ANALYSIS & COMMENTARY
The International Longshore and Warehouse Union (ILWU) has filed for bankruptcy protection stating that it cannot afford to pay damages that a jury awarded an employer after a jury found the union and its Portland, Ore., local guilty of perpetrating unfair labor practices.
In 2019, a federal jury handed down the award to ICTSI Oregon Inc., the former operator of an inland Port of Portland terminal, which had been forced to close down because of the longshoremen’s union actions taken against the terminal operator in a jurisdictional dispute with another union. Originally pegged at $93.6 million, the damages were later substantially reduced to a little more than $19 million but were still more than the union can afford to pay.
The original legal dispute began in 2012 over whether members of the ILWU local or the International Brotherhood of Electrical Workers (IBEW) would be entitled to perform the job of plugging, unplugging and monitoring refrigerated shipping containers (referred to as “reefer jobs”).
ICTSI had signed a contract with the IBEW, and that union’s right to represent the reefer workers was later upheld by the National Labor Relations Board (NLRB) after ILWU had disputed that right.
ICTSI said the ILWU then chose to embark on a campaign of conducting unlawful secondary boycotts, including the imposition of slowdowns by longshoremen who unnecessarily operated cranes and drove trucks in an excessively slow manner. The union members also were directed to refuse the hoisting of cranes in bypass mode, and also to move 20-foot containers two at a time on older carts. The purpose of these actions was to force ICTSI and carriers who called at the ICTSI facility to stop doing business with the port.
At one point, the union bussed in protesters who were not union members from the Occupy Portland encampment, which the ILWU presided over, to take part in a picket line that blocked the entrance to the facility so truckers would not be able to enter or leave it.
Although it was not widely known at the time, each of the nationwide “Occupy” city encampments that cropped up in 2011 during the Obama administration were managed and supervised by various different labor unions, and encouraged by Democrat city officials who refused to take action to close any of them down. However, among the unions who were involved the ILWU was the only one known to have enlisted itinerant encampment members in support of union activities away from the encampments.
All the of the camps quietly disappeared after it was discovered that a denizen of the Occupy encampment in Washington, DC, which had been supervised by the Service Employees International Union, had used a rifle to shoot up the back of the White House second floor balcony where the family residence was located. Fortunately, the Obamas were not in town at that time the shots were fired.
In its lawsuit, ICTSI charged that the union’s campaign against the terminal eventually led to the loss of the company’s service contracts with two major shipping companies, representing 98% of the facility’s business. The company further alleged that the union’s actions caused it to suffer more than $101 million in losses.
Following a 10-day trial, the federal court jury unanimously found that both the ILWU and its Local 8 had engaged in unlawful labor practices for a several-year period. The jurors also found that at no time during this period did either the ILWU or its local engage in lawful, primary labor practices and determined that their actions had caused substantial damages to ICTSI.
The jury awarded $93,635,000 to ICTSI because of what the ILWU and Local 8 did. The jury apportioned these damages as 55% the fault of the ILWU and 45% being the fault of the local.
The union sought to appeal the verdict and have it reversed, asserting that if it was allowed to stand, the award would bankrupt the ILWU.
But at the time, one labor attorney observed that he believed the union had little chance of winning the appeal to reverse the judgment because the ILWU continued to maintain an obstreperous and defiant attitude towards the court, choosing to repeat many of its earlier losing arguments about extreme exploitation of workers by ICTSI that the jury did not buy the first time around.
In 2020, a district court judge did choose to reduce the total damages from $96.3 to $19.1 million, but in the end that turned out to be even too rich for the ILWU’s blood. The union had continued to appeal the original court judgment and a new trial was possible. But according to reports, the union informed its members that it lacked the funds to continue pursuing the case in court.
The ILWU’s Chapter 11 filing revealed that it has assets of $11.6 million, including $9.5 million in cash. (In 2019, the union had told the judge that its total assets amounted to only $8 million). In recognition of its current financial situation, the union has been forced to admit that the bankruptcy filing is in reality a negotiating tactic forced on it by extreme circumstances.
“We intend to use the Chapter 11 process to implement a plan that will bring this matter to resolution,” the ILWU stated. “The officers are confident that we are taking the right step to put our organization on the best path forward—and we are optimistic for all that is ahead.”