Kinslow, William v. American Postal Work ( 2000 )

In the
United States Court of Appeals
For the Seventh Circuit
No. 99-2293
William Kinslow,
Plaintiff-Appellee,
v.
American Postal Workers Union,
Chicago Local,
Defendant-Appellant.
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 92 C 4120--Milton I. Shadur, Judge.
Argued February 11, 2000--Decided August 2, 2000
Before Posner, Manion and Kanne, Circuit Judges.
Manion, Circuit Judge. The late Tommy Briscoe
used his presidency of the Chicago Local of the
American Postal Workers Union to facilitate
several different criminal schemes, including the
embezzlement of Union funds. For obvious reasons,
Briscoe and the Union secretary Elizabeth Bell
didn’t take kindly to Union member William
Kinslow’s persistent complaints and inquiries
about Union finances. When Kinslow went so far as
to request access to the Union’s financial
records and to sue the Union, it retaliated by
expelling him. Kinslow sued Briscoe, Bell, and
the Union under the Labor Management Reporting
and Disclosure Act of 1959 ("LMRDA"). After a
bench trial, Kinslow prevailed on his retaliation
and access to financial records claims. He was
awarded overtime pay, punitive damages,
attorney’s fees, and injunctive relief. The Union
appeals, raising numerous arguments. Only its
argument concerning overtime pay might have
merit, so we vacate the award of overtime pay and
remand the case for more specific findings on
this claim. We affirm in all other respects.
I.
Tommy Briscoe was first elected president of the
4,000-member Chicago Local of the American Postal
Workers Union in 1982. He soon began using his
office for criminal schemes and was eventually
indicted for embezzling Union funds. One of his
partners in crime was codefendant Elizabeth Bell,
who served as the Union’s secretary and treasurer
from 1981 until 1992. Briscoe was eventually
convicted on fourteen counts, including charges
of making illegal loans, destruction of financial
records, mail and wire fraud, income tax evasion,
and theft and embezzlement of union funds. United
States v. Briscoe, 65 F.3d 576, 582 (7th Cir.
1995)./1 For her part, Bell pleaded guilty to
aiding and abetting Briscoe in obtaining illegal
loans from the Union. Because the present case
was suspended due to Briscoe’s criminal case, by
the time it went to trial, Briscoe had died.
William Kinslow was a member of the Union since
1971. During the early part of the Briscoe
administration, Kinslow served as executive vice
president of the Local, during which time he
began to suspect that something was amiss with
Briscoe’s use of Union funds. On many occasions
he accused Briscoe and Bell of financial
improprieties, such as using Union funds to lease
Briscoe’s car, bouncing checks drawn on Union
accounts, and illegally "borrowing" funds from
the Union. In October 1991, after Briscoe and
Bell were indicted for their crimes, Kinslow
requested from Bell copies of the Union’s
financial records, as was his right under federal
law. For reasons that are now obvious, Bell
ignored his requests.
Various Union leaders became fed up with Kinslow
and began to retaliate against him. Several Union
stewards refused to file grievances on Kinslow’s
behalf regarding the Postal Service’s refusal to
assign Kinslow overtime work. In an apparent
effort to silence Kinslow or at least to make his
charges seem incredible, the stewards threatened
Kinslow and disparaged him to other Union
members. In response, Kinslow submitted repeated
complaints to Briscoe and the national Union
about the objectionable treatment. These
complaints were essentially ignored. The final
straw came in July 1992, when Kinslow sent a
letter to the Local’s executive board outlining
Briscoe’s pattern of conduct and reminding the
board of Briscoe’s indictment. When Briscoe
learned of the letter, he invited Kinslow to
attend a board meeting to present his case.
Kinslow declined, not only because of his claimed
fear of bodily injury, but also because he
recognized the futility of attending a Briscoe-
led meeting. He did, however, urge the board to
conduct its own investigation of Briscoe.
