivated by desire, political ambition for office.
All cause of actions were dismissed against all individual defendants, and the court granted a mandatory injunction against the Union requiring reinstatement permanently of Mr. Cole.
Now it came to the issue of attorneys fees which was the issue before this Court.
The court said, based upon the authority of Gartner v. Soloner, 384 F.2d, Third Circuit, that the court had authority under Section 102 of the Act to award the counsel fess.
Justice William H. Rehnquist: This is the District Court --
Mr. Howard Schulman: This is District Court Mr. Justice Rehnquist, yes.
And that in addition to that, the absence of express statutory provisions authorizing the attorney’s fees does not stop the court in a case such as this, to awarding attorney’s fees, relying upon this Court's decision in Mills.
Justice William J. Brennan: And I expect also pointing out that general provision, such relief is maybe appropriate sometimes.
Mr. Howard Schulman: He didn't say that.
Justice William J. Brennan: Oh, not the district court.
Mr. Howard Schulman: Not the district court.
Justice William J. Brennan: That was the Court of Appeals.
Mr. Howard Schulman: Court of Appeals fundamentally affirmed and said, as maybe appropriate, as you just said Mr. Justice Brennan.
Now, it appears to us, that present here is a -- this termination, a fundamental decision which is contrary to a very long established rule, I think it's the 1784, and that is that ordinarily attorney’s fees are not awarded, absence express statutory authority in the court as used express statutory authority or a contract providing therefore, and there have been exceptions, we'll come to them in a moment.
We don't believe any of these exceptions apply to this case, but equally significant, and I think quite significant, is that when you examine the legislative history, when you examine Congress' attempt to plenary body, it becomes manifest, that Congress did not authorize attorney’s fees.
When we look at the statutory provisions which we're concerned with, which is Section 102, it provides that the district court may grant such relief, including injunctions as may be appropriate.
And not to belabor the point, there was no express provision for that, other than to point out as this Court has pointed out in the Fleischmann case, that Congress is not reluctant.
Congress wants to award attorney’s fees in express statutory action, it says so.
The Footnote, 16, I believe it is in Fleishmann, as more recently Title II of Civil Rights Law, Fair Housing Law.
There is no question that if one Congress wants done it, knows how to, say it.
In fact in this statute, as we shall come to, it's so expressed the state in the certain instances.
Now, when we examine the legislative history in the derogation, we find the Bill started as this Court knows, with the Kennedy I Bill on the Senate side in 1959, and with respect to Section 102 which we are talking about.
Senator McClellan had introduced his Bill of Rights, but under his Bill of Rights, Section 102 and 103, there were two provisions.
One, it was that the Secretary of Labor is authorized to apply to such relief as may be appropriate. The second was a criminal provision, penal provision.
The Sections 102 and 103, at that time 102 in the McClellan Bill was a penal provision.
A debate raged in that Senate on this point, as to the problem which will be attended, that the Secretary of Labor was to be the one to initiate due process, these sort of matters.
The consensus was finally arrived at after an amendment by Senator Kuchel and Senator Kuchel Amendment in substance substituted for the Secretary of Labor as the party to seek the relief, the private party affected, and as the legislative history shows, done solely to avoid bureaucratic chaos.
Absolutely no one attempted to provide for attorney’s fees, and certainly, no one can seriously contend that the Secretary of Labor if successful would be entitled to attorney’s fees.
Now, Section 102, and the Senate Bill as passed, then went over to the House.
On the House side, Senator McClellan, I am sorry Senator Goldwater took the unusual step of appearing before the House Committee of Education and Labor and explained to him, the meaning of the language which was utilized, and specifically pointed out as we have in our brief at page 13 and 14.
That with respect to Section 102, it does not provide for attorney’s fees.
He further pointed out as distinguished from the Fair Labor's Standards Act, which does provide expressly for attorney’s fees, this provision doesn't apply for it.
Justice Harry A. Blackmun: Mr. Schulman, did the Senator carry his argument to the Senate?
Mr. Howard Schulman: No, he did not carry it to the Senate.
Justice Harry A. Blackmun: Which was his own House?
Mr. Howard Schulman: Which was his own House.
Justice Harry A. Blackmun: Is there anything indicative in that part?
