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Keywords

lawsuitliabilitymotionsummary judgmentcorporationmotion for summary judgment
lawsuitmotionsummary judgmentwillcorporationmotion for summary judgmentdeclaratory judgment

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Waker v. Republic Steel Corp., Not Reported in F.Supp., 1987 WL 109068, 45 Fair Empl.Prac.Cas. (BNA) 303, 56 USLW 2322

Facts

In 1974, consent decrees were entered in a Title VII lawsuit against several steel companies, including Republic Steel Corporation, which operated a plant in Gadsden, Alabama. Following a merger and subsequent court-ordered divestiture, Gulf States Steel, Inc. acquired the Gadsden plant in 1986. Although Gulf States recognized the United Steelworkers as the exclusive bargaining representative and entered into a collective bargaining agreement, it opposed being bound by the earlier consent decrees.

On April 12, 1974, this court — with consent of the parties — entered two decrees in a massive Title VII lawsuit brought by the United States and the EEOC against nine major steel companies and the United Steelworkers of America.

Issue

Whether Gulf States Steel, Inc. and the Brenlin Corporation should be deemed bound by the terms of the injunctive decrees entered in 1974.

Whether Gulf States Steel, Inc. and the Brenlin Corporation should be deemed bound by the terms of the injunctive decrees entered in 1974.

Rule

The court applied principles regarding successor liability under Title VII, borrowing from NLRA principles, while considering the specific facts of the case.

In determining when a new employer will be deemed a successor for purposes of Title VII responsibilities, the courts have generally borrowed from the principles applicable when deciding whether a purchaser is a successor for NLRA purposes.

Analysis

The court found that while many factors typically indicating successorship were present, unique circumstances surrounding the acquisition of the Gadsden plant, including the court-ordered nature of the divestiture and the specific terms of the consent decrees, weighed against applying the decrees to Gulf States. The court emphasized the importance of the consent of the parties involved and the long duration since the original decrees were established.

There are, however, three unique factors in the present case that, at least in combination if not singly, tip the balance in the other direction.

Conclusion

The court granted Gulf States Steel, Inc. and the Brenlin Corporation's motion for summary judgment, concluding that they were not subject to the 1974 consent decrees.

The court accordingly will grant the companies' motion for summary judgment as to the Union's motion to Join a Party and for Declaratory Judgment.

Who won?

Gulf States Steel, Inc. and the Brenlin Corporation prevailed because the court determined they were not successors to Republic-LTV for the purposes of the consent decrees, based on the unique circumstances of their acquisition and the nature of the decrees.

The court concludes that Gulf States Steel, Inc., and the Brenlin Corporation should not be held to be successors to Republic-LTV for purposes of the consent decrees.

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