Instead, the board charged Kinslow with engaging
"in conduct that would expose the Union to civil
liability," meaning his filing of this suit.
Ironically, it is this charge that set in motion
the events which would contribute to the Union’s
civil liability in this case. Although the
accusation was out of line, in October 1992 the
Union members voted unanimously to expel Kinslow.
This gave Kinslow the distinction of being the
only member expelled from the Union in at least
twenty years. Undeterred, Kinslow appealed his
expulsion to the national Union, but as usual he
received no response.
Kinslow’s suit was brought pursuant to the
LMRDA, which was enacted to ensure that unions
and their officials "adhere to the highest
standards of responsibility and ethical conduct."
29 U.S.C. sec. 401(a). After the expulsion,
Kinslow amended his complaint to allege that the
Union retaliated against him for bringing the
suit and for exercising his right to protest
unethical conduct, and that the Union refused him
access to the financial records. 29 U.S.C.
sec.sec. 411(a)(2), 411(a)(4), 431(c). Because
much of the evidence was undisputed, the district
court needed only a three-day bench trial to find
for Kinslow on all claims. The court granted
equitable relief in the form of Kinslow’s
reinstatement and an injunction against further
retaliation. It also awarded $40,000 for overtime
wages that Kinslow lost because the Union failed
to file grievances on his behalf, $1 for his loss
of his LMRDA free speech rights, $150,000 in
punitive damages, and attorneys’ fees. Although
Briscoe and Bell were also defendants, Briscoe
died on the eve of trial and Bell is presumably
judgment-proof, which explains why only the Union
appeals.
II.
A. Examination of Union Financial
Records
The Union presents a series of arguments
asserting that the district court erred in
finding that the Union violated Section 431 of
the LMRDA by refusing Kinslow access to the
Union’s financial records. To understand the
Union’s arguments, a little background concerning
the LMRDA is necessary.
After determining that some union leaders were
running their organizations primarily for their
own benefit, Congress enacted the Labor
Management Reporting and Disclosure Act of 1959,
in part to curb embezzlement and other unlawful
activities. Finnegan v. Leu, 456 U.S. 431, 434
(1982); Mallick v. International Bhd. of Elec.
Workers, 749 F.2d 771, 776 (D.C. Cir. 1984).
Among other things, the LMRDA requires unions to
file annual financial reports with the Secretary
of Labor--known as LM-2 reports--detailing the
union’s assets, liabilities, and disbursements.
29 U.S.C. sec. 431(b). Because union members are
often in the best position to discover union
corruption and have a vested interest in honest
union leaders, the Act also requires unions to
make available to their members those records
which purportedly corroborate the LM-2 reports.
29 U.S.C. sec. 431(c); Conley v. United
Steelworkers of Am., Local Union No. 1014, 549
F.2d 1122, 1123 (7th Cir. 1977). The provision is
designed "to make full information related to the
financial affairs of unions available to members
in order that they would be ’strengthened in
their efforts to rid themselves of untrustworthy
or corrupt officers.’" Conley, 549 F.2d at 1124
(quoting Antal v. District 5, United Mine Workers
of Am., 451 F.2d 1187, 1189 (3d Cir. 1971)). But
access to these reports is not unfettered.
Believing that some union members might harass
union officials with repeated requests for
documents, the LMRDA only requires the production
of financial records when the request is based on
good cause. Specifically, the LMRDA states:
Every labor organization required to submit a
report under this subchapter shall make available
the information required to be contained in such
report to all of its members, and every such
labor organization and its officers shall be
under a duty . . . to permit such member for just
cause to examine any books, records, and accounts
necessary to verify such report.
29 U.S.C. sec. 431(c) (emphasis added). Thus, in
pursuing judicial enforcement of this right, the
plaintiff has the burden of showing that he has
just cause for seeking the information and that
his request is not simply based on idle
curiosity. Mallick, 749 F.2d at 784.