Mr. Howard Schulman: No, there is -- I think the manner in which the debate occurred brought this about, because the Kuchel Amendment to 102 did not come out of a committee, it came right up on the floor over this problem of bureaucratic chaos, and we haven't enable to ascertain any discussion on the Senate side, relative to providing for attorney’s fees.
We do however, throughout call your -- this Court's attention to the fact that this issue in substance was before this Court in the Hardeman case.
When Senator Goldwater went over before the House, he testified as to a whole series of items which a Senate Bill had contained.
This Court said it was an (Inaudible) analysis of the language in the Hardeman case.
Senator Goldwater discussed Section 102.
He discussed Section 104.
In fact, as a consequence of his testimony, the Senate Bill Section 104, which was the exhaustion provisions, and was a six-month period was reduced to four months.
He testified as to --
Justice William H. Rehnquist: Reduced by the House or--?
Mr. Howard Schulman: The House Bill then contained four months, and then committee accept it as four months.
Justice William H. Rehnquist: Well you think Senator Goldwater’s vision perhaps was the fight having been lost in the Senate.
He was going over to the House to try to get them to stiffen the thing?
Mr. Howard Schulman: I think it was a combination of both Mr. Justice.
I think number one, he was explaining to the House this is the meaning of the language.
Look at these provisions.
I do not think it was a situation of a loser trying to express beguiling his disappointment and being unsuccessful.
In fact, I think this court has recognized that in the Hardeman case, that this was an explanation and say, “Look gentleman, look at the language, look at what the statute says, look what the fair Labor Standards Act says.
This language standing in and of itself will put the burden upon the individual.
Why don't we do something about it, among that as a well as other items?”
Justice William H. Rehnquist: So he is trying in fact to get the House to do something that the Senate was unwilling to do?
Mr. Howard Schulman: That's correct.
I would say that is correct.
Chief Justice Warren E. Burger: I got some impression Mr. Schulman of this record, and you perhaps can clarify it for me, that the legislative history suggests that one of the reasons why they did not affirmatively provide before attorney’s fees is that there were some thought that the statute without that explicit provision was broad enough to give a very broad relief.
Mr. Howard Schulman: I would direct myself Mr. Chief Justice.
Chief Justice Warren E. Burger: If you would.
It's my general impression on the --
Mr. Howard Schulman: There is nothing at all by any contender of this Bill saying that broad language will encompass attorney’s fees.
Someone must only assume that or infer it.
There was nothing in it.
In fact, it has pointed out as I shall come to in a moment, after Senator Goldwater concluded his testimony and Senator McClellan equally testified, if I recall, in the Hardeman brief represented to this Court, Senator McClellan took a similar position to Senator Goldwater.
After that testimony there was reported the Elliot Bill in the House on the Senate’s Bill.
The Elliot Bill after reported did not succeed, and a minority House report was filed in substance saying as I see, that there is no provision for attorney’s fees.
However, Elliott Bill could not command a majority.
Hence, Thomas Landrum and Griffin proposed their Bill, but their provision with respect to attorney’s fees which was the House minority dissent could not command the majority of the House, and the Bill as it came out, took Section 102 of the House Bill, the Kuchel Amendment with one change not significant here, the conference report parenthetically inserted the words including injunctions.
Justice William H. Rehnquist: There had been an earlier draft in the House that specifically provided for attorney’s fees, but it failed and the Bill that came out of the House didn't --
Mr. Howard Schulman: That is not so Mr. Justice.
No Bill as such, either the Elliott Bill or Landrum-Griffin Bill, as such provided for the authorization expressly of the attorneys fees, neither Bill did.
Justice William H. Rehnquist: Well, was there a difference between the Elliott draft and the ultimate Landrum-Griffin Bill?
Mr. Howard Schulman: No, both accepted in substance the Kuchel Amendment.
Justice William H. Rehnquist: And neither dealt with attorney's fees?
Mr. Howard Schulman: And neither dealt with attorney’s fees, that is correct Mr. Justice, but there are equally significant issues in this matter.
In the debate, on the House, Congressman Griffin stated directing his attention to the 102 original McClellan provision which provided for penal remedies.
He said, “Look, the convict we are talking about, he was comparable to Taft-Hartley unfair labor practice charges, that's a comparable comment and there are no criminal penalties for that.
