Full opinion text
NIELDS, District Judge. This is a suit in equity,brought by the United States against Weirton Steel Company, a Delaware corporation. The amended bill of complaint prays for a perpetual injunction enjoining defendant from violating the labor section of the Code of Fair Competition for the Iron and Steel Industry, approved by the President August 19, 1933. A motion for preliminary injunction was denied. United States v. Weirton Steel Co. (D. C.) 7 F. Supp. 255. On final hearing the testimony of 283 witnesses was heard in open court with opportunity for cross-examination. Jurisdiction of the suit is conferred by section 3 (c) of title 1 of the National Industrial Recovery Act (15 USCA § 703 (c) r “Sec. 3. * * * (c) The several district courts of the United States are hereby invested with jurisdiction to prevent and restrain violations of any code of fair competition approved under this title [chapter] ; and it shall be the duty of the several district attorneys of the United States, in their respective districts, under the direction of the Attorney General,, to institute proceedings in equity to prevent and restrain such violations.” The Code of Fair Competition for the Iron and Steel Industry provides in article IV, § 1: “(1) That employees shall have the right to organize and bargain collectively through representatives of their own choosing, and shall be free from the interference, restraint, or coercion of employers of labor, or their agents, in the designation of such representatives or in self-organization or in other concerted activities for the purpose of collective bargaining or other mutual aid or protection; “(2) That no employee and no one seeking employment shall be required as a condition of employment to join any company union or to refrain from joining, organizing; or assisting a labor organization of his own choosing.” The National Industrial Recovery Act, § 7 (a), 15 USCA § 707 (a), prescribes as conditions of every code of fair competition the above-recited paragraphs. Pleadings. In its bill of complaint plaintiff avers: “The provisions of the [steel] code confer upon the iron and steel industry and the members thereof, including this defendant, many valuable privileges and advantages not theretofore enjoyed by them.” Plaintiff further avers: “The total capital stock of the defendant is owned and held by the National Steel Corporation, a holding company organized under the laws of Delaware. The properties of the subsidiary companies of said holding company constitute a completely integrated unit for the production of iron and steel with diversified lines of finished products and by-products. * * * Defendant’s business and operations are an integral part of a stream of commerce originating with orders and contracts for coal, iron ore, and other raw products in various States which are shipped across State lines to defendant’s plants to be processed, and which as processed are shipped across State lines and delivered, all in the current of, or affecting, interstate commerce, to defendant’s customers for use or further fabrication. * * * Defendant’s operations as above described are carried on, in large part, pursuant to specific contracts and orders and specifications thereunder, and the output of the defendant’s plants is, in large part, designed and intended for immediate shipment and delivery to purchasers outside the .State of manufacture. Steel products, as a rule, are not held in stock. The business of steel companies in general, and of the defendant in particular, is dependent in large measure upon the known ability to produce and ship without obstruction or delay. Because of the above considerations, obstruction of production in said plants directly interferes with and obstructs transportation and delivery therefrom, and thereby substantially obstructs, restrains and otherwise affects the flow of interstate commerce and tends to diminish the amount thereof. The denial of the right of employees to engage in collective bargaining as provided in the National Industrial Recovery Act and in the Code of Fair Competition for the Iron and Steel Industry, both as originally adopted and as amended, causes discontent and dissatisfaction, resulting in strikes and lockouts, which delay and obstruct tile production of steel plants and shipment therefrom, and lead to the cancellation of orders by purchasers, all with the necessary result that the production, sale, shipment, and delivery of steel products in the course of interstate trade and commerce is substantially restrained, interfered with and obstructed.” Plaintiff further avers: “During the month of June, 1933, defendant, in anticipation of the adoption of the code and as a means of circumventing the rights of its employees to bargain collectively with their employers and to choose their own representatives for that purpose, formulated, initiated, and imposed upon its employees and at all times since has maintained and controlled the activities o f a company dominated plan of employee representation. * * * Defendant has represented and continues to represent to its employees that said plan was adopted and is being maintained in compliance with the requirements of the National Industrial Recovery Act, and particularly for the purpose of enabling them to exercise the right of collective bargaining as guaranteed to them by the provisions of section 7 (a) of said Act and the same provisions as incorporated in said Code, whereas in truth and in fact said company plan of employee representation is wholly ineffective as a means of collective bargaining, and the same was adopted, has been and is being maintained by defendant in furtherance of a scheme to prevent its employees from organizing or joining a labor union for that purpose.” In other words, plaintiff avers that defendant formulated and unlawfully maintains a company-dominated plan of employee representation as a means of circumventing the rights of its employees to choose their own representatives for purposes of collective bargaining; and that the defendant represented and continues to represent that the plan of employee representation is a compliance with the provisions of the National Industrial Recovery Act. Plaintiff further avers: “During the year 1933, a substantial number of defendant’s employees joined a certain union known as the Amalgamated Association of Iron, Steel and Tin Workers of North America, and sought through said union to exercise the rights conferred by the above quoted provisions of the code; but defendant has refused and continues to refuse to meet with the representatives of such employees as so or otherwise selected, or discuss their