In attacking the district court’s findings on
this claim, the Union first argues that Kinslow
had no just cause to see the Union’s financial
records. Many courts have noted that the
"standard for determining whether there was just
cause is necessarily minimal. Just cause need not
be shown beyond a reasonable doubt, nor by a
preponderance of the evidence. It need not be
enough to convince a reasonable man that some
wrong has been done . . . ." Fruit and Vegetable
Packers and Warehousemen Local 760 v. Morley, 378
F.2d 738, 744 (9th Cir. 1967); see Landry v.
Sabine Indep. Seamen’s Ass’n, 623 F.2d 347, 349
(5th Cir. 1980). Indeed, a union member need not
even suspect an impropriety, although a
reasonably-based suspicion would certainly
constitute just cause. The just cause requirement
simply entails a showing that the union member
had some reasonable basis to question the
accuracy of the LM-2 or the documents on which it
was based, or that information in the LM-2 has
inspired reasonable questions about the way union
funds were handled. Mallick, 749 F.2d at 781
("Typically, union members will be interested in
looking at underlying records precisely because
they believe the LM-2 reports are accurate, and
raise questions about the handling of union
funds.")./2
In this case, at the time Kinslow initially
requested the records, Briscoe and Bell had
already been indicted for embezzlement and for
issuing improper loans with union funds. The
existence of the indictment indicates that an
impartial grand jury believed that crimes
relating to union disbursement of funds probably
occurred. Clearly the indictment gave Kinslow a
rational basis for his suspicions and a good
reason to inspect the Union’s financial records.
Because just cause under the LMRDA requires less
than a reasonable suspicion of wrongdoing, and an
indictment’s indication of probable cause easily
surpasses the requisite showing, an indictment
for financial improprieties within the Union
certainly satisfies the just cause requirement.
Only a criminal conviction for embezzlement,
which requires proof beyond a reasonable doubt,
could provide a stronger basis for good cause.
Incidentally, even after Briscoe was convicted
and Bell pleaded guilty, the Union continued to
refuse to provide Kinslow with the requested
documents. Because either the indictment or the
convictions would instill in any reasonable
person a level of skepticism surpassing
reasonable suspicion, the Union’s argument that
Kinslow lacked just cause is patently frivolous.
Its next argument isn’t much better. The Union
contends that it had no duty to turn over the
financial records to Kinslow because at the time
he requested the documents he didn’t state his
reason for seeking them. Notably, the text of
Section 431 seems to require the plaintiff to
show at trial that he had good cause to examine
the books. It doesn’t explicitly require that the
union member inform the union of the reasonable
basis for his inquiry. The "notice of reasons"
requirement to which the Union points is a
judicial addition which apparently is based on a
hope that once the union learns of the member’s
good cause, it will comply with its duty to turn
over documents without requiring the member to
resort to litigation. Morley, 378 F.2d at 743.
This reasoning may have some logic to it, but it
also has obvious limitations. It seems likely
that corrupt union officials would be more
reluctant to produce incriminating documents once
they know that suspicion is converging on them.
At that point, they have little to gain by
handing over incriminating documents, and much to
lose, specifically because they know that there
is good cause for suspicion. Thus, contrary to
the rationale underlying this rule, notice of
good cause might make unions less inclined to
cooperate.
We also note that in Morley, the case from which
this requirement originated, the Ninth Circuit
acknowledged that there is no specific statutory
requirement of prior notice, and whatever right
there was to notice was waived in that case.
Furthermore, the D.C. Circuit case cited by
Morley in support of the existence of this notice
requirement in fact never adopted such a rule.