There is accepted -- generally accepted provisions and they are all civil and this was his understanding, one of the sponsors of a convict which sought to be remedied here.
And I think this as far back as 1941, it has been determined that the only compensatory or other damages of any kind available in unfair labor practice charges is lost time, compensatory damages and I think equally significant is that when we turn again to the provisions itself of the Act and track it, we find very significant language, the identical language which appears in 102, which I say, rejects any inference that attorney's fees first were not even expressly authorized, or even inferentially authorized and I am referring to the following.
The language used in Section 102, such relief as maybe appropriate.
We examined Title II, which is the provision of the Act which provides for filing reports, responsibilities and so forth, the enforcement provision of that is the identical language, the Secretary of Labor being the enforcement officer.
And here we have Congress using this same language.
We are now asked to say it means one thing here, but means another thing here.
And now we go to Section III, Title III, and we found the same thing in the enforcement provision with respect to that matter, which in substance is the same context, and used again for individuals who exercised their rights.
Again, you will have to have a different meaning for the same language and when we go to Title V, which is very significant, it's actually the fiduciary, that's the akin to the Mills case, which is property rights, and when they come to that Section, Congress specifically said, “Appropriate relief plus accounting damages and attorney’s fees, and I think when you track that language, it becomes very significant that not only was it not expressed, nor kind of be inferred and the question of inferring just to direct a few moments to --
Chief Justice Warren E. Burger: If I may interrupt you again Mr. Schulman --
Mr. Howard Schulman: Yes, Mr. Justice.
Chief Justice Warren E. Burger: I think I have put my finger on what had raised this subject in my mind.
Congressman Elliott apparently in the debate responding, it would seem in this context to this problem about fees, said that the court’s jurisdiction to grant such other and further relief as maybe appropriate, gives it wide latitude to grant relief according to the necessities of the case to cover any loss suffered by members.
Mr. Howard Schulman: That language referred to, but at no time was there any mention at all with respect to attorney’s fees, and it rose within a context.
Chief Justice Warren E. Burger: But wasn't that a response to a suggestion or in the general context of the debate about the inadequacies of the Bill?
Mr. Howard Schulman: No, it would appear to me that if I would make an objection that there are not provisions for attorney’s fees, and if that was intended as a reply, certainly the inference would be, “This has broad enough to cover everything including attorney’s fees.
One must guess and hypothecate, whether or not that was intended for that purpose and it appears to me when you have —
Chief Justice Warren E. Burger: His views -- if any of these views carry any weight, his views would be of more utility than the views of the --
Mr. Howard Schulman: Sponsors.
Chief Justice Warren E. Burger: -- people who were protesting, would they not?
Mr. Howard Schulman: No, because his Bill was never adopted.
Mr. Elliott’s, Congressman Elliot's Bill was not adopted.
It was the Landrum-Griffin Bill that was adopted, which was substituted for the Elliot Bill in the House, and that's what happened.
The Elliott Bill couldn't command a majority, and you have the dissent too and you therefore will have then coming up the Landrum-Griffin Bill.
And which apparently could neither command a majority with respect to the minority report that it doesn't provide for attorney’s fees and that's how it came through.
I would like if I may just direct a few more of my remarks so I can maintain a few minutes for rebuttal with respect to the Mills decision on the exceptions provided therein -- the judge created exceptions.
Now we're talking about, first of all when we examined the statute, we find foursquare within this court’s decision of Fleischmann.
When you look at this legislative scheme Title I, II, right through, Congress lays out the rights.
Congress provides the remedies.
When it wants attorney’s fees, it says attorney’s fees.
When it describes the nature of accounting, it says accounting.
It blazed it out within what I think Fleischmann says, “The boundary was Congress intended to be utilized.
Then we come to the exceptions.
In the Mills case fundamentally he is discussing a property right, a stick holder's right.
And I must call it attention to one fact, Mills case per se is not an express statutory right.
In fact, this Court specifically said that the only right under the Section 14 (a) of the Security Exchange Act was a declaration avoidance leading to this Court the obligation to imply a right.
And obviously when the Court implies a right of necessity, it must make some provision, how will that right be implemented, how will it be enforced and that's the remedy.
The Mills decision does not apply here.
This is not a property right case.
