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In re Irving

decided: April 12, 1979.

IN RE JOHN S. IRVING, GENERAL COUNSEL, NATIONAL LABOR RELATIONS BOARD, A WITNESS UNDER SUBPOENA TO PRODUCE DOCUMENTS, APPELLANT, UNITED STATES OF AMERICA, PLAINTIFF,
v.
ANTHONY DILAPI, ROBERT RAO, SIDNEY LIEBERMAN, BENJAMIN LADMER, STEPHEN KINGSTON, DAVID BERGNER, AND INTERSTATE DRESS CARRIERS, INC., DEFENDANTS-APPELLEES



Appeal from two orders of the United States District Court for the Eastern District of New York, Henry Bramwell, J., entered on January 12, 1979 holding appellant in contempt of court. Affirmed in part, vacated in part and remanded.

Before Mansfield and Timbers, Circuit Judges, and Werker, District Judge.*fn*

Author: Werker

John S. Irving, General Counsel of the National Labor Relations Board, appeals from two orders of the United States District Court for the Eastern District of New York (Bramwell, J.), entered on January 12, 1979, adjudicating Irving to be in contempt of court. The first order imposes a $10,000 fine. The second fines Irving an additional $1,000 per day until he complies with the court's order. A stay pending appeal was granted.

The events leading up to these orders of contempt are as follows. On April 5, 1978, Local 20408, United Warehouse, Industrial and Affiliate Trades Employees Union, filed a representation petition with the Newark Regional Office of the NLRB (the "Board") seeking recognition as collective bargaining agent for certain employees of G.S. Supply Associates, Inc. and G.S. Temporary Service, Inc. employed at a terminal of Interstate Dress Carriers, Inc. ("IDC") in Jersey City, New Jersey. This petition was later amended to include additional IDC employees at terminals in Jersey City and New York.

On September 6, 1978, a criminal indictment was returned in the Eastern District of New York charging nine defendants, including IDC and Local 102, International Ladies Garment Workers Union, with conspiracy and obstruction of an administrative proceeding in violation of 18 U.S.C. §§ 2, 371 and 1505. Included in the charges were alleged efforts to bribe and induce Matthew Eason, president of Local 20408, into withdrawing his petition, threats of physical harm and economic injury against Eason, and threats of loss of employment against the employees of IDC, G.S. Supply and G.S. Temporary Service. After a series of efforts by Local 102 and IDC to obtain production of certain "authorization cards" (I. e., membership applications executed by employees as a showing of interest in having Local 20408 represent them), IDC, on December 29, 1978, served two subpoenas on Board personnel directing them to produce at the criminal trial on January 3, 1979 all "authorization cards or applications for membership in Local 20408" and "other writings" concerning a "showing of interest" by employees in Local 20408. On January 3, the Board and the prosecution moved to quash on the ground that the cards were privileged.

The district court, on January 8, 1979, denied the motion to quash and ordered the Board to turn the cards over to the defendants. The Board appealed to this court, which, on January 9, 1979, entered an order dismissing the appeal and denying the Board's application for mandamus. United States v. DiLapi, 529 F.2d 1209 (2d Cir. 1979). John Irving, General Counsel of the Board and custodian of the cards, nonetheless refused to disclose, and IDC moved for dismissal of the indictment. This motion remains pending in the district court. Irving was held in contempt by Judge Bramwell on January 12, 1979 by two orders, one imposing a flat fine of $10,000, and the second imposing fines of $1,000 per day until he complies. Both orders are now stayed pending the Board's instant appeal from the orders of contempt. Both Local 102 and the United States Attorney for the Eastern District of New York have filed amicus briefs. The record indicates that if the contempt orders are upheld here, the Board will relinquish the cards.

1. Appellate Jurisdiction

We are met at the threshold with IDC's argument that neither of the two contempt orders issued below are "final" orders within the meaning of 28 U.S.C. § 1291, and therefore neither are within this court's appellate jurisdiction. Invoking the well-established rule that orders of civil contempt against parties to pending proceedings are not appealable, See Fox v. Capital Co., 299 U.S. 105, 107, 57 S. Ct. 57, 81 L. Ed. 67 (1936); International Business Machines Corp. v. United States, 493 F.2d 112, 117-19 (2d Cir. 1973), Cert. denied, 416 U.S. 995, 94 S. Ct. 2409, 40 L. Ed. 2d 774 (1974); 15 C. Wright, A. Miller & E. Cooper, Federal Practice & Procedure § 3917 (1976), IDC argues first that both the orders below were orders of civil contempt, and second that the General Counsel to the Board, as part of the government, is "party" to the criminal proceedings below.*fn1