problems or bargain collectively with them. * * * As a direct result of all of the activities of defendant alleged in this and the preceding paragraph hereof, and of the dissatisfaction of the employees resulting therefrom, a strike occurred at defendant’s plants on or about September 26, 1933. Thereupon,, the defendant closed down its plants for about two weeks, discontinued employment, ceased to manufacture steel products and to make sales and shipments thereof-, thereby discouraging the placing of purchase orders, and causing the cancellation of existing purchase orders. As a result thereof, the ordinary flow of interstate commerce in such products was substantially obstructed.” In other words, plaintiff avers that a substantial number of employees of defendant joined the Amalgamated Association and sought through that union .to exercise the rights conferred by section 7 (a) of the National Industrial Recovery Act, but that the defendant refused and refuses to meet with and bargain collectively with such representatives, and that as a result of the various activities of the defendant as- alleged, a strike occurred on September 26, 1933, obstructing and interfering with interstate commerce. Plaintiff further avers that the defendant refused to permit the National Labor Board, as agreed, to hold an election of the employees of the defendant in order to express a choice between the Amalgamated Association and the company plan of employee representation. Plaintiff further avers: “As a means of perpetuating said company dominated plan and of effectuating said scheme to deprive its employees of the rights guaranteed by the above quoted provisions of the code, and for the purpose of compelling its employees against their will to accept said company dominated plan and to refrain from organizing or joining a labor organization for the purpose of securing the benefits of the above quoted provisions of the code, and for the further purpose of compelling such of its employees as had joined the Amalgamated to withdraw therefrom, the defendant has employed and continues to employ various measures of coercion, intimidation and interference, including discharges, layoffs, de-' motions and changes in conditions of employment and threats thereof.” In other words, that in order to perpetuate a company-dominated plan and to deprive the employees of their lawful rights with respect to collective bargaining and to refrain from organizing or joining a labor union of their choice, and to compel such of its employees as' have joined the Amalgamated Association to withdraw therefrom, the defendant has employed various means of coercion, intimidation, and interference, as alleged, and, unless restrained therefrom, the defendant will continue such measures. Plaintiff further avers: “The defendant purposes, intends and threatens to restrain,, interfere with and coerce its employees in the manner, for the ends and by the means, methods, acts and conduct hereinbefore alleged, and unless enjoined from so doing by this Honorable Court, defendant will continue to compel its employees to accept and submit to said company dominated plan and to refrain from organizing or joining a labor union as a means of collective bargaining through representatives designated by them without interference, restraint or coercion of defendant or its agent.” Plaintiff prays that defendant Be perpetually enjoined: “(1) From representing or holding out to its employees, or any of them, that the company dominated plan of this defendant is an effective means of collective bargaining;. “(2) From representing or holding out to its employees, or any of -them, that the so-called representatives elected under the company dominated plan are free from company influence and domination; “(3) From making any payments whatsoever for the account or in aid of the company dominated plan, or to or for the account of the representatives elected thereunder, other than the payment of their regular wages as employees; “(4) From in any way, directly or indirectly, through the means described in this Amended and Supplemental Bill of Complaint, or otherwise, obstructing, impairing, restraining, or interfering with the right of any of defendant’s employees; (a) to organize and designate representatives; (b) to bargain collectively with the management through the representatives so designated; (c) to organize and maintain, or to join and maintain, any labor union or labor organization they may see fit to organize or to join for the purpose of engaging in concerted activities as a means of collective bargaining or other mutual aid or protection; “(5) From in any way, directly or indirectly, through the means described in this Amended and Supplemental Bill of Complaint, or otherwise, requiring any employee or anyone seeking employment, to submit to the company dominated plan or to participate in any of its activities, or to refrain from joining, organizing or assisting a labor organization of his own choosing; “(6) From discharging, laying off, transferring or changing conditions of employment of any of the defendant’s employees; or threatening so to do, on account of union affiliation or activities, or for opposing the company dominated plan; “(7) From refusing, or threatening to refuse, to meet, confer or bargain collectively, with such person, or persons, or organization as the employees or any specific .group of employees may designate to represent them; “(8) From announcing to its employees, or in any manner giving them to understand, that it will close its plants rather than to recognize or deal with the Amalgamated or its agents, if selected, as the designated representatives of the employees; “(9) From compelling its employees, or any of them, as a condition of employment to submit to or join said company dominated plan.” In its answer defendant denies all the material averments of the amended bill of complaint. The defense is twofold: (1) On the facts the preponderance of evidence is against the plaintiff; and (2) section 7 (a) is unconstitutional if construed to apply to defendant. The Defendant. Nearly thirty years ago Ernest T. Weir and his brother, D. M. Weir, with J. C. Williams, organized the defendant and acquired the plant of Phillips Sheet & Tin Plate Company at Clarksburg, W. Va. In 1910 defendant purchased several farms in the Ohio valley, now the site of the town of Weirton, and began building its Weirton plant. In 1912 the defendant purchased the Pope Tin Plate Company at Steubenville, Ohio. E. T. Weir, chairman of the board of directors of defendant, started in the steel business as a boy in 1893 and worked in various departments of steel mills before