In fact, Section 501 (b) of this Act which is the akin to Mills, the derivative stockholder's action, property held by a third party acted upon improperly, the therapeutic purpose of that, Congress was specific.
It said, that's a breach of fiduciary obligation, that's 501, and specifically said, we shall give in that instance reasonable attorney's fees.
As it appears to me, this does not fall within one of the exceptions.
The legislative history sets forth what it is.
There is no express provision.
In these circumstances I think to permit in a case such as this, that Congress has not expressly provided attorney's fees, and if effect to say equity, you have equitable powers, and you can grant attorney's fees, I think it will be applicable to most, any litigation, any statute enacted and I think would vitiate a rule which we have had since 1789 and if that is to be vitiated, it's the function of Congress.
It's a plenary power.
Chief Justice Warren E. Burger: Mr. Hall.
Argument of Burton H. Hall
Mr. Burton H. Hall: Mr. Chief Justice, and may it please the Court.
I like to go back to the facts just briefly to correct what I believed to be some errors in my friend’s presentation. Mr. Cole introduced his resolution at a Union meeting in 1962.
He was fully in order to introduce it.
He was declared to be in order.
He was not however allowed to read it.
It was read in a verbal fashion by one of the officials at the Union.
The head of the Union then took the floor and denounced them as in re the variety of other bad things. He wasn't allowed to answer it.
The Motion was put to a vote, he and his seconder were the only ones who dared to put up their hands in favor of.
I think that reveals not only the nature of how these Unions internal affairs have been run in recent years.
It also reveals the nature of the benefit that this suit has conferred upon the Union and upon the membership.
According to the Union officers themselves, those officers believed and they say they believed it in good faith and there has been a finding below to that effect, that they can expel a member who introduces a resolution, critical of them at a Union meeting.
If they believed it, their members must have believed it also, or believes they were not secure in their ordinary democratic rights, guaranteed them by the Bill of rights title of this act, Landrum-Griffin Act.
This was already three years after the Landrum-Griffin Act had gone into law.
It was more than four years after the State of New York Court of Appeals, the highest court of the state have declared in very clear language that public policy requires that Union members be protected in their rights to express views and opinions critical of the Union's leadership and its offices, even when the criticism is hard-hitting and ardent.
Despite all of these, and despite the fact that the Union was represented, and is represented by variable counsel, the Union officers insist they still believe they could freely expel a man.
What's more they must have believed have they could expel them on no evidence or whatsoever, because their trail committee was unable to find any evidence, whatsoever to support the charges, the call had maliciously vilified the Union president.
One more point on this, the resolution was critical of certain violations of the Union’s established shipping procedure and it called for a more regularized high rank.
This related to the Union’s practice or the Union’s officers practice, a raiding of their Maritime unions.
There reason it related is rather complicated.
In addition to the ordinary picketing that the Union carried on by -- carries on from time to time by membership approvals, the officers were leading men in what was called voluntary picketing.
And rewarding the voluntary -- which involves disputes that the Union was not a party to and which had not have been approved by the Union membership.
He was rewarding this voluntary picketing by giving a shipping man off their voluntary picket lines.
And that was one of the variations, in fact, that was the chief variation from the established shipping rules that Mr. Cole was complaining about.
His motives in introducing the resolution are there right on the face of the resolution.
Mr. Cole testified as to his motives, and it's clear his motives -- that the motives that he testified to are exactly the same as the motives that are indicated by the resolution itself.
Namely he wanted more regularized hiring, and he wanted to end this doggy dog warfare between the sister Unions, where you are one Union, and in particular this Union would raid another Union by sending strikebreakers through the other Union’s picket lines, by offering men to work at lower wages under worst conditions than the other Union.
These can be two instances he has here, and I think that the only answer is -- the only instances of those particular practices are committed by this Union I believe, against the others.
Cole wanted to stop that, because he wanted better conditions for all say, for reasons I think that are obvious.
He was brought up on charges by the court agent for this, charge with malicious vilification of Mr. Hall, not really, we have no relation to each other.
He was put through this deterrence of a trial committee which as I say, he could find no evidence, or could produce in its report, no evidence of any malicious vilification on his part, or other violation of the Section under which he was charged.
And this was put out for ratification and approved by the members voting in the same way at the various reports by hand vote.
