Federal Courts continue to be a friendly venue for victims of illegal union actions. Recently in Waugh Chapel South, LLC v. UFCW Local 27, the Fourth Circuit Court of Appeals joined a growing number of Federal Courts in affirming the right to recover damages against a union for illegal secondary activity.
In that case, Waugh Chapel South, a real estate developer, sued the UFCW under the Section 303 of the Labor Management Relations Act. As we have written about previously, Section 303 provides a cause of action for victims of “unfair labor practices” as defined by the National Labor Relations Act . In its complaint, the developer alleged that the UFCW orchestrated fourteen separate sham legal challenges against its commercial real estate project in order to force it to terminate their relationship with Wegmans, non-unionized supermarket. The developer, rightfully, alleged that the UFCW was engaging in an illicit “secondary boycott” under § 158(b)(4)(ii)(B) of the NLRA.
According to the opinion, the UFCW activities began in December 2006 when union leadership “set[ ] its sights on Wegmans” to mount an antagonistic campaign. According to the developer, a union executive threatened that if Wegmans did not unionize, “we will fight every project you develop where Wegmans is a tenant.” The UFCW then directed and funded a barrage of legal challenges to the projects’ development. None of the challenges were brought directly by the UFCW. Rather the union funded various legal challenges by plaintiffs, who often lacked standing to challenge the development. All but one of these cases was dismissed.
The district court granted the UFCW motion to dismiss and the Fourth Circuit overturned it. The Fourth Circuit held that the UFCW’s “shaw” litigation could amount to illegal secondary activity under the NLRA. Accordingly, the Fourth Circuit revived the developer’s lawsuit.
The Waugh Chapel case shows that federal courts are not willing to tolerate illegal union shenanigans. For anyone suffering from illegal secondary activity at the hands of union, a federal action under Section 303 of the LMRA is worth consideration.
Wally Zimolong
Wally represents contractors (and subcontractors) and developers. His clients build and develop residential, commercial, and industrial properties nationwide. Wally enjoys working with the owners of the businesses he represents because they tend to be entrepreneurs and all around interesting people.