See International Bhd. of Teamsters, Chauffeurs,
Warehousemen and Helpers of Am. v. Wirtz, 346
F.2d 827, 832 (D.C. Cir. 1965) (assuming without
deciding that the member must give notice to the
Union of his just cause at the time the document
request is made). Although we too previously
derived from legislative history the assumption
that this requirement is legitimate, see Conley,
549 F.2d at 1124, it seems that even if the
rationale underlying the policy were sound, the
desire to encourage the settlement of the claim
without litigation is hardly a sufficient basis
for whittling away a union member’s statutory
rights. This is especially so when we consider
that the notice prerequisite cuts against the
statute’s goal of permitting timely access to
union financial records in order to prevent
corruption. But we need not further address this
issue today because even those courts that have
added this condition recognize three separate
exceptions, any one of which is applicable here.
Specifically, a union member seeking union
financial records need not inform the union of
his basis for suspecting financial improprieties
when the basis for his suspicions should be known
to the union, when the union waives this notice
requirement by failing to ask for his reasons, or
when a reasonable union member would believe that
providing such notice would be futile. Morley,
378 F.2d at 743; cf., Bagsby v. Lewis Bros. Inc.
of Tenn., 820 F.2d 799, 805 (6th Cir. 1987)
(Ryan, J., concurring); Retana v. Apartment,
Motel, Hotel and Elevator Operators Union, Local
No. 14, AFL-CIO, 453 F.2d 1018, 1027 (9th Cir.
1972).
Here, Briscoe and Bell’s indictment for
embezzlement was well known among the union
leadership, and so Kinslow’s reason for seeking
the records should have been obvious to the Union
as well. Because the Union had notice of
Kinslow’s just cause for desiring to examine the
documents, Kinslow was not obliged to inform the
Union of his obvious reasons. Furthermore, even
if there had been no indictment, Kinslow would
still be exempted from any duty of prior notice
because Briscoe’s criminal exploits were so well
known within the union that any reasonable
members should have suspected that criminal
conduct was afoot. See Briscoe, 65 F.3d at 580
(describing Briscoe’s exploits, including
testimony that he openly destroyed union records
and instructed the Union’s administrative staff
to collect loan application fees only in cash).
As a second independent ground for excusing
actual notice, the Union waived any right to
notice by failing to ask Kinslow about his
reasons for requesting the documents. Instead of
attempting to find out what prompted Kinslow’s
demand, the Union simply ignored his requests. In
a nearly identical case, the Ninth Circuit held
that this constitutes waiver. It stated:
Here the members presented a written demand to
inspect the records. The union’s answer was to
ignore the demand. Had it wished to exercise its
right to have a showing of just cause, the union
should have asked the demanding members to allege
such cause. To completely ignore the members’
demand is inconsistent with the purpose of the
union’s rights to first consider the just cause
allegation. To ignore the members’ demand is a
reflection of the union officers’ attitude that
they are unconcerned with the demand, whether or
not it is supported by just cause.
Morley, 378 F.2d at 743. The Postal Workers Union
displayed the same attitude in refusing to
respond to Kinslow’s demands, so any right it had
to notice was waived. This attitude lends support
to a third independent reason to excuse notice:
futility. The Union’s repeated acts of disdain
for Kinslow’s rights would lead a reasonable
person to believe that even if Kinslow set forth
a detailed list of his reasons for suspecting
illegal conduct, the Union would still have
refused to produce the documents. Section 431
doesn’t require a union member to perform futile
acts in order to vindicate his rights.
Accordingly, Kinslow was under no obligation to
provide the Union with a detailed list of his
concerns when this would most likely prove
fruitless.
The Union next argues that Kinslow didn’t
specifically identify the documents he wanted. We
have already discussed the hollowness of this
argument in the context of the Jencks Act; it is
impossible for a person requesting documents he
has never seen to describe them with great
detail. United States v. Johnson, 200 F.3d 529,
534 (7th Cir. 2000); United States v. Allen, 798
F.2d 985, 997 (7th Cir. 1986). In recognition of
this fact, the LMRDA, like the Jencks Act, does
not require great precision in crafting requests.
