In early 2007, Ernst & Young published a request for bids to install telecommunications equipment at its Secaucus, New Jersey, project. Preferred Communications Technologies (PCT) submitted the winning bid. It then subcontracted the work to U.S. Information Systems, Inc. (USIS), whose employees are represented by the Communication Workers of America (CWU), Local 1106. On August 16, 2007, IBEW Local 164 placed a picket line on the building project, and 100 union members employed by other companies refused to cross the picket line, shutting down the project. Because of the picketing by the IBEW, Ernst & Young requested PCT to remove USIS from the job.

USIS was replaced by Star-Lo, a contractor that had a relationship with IBEW Local 164. USIS filed a Section 303 lawsuit against Local 164 for damages, asserting a violation of Section 8(b)(4). IBEW Local 164 defended its picketing as a legal area-standards protest.] LINARES, D.J.... Section 8(b)(4)(i)(B) prohibits any labor organization from inducing or encouraging any person employed by a neutral employer to strike or refuse to work. See George v. Nat'l Ass'n of Letter Carriers, 185 F.3d 380, 388 (5th Cir. 1999).

Secondary boycotting and secondary picketing have been construed as unfair labor practices pursuant to subsection (b)(4) of the NLRA. Area Standards The maintenance of the compensation rate in a geographic area is a legitimate focus of union activity. In this regard, a union has a right to protest the payment of substandard wages through area standard picketing even if it results in a work stoppage. "[A]rea standards picketing is permissible only where it can be shown that the employer's mode of operation is substandard in comparison with the negotiated area standards." This means that "there must have been an investigation and an evaluation of comparative standards carried out with as great a degree of thoroughness as the circumstances will permit."

Sales Delivery Drivers, Warehousemen and Helpers Local 296 and Food Employers Council, Inc., 205 N.L.R.B. 462, 471 (1973). Local 164's claim of substandard wages was not based on actual knowledge and its investigation of such was cursory at best. Any suspicions it may have had regarding Plaintiffs alleged substandard wages- to the extent such suspicions existed-were entirely unsubstantiated. If Local 164 had been trying to ascertain whether Plaintiff was, in fact, paying substandard wages, [Local 164 Business Agent] Misciagna's testimony confirms that it could have easily obtained a copy of the relevant CBA. In addition, Local 164 could have attempted to contact Plaintiff directly prior to erecting the picket. Local 164's failure to make such obvious efforts to substantiate its claim of substandard wages calls into question its true object.

More importantly, in failing to make such efforts, Local 164's actions fall short of those required for properly asserting a claim of substandard wages.... In light of the foregoing, the Court finds that Local 164 has not established that it made a bona fide attempt to determine that Plaintiff's wages were, in fact, substandard. Such a finding, coupled with evidence presented by the Plaintiff of the circumstances leading up to and surrounding Local 164's August 16, 2007 picket, compels an inference that maintenance of area standards was not its true object.

It is therefore the finding of this Court that Local 164's true object was to force PCT to cease doing business with the Plaintiff in order to obtain the Ernst & Young telecommunications project for one of its signatory contractors. Picketing for such a proscribed object constitutes a secondary boycott in violation of Section 8(b)(4)(i)(B). Plaintiff's motion for summary judgment as to this claim is, therefore, granted. [The issue of the amount of damages under Section 303 of the LMRA is to be resolved before a magistrate judge.]

Case Questions

1. Explain the "secondary" nature of Local 164's actions in this case which were held to be a violation of Section 8(b)(4).

2. Area-standards picketing is legal. Was this a valid defense for Local 164?

3. Does Section 303 of the LMRA allow a private lawsuit against a union for damages caused by secondary picketing?