in jobs and in membership in the Papermakers Local Union at Bogalusa which will deprive the International Union of its dues. Further, if a strike should occur as a result of the imposition of a seniority system unacceptable to the bargaining parties, Crown will suffer total loss of production at its Bogalusa Mill and the Papermakers will be subject to loss of substantial money which it is obligated to pay in benefits. (Affidavit of Paul L. Phillips, [*] 6; Affidavit of T. I. Meehan, [*] 19.)
14. Crown has not been afforded an opportunity for an administrative hearing pursuant to Section 208(b) of the Executive Order. (Transcript of Hearing on Plaintiffs' Motions for Temporary Restraining Order, p. 11.)
15. The issue of whether the seniority system presently in operation in the Mill is discriminatory and unlawful under Title VII of the Civil Rights Act of 1964 and whether a revised seniority system giving credit for plant wide seniority would be legal and equitable in the circumstances is pending in two cases in the United States District Court for the Eastern District of Louisiana styled Hill et al. v. Crown Zellerbach et al. and Mondy et al. v. Crown Zellerbach et al., 271 F. Supp. 258. The local affiliates of the Papermakers are defendants in those actions. The Equal Employment Opportunity Commission has intervened in those cases on other issues. (Complaints in Hill and Mondy filed by Crown; Crown's Complaint, [*] 10(c); Papermakers' Complaint, [*] 16.)
16. The defendants have not made any showing of a public interest that requires summary suspension of Crown's business with the Government and Government contractors at the present time or during any administrative hearing.
17. Neither of the defendants, and none of their agents or employees, have made efforts to persuade the leadership or the members of the Bogalusa local affiliates of the Papermakers to accept the combination seniority proposal described in Paragraph B.2. of the June 16 OFCC Agreement. (Affidavit of John M. Defee, [3; Affidavit of William S. (Jack) Gentry, [*] 14.)
18. In the event an administrative hearing is held in accordance with Section 208(b) of the Executive Order, the defendants have agreed that the Papermakers will be entitled to participate therein. (Transcript of Hearing on Plaintiffs' Motions for Preliminary Injunction, p. .)
Conclusions of Law
1. This Court has jurisdiction over the parties and the subject matter of this action.
2. Section 208(b) of the Executive Order requires that Crown be given an opportunity for a hearing before being debarred, directly or indirectly, from Government contracts. Circulation without notice or hearing of a "Heads of All Agencies" memorandum or summary debarment, pending a hearing, violates Section 208(b) of the Order.
3. The Court cannot conclude on the record now before it, that the defendants are constitutionally authorized to debar Crown, formally or informally, prior to completion of an administrative hearing.
4. Crown cannot comply with both Sylvester's demands that it install combination seniority unilaterally and the Papermakers' demand that any change in the seniority system be made by collective bargaining and their claim that any change made unilaterally would violate the agreement to bargain for a reasonable time about changes in the seniority system and the National Labor Relations Act.
5. If Crown accedes to the demands of the Papermakers, defendants, unless restrained, would inflict irreparable injury upon it by causing suspension of Crown's sales to the Government and Crown's customers that themselves do business with the Government, without a prior hearing. If Crown accedes to the demands of the defendants, it will probably suffer a strike in the Mill and be subject to charges by Papermakers of unfair labor practices in violation of the National Labor Relations Act. Either course of action will inflict upon Crown and the Papermakers irreparable injury, the value of which is not susceptible of measurement and for which neither would have an adequate remedy.
6. The public interest will be best served by preservation of the status quo pending the outcome of an administrative hearing or a trial of this action.
7. Crown Zellerbach and Papermakers are entitled, as a matter of law, to a preliminary injunction enjoining defendants from directly or indirectly debarring Crown from further business with the Government or Government contractors by means of formal debarment, temporary suspension, or otherwise, and from interfering with Crown's collective bargaining agreement with Papermakers, issuance of a consult memorandum, or any other similar device, prior to an administrative hearing in which the question of whether Crown is in compliance with Executive Order No. 11246 can be resolved.
Additional Conclusion of Law
8. Plaintiffs have an adequate administrative remedy under the procedures contemplated by Executive Order 11246 and the contracts entered into by Crown, and the implementing regulations. Accordingly, plaintiffs are not entitled to an injunction restraining defendants from instituting administrative proceedings to debar Crown from eligibility for Government contracts.
The actions came on to be heard on plaintiffs' Motions for Preliminary Injunction, and upon the affidavits, exhibits and legal memoranda in support thereof and in opposition thereto, and was, on December 22, 1967, argued by counsel. The Court, having considered the aforesaid motions, affidavits, exhibits, memoranda and argument, announced from the bench its decision to enter a preliminary injunction and, on that day, modified the temporary restraining order theretofore entered and continued it as so modified to and including January 2, 1968. The Court having this 2nd day of January, 1968, made findings of fact and conclusions of law, it is this 2nd day of January, 1968.
ORDERED: that defendants W. Willard Wirtz, Edward C. Sylvester, and their subordinates, agents and employees, and others acting in concert with them, be and hereby are restrained from taking any action without first affording Crown and Papermakers notice and a full evidentiary hearing on the issue whether plaintiff Crown Zellerbach Corporation is in compliance with the equal employment opportunity clauses required in its Government contracts and subcontracts by Executive Order No. 11246, as implemented by agreements dated March 19 and June 16, 1967, between Crown Zellerbach Corporation and the Office of Federal Contract Compliance, to:
(a) advise the heads of any agencies of the United States that Crown is not in compliance with the OFCC Agreements or with the Executive Order by issuing or circulating any memorandum, notice of hearing or other communication to any head of agency or contracting officer or any other persons than those who require notice in order to participate in the hearing;
(b) cancel, cause to be cancelled, or recommend cancellation of, any of Crown's existing contracts with the United States or its agencies, or with others who contract with, sell to or otherwise deal with the United States or any of its agencies;