It took him more than nine years to get this far in this lawsuit.
Justice Potter Stewart: Was Cole a -- he was not himself a Union officer or agent.
He was the rank and file member?
Mr. Burton H. Hall: He was rank and file member, that's right, Your Honor.
Justice Potter Stewart: And employed as a seaman?
Mr. Burton H. Hall: That's right.
In the course of this suit, about 1966 or 1967, he suffered a board ship, a back injury and that's why he is now retired, he was not able to work anymore.
It has taken him more than nine years to bring.
This case was brought in December of 1963.
It has gone through a long series of obstructive I think, or opposition tactics shall we say.
Mr. Schulman has an error when he says that it was removed from the calendar, because of the failure to observe local court rules.
It was removed from the trail calendar on motion of defendant, because defendant a year after the calendar had been put down for a trial, desired to serve interrogatories.
The actual putting it down on for trial was delayed at defendant’s request, because they had said that they wanted to serve interrogatories.
No interrogatories were served, and it was put down for trial I think the day before a calendar order would have been gone into effect, dismissing the case.
A year later, the defendant came for his 195 interrogatories.
After those were disposed off, the defendant demanded depositions of the plaintiff and from thereon it went to trial.
It has been on request to Court of Appeals twice, once on the preliminary judgment, and the second on this instance here.
Chief Justice Warren E. Burger: Could you raise your voice a little Mr. Hall?
Mr. Burton H. Hall: Oh, I am sorry, Your Honor.
Getting onto the real meat of the question which is the nature of the Court of Appeal -- the power of the court inequity to award attorney's fees where the doing of justice requires.
I would suggest that this case is on off force with Mills against the Electric Auto Light Company.
In fact, it would be almost possible to strike out the word corporation and putting the word Union and have the identical case before us.
In Mills, certain minority stockholders brought the suit as Your Honors know, to challenge a merger.
This Court’s decision did not decide the merger question, but it was found by the District Court and this court agreed, that there was a violation of the duty of the corporation officers to send out non-misleading information.
The benefit conferred in other words on the corporation, and its members by the Mills case was a no-profit benefit, it was a non-monetary benefit.
It was the benefit of fair and democratic proceedings within the corporation just as the benefit which Mr. Cole has contributed to this Union and to its members, is the guarantee of democratic rights on the part of those Union members.
Chief Justice Warren E. Burger: And what was the source of the cause of action in the Mill’s case?
Mr. Burton H. Hall: I believe it was a suit to challenge a merger on the ground that the --
Chief Justice Warren E. Burger: Equity action or --?
Mr. Burton H. Hall: I believe it was a --
Chief Justice Warren E. Burger: Or was it statute?
Mr. Burton H. Hall: It rose under the Security’s Exchange Act, under a guarantee of non misleading statements to be sent out in shareholder’s votes.
Chief Justice Warren E. Burger: But it wasn't part of the structured statutory scheme, or was it that it was provided for stockholder suits, and stockholder claims, and remedies?
Mr. Burton H. Hall: The statute did provide for suit in other Sections, and it provided specifically for attorney’s fees in other Sections.
I believe in the Section under which it was brought, I believe Section 14, does not specifically say that suit can be brought.
Justice William H. Rehnquist: And wasn't that one of the reasons the court used to distinguish Mills from Fleischmann, where they have held attorney’s fees weren't permissible, was that in Fleischmann the statute had provided a private remedy, whereas in Mills, the Court had to imply the private remedy, and therefore was free to also imply attendant attributes of the remedy?
Mr. Burton H. Hall: I believe there are two distinctions, and were two distinctions in the Fleischmann case when they discussed -- they didn't request, Fleischmann did not discuss Mills.
I am thinking, this discussion of Spraig (ph), but I am tying it around then Mills discussion or Fleischmann.
First of all, Fleischmann was not such a suit as conferred a benefit on the defendant corporation or its members.
There was no way in Fleischmann that a fee award could operate so as to spread the cost of the litigation among the person’s benefit by the litigation.
Fleischmann was a straight trademark case.
The second distinction is, that one year that counsel is referring to, is the fact that in Lanham Act Section 35, suit under which Fleischmann was brought, there is a extremely specific and intricate statutory scheme for relief.
The statute specifies that profits may be obtained in addition to damages, in addition to costs.