Rather, we perceive the statute to require only
minimal specificity. Here, Kinslow requested
"full financial disclosure of our Local’s
Financial business including copies of the
General Account, Payroll Account and also the
full minutes of both the Executive Board and
General meeting minutes. For months beginning May
1990 to September 1991." This request was
sufficiently specific to apprise the Union of
what Kinslow desired. Moreover, to the extent it
was imprecise or overly broad, the Union waived
any objection by failing to ask Kinslow for more
precision, as we discussed above with respect to
notice of just cause. Accordingly, we reject the
Union’s lack of specificity argument.
The Union’s last argument concerning Kinslow’s
access claim is that it was impossible to comply
with his request because either the Departments
of Labor or Justice had the relevant documents.
This argument seems specious in light of its late
introduction into the case and the Union’s
contention that it couldn’t even tell what
documents Kinslow wanted. If it didn’t know what
documents Kinslow was requesting, it is unlikely
that it could know that it didn’t have them. This
apparent inconsistency might be reconcilable if
the government had seized all of the Union’s
financial documents and the Union kept no copies,
but the record indicates otherwise. Regardless,
there is sufficient evidence in the record to
support the district court’s implicit finding
that the Union had the documents, so we cannot
say that the district court erred in granting
relief on this claim.
B. Overtime Pay
The Union next attacks the district court’s
award of $40,000 for Kinslow’s lost overtime with
essentially three arguments. First, the Union
contends that the award is barred by the statute
of limitations, but as the district court noted,
the Union waived its statute of limitations
argument by failing to develop it before the
district court. Its second argument is that the
award was the result of the district court’s
prejudice against the Union, but because this
argument is undeveloped on appeal, it too is
waived. Kelly v. United States E.P.A., 203 F.3d
519, 522 (7th Cir. 2000). This leaves only the
Union’s argument that it cannot be held liable
for the lost overtime because only the Postal
Service could award overtime. For his part,
Kinslow concedes that only the Postal Service
awards overtime, but he maintains that the Union
is also responsible for its retaliatory failure
to grieve his complaint to the Postal Service.
Although Kinslow’s claim is for retaliation
based on the exercise of his LMRDA free speech
rights, it is a hybrid claim in the sense that
the harm Kinslow suffered stemmed from both his
employer’s denial of overtime and the Union’s
failure to grieve the wrong. Such claims are
usually brought against the Union in suits for
breach of the duty of fair representation and
against the employer for breach of the collective
bargaining agreement. See 29 U.S.C. sec. 185(b);
Christiansen v. APV Crepaco Inc., 178 F.3d 910,
913 n.2 (7th Cir. 1999) (hybrid cases entail an
employer’s breach of the CBA and the union’s
breach of its duties to grieve the wrong
committed by the employer); Demars v. General
Dynamics Corp., 779 F.2d 95, 97 (1st Cir. 1985).
Even though no claim was brought against the
Postal Service, in hybrid cases the district
court is required to assign responsibility to
both the union and the employer according to
which party is most culpable for the specific
facets of harm suffered by the plaintiff. The key
in such suits is "to apportion liability between
the employer and the union according to the
damage caused by the fault of each," so that the
union does not have to pay the employer’s share
of the damages, and vice-versa. Vaca v. Sipes,
386 U.S. 171, 197 (1967); Seymour v. Olin Corp.,
666 F.3d 202, 213 (5th Cir. 1982). For purposes
of apportioning responsibility, the fact that
Kinslow is suing for retaliation as opposed to
breach of the duty of representation is of no
moment, as the general principles applicable to
breach of the duty of fair representation cases
apply equally to retaliation cases.
