5-10-13 midland electrical contracting corp. v. united electrical workers union, iujat, local 363 et...

Case 1:13-cv-02804-KAM-VMS Document 1 Filed 05/10/13 of 11 PageID #: 1

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK ----------------------------------------------------------------------X MIDLAND ELECTRICAL CONTRACTING CORP.,

Plaintiff,

-against-

UNITED ELECTRICAL WORKERS UNION, IUJAT, LOCAL 363 and BUILDING INDUSTRY ELECTRICAL CONTRACTORS' ASSOCIATION,

Defendants. ----------------------------------------------------------------------X

Civil Action No:

COMPLAINT FOR DECLARATORY JUDGMENT

Plaintiff Midland Electrical Contracting Corp. by its attorneys, Rabinowitz &

Galina, Esqs, as and for its Complaint against Defendants United Electrical Workers

Union, IUJAT, Local363 and Building Industry Electrical Contractors' Association

alleges as follows:

STATEMENT OF THE CASE

1. Plaintiff brings this action for a judgment declaring that its Collective Bargaining

Agreement ("Local 363 CBA") with Defendant Local 363 is invalid and

unenforceable due to Defendants' inability to perform its essential contractual

obligations as required under the Local 363 Collective Bargaining Agreement due

to the impact of project labor agreements entered into by various public entities,

including the City of New York and New York City School Construction

Authority that mandates the representation of workers by different unions and

precludes representation and participation by Defendants as a collective

bargaining representative of workers on such publicly "owned" construction

projects.

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PARTIES, JURISDICTION AND VENUE

2. Plaintiff Midland Electrical Contracting Corp. ("Midland") is, and at all times

relevant herein was, a domestic corporation engaged in the electrical construction

industry and maintains an office for the transaction of business at 530 Midland

Avenue, Staten Island, New York 10306.

3. Upon information and belief, Defendant United Electrical Workers of America,

IUJAT, Local363 (the "Union") is, and at all times relevant herein was, a trade

union that is the collective bargaining representative for laborers in the electrical

construction industry and maintains an office for the transaction of business at

138-50 Queens Boulevard, Briarwood, New York 11435.

4. Upon information and belief, Defendant Building Industry Electrical Contractors

Association (hereinafter the "Association" or "BIECA") is, and at all times

relevant herein was, a trade association comprised of electrical contractors and

maintains an office for the transaction of business at 926-B Lincoln Avenue, Unit

B, Holbrook, New York 11741.

5. This is an action for, inter alia, declaratory relief and breach of contract, arising

under the provisions of a Collective Bargaining Agreement and as such this Court

has subject matter jurisdiction of the action pursuant to section 301 of the Labor

Management Relations Act (29 U.S.C.A. 185).

FACTS COMMON TO ALL COUNTS

The Collective Bargaining Agreements between Midland and the Union

6. That on or about July 1, 2010, Midland and the Union entered into an

"Assumption Agreement" by which it was agreed that Midland would be bound

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by the terms and conditions of a Collective Bargaining Agreement entered into by

the Union and the Association for the period of December 1, 2008 through

November 30, 2011 (hereinafter the "2008 CBA") .

7. That the Assumption Agreement further provided that Midland agreed that the

Association, on behalf of Midland, would negotiate successor Collective

Bargaining Agreements with the Union unless the Collective Bargaining

Agreement was properly terminated by Midland "in accordance with the renewal

and/or Termination Provisions of the Association Collective Bargaining

Agreement." A copy of the Assumption Agreement is annexed hereto as Exhibit

"A".

8. Upon information and belief, the 2008 CBA provided that it could be modified,

amended and/or renegotiated if a party to the Agreement gave written notice to

the other party at least sixty (60) days prior to the date of the expiration of the

Agreement.

9. On or about December 1, 2011, Defendants Union and Association entered into a

new Collective Bargaining Agreement for the period of December 1, 2011

through November 30, 2014. (the "2011 CBA"). A copy of the 2011 CBA is

attached hereto as Exhibit "B".

10. The pertinent sections of the 2011 CBA are as follows:

1. Article 1(a)- "The ASSOCIATION and the EMPLOYERS, hereby recognize the UNION is the "sole and exclusive bargaining representative of all of the electrical workers, including electricians, electrical maintenance mechanics, helpers and apprentices and trainees who are or hereafter may be employed by EMPLOYERS .... " (emphasis added)

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2. Article 2(a)- "All present EMPLOYEES who are members of the UNION on the execution or effective date of this Agreement, whichever is later, shall remain members of the UNION at least to the extent of paying UNION dues and initiation fees uniformly required as a condition of acquiring or retaining membership. All present EMPLOYEES who are not members of the UNION, and all EMPLOYEES hired hereafter shall become and remain members of the UNION at least to the extent of paying UNION dues and initiation fees uniformly required ....