It spells out the various ways in which the profits are to be determined, or if the District Court doesn't find the actual profits that are adequate, will find new ones.
The statute has prescribed in a elaborate detail, in fact, in the Landrum-Griffin Act, what the man may get if he bring suit.
Here, there is no such spelling out.
There is simply the provision by the statute that you can bring a suit for such relief as maybe appropriate.
That is to say, if the equivalent of saying you could bring suit, obviously the court gives on such relief as it deems appropriate and it would be impossible I think for Congress ever to specify -- to give more general language, to indicate a more general intact as to the nature of the relief given, and then it has in Section 102 of the Landrum-Griffin Act.
Justice William H. Rehnquist: Well, unless you take Mills where it didn't specify any private right at all, I mean, isn't -- this is really somewhere between Mills and Fleischmann, isn't it?
Mr. Burton H. Hall: Somewhere in that sentence; I believe the Section -- and I don't have the Section as I see that clearly in my mind to answer very specifically.
But I believe the right of a cause of action was newly discovered.
I think that's about as far as that point can be put.
I think that the Congress intended the action.
So my recollection in Section 18 is much more clear than the Railway Labor Act, inferred guarantee of a right to sue for a fair representation.
I believe that there is statutory indication, that for instance, an action done in violation of the requirement about non-misleading information would be void.
And this only would be actionable to make it void.
But I can't – I have to retreat, because I don't know if that was statutory.
Justice Harry A. Blackmun: Do you have any comment about Section 501(b) specific provision?
Mr. Burton H. Hall: 501(b) is a suit involving fiduciary -- it is a Section involving the -- no, 501(a) imposes a fiduciary duty on officials and 501(b) is a suit obtained for the benefit of the Union, relief for breach of the fiduciary duty.
It does not give to my mind general equitable powers to the court.
What's more the nature of the suit, contemplated in 501(b), is such that there would be no fee award in the sense of award-payable by the defendant as such, rather 501(b) talks about division of the monies recovered for the benefit and beyond.
I believe the set operative language is, the district court may allocate a portion of the recovery for the plaintiff – for counsel fees.
The district court's power, and probably I would suggest it does have the power in the 501(b) suit to award counsel fees in addition, would not come out of that clause as I understand, but would come out of the fact that perhaps that the amount recovered was not sufficient, and it was necessary to give counsel the award.
There is another distinction between the Section, I didn't mean to jump into it in the middle this way, that the two Sections which specify attorney’s fees awards in the Landrum-Griffin Act are the only Sections which specifically say that suit could be brought in state as well as in federal court.
Now, the power of a court of inequity to award counsel fees has been essentially a federal matter.
The states are various in their views on that question, and it is I believe possible that the Congress may have had in mind, a desire to make clear to all the state jurisdictions that counsel fees are properly awardable under the two sections, one is 201(c), and the other which relates to accounting a Bill of assets and so on, and then the other is the 501(b) that we have been talking about.
The history of the Act indicates very clearly that the desire, that many people in Congress, and certainly the ultimate drafters of the Act felt very strongly that counsel fees should be awardable in a case of this kind.
Senator Goldwater was extremely outspoken on the question, as Mr. Schulman has commented.
He apparently at first thought that the Senate Bill or that the Title I as it came out of the Senate, did not provide adequate guarantee that there would be counsel fees.
So he testified – so he voted against the Bill, he was the only senator who did.
He wanted in that initial time that came up in the Senate and so he urged some other kind of provision in the House Bill.
The House had before it, not the Senate Bill directly but the Elliot Bill, and the Elliot Bill was somewhat different in its language.
I have quoted the operative language on page 31 of my brief.
I would suggest that although as Congressman Elliot indicates, he intended very general relief by that provision, that in a style in which it's written, would suggest to somewhat flabbier approach to the powers of the court it comes before.
That at least must be the opinion of the nine Republican members of the House committee.
Those nine members, and they included Congressman Griffin, submitted a set of dissenting view of the minority report to the House report on the Elliot Bill.
They started it by saying, “We the undersigned members of the committee are convinced beyond doubt that H.R. 8342, that's the Elliot Bill, in its present form is woefully inadequate as a means of dealing with corruption and racketeering in the labor management field.”