In Bowen v. United States Postal Service, the
Supreme Court reviewed a district court’s
apportionment of damages in a hybrid case arising
out of a postal employee’s wrongful termination
and the union’s wrongful failure to grieve his
complaint. 459 U.S. 212, 214 (1983). Because both
the union and the Postal Service shared
responsibility for the employee’s lost wages, the
Court apportioned damages according to a temporal
framework. Thus, as the employer was responsible
for the employee’s discharge, the Court held that
the Postal Service was liable for all the pay the
employee would have earned prior to the time he
would have been reinstated had the union properly
pursued his case. But because the employee
probably would have been reinstated had the union
promptly sought redress, the Court thought that
it would be "unjust to require the employer to
bear the increase in the damages caused by the
union’s wrongful conduct." Therefore, it held
that only the union was liable for the wages the
employee would have earned after he would have
been reinstated had the union fairly represented
him. 459 U.S. at 223; see Cruz v. Local Union
Number 3 of the Int’l Bhd. of Elec. Workers, 34
F.3d 1148, 1158 (2d Cir. 1994); Aguinaga v.
United Food and Commercial Workers Int’l Union,
993 F.2d 1463, 1475 (10th Cir. 1993); Niro v.
Fearn Int’l, Inc., 827 F.2d 173, 179 (7th Cir.
1987).
In our case, Kinslow’s lost opportunity to work
overtime is initially traceable to the Postal
Service’s breach of the CBA through its failure
to assign him overtime. So the Postal Service’s
responsibility begins with the time it first
breached the CBA, and had Kinslow also sued the
Postal Service, it would have been responsible
for the damages accruing from the initial lost
opportunity to work overtime. As far as the
Union’s responsibility for Kinslow’s predicament,
he does not allege that the Union affirmatively
caused the Postal Service to breach the
agreement, which would be the only basis for
assigning responsibility to the Union for the
breach. Instead, Kinslow only claims that the
Union failed to rectify the breach by refusing to
file a grievance on his behalf. So the Union
cannot be held responsible for any overtime
Kinslow lost prior to the date Kinslow would have
been reinstated if it had processed his
complaints. The Union is liable, however, for the
lost overtime which occurred after it should have
sought a remedy for the Postal Services’s breach
of the CBA. Thus, we reject the Union’s argument
to the contrary.
All that is left is to determine what portion,
if any, of the $40,000 awarded is derived from
overtime Kinslow lost prior to the date he would
have obtained overtime work had the Union not
retaliated against him; that is, what portion of
the award is attributable to the Postal Service
rather than the Union. We cannot make this
determination on the present record, however,
because the district court made no specific
findings as to the date the Union should have
filed a grievance, and the date the grievance
should reasonably have resolved Kinslow’s
dilemma. Thus, we cannot say whether the award of
overtime pay accurately reflects that portion of
harm for which the Union is responsible, although
the record seems to indicate otherwise.
Therefore, we must vacate the award and remand
the case to the district court so that it might
reconsider its award and enter further findings.
Such findings should include the date Kinslow was
first denied overtime, the date Kinslow first
complained about his plight, the date he would
have been allowed to work overtime had the Union
grieved his complaint, the amount of overtime he
likely would have worked, and the amount of
compensation he would have received per hour of
overtime. Of course, the district court may
exercise its discretion to reopen the record and
receive additional evidence on these points.
Although we do not retain jurisdiction over this
case, any disagreement with the district court’s
subsequent award could be addressed in a
separate, successive appeal, which would be heard
by this panel.
C. Punitive Damages
The Union also challenges the award of $150,000
in punitive damages, asserting among other things
that its conduct was not sufficiently egregious
to warrant punitive damages./3
The LMRDA does not specifically permit or
preclude punitive damages. But because all union
members’ rights are threatened when one member’s
rights are violated, courts have held that the
LMRDA implicitly authorizes the award of punitive
damages to deter malicious violations of the Act.
Maddalone v. Local 17, United Bhd. of Carpenter
and Joiners of Am., 152 F.3d 178, 186 (2d Cir.
