Houston Judge Slaps Down Member’s Fiduciary Duty Suit

U.S. Dist. Judge Lynn N. Hughes (S.D. Tex., Reagan) ruled Feb. 4 that Louis A. Hoffman, a member of the S.W. Airlines Pilots Ass’n aggrieved by the conduct of the union’s bosses, including the ex-president’s use of union money to ship a pair of moose antlers to his out-of-state home, does not good cause to bring suit under the Labor-Mgmt. Reporting & Disclosure Act of 1959 (a.k.a. Landrum-Griffin Act). “Because corrupt union leadership cannot be trusted to police itself, individual union members may sue officers if the union refuses to take action,” but the have to show good cause, Hughes wrote. Hoffman has appealed the ruling to the U.S. Court of Appeals for the Fifth Circuit.

“However stupid and wasteful the former officers’ actions may have been,” they did not amount to breach of fiduciary duty under the LMRDA, Hughes said. Finding that Hoffman had no cause to sue, the court suggested that he “pursue his frustration … through other avenues; he should watch the current administration to ensure it does not repeat the errors.”

Hoffman brought fifteen charges in all. In addition to the shipment of the moose antlers, Hoffman charged that the bosses, John E. Kramer, Marilyn H. Zeiler, and Patrick P. Filburn, conspired to rig a union election and complained about the bosses’ decisionmaking and administrative practices. He filed internal union charges maintaining that the officers, who no longer hold the elected posts, engaged in conduct that breached their fiduciary duty to the union. When the pilots’ union refused to take action, Hoffman petitioned the court, maintaining that he had good cause to sue.

Further, Hughes pointed out that the union officer election Hoffman complained of had been rerun by the Dep’t of Labor and that the initial winner of the vice president post lost in the second election. “The remedy for the defective electoral process is not this suit but the intervention of the Labor Department,” Hughes said.

Hughes described other claims of Hoffman as arising from disagreements over the officers’ routine operating decisions and internal office administration. “Deciding to pay for an employee’s graduate studies, giving employees extra time off, or even shredding union documents are not breaches of fiduciary duty covered by the statute,” the court said. “Neither are poor attendance, sloth, and sending letters to union members instead of using the union newsletter violations of federal law.”

With respect to the moose antlers, Hughes acknowledged that the former president spent union money to send the trophy from his office to his home in New Mexico. However, “he had used the antlers as an office decoration, giving the union the benefit of their use in consideration of the re-delivery cost,” the court said. “Federal law does not bar a union from shipping personal effects from an office to a home once an officer has been turned out of his position,” according Hughes.  Thus, Hughes concluded that Hoffman did not have good cause to sue.

The union is headquarter in Dallas, but the suit was brought in Houston. Joseph A. Garnett of Houston represented Hoffman, Patrick Flynn of Houston represented the former officers, and Nicholas Enoch and Stanley Lubin of Phoenix represented the union. [BNA 2/21/02; Hoffman v. Kramer,  No. 01-486,  2002 U.S. Dist. LEXIS 2475, at *1 (S.D. Tex. Feb. 4, 2002)]