Brotherhood of Locomotive Eng'rs v. Springfield Terminal Ry. Co.
United States Court of Appeals for the First Circuit
210 F.3d 18 (1st Cir. 2000)
During mediation with the unions (plaintiffs) under the Railway Labor Act (RLA), which required Springfield Terminal Railroad Company (Springfield) (defendant) to maintain the status quo, the unions declined proposed wage cuts, and Springfield shortly afterward hired Aroostook and Bangor Resources (ABR) (defendant) to perform switching work the unions traditionally did. Springfield was wholly owned by Guilford Transportation Industries, which was closely held by four men, three of whom also owned ABR entirely; Springfield, Guilford, and ABR shared the same four directors, and the person who first contacted ABR about the work had been the key negotiator in the failed mediation, while the ABR representative deciding to take the work was also a Guilford owner and Springfield director. The unions sued to enjoin ABR from performing the switching work during mediation, and the district court granted the injunction; Springfield appealed.
Whether, in the context of labor negotiations under the Railway Labor Act, a court will pierce the corporate veil if a railway carrier uses its affiliate to escape its collective bargaining agreement and violate the RLA's status quo requirements.