1998); Woods v. Graphic Communications, 925 F.2d
1195, 1205 (9th Cir. 1991); Doty v. Sewall, 908
F.2d 1053, 1062 (1st Cir. 1990). Punitive damages
are awarded in LMRDA cases only where the union
has acted with ill will or reckless disregard for
the plaintiff’s interests. Thompson v. Office and
Professional Employees Int’l Union, AFL-CIO, 74
F.3d 1492, 1508-09 (6th Cir. 1996). Thus, to
merit such an award, the plaintiff must show
that: (1) in retaliating against the plaintiff,
the union acted willfully or with reckless
disregard for the plaintiff’s interests; and (2)
the conduct of the union was egregious or the
harm it inflicted was severe. Woods, 925 F.3d at
1206; Schmid v. United Bhd. of Carpenters and
Joiners of Am., 827 F.2d 384, 386 (8th Cir. 1987)
(per curiam); Bise v. International Bhd. of Elec.
Workers, AFL-CIO Local 1969, 618 F.2d 1299, 1306
(9th Cir. 1979). Because we believe this approach
is in accordance with the policies and goals of
the LMRDA, we apply this test to the present
case.
Despite the Union’s protestations to the
contrary, the record is replete with instances of
egregious conduct manifesting a specific intent
to harm Kinslow in retaliation for voicing his
concerns about corruption. The Union tries to
distance itself from president Briscoe, but a
Union can only act through its agents, and the
actions and intentions of the Local president
would usually be imputable to the Local.
Regardless, it wasn’t just Briscoe who
retaliated; the Union stewards were also
involved, as they refused to grieve Kinslow’s
complaints about overtime. And although Kinslow
wasn’t required to show that the rank and file
members specifically approved their officers’
misdeeds in order to merit punitive damages, the
record indicates that the Union members ratified
Briscoe’s heavy-handed tactics by voting
unanimously to expel Kinslow from the Union. Even
after Briscoe was incarcerated and a new
president installed, the Union made no attempt to
reinstate Kinslow, and in fact thwarted such
efforts. See Howard v. Weathers, 139 F.3d 553,
555 (7th Cir. 1998) (describing the Union’s
refusal to even consider reinstatement). As the
district court acknowledged, the Union leadership
has "done absolutely nothing to make things right
with Kinslow. To the contrary, the Union not only
stubbornly continued to defend this case (as was
its right) but sought to do so on wholly
untenable grounds (as was not its right)." In
light of the Union’s malicious intent, the
seriousness of its conduct, and the need to deter
similar acts, the Union’s arguments about
punitive damages are also untenable. In short,
when faced with conduct this outrageous, we
cannot say that the district court erred in
awarding substantial punitive damages.
D. Attorneys’ Fees
Finally, the Union argues that the district
court erred in awarding attorneys’ fees.
The district court awarded attorneys’ fees for
both Kinslow’s Section 431 access to financial
records claim and his Section 411 retaliation
claim. Section 431 specifically authorizes
attorneys’ fees, and the Union apparently doesn’t
challenge the award of fees on this claim. 29
U.S.C. sec. 431(c); see generally Stomper v.
Amalgamated Transit Union, Local 241, 27 F.3d 316
(7th Cir. 1994). As to the Section 411 claim,
although the LMRDA does not specifically
authorize counsel fees, the Supreme Court has
held that courts may exercise their inherent
equitable power to award attorneys’ fees in such
cases. Hall v. Cole, 412 U.S. 1, 4-5 (1973); see
Stomper, 27 F.3d at 319. In Hall, the plaintiff
was a union member whose union violated the LMRDA
by expelling him in retaliation for criticizing
union policies. He prevailed at trial and was
awarded attorneys’ fees, which the union
challenged. The Court found two bases for
upholding the award. First, under a punitive
theory, it held that attorneys’ fees were
awardable to punish the union for its malicious
conduct. Second, under a common benefit theory,
because the plaintiff’s suit benefitted all of
the union’s members, the Court believed that
fairness dictated that all of the union members
should share the costs of the common benefit.
