The opinion of the court was delivered by: LOUIS F. OBERDORFER
This is an action brought under the Railway Labor Act (RLA), 45 U.S.C. §§ 151 et seq., arising from an agreement under which defendant, USAir, Inc., took over the management of Shuttle, Inc., the former Trump Shuttle. Effective August 10, 1992, plaintiff, the Association of Flight Attendants, AFL-CIO (AFA), became the certified representative of the flight attendants employed by Shuttle pursuant to a ruling of the National Mediation Board (NMB) that declared USAir and Shuttle a single carrier for representation purposes. Since that date, USAir has applied to Shuttle flight attendants the terms of the bargaining agreement between Shuttle and the Transport Workers Union (TWU), the Shuttle flight attendants' previous representative, rather than the terms of the agreement between AFA and USAir. Plaintiff argues that defendant is now obligated to apply the AFA-USAir bargaining agreement to Shuttle flight attendants. Extending the AFA-USAir agreement to Shuttle as well as USAir flight attendants would have two basic effects on the employees represented by AFA. First, the terms and conditions of the AFA bargaining agreement, which are generally superior to those of the TWU agreement, would extend to Shuttle flight attendants. And second, the seniority lists of USAir and Shuttle flight attendants would be integrated.
Plaintiff's principal claim is that defendant's application of the TWU bargaining agreement to Shuttle flight attendants, in light the NMB's decision, violates the "major dispute" status quo and collective bargaining requirements found in §§ 2 First, 2 Seventh, 5, and 6 of the RLA, 45 U.S.C. §§ 152 First, 152 Seventh, 155 & 156. In addition, plaintiff contends that defendant's action violates its duty under § 2 Ninth of the RLA, 45 U.S.C. § 152 Ninth, to "treat with" the representative of the craft or class as certified by the NMB. Finally, plaintiff claims that defendant's conduct undermines and subverts plaintiff's status as the bargaining representative of USAir/Shuttle flight attendants in violation of §§ 2 First, 2 Third, and 2 Fourth of the RLA, 45 U.S.C. §§ 152 First, Third & Fourth.
Plaintiff has filed a motion for a preliminary injunction. At a hearing on that motion held on October 26, 1992, the parties agreed that the hearing should be consolidated with a hearing on the merits, and it was ordered that the parties' filings be treated as cross-motions for summary judgment. See Fed. R. Civ. P. 65(a)(2).
Plaintiff, an unincorporated labor organization, is the duly authorized, certified, and exclusive representative under the RLA of the approximately 9,000 flight attendants employed by USAir. Defendant is an air carrier engaged in interstate and foreign commerce pursuant to certificates of public convenience and necessity issued under the Federal Aviation Act of 1958, 49 U.S.C. §§ 1301 et seq.
AFA and USAir have been parties to successive collective bargaining agreements covering the rates of pay, rules, and working conditions of USAir's flight attendants. The current collective bargaining agreement has been effective since September 1, 1988, with an amendable date of August 31, 1989. Since November 1989, AFA and USAir have been engaged in collective bargaining negotiations for a new bargaining agreement pursuant to § 6 of the RLA, 45 U.S.C. § 156. The parties have been in mediation under the supervision of the NMB since July 31, 1990.
USAir presently manages the airline operation of Shuttle, Inc., formerly known as the Trump Shuttle, pursuant to a management agreement. The management agreement between USAir and Shuttle became effective April 10, 1992, and has a duration of up to 10 years. Under the agreement, USAir manages essentially all operations of Shuttle, which does business as "USAir Shuttle," with the exception of certain activities regulated by the Federal Aviation Administration such as dispatch. USAir has no present equity interest in Shuttle, but it does have an option to purchase Shuttle effective October 10, 1996. Shuttle was incorporated on April 10, 1992 and, through a corporate merger with Trump Shuttle, Inc., assumed the assets and operations of Trump Shuttle. Trump Shuttle had been organized in 1989 from the assets and operations of the Eastern Airlines Shuttle. The employees of Shuttle, with the exception of some new hires, are the former Eastern employees who accepted employment with Trump Shuttle. The approximately 240 flight attendants employed by Shuttle are not employees of USAir. USAir is, however, responsible for labor relations with those employees under the management agreement.
On April 2, 1992, USAir petitioned the NMB to determine the effect of the USAir-Shuttle management agreement on union representation. USAir's position before the Board was that USAir and Shuttle, although separate corporations, should be considered a "single transportation system" for purposes of representation under the RLA. On August 10, 1992, the NMB issued its decision finding USAir and Shuttle a "single transportation system" for purposes of representation. The Board terminated TWU's right to represent Shuttle flight attendants and certified AFA as the single representative of Shuttle and USAir flight attendants. Since August 10, 1992, USAir has dealt exclusively with AFA as the representative of Shuttle flight attendants.
In November 1991, when USAir was considering entering an agreement to manage Shuttle, representatives of USAir met and discussed the transaction with representatives of AFA and TWU. USAir's representatives stated to the unions' representatives that USAir would not integrate the USAir and Shuttle flight attendants during the term of the management agreement, and that applying the more costly terms of the AFA-USAir agreement to Shuttle flight attendants would be a "deal breaker." USAir also explained that the separation of flight attendants was insisted upon by the consortium of banks which owned the Shuttle assets, because the consortium wanted to be able to sell the Shuttle operation to another carrier without an interruption in service in the event that USAir did not exercise its purchase option. USAir communicated to AFA that it wanted to enter into a "fence" agreement to ensure a segregation of USAir and Shuttle flight attendants. In response to USAir's position, AFA advised that it supported the proposed management agreement and did not object to a fence agreement separating USAir and Shuttle flight attendants.
In December 1991, USAir entered into the management agreement with Shuttle. In January 1992, representatives of AFA and USAir again met and discussed labor relations aspects of the transaction. At that time, AFA informed USAir that in its view the parties would have to execute a written fence agreement in order to segregate USAir and Shuttle flight attendants and keep them under separate bargaining agreements. In a letter filed with the NMB in May 1992 in support of USAir's request for single carrier status, AFA stated its position that USAir and Shuttle flight attendants would be employed under the terms of the AFA-USAir bargaining agreement if the parties failed to negotiate a fence agreement.
In February 1992, USAir entered into a fence agreement with the representative of USAir and Shuttle pilots, the Air Line Pilots Association (ALPA). In March 1992, USAir and TWU, as representative of the Shuttle flight attendants, agreed to the fencing of Shuttle flight attendants during the term of the USAir-Shuttle management agreement.
USAir began negotiating with AFA, as representative of the USAir flight attendants, for a written fence agreement in June 1992. The parties have failed to execute a written fence agreement. USAir proposed a simple separation of USAir and Shuttle flight attendants and a retention of each group under its previous bargaining agreement. AFA rejected USAir's proposal, declaring it inadequate and seeking to add conditions involving retirement terms, paid release ...