organizing defendant. Williams, president of defendant, started at the age of thirteen in a steel mill in Wales where he remained until he was twenty. While in the Welsh mill, he worked in every department. For the next two years he was a steel hand in Italy. On his twenty-second birthday he came to this country and worked in steel mills in Indiana, Michigan, Wisconsin, and West Virginia until he became associated with E. T. Weir as his assistant in 1904. These founders of defendant rose from the ranks and knew from personal experience every job in the mills. For thirty years they lived at the mills with their men and saw the operations grow from year to year. They are responsible for the present size of the plants, the volume of production, and the choice of the entire personnel of the management. Below the president and chairman of the board are the vice presidents, general superintendents, general manager, managers of the six mills, and the superintendents in each mill with several hundred foremen and subforemen. In addition to these, there are the engineering, mechanical, and electrical divisions and the department of industrial relations. From a tract of farm land with two buildings, Weirton has grown into an unincorporated community of 25,000 people. Defendant supplies without charge fire protection, garbage disposal, street cleaning, street paving, street lighting, and playgrounds to the inhabitants, chiefly workmen and their families. It also maintains hospital and medical facilities. From the beginning, there has been an intimate personal relationship between the management and the workmen. Defendant is engaged in manufactu! ing iron, steel, and tin products and by-products. It owns and operates three plants situated at Weirton, W. Va., Clarksburg, W. Va., and Steubenville, Ohio. The Weirton plant is situated near the Ohio river and extends for a distance of iy2 miles. It comprises wharves, transportation facilities, buildings, machinery, and equipment necessary in its manufacturing business. The Steubenville plant with 1,000 employees is in Steubenville near the Ohio river and 4 miles from Weir-ton. It consists of a tin mill for the manufacture of tin plate from slabs and bars of unfinished steel manufactured at Weirton and transported by independent carriers to Steubenville for fabrication and finishing. The finished product of Steubenville is delivered to independent carriers for transportation to the customers of the company. The Clarksburg plant with 1,200 employees is in the outskirts of Clarksburg, 135 miles from Weirton. Like Steubenville, it consists of a tin plate mill for the manufacture of tin plate from unfinished steel manufactured at Weirton and transported by independent carriers to Clarksburg for finishing. The finished product of Clarksburg is delivered to independent carriers for transportation to customers or is transported by such carriers to Weirton. Tlie Weirton plant with approximately 10,000 employees comprises four departments — steel works, with 3,000 employees; sheet mill, with 800 employees; strip steel department, with 3,000 employees; and tin mill, with 2,800 employees. The steel works department consists of certain subdivisions designated coke plant, open hearth department, blooming mill, and structural mill. The function of the steel works department is the manufacture from raw materials of unfinished-steel. Coal is brought into the coke plant where it is 'manufactured into coke. This coke with iron ore and limestone is transformed into pig iron in the blast furnaces of the steel works department. Pig iron is transported in a molten condition to a mixer in the open hearth department from which it is removed from time to time and charged with ore, scrap, and limestone into the open hearth furnaces and there transformed into molten steel, tapped, and cast into ingots. The ingots produced in the open hearth department of the steel works are transported to the blooming mill, where the molds are removed and ingots after being reheated are rolled into bars, billets, or slabs of unfinished steel and distributed to the bar and slab yards for transportation to the various finishing departments in the company’s units at Weirton, Clarksburg, and Steubenville. The finishing departments at Weirton — the tin mill, sheet mill, and strip steel department — manufacture the unfinished slabs, billets, and bars into finished iron, steel, and tin products. During the manufacture of bars, billets, and slabs of unfinished steel from raw materials, neither the materials nor the labor in the manufacture of the materials is in interstate commerce. During the manufacture of finished products in the finishing mills at all the plants, neither the products nor the labor in the manufacture of the products is employed in interstate commerce. Defendant is a wholly-owned subsidiary of National Steel Corporation. With its subsidiaries, National Steel Corporation constitutes a well integrated organization for the production of iron and steel. The principal subsidiary companies beside the defendant are Great Lakes Steel Corporation, Hanna Iron Company, Hanna Iron Ore Company, Producer Steamship Company, and Weirton Coal Company. One of the Hanna companies owns and operates iron mines in Michigan, Wisconsin, and Minnesota. The defendant obtains over 50 per cent, of its iron ore from the Hanna Iron Ore Company. The Producer Steamship Company operates steamers upon the Great Lakes transporting ore from the .upper lake to the lower lake ports from which the ores are transported by rail to Weirton. This company carries about 1,500,000 tons per year, 45 per cent, of which goes to defendant.- The defendant uses all the coal produced by the Weirton Coal Company at- its mines in Pennsylvania. In 1933 defendant received 1,305,955 tons of coal and 836,428 tons of iron ore. Defendant uses between 50,000 and 60,000 tons of scrap iron per month. All of the iron ore and most of the scrap and coal moves across state lines from sources of supply to defendant’s plants. In 1933, 577,976 gross-tons of steel products were manufactured at defendant’s plants, 99 per cent, of which was transported across state lines to customers. Collective Bargaining. In the spring of 1933 emergency legislation for industrial recovery was actively discussed in Congress and the public press. The proposed legislation recognized the temporary right of capital to ensfage in co-operative action by way of fixing prices and regulating production exempt in part from the restraints of the Sherman Act (section 1 et seq. [15 USCA § 1 et seq.]) and Clayton Acts (section 1 et seq. [15 USCA § 12 et seq.]). In compensation therefor and as a