3. Article 25(a) requires all employers to participate and make contributions to the following funds for each union employee covered by the CBA:

1. The Building Trades Annuity Benefit Fund. 2. The Building Trades Educational Benefit Fund. 3. United Service Workers Union Security Fund. 4. The Building Trades Welfare Benefit Fund. 5. Electrician's Retirement Fund.

The Project Labor Agreements entered into the City and NYCSCA

11. Plaintiff is primarily engaged in the performance of electrical construction

contracts in the City of New York and in the nearby suburbs.

12. Plaintiff desires to submit bids to perform electrical construction projects for

various agencies and departments of the City ofNew York (the "City") and the

New York City School Construction Authority ("NYCSCA").

13. That many of the projects that are "owned" by the City and the NYCSCA are

subject to a Project Labor Agreement ("PLA") and the Contractors retained to

perform said Projects must agree to the conditions and obligations set forth in the

PLA.

14. New York State Labor Law section 222 provides that a PLA is a "pre-hire

collective bargaining agreement between a contractor and a bona fide building

and construction trade labor organization establishing the labor organization as

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the collective bargaining representative for all persons who will perform work on

a public work project, and which provides that only contractors and

subcontractors who sign a pre-negotiated agreement with the labor organization

can perform project work."

15. That the PLAs entered into by the City and NYCSCA require that the Contractor

that performs work shall be bound by the Agreement and that the Contractors

shall include in any subcontract that they enter into shall include a provision that

the Subcontractor shall be bound by the PLA.

16. That the PLAs entered into by the City and the NYCSCA provide that "[t]he

Contractors recognize the Unions as the sole and exclusive bargaining

representatives of all craft employees who are performing on-site Program Work,

with respect to that work." See "Article 4 Union Recognition and Employment,

Section 1. Pre-Hire Recognition" at pg. 10 ofNYCSCA PLA annexed hereto as

Exhibit "C". See "Article 4 Union Recognition and Employment, Section 1. Pre

Hire Recognition" at pg. 9 of the "Project Labor Agreement Covering Specified

Renovation & Rehabilitation of City Owned Buildings and Structures" annexed

hereto as Exhibit "D".

17. That under the terms of the NYCSCA and City PLA's the unions that are

permitted to perform construction work are affiliated with the Building and

Construction Trades Council of Greater New York and Vicinity ("Council"). See

City and NYCSCA PLA at Section 4 "Supremacy Clause" and Schedule A

18. That the PLA for the NYCSCA and City expressly incorporates the terms and

conditions of the Collective Bargaining Agreement between New York Electrical

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Contractors Association, Inc. and the Association of Electrical Contractors, Inc.

and Local Union No.3 International Brotherhood of Electrical Workers, AFL-

CIO (hereinafter referred to as the "Local 3 CBA"). A copy of said IBEW Local

3 Agreement is annexed hereto as Exhibit "E".

19. That in order for the Plaintiff to perform electrical construction work on

renovation and rehabilitation projects for City Agencies and the NYCSCA it must

agree, pursuant to the PLAs, that International Brotherhood of Electrical Workers

Local 3 ("IBEW Local 3") will be the sole and exclusive bargaining

representative of all of its employees that perform said electrical construction

projects.

20. Pursuant to the PLA's, Midland is obligated to abide by the terms of the

Collective Bargaining Agreement of IBEW Local 3 including the remittance of

benefit payments and dues when it performs the applicable electrical work for the

City and the NYCSCA.

21. The IBEW Local 3 CBA at Article I, Section 2( d) provides, in pertinent part that:

"All Employers who are a party to this contract acknowledge and agree that the jurisdiction of Local Union No.3 I.B.E.W. as set forth in the Agreement, as well as all work traditionally performed by members of Local Union No.3. I.B.E.W., is recognized as the work and jurisdiction of members of Local Union No. 3 I.B.E. W. Each Employer who is a party to this Agreement may not enter into a Collective Bargaining Agreement in which it agrees to have non-Local Union 3 I.B.E. W. members perform such work. LOCAL UNION No.3 I.B.E. W. 'S JURISDICTION OVER THE WORK SET FORTH HEREIN WILL SUPERSEDE ANY AND ALL OTHER AGREEMENTS OR AKRANGMENTS EMPLOYERS ENTER INTO." (Emphasis added).

22. The IBEW Local3 CBA at Article I, Section 2(h) provides, in pertinent part that:

"All employees employed by the Employer, shall, as a condition of employment, be or become members of the Union on the 11th day following the beginning of

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their employment. All employees who are or become members of the Union shall remain members of the Union during the term of this Agreement as a condition of employment."

23. That Local 363 is not affiliated with the Council and IBEW Local 3 and as such it

is not permitted to perform work under the PLAs for the City and the NYCSCA.

The Lawsuit by BIECA against the City and Council

24. That Defendant BIECA brought an action against the City of New York and the

Council alleging that the PLAs were improper on several grounds in a lawsuit

known as Building Industry Electrical Contractors Assoc. v. The City of New

York, et. al., United States District Court, Southern District of New York, Case

no. 10 Civ. 8002 (RPP) (hereinafter referred to as "BIECA v. City").

