Judge Dismisses ABF's Suit Against Teamsters and YRC

Dec. 23, 2010
A federal judge has dismissed ABF's suit alleging the Teamsters made unfair concessions to YRC

Judge Susan Webber Wright of the U.S. District Court for the Eastern District of Arkansas has ruled that ABF Freight System does not have standing to sue YRC Worldwide Inc. and the International Brotherhood of Teamsters in court.

As reported earlier, ABF, a national less-than-truckload (LTL) carrier, had filed legal actions against the Teamsters and other parties, including several YRC Worldwide subsidiaries, for violation of the National Master Freight Agreement (NMFA), the collective bargaining agreement covering most unionized trucking employees in the country.

ABF’s contention is that the defendants violated the NMFA in 2009 and 2010 by entering into concessionary side agreements with YRC companies to the exclusion of ABF and other companies signatory to the NMFA. These agreements, ABF claims, led to ongoing significant wage and benefit reductions and other economic concessions that were applied only to YRC companies, and not ABF. With more than 8,000 union employees, ABF’s lawsuit asserted that these concessionary agreements were unlawful, unfair and inconsistent with the plain language, intent and purpose of the NMFA, and that they resulted in a substantial competitive disadvantage for ABF.

Understandably, the Teamsters and YRC are pleased with the dismissal of the case, while ABF is disappointed with the judge’s ruling.

“We have said all along that ABF took itself out of the National Master Freight Agreement and therefore has no right to bring the suit,” says Brad Raymond, general counsel for the Teamsters. “The bench dismissal should send a strong message to ABF that its attempts to interfere with the contractual arrangement between YRC and its Teamsters-represented employees must end.”

“We negotiated with ABF in good faith earlier this year, reaching an agreement that was overwhelmingly rejected by its employees,” adds Tyson Johnson, director of the Teamsters National Freight Division. “We are pleased that Judge Wright dismissed this lawsuit because it removes an impediment to YRCW's restructuring efforts. This decision is the best possible outcome for Teamster members at both companies.”

The Teamsters represent 25,000 workers at YRC, and 7,000 workers at ABF.

“From the moment the suit was filed we were extremely confident it had no merit,” says Mike Smid, president of YRC Inc. and chief operations officer at YRC Worldwide. “We are gratified that after a thorough review of the facts the judge came to the same conclusion and dismissed this case. The agreement we negotiated in good faith with the union was ratified by our employees who have remained committed to our company, and our customers.”

This doesn’t necessarily mean the legal wranglings are over, though. In a statement, ABF announced: “In regards to the dismissal of the lawsuit, we are disappointed in this outcome and continue to believe that our November 1 lawsuit is strong. We are reviewing the Court’s ruling and considering next steps, including possibly an appeal of the decision to the United States Court of Appeals for the Eighth Circuit.”

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