counterbalance, labor strongly urged that the provisions of the Railway Labor Act (45 USCA §§ 151-163) concerning the right of labor to organize and bargain collectively, free from interference be accorded to labor in the proposed industrial legislation. In deference and submission to this demand, Congress included section 7 (a) in the National Industrial Recovery Act. The agitation in Congress and throughout the country aroused Weir to the situation at Weirton where no plan or provision for collective bargaining had ever prevailed. Relations between the management and the employees heretofore had been handled on an individual basis. When a man or group of men had a grievance to discuss, they discussed it with the management’s representatives in the mills, and, if not adjusted to the satisfaction of the men, they went to the office of the company and took the matter up there. In anticipation of legislation on the subject, Weir consulted Eugene R. Grace, president of Bethlehem.Steel Corporation, and obtained from him a copy of the Bethlehem Plan of Employee Representation. He also consulted with the heads of other large companies in the steel industry and obtained copies of their plans. He was attracted by the Bethlehem plan which had been in operation for over fifteen years among 70,000 employees in its steel plants, and had established satisfactory and peaceful relations with its workmen. Collective bargaining as prescribed in the plan and practiced at the plants of the Bethlehem Company through many years had proved an effective means of satisfying reasonable demands of labor and developing the principle of co-operative relations between management and workmen. Weir turned the plan over to Williams who submitted it to the employees. The problem was the practical mode of submitting the plan to 13,000 employees, 6,000 of whom were foreigners and all of whom were scattered in mills located in three towns operating twenty-four hours a day with five shifts of eight hours each. Obviously, mass meeting methods applicable to small mills with a few men were out of the question. At least 40 per cent, of the workmen were foreign born. In certain mills practically all were foreign born. These workmen were of eleven different nationalities and many of them are unable to read, speak, or understand English. For eight years there had been in effect at Weirton a group insurance plan known as the Employees’ Relief and Beneficial Association with a board of directors, seventeen of whom were elected by the employees by secret ballot. One obvious means of direct communication with employees was through these directors. Williams discussed the plan with the company’s managers and superintendents and instructed them to reach the employees through the acting and past directors of the beneficial association, and also through foremen and recognized leaders among the men. The managers requested the leaders to select from their own number men fitted to discuss and explain the problem of employee representation to tlie employees and ascertain their views. The men so selected formed themselves into steering committees in each mill for that purpose. Each committee organized and considered various plans of employee representation made available by the managers or by members of the committee or other employees, such as plans in force at the Wheeling Steel Company and at the different Bethlehem plants. The committees undertook to explain the plan to other employees and with the foremen and superini endents reported to the management that the men approved the Bethlehem plan. General knowledge of the Bethlehem plan before it was acted upon by the employees was proved by 91 witnesses. It is significant that the testimony of these witnesses showed there was practically no opposition to the plan. This is further confirmed by the fact that no other plan of representation was even suggested. After reports of the steering committees, the following notice was posted in the mills on June 22, 1933 : “Beginning July 1st the Employees’ Representation Plan will be adopted by the Weirton Steel Company. This plan will provide more effective communication and means of contact between the management and employees on matters pertaining to industrial relations and conditions under which the employee will work. “J. C. Williams, President.” On the same day defendant ordered 15,-000 copies of the Bethlehem plan printed with slight modifications to adapt it to the Weirton plant and on June 24 they were distributed throughout the mills so that each employee received a copy. The steering committees also undertook to hold an election for the purpose of selecting representatives under the plan and to that end formed themselves into election boards for each mill. Also on June 22 notices were .posted in each mill of the plant naming the employees selected by the steering committee as the election board for that mill to serve at the nomination election on Tuesday, June 27 and at the general election on Friday, June 30. As an example of an employee election board named by a steering committee, the notice posted in the Strip Steel Works appears in . Before the nomination election, defendant posted still another notice stating the qualifications of voters, the qualifications of candidates for representative, describing the method of nomination and the method of election. This notice appears in . Defendant provided the facilities for the elections, but neither the company nor any officer had anything whatever to do with choosing any one who acted either as judge or clerk on any of the election boards. Slates were fornied in every mill and there was the keenest interest in the nomination and election of rival candidates. In round numbers 85 per cent, of the employees eligible to vote participated in the June elections. Any evidence of coercion or interference at the June elections was trifling and not worthy of mention. Forty-nine representatives and alternates were declared elected. The election boards functioned fairly. No one has challenged the accuracy of the count or the honesty of the election officers at every polling place.