With respect to the first order of contempt, imposing a flat fine of $10,000, we conclude that it is an order of criminal contempt and therefore immediately appealable as a final order. See Union Tool Co. v. Wilson, 259 U.S. 107, 111, 42 S. Ct. 427, 66 L. Ed. 848 (1922); International Business Machines Corp. v. United States, 493 F.2d at 114. The chief characteristic of civil contempt is that its purpose is to compel obedience to an order of the court to enforce the rights of the other party to the action. Nye v. United States, 313 U.S. 33, 42, 61 S. Ct. 810, 85 L. Ed. 1172 (1941); McCrone v. United States, 307 U.S. 61, 64, 59 S. Ct. 685, 83 L. Ed. 1108 (1939); International Business Machines Corp. v. United States, 493 F.2d at 115. Consistent with this remedial purpose, the sanction imposed is generally made contingent on compliance. Shillitani v. United States, 384 U.S. 364, 370, 86 S. Ct. 1531, 16 L. Ed. 2d 622 (1966); Penfield Co. v. SEC, 330 U.S. 585, 590, 67 S. Ct. 918, 91 L. Ed. 1117 (1947); Gompers v. Bucks Stove & Range Co., 221 U.S. 418, 442, 31 S. Ct. 492, 55 L. Ed. 797 (1911). This is often accomplished by a purgation provision, whereby a civil contemnor may purge himself of contempt at any time by compliance. See generally C. Wright, A. Miller, J.E. Cooper, Supra, § 2960. The purpose of an order of criminal contempt, on the other hand, is punitive. It is imposed to vindicate the court's authority. Nye v. United States, 313 U.S. at 33, 61 S. Ct. 810, 85 L. Ed. 1172 ; See generally Dobbs, Contempt of Court: A Survey, 56 Cornell L.Rev. 183, 235-39 (1971). Accordingly, compliance with the court's command will not lift the sanction. In responding to a single contemptuous act, a court may well impose both criminal and civil sanctions wishing to vindicate its authority and to compel compliance. Id. at 236-37.

This is what the district court intended here. In his first order, imposing on Irving a flat fine of $10,000 for "wilful" contempt, Judge Bramwell captioned his order in a criminal contempt format, followed the language of Fed.R.Crim.P. 42(a), and made no provision for purgation. The fine was punitive, levied regardless of subsequent compliance. We find that this order held Irving in criminal contempt and is therefore immediately appealable.

We also find that the second order, which imposes a continuing fine of $1,000 per day and contains a provision for purgation, has coercion as its primary purpose and constitutes an order in civil contempt. Therefore, to determine whether this order is immediately appealable, it is necessary to consider whether Irving, as General Counsel to the Board, is a "party" to the criminal proceeding below.

IDC, viewing the "government" as a monolith, argues in effect that the government (I. e., the Justice Department) is prosecuting the criminal action below, and therefore, the government (I. e., the General Counsel to the Board) is "party" to the action. Refining this argument somewhat, IDC cites authority indicating that the duty of disclosure in criminal cases affects not only the prosecutor but the government as a whole. See United States v. Caldwell, 178 U.S.App.D.C. 20, 543 F.2d 1333, 1352 n. 91 (D.C. Cir. 1974), Cert. denied, 423 U.S. 1087, 96 S. Ct. 877, 47 L. Ed. 2d 97 (1976); United States v. Bryant, 142 U.S.App.D.C. 132, 439 F.2d 642, 650 (1971); United States v. Grayson, 166 F.2d 863, 870 (2d Cir. 1948). See also Harvey Aluminum (Inc.) v. NLRB, 335 F.2d 749, 754 (9th Cir. 1964). Assuming this to be so, however, it has only marginal bearing on the question of whether the General Counsel of the Board is a "party" to a criminal proceeding for the purposes of determining whether an immediate appeal can be taken from an order of civil contempt. The Supreme Court, in Cobbledick v. United States, 309 U.S. 323, 60 S. Ct. 540, 84 L. Ed. 783 (1940), while holding that a non-party witness could not appeal a denial of a motion to quash a grand jury subpoena, noted in dictum that appeal would become available if the non-party were to be held in contempt for noncompliance. The Court stated as the rationale for this rule the following:

At that point the witness' situation becomes so severed from the main proceeding as to permit an appeal. To be sure, this too may involve an interruption of the trial or of the investigation. But not to allow this interruption would forever preclude review of the witness' claim, for his alternatives are to abandon the claim or languish in jail.

309 U.S. at 328, 60 S. Ct. at 542. See also Alexander v. United States, 201 U.S. 117, 121-22, 26 S. Ct. 356, 50 L. Ed. 686 (1905) (dictum); Fenton v. Walling, 139 F.2d 608, 610 (9th Cir. 1943), Cert. denied, 321 U.S. 798, 64 S. Ct. 938, 88 L. Ed. 1086 (1944) (since non-parties have no appeal from a final judgment, they have no right of review unless they can appeal independently); Accord, David v. Hooker, Ltd., 560 F.2d 412, 417 (9th Cir. 1977). See generally 9 J. Moore, Federal Practice P 110.13(4), at 167 (2d ed. 1975). Therefore, it is significant, as the Board argues, that the General Counsel has no control over a criminal prosecution brought by the Justice Department nor any right of appeal from a final decision.*fn2 Furthermore, the Board is not subject to direct control by the Executive Branch, but rather is an independent regulatory agency created by statute, See 29 U.S.C. § 153(a), and the General Counsel has ...


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