25. Defendant City and Council in BIECA v. City moved to dismiss the Complaint

and by an "Opinion and Order" dated August 4, 2011 the Hon. Robert P.

Patterson, Jr. granted the City and Councils' motion to dismiss the Complaint.

AS AND FOR A FIRST CAUSE OF ACTION (Anticipatory Breach of Contract)

26. Plaintiff repeats and realleges each and every allegation contained in paragraphs

"1" through "25" of the Complaint with the same force and effect as if more fully

set forth at length herein.

27. The Union and BIECA are not allowed to participate in the City and NYCSCA's

PLAs and Defendants are not permitted to be the "sole and exclusive bargaining

representative of all of the electrical workers, including electricians,

electrical maintenance mechanics, helpers and apprentices and trainees who

are or hereafter may be employed" (emphasis added).

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28. Thus, Defendants cannot perform a fundamental and integral part of the 2011

CBA because it cannot be the "sole and exclusive bargaining representatives" of

Midland's trades people when Midland performs work for the City and NYCSCA

pursuant to an applicable PLA.

29. The PLA and IBEW Local3 CBA requires any contractor performing electrical

construction work on projects "owned" by the City and the NYCSCA to

recognize IBEW Local 3 as said sole and exclusive bargaining representative and

requires employees that perform said work to become members of IBEW Local 3

on the 11th day following the beginning of their employment.

30. Midland intends to submit bids and procure contracts from the City and the

NYCSCA to perform Projects that require Midland to agree to the terms and

conditions of the PLAs.

31. That Defendants' inability to perform its fundamental obligations under the terms

of its CBA constitutes a breach of said Agreement.

32. Further, it is legally impossible for the Defendant Union to represent Midland's

employees that are performing work on PLA projects and that said employees

must become members of IBEW Local 3 after working 11 days on said Projects

and as such, Midland's performance under the CBA should be excused.

33. Thus, Plaintiff seeks a declaratory judgment declaring the CBA to be null and

void, of no force and effect and Midland's performance under the CBA should be

excused when Midland performs work pursuant to any Project Labor Agreements

that require Midland to recognize IBEW Local 3 as the sole and exclusive

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bargaining representative of its craft employees who are performing work covered

by the said Agreement.

AS AND FOR A SECOND CAUSE OF ACTION (Fraudulent Inducement)

34. Plaintiff repeats and realleges the allegations contained in paragraphs "1" through

"33" of the Complaint with the same force and effect as if more fully set forth at

length herein.

35. That the Association failed to advise Midland that the City and Council had

obtained an order that dismissed its complaint in the BIECA v. The City matter.

36. That the Association and Union should have advised Midland that its lawsuit

challenging the validity of the City PLAs had been dismissed.

37. That if the Association and Union had advised Midland that Judge Patterson had

dismissed the lawsuit on August 4, 2011, then Midland would have withdrawn

from the Association and terminated the 2008 CBA pursuant to the terms of said

2008 CBA and it would not have agreed to enter into the Association's

subsequent CBA with the Union on December 1, 2011.

38. That the Association's and Union's failure to advise Midland of the dismissal of

its action was misleading, deceptive and constituted a material omission of a

crucial fact.

39. That the Association's failure to advise Midland of the Court's Opinion and Order

in BIECA v. The City, which would have enabled it to withdraw from the

Association and terminate the Collective Bargaining Agreement prior to the

execution of the subsequent CBA on December 1, 2011 constitutes fraudulent

inducement.

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40. By virtue of the foregoing, Midland's agreement with the Association and its

assent for the Association to enter into the July 1, 2010 Assumption Agreement

and the December 1, 2011 CBA on its behalf with the Union was procured

through fraud and thus, the Association's Agreement and 2011 CBA should be

declared null and void.

41. Midland request a declaratory judgment declaring the 2011 CBA to be null and

void and of no force and effect on the grounds that it was procured through the

fraudulent misrepresentations and omissions of the Union and Association.

WHEREFORE, Plaintiff Midland requests a declaratory judgment against

Defendants as follows:

1. For a declaratory judgment declaring the Collective Bargaining Agreement to

be null and void, of no force and effect and excusing Midland's performance under said

Agreement when Midland performs work pursuant to Project Labor Agreements that

require Midland to recognize IBEW Local 3 as the sole and exclusive bargaining

representative of its craft employees who are performing work covered by said

Agreement.

2. For a declaratory judgment declaring the Collective Bargaining Agreement to

be null and void, of no force and effect as to Midland on the grounds that the December

1, 2011 Collective Bargaining Agreement was procured through fraud due to the material

omission of the dismissal of the Complaint in the BIECA v. The City matter; and

3. For such other and further relief including an award of attorneys' fees, costs

and disbursements as to this Court may seem just and proper.

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Dated: May 2, 2013

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5-10-13 midland electrical contracting corp. v. united electrical workers union, iujat, local 363 et...

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