- The participation of over four-fifths of the eligible employees in the June elections was a conclusive expression of approval and adoption of the Bethlehem plan. It was the general understanding among the employees participating in the elections that the representatives elected would hold office for a period of six months from July 1, 1933, and that their successors would be elected in December, to take office on the first of the year. Following the election, the 49 representatives immediately met and elected a chairmarr and secretary and other committees. From the 49, the 6 divisional committees were selected by each department. Although the plan provided for joint committees consisting of representatives and management, the testimony shows that in actual practice the management never appointed any one on these joint committees. Williams testified: “When the election took place in June, the representatives were organized. * * * I did not appoint anyone on any joint committee that they had, and I left it entirely to themselves. * * * “XQ. Did you say this in your testimony: ‘We as a company have no more to do with the management of the employees’ representative plan than we have with the Amalgamated Association’? A. I reiterate that. “XQ. That is your statement? A. And it is a true statement.” This testimony of Williams is fully borne out by the record. During the summer of 1933, the committee of 49 and the divisional committees functioned effectively and adjusted many grievances. Harmonious relations prevailed. Within a fortnight, seeds of discord were planted. Organized labor took notice of the Weirton situation. Amalgamated Lodges. The Amalgamated Association of Iron, Steel, and Tin Workers of North America is a labor organization composed of a small percentage of the workers employed in the manufacture of iron, steel, and tin products. Two organizers of this association appeared in the Ohio Valley. Romanogli went to Clarksburg. Bowen was dispatched by the association to Weirton and Steubenville. Their mission was to organize the employees into Amalgamated lodges and to enlist them to become members of the Amalgamated Association. These organizers were paid salaries and expenses and were directed to obtain from each prospective member an initiation fee of $3 to be remitted to the National office. Aside from the testimony of Long that he consulted with Bowen before the latter had been assigned to organize Weirton and Steubenville, it is clear from the evidence that the employees of defendant did not request the Amalgamated Association to organize lodges or to send organizers for that or any other purpose. The Amalgamated Association undertook this task on its own initiative and for its own purposes. Large numbers of employees at defendant’s plants were induced to sign membership cards and many paid to the organizers all or part of the initiation fee of $3. This membership was procured in the main by misrepresentation and extravagant promises. A circular widely distributed by the organizers appealed to the steel workers in these terms: “AMALGAMATED ASSOCIATION OF IRON, STEEL AND TIN WORKERS. “To the Steel Workers: “Under the Industrial Recovery Act, the workers of the Steel Mills are challenged by the President of the United States TO BECOME MEMBERS OF A LABOR ORGANIZATION. “Will you be a slacker, or are you going to help him bring back the economic security of the steel workers? You can do this by complying with Section 7 of the Industrial Recovery Act. “This Act gives to the employees the right by law to help themselves: “Section 7: ‘That employees shall HAVE THE RIGHT TO ORGANIZE AND BARGAIN COLLECTIVELY THROUGH REPRESENTATIVES OF THEIR OWN CHOOSING, and SHALL BE FREE FROM THE INTERFERENCE, RESTRAINT, OR COERCION OF EMPLOYERS OF LABOR, OR OTHER AGENTS, IN THE DESIGNATION OF SUCH REPRESENTATIVES, OR IN SELF ORGANIZATION, OR IN OTHER CONCERTED ACTIVITIES FOR THE PURPOSE OF COLLECTIVE BARGAINING OR OTHER MUTUAL AID OR PROTECTION; THAT NO EMPLOYEE AND NO ONE SEEKING EMPLOYMENT SHALL BE REQUIRED AS A CONDITION OF EMPLOYMENT TO JOIN ANY COMPANY UNION OR TO BEFRATN FROM JOINING, ORGANIZING, OR ASSISTING A LABOR ORGANIZATION OF HIS OWN choosing ; and that employers shall comply WITH THE MAXIMUM NUMBER OF HOURS, MINIMUM RATES OF PAY, AND OTHER CONDITIONS OF EMPLOYMENT, APPROVED OR PRESCRIBED by the President.’ “Your employer cannot discharge you for joining the Amalgamated Association of Iron, Steel and Tin Workers. “Meeting at- “Town--.” This circular was false and misleading. There was no demand on the part of the President that any one join a labor organization. There was no warrant for branding as a “slacker” a man who refused to join a labor organization. About the middle of July,. 1933, Romanogli went to Clarksburg at the request oí a committee of coal miners, potters, and members of other unions, not one of whom was a steel worker. He was met by the committee July 16 and taken to a Sunday afternoon meeting that had already been arranged. He talked about the Amalgamated Association and answered questions from the audience. He invited all interested to sign slips of paper as formal pledge cards provided by the association had not then been received. Before adjournment, arrangements were made to hold a meeting on the following Sunday, July 23. Meanwhile Romanogli communicated with the International office at Pittsburgh and arranged for Leonard, the National secretary, to address that meeting. Romanogli opened headquarters and on the following day was visited by three steel workers — Guice, Mil-stead, and Murray. At the meeting on the following Sunday, Leonard reviewed the organization and work of the Amalgamated Association. “He asked those present if they were willing'to join the Amalgamated Association. Unanimously the assemblage showed their intention in so doing. So an organization was instituted at that time.” Temporary officers were installed. The organization thus instituted was Blue Eagle Lodge No. 32. The temporary officers were made permanent on the following Sunday. At the end of the meeting, numerous steel workers signed pledge cards like the following: “Membership and Pledge Card. "“Amalgamated Association of Iron, Steel, and Tin Workers of North America. “As an Employee of the - I, the undersigned, accept membership in the Amalgamated Association of Iron, Steel and Tin Workers of North America, with offices in the Iron, Steel and Tin Workers’ Building, 500 South Main Street, Pittsburgh, Pa., as the only union having jurisdiction in the iron, steel, sheet and tin mills through the American Federation of Labor. I take this action voluntarily and of my own free will, without influence or coercion on the part' of anyone, and pledge every effort at my command to make my organization effective in the mill in which I work. I pledge myself to help organize the men at the mill where I work. “Signature-- “Address-1- "“Name of Mill- “Town-' State- “Date-,. 