Union Sued by Construction Contractor for Secondary Boycott

The Southeastern Carpenters Regional Council, a union, was sued by a Georgia construction contractor, Fidelity Interiors, Inc. for violating the National Labor Relations Act. The company alleged that the union had picketed neutral parties as a means of coercing them into no longer employing Fidelity. The case made its way to a jury and later appellate judges.

In 2004, the union initiated an “area standards campaign” to pressure nonunion interior systems contractors into increasing employee pay and benefits. Fidelity was selected as a contractor that handled a considerable amount of potential union work. The campaign’s strategy was to focus on neutral contractors and property managers who employed Fidelity.

The union sent warning letters to neutral contractors, tenants, property owners and managers associated with Fidelity, explaining its intent and what the picketing would entail: i.e., “highly visible” banners, etc. A hospital’s construction site was picketed first, where approximately 130 picketers yelled “Rat!” and “Stop the Rat!” at hospital patients and visitors. The hospital asked the general contractor to remove Fidelity from the job. The same contractor removed Fidelity permanently from another project and, to avoid picketers driving clients away, agreed to cease hiring the company.

The union also targeted sites where another Fidelity-related construction company worked. When the company refused to remove Fidelity from a project, the union picketed a plaza where the company worked – but a job on which Fidelity was not working. The union then sent picketers to a construction site for an architectural firm that had hired the company, who had in turn employed Fidelity. The firm was picketed as well, with signs naming only the firm. The company ultimately stopped hiring Fidelity for its Atlanta, GA, projects.

Fidelity lost other jobs, and businesses ceased working with the company altogether. It responded by bringing action against the union, claiming that it had attempted to coerce Fidelity employees into joining a union and neutral employers of the company into firing or refusing to hire Fidelity. The district court granted the union’s motion to exclude evidence of banners and handbills, which were considered lawful, but would not exclude evidence of threats to picket and threats to banner.

In court, the union asserted that it had picketed at the architectural firm directly due to a labor dispute unrelated to Fidelity or the corresponding construction company. Video introduced by Fidelity, however, showed the union at the firm before the unfair labor practice charge was filed, a charge that was withdrawn soon after its filing. The director of special projects for the union admitted in court that the filed charge was a “tactic” for picketing.

Fidelity claimed that it lost over 31,000 dollars from jobs and estimated a future loss based on companies refusing to hire Fidelity. The union later argued that the judge should not have permitted the jury to consider evidence of “lawful conduct,” and that the judge should have instructed the jury that evidence of unlawful picketing at one site cannot be considered for other sites. The jury rejected the claim of coercing Fidelity employees, but awarded 1.7 million dollars to Fidelity for the union conducting a secondary boycott – boycotting and picketing the companies working with Fidelity. The union appealed the decision, which was affirmed by an appeals court.