Down further on their dissenting views as it becomes clear, that they are talking in large part about the Bill of rights, which they say has (Inaudible) down along with the elimination of adequate enforcement provisions.
That's their principle -- that's the first reason given for saying that the Elliot Bill is inadequate.
Then they had to come around specifically and they talk about counsel fees, they say, “one of the most serious inadequacy,” now they refer to the Senate Bill for reasons which I would suggest are something in a terminological error here, “is the lack of any infective enforcement procedure to infect -- to protect the Union members from those few Union officials who fail to recognize that the Union belongs to its members and so on.”
And they emphasize that there must be counsel fees awardable.
Then at the end of their descending views, they say very clearly, “that because of these inadequacies, we, us nine people, we are going to oppose this Bill, and we intend to support the Landrum-Griffin Bill when it comes up on the House floor.”
Now in fact, they did support the Landrum-Griffin Bill.
In fact, one of these was Mr. Griffin and the Landrum-Griffin Bill replaced the Elliot Bill.
That is it replaced the text.
The entire text of the Elliot Bill after the enacting clause was deleted and the text of the Landrum-Griffin put in.
I would submit that the very least, those statements by Mr. Griffin and by the other eight minority people indicate that when they pushed for the Landrum-Griffin Bill, they were pushing for language which they believed would be adequate which would guarantee counsel fees to Union members, which would be adequate in other words to meet the problem of corruption and racketeering in the unions.
Whether or not the Elliot Bill really was inadequate, of course is a dispute between them and Mr. Elliot.
Mr. Elliot believed that it gave wide relief at the language that he had to drawn up gave wide latitude to grant relief according to the necessities of the case.
They disagreed and so they opposed Mr. Eliot’s Bill and they put in their own and their own is virtually identical except for few additions like the parenthetical phrase, including injunctions with the Act as presently adopted.
I would suggest that as far as Mr. Goldwater, Senator Goldwater’s criticisms are concerned, Senator Goldwater on reflection must have concluded that the language of the Senate Bill, because the language of the Senate Bill was identical with the language of the Landrum-Griffin was after all sufficient, that its generality did give courts power to grant equitable relief including attorney’s fees.
Nothing at least more was said on the matter and it came before the Senate again.
And my recollection is although I can't say definite or certainty that Senator Goldwater ultimately voted for it.
I think if you are to conclude as my friend would that these congressmen and senators did not intend their final Bill to give attorney’s fees and they deliberately, then you would have to conclude that they deliberately pushed the Bill which they believe to be inadequate which would not meet the needs that were called for to combat corruption and racketeering.
I would suggest that implies a kind of Machiavellianism that should not be assumed and they should not be accused of unless there is something more suggestive.
I think one must draw from the gentlest overall history that these congressmen and senators wanted attorney’s fees to be available, they said so.
They felt that it would -- any Bill which failed to make them available would be woefully inadequate and so they chose language which on reflection and study was sufficient to make an attorney’s fee awardable under ordinary equitable principles.
Chief Justice Warren E. Burger: Thank you Mr. Hall.
Mr. Schulman, do you have any further?
Rebuttal of Howard Schulman
Mr. Howard Schulman: Just a few comments.
Number one, I would just like to direct my few comments to the issue of malice and the findings in connection therewith.
I think the trial court's findings will determine that and I don't intend to devote my time to that.
The issue I would like to point out specifically to this Court is that as this Court has so often admonished and advised us and told us that labor legislation is compromise of extreme views and the question of getting legislation passed is a distillation of the compromise and I think that's most reflected in the additional statement by the honorable Philip M. Landrum and honorable Robert P. Griffin talking about the permissible differences between the Elliot Bill and their Bill.
And they say in paragraph one, Title I of the substitute that Bill of rights for Union members is essentially the Bill rights in S1555 as it passed the Senate.
Those who have tried to pin a Union busting label on our Bill of rights, he is talking about the Landrum-Griffin would come into same label on 90 members of the other body manifesting to me so clearly.
Now what the Bill was in the Senate and which Senator Goldwater went before them, the House committee to tell them what the line was meant could not command a majority to bring forth any language to provide for expressly as required by the American law for the authority to grant counsel fees.
Thank you very much.
Chief Justice Warren E. Burger: Thank you gentleman.
The case is submitted.