Hall, 412 U.S. at 5; see Murray v. Laborer’s
Union Local No. 324, 55 F.3d 1445, 1453 (9th Cir.
1995). It therefore affirmed the award of counsel
fees.
The district court in the present case similarly
believed that attorneys’ fees were warranted
under either of these rationales. As we have
already discussed the need to punish the Union,
we will not address that issue again here. It is
sufficient to note that the Union’s misdeeds,
which were only corrected through this suit, were
sufficiently egregious to warrant both punitive
damages and attorneys’ fees. Although this
rationale alone justifies the attorneys’ fees,
the common benefit rationale is also relevant. As
to that theory, the Supreme Court in Hall aptly
described the benefit that a retaliation
plaintiff bestows upon his fellow union members
in pursuing his claim:
[T]here can be no doubt that, by vindicating his
own right of free speech guaranteed by sec.
101(a)(2) of Title I of the LMRDA, respondent
necessarily rendered a substantial service to his
union as an institution and to all of its
members. When a union member is disciplined for
the exercise of any of the rights protected by
Title I, the rights of all members of the union
are threatened. And, by vindicating his own
right, the successful litigant dispels the
"chill" cast upon the rights of others. Indeed,
to the extent that such lawsuits contribute to
the preservation of union democracy, they
frequently prove beneficial "not only in the
immediate impact of the results achieved but in
their implications for the future conduct of the
union’s affairs."
Hall, 412 U.S. at 8 (quoting Yablonski v. United
Mine Workers of Am., 466 F.2d 424, 431 (1972)).
Kinslow’s tenacity in pursuing his claims
assisted his fellow Union members by sending a
clear message to Briscoe’s comrades who remained
in Union leadership positions that the violation
of free speech rights will not go unpunished. By
vindicating his own rights, Kinslow’s suit warns
Union officials not to violate the LMRDA rights
of other Union members and provides a fine
example of the punishment that corruption will
elicit. Furthermore, Kinslow’s suit was, in part,
the catalyst for the investigation of Briscoe and
his eventual conviction. This, in turn, forced
his resignation from the Union, which in itself
was a benefit to honest members of the Union.
Accordingly, whether the district court’s award
of attorneys’ fees is based on a punitive or
common benefit theory, it did not abuse its
discretion.
III.
The district court’s decision to award punitive
damages, injunctive relief, and attorneys’ fees
is AFFIRMED in all respects. But we VACATE the award
of overtime pay and REMAND this portion of the case
to the district court for the purpose of entering
more specific findings and any further
proceedings consistent with this opinion.
/1 The Secretary of Labor also investigated Briscoe,
Bell, and the Union for conducting fraudulent
elections. See Brock v. American Postal Workers
Union, AFL-CIO, Chicago Local, 815 F.2d 466 (7th
Cir. 1987).
/2 The Fifth Circuit has defined "just cause" as
"circumstances that would put a reasonable union
member on notice that further investigation is
warranted to assure that the union’s LM filings
with the Secretary of Labor (required under sec.
431) comport with the union’s own records of its
activities." Fernandez-Montes v. Allied Pilots
Ass’n, 987 F.2d 278, 285 (5th Cir. 1993). While a
belief that the LM-2 might be inaccurate would
certainly constitute "just cause" for examination
of the union’s books, we fear that the Fernandez-
Montes’s formulation of this concept might lead
parties to believe that the right of access is
limited to only instances where union members
seek to verify figures in the LM-2. A
verification rationale is too narrow because it
"reduces the right of examination to a check on
the union’s arithmetic." Mallick, 749 F.2d at
781. Because the Fifth Circuit’s formulation is
not clear on this point, we want to explicitly
state our agreement with the D.C. Circuit that
"just cause" encompasses more than just a desire
to confirm the information on the LM-2 statement.
/3 The Union makes no argument that the award was
excessive in relation to the amount of compensatory
damages awarded.