19-.” (Allied Printers* Label1 No. 45) Pursuant to the pledge, the officers of the lodge, certain steel workers, and the organizers procured signatures to numerous other pledge cards. By the end of July, holders of pledge cards paid their initiation fee of $3 and received a pink card acknowledging the receipt thereof. This pink card' was evidence of the holder’s status as a member of the Amalgamated Association. The organization at Clarksburg was typical of the organization of the five lodges at Weirton and the one lodge at Steubenville. By the middle of September, a large majority of the employees of defendant had been induced to sign pledge cards and to pay $3 or part thereof and to accept pink cards. The membership of the seven lodges may be briefly summarized as follows: N. R. A. Lodge No. 35 (Weirton).. 1,958 Goodwill Lodge No. 39 (Weirton).. 263 Weir-Cove Lodge No. 30 (Weirton) 2,473 Valley Lodge No. 31 (Weirton).... 693 New Deal Lodge No. 33 (Weirton) 1,735 Blue Eagle Lodge No. 32 (Clarksburg) ......................... 949 Steubenville' Lodge No. 150, Ohio... 706 Total 8,777 The situation presents an interesting query. How was this membership assembled ? The answer to this query is made by 38 witnesses called by the defendant who testified that they took out cards in the Amalgamated Association under pressure and coercion. This is attempted to be offset by 6 witnesses called by the plaintiff who testified that they joined of their own free will. A few of the defendant’s witnesses may be quoted. Mason, a heater, testified: “Q. Was anything told you as to the necessity for your signing the card? A. If I expected to work, I would have to sign a card' and the charter would be closed and the dues raised shortly. “Q. Is that why you signed it? A. Absolutely.” Lafferty, a roller, testified: “Q. Will you state the reason why you joined the Association? A. My reasons for joining the Amalgamated Association were that I was not financially able to pay a $50 fee to get into it, and I could get into it for $3; I could better afford to lose $3 than I could $50. “Q. Who mentioned any $50 fee? A. They told me that if I didn’t join the Amalgamated Association before the charter was closed, that it would cost me $50 to get in. “Q. Who told you that? A. Harry Dean, A. W. Peat, Henry Lesher. “Q. Were they Amalgamated organizers? A. They were not what you would call organizers, but they were working for the organization.” Collins, a roller, testified: “Q. You stated that you joined the Amalgamated Association? A. I did, yes. “Q. Will you state what lodge you did join of the Amalgamated? A. Well, in the last part of August, I attended an open meeting of the Amalgamated, and they were discussing dues, and one thing and another, and they said that — it was brought up by a resolution, which was brought before the lodge, that they were going to close the charter right away, and anyone that had not paid in their dues up then, would be assessed $50. So I did not at that night, and the next day, coming down through the mill, Emil Walters, a fellow by the. name of John Rawlins was coming down, and they says, ‘Tom, are you going to sign up ?’ I said, T don’t know, it looks like as if I am going to have to.’ John Rawlins said, ‘If you are not, your iron is not going to be sheared next week.’ I said, ‘What do you mean by that?’ He said, ‘Practically every roller in the plant has signed up, and the majority of them — those rollers that are not signed up by next week arc not going to have their iron sheared.’ Well, I says, ‘In that case, then, it looks like I will have to.’ tie said, ‘You certainly are.’ He says, ‘If you are not in on the line by next week, by next midnight,’ he says, T am afraid you won’t have your iron sheared.’ “Q. Were you dissatisfied with the employee representation plan at that time ? A. I was not.” Kinty, a tinner, testified: “Q. Was anything said to you as to what would happen if they got 51 per cent, of the workers in the Amalgamated? A. Yes, sir; they told me that the U. S. Government would be back of this A. A. “Q. What do you mean by the A. A.? A. This Amalgamated Union. “Q. The Amalgamated Association ? A. Yes, sir. They said when the President would get behind their back, it would bring all the boys home. “Q. Was any statement made to you with respect to the recognition of the Amalgamated Association and what would happen if they came to you? A. They said if the ones did not have a card and unrecognized, they would have no job. “Q. What did you understand by the phrase ‘recognition of the Union’ to mean? A. That means closed shop. “Q. Is that the general understanding among steel workers ? A. Yes, sir.” Reardon, a roller, testified: “Q. Why did you join the Amalgamated? A. I was working there and there was a lot of agitation going around this way and that way, and they were right after me all the time because they figured if they could get me to join the Amalgamated, they would have a lot of my following to join, but nevertheless I was approached by a heater in the mill, Tom Buccey by name, and he said, ‘We have every roller in the mill now joined but you. It is up to you to join.’ I said, ‘Tom, I do not know. I belonged to it before and I know what it is and 1 do not think 1 will.’ He said, ‘Let me know before the turn is over.’ He came back in two heats’ time, and said, ‘What are you going to do?’ I said, T do not know,’ He said, ‘Listen, Bill, if you do not join tonight,’ he says, ‘your iron will not be open on Monday morning.’ “Q. What do you mean by that? A. Well, my iron is my finished product. That is what I get paid for. I work on a tonnage basis, not only me but my crew. “Q. Well, when he said that your iron would not be opened, what did he mean ? A. He meant that the man that shears my iron and the three boys that opens my iron would refuse to open it, because I was not a member of the Union. “Q. You joined the Union then? A. Yes, sir.” Miller, a rougher, testified: “Q. Did you join the Amalgamated Association? A. I did. “Q. Why? A. Because I was told I would lose my job if I didn’t. “Q. Who told you that? A. Mr. States. “Q. Is he active in the Amalgamated Association? A. lie was at that time. “Q. When did you join? A. I am not definitely positive what date it was. It was a Saturday, either the 20th or 27th of August. “Q. Was any statement made to you as to any increase in the initiation fee? A, Yes. “Q. What? A. Mr. States also told me if I didn’t join at a certain time that the increase in initiation fee would amount to $25. “Q. Did you ever belong to the Amalgamated Association before that? A. No, sir.” Bailey, a heater, testified: “I was working there one day, so I was in back of the furnace and I was talking to Fred Lewis and Fred said to me, ‘Have you signed a card yet ?’ I said, ‘What card ?’ ‘Why,’ he said, ‘Union card.’ I said, ‘No, sir.’ He said, T have a card.’ He said, ‘Wouldn’t you like to throw out one?’ He said, ‘Tt is going to be a closed shop.’ I hadn’t heard anything about Union, practically, I did not know anything about unionism, so I said, ‘Let me see one of your cards.’ So he showed me the card. I looked it over. I said, ‘No, I don’t believe I want to join; I don’t have any money to spend.’ I says, T belong to one lodge.’ He said, ‘It is going to be a closed shop,’ and he said, ‘If you don’t have a card, you won’t be allowed to work,’ and he said, ‘You won’t have any job.’ I said, ‘I don’t want to lose my job; I got a family to keep; I want to work.’ He said, ‘You fill this card out,’ and I says, ‘All right, I will fill it out when I get it.’ So I filled out the card and just in a day or two he told me to see Long. I seen Mr. Long on his mill. He gave me my card. I paid him the money.” DiStefani, a shearman, testified': “Q. Did you join the Amalgamated Association? A. Yes, sir. “Q. Why? A. I worked right alongside the fellow that was Chairman. “Q. Chairman of the Amalgamated Association? A. I worked under Jimmy Coad. “Q. What did he say about it to you? A. I kept talking to him all the time about it, and he would call the fellows over and tell them to join, and tell them to pay up their dues, and later on, I told him, I said, ‘What if I don’t join, then what?’ He said, ‘If they don’t join it now and are recognized, it will cost them a fine of $50.’ I said, ‘Well, if they don’t join it anyway, what are they going to do then?’ He said, ‘They will be out of a job.’ ” Misrepresentation, threats of closed shop, and increase in initiation fees is thoroughly borne out by a great preponderance of the evidence. The threat to raise initiation fees is further corroborated by a contemporary minute of a meeting of August 24, 1933, of the Clarksburg lodge as follows : “The matter of closing the Charter was again brought up and also a plan of raising the initiation fee of $3.00. A suggestion was then made by a brother that we hold up the closing of the Charter and allow a little more time to the employees not already in the organization. Also to the ones that have signed pledge cards but have not paid anything of their initiation fee. A resolution was then passed by the girls to levy initiation fees of $25 to girls who are holding back. A motion was made and seconded that the Charter be closed Aug. 31. The men set their initiation fee at $50. These initiation fees to go into effect after Aug. 31, 1933. Motion to close Charter on Aug. 31 was carried. Motion was then made that the meeting adjourn until Thursday, 8:00 P. M., Aug. 31, 1933. “Minutes approved. .“Roy E. Guice, Secretary.” The testimony shows that initiation fees were paid only in part or not at all by a large percentage of the holders of the hundreds of cards produced. Finally, the testimony of an official of the Amalgamated Association reveals that in October, 1934, only 183 employees of defendant who had taken out cards from the local lodges were recognized as members of the association in good standing. From all the evidence relating to the organization of the lodges, it is clear that procuring the cards by employees falls far short of designating the Amalgamated Association as their bargaining agent. Throughout the summer of 1933 the employees of defendant used the Bethlehem plan and found it an effective means of bargaining with defendant and of adjusting grievances. Committees of the 49 representatives dealt with the defendant in 181 different matters between July 1 and October 1, 1933, pertaining to wages, hours, and working conditions. All matters brought to the attention of defendant by these committees received prompt attention and were adjusted satisfactorily. With this experience with the committees of its employees defendant posted in September, 1933, the following notice: “For Company Use Only “Weirton Steel Company “To:- “From:- “Subj ect:- “Notice “The Weirton Steel Company plants are operating under the Code of Fair Competition of the Iron and Steel Industry. Hours of labor have been adjusted and wages have been increased to meet the full requirements, of the Steel Code as pertaining to the Eastern District in which the Clarksburg Plant is located. “According to the plant [plan] of Employees’ Representation, Article 9, under the caption ‘Procedure for Adjustments,’ makes provision for the settlement of any dispute which may arise between employees and the management. Clause 3 states: " ‘If the General Joint Committee on appeals shall fail to effect a settlement, the President of the Company shall he notified, and the matter may be referred, if the President and a majority of the Employees’ Representatives on the General Joint Committee agree to such reference, to an arbitrator or arbitrators, to be determined at the time according to the nature of the controversy.’ “The Weirton Steel Company wishes to do their part to end this depression and intends to live up to the N R A and the Iron and Steel Code in every respect. Beyond this we cannot go, and if any employees have any grievances they will have to be settled in accordance with Clause 3, Article 9 of the Employees’ Representation Plan as quoted above. “Weirton Steel Company. “September 11, 1933.” Strike for Recognition. On Sunday, September 24, without any previous warning or demand, 39 men out of a total of 91 employed in the tin plate cold rolled department failed to report for work at midnight. A group of a few workers stationed at a mill entrance persuaded these 39 not to go to work. The next two crews reported for work as usual. The following night the men who remained away from work on the first shift entered the mill and demanded that the 52 men who had worked the night before be discharged because they had worked instead of remaining out with the other 39. This demand was refused by the foreman. The men then left work, stationed themselves at the entrances to the mill, and persuaded other employees not to report for work at the next turn. The result was that certain parts of the mill were completely tied up. The strikers organized pickets. A group of 300 men gathered in a narrow street blocking the main entrance to the tin mill and refused admission to employees who wanted to work. These tactics were continued until by Wednesday night operations were so crippled that the entire plant was shut down. Long became the leader of the strikers and Ellison of the pickets. The pickets congregated in large groups in the streets and at the mill entrances. They turned back cars of workmen seeking to go to work. They refused every one admittance to the mill. They carried chibs and threw stones and hooted and jeered men trying to go to work, calling them scabs and other vile names. They lifted automobiles off their wheels and turned them around; pushed back cars trying to enter the mill; threatened men who wanted to work; stoned cars hauling workmen to the mill; and sent groups of men called “Good-Will” committees to the homes of workmen to threaten them and their families with personal violence if they returned to work. The situation was so grave that the mayor of Steubenville issued a proclamation forbidding assemblies. In Weirton the strikers took advantage of the lack of police and took possession of the town and the mills. Thereupon the sheriff called upon the state police and a unit was dispatched to the scene. Knowledge of the strike at Weirton was received at Clarksburg. The officers of the Clarksburg lodge called a meeting and a sympathetic strike was declared. Milstead, vice president of the lodge, when asked, “When this vote was taken to strike you had no knowledge of what the strike was about, did you?” frankly answered, “No, sir.” Reese, an officer of the Steubenville lodge, testified that on the following day that lodge also declared a sympathetic strike. In response to an inquiry from Clarksburg, Reese telegraphed Guice, secretary of the Clarksburg lodge, the purpose of the strike was “Want recognition.” Most of the employees at Weirton did not know what the strike was about. There had been no dispute between the company and the men. No vote was taken by the employees as to whether or no they should strike. Before the strike, no grievance of any kind was brought to any manager or officer of the company. On Wednesday, September 27, Long with officers of other lodges went to defendant’s office and met the general superintendent and other officials. According to Long’s testimony, the general superintendent “asked what the purpose of our visit was there.” In reply, Long testified: “Wc told him the purpose of our visit was to ask him to recognize the Amalgamated Association sub-lodges in Weirton as the bargaining agency for the employees of the Weirton Steel Company * * and the general superintendent replied that “during the absence oí Mr. Williams and Mr. Weir, it was not within their power and right to grant us recognition. * * * ” No grievance of any sort was mentioned or even suggested at the meeting. Thereupon Long and his associates left the office. About two weeks before Long’s visit, Williams, president of defendant, had sailed for Europe to recover from a nervous breakdown. On the day following the visit of Long, Weir interviewed a large number of officials and employees at the office of the company in an effort to learn about the strike. The following day, September 29,. he reviewed the situation in detail in a letter mailed to all the employees of defendant, the text of which appears in . Within a few days after this letter Weir interviewed several hundred employees at the office seeking to obtain first hand information of the cause of the strike. They came in a steady stream. In this throng Long appeared with a delegation of 16 or 17 Amalgamated Lodge members, together with Edward W. Miller, a vice president from the International office of the Amalgamated. Long was informed that Weir would receive the delegation but not Miller. Weir gives his own explanation of the reason for excluding Miller on this occasion. He testified: “XQ. I want to go back for a moment, Mr. Weir, to the occasion when Mr. Long and other employees came to your office and requested an audience with you, at which time a Mr. Miller who has been referred to here I think as an official of the Amalgamated Association was present. You have that in mind, do you? A. Oh, yes. “XQ. That occasion? A. Yes. “XQ. Now, at least, you stated that during that entire day you were busy, meeting delegations and employees; that is the delegation came in, you made inquiry of them as to what their grievances were and what the strike was about, is that right? A. Yes. “XQ. And you said that yoti were unable to ascertain what it was all about from anybody that you consulted with. Were you really very anxious to get that information ? A. I certainly was. “XQ. Then why did you not let Billy Long and Miller or anybody else come in that would be able to give you that information ? A. I would be very glad to have had Billy Long and his associates that were employed. I did not know Mr. Miller and I never heard of him. “XQ. You knew that he was there in the capacity of an adviser, did you not ? A. No, I did not know anything about him. I was trying to develop from our employees the basis for the strike. “XQ. Did you not take the pains to ascertain who this man Miller was, and to find out whether you had any good objection to his being present at that meeting? A. I certainly had objection to anybody being present, at those meetings except employees, and they are the only ones that could give me information as to the cause of the strike and the reason of its continuation.” Weir was then concerned solely with the cause of the strike. Large numbers of employees who were interviewed demanded an opportunity to return to work stating that they were being kept from work by a small group of employees. Practically all of them declared that they had no knowledge of the cause of the strike, did not approve it, and desired to resume work. The purpose of the Amalgamated delegation with Miller doubtless was to repeat the demand for recognition. To the employees’ request for work and to the demand of the Amalgamated delegation for recognition, a formal answer was made by the defendant through Weir on the following day. In a letter to all the employees he stated: “October 3, 1933. “To the Employees of the Weirton Steel Company: “After conferences with committees of our employees, we are convinced that the strike in our mills was instigated and is being maintained by only, a small percentage of our employees, and that the vast majority of them wish to return to work. “The Weirton Steel Company has made no change in its policy — it will make no contract with the Amalgamated Association of Iron, Steel and Tin Workers, and there is no such requirement in the Steel Code, the NRA or the President’s Recovery Program. “We are co-operating in every way with the President’s Program for reemployment, and fulfilling our obligations under the NRA and Steel Code, and we believe it our duty to open our mills and operate them with our own employees. You are not required to belong to any union. “Notices will be posted of the time of returning to work. “Weirton Steel Company, “E. T. Weir.” Defendant’s statement that “it will make no contract with the Amalgamated Association” provoked Long into sending a telegram to Senator Wagner: “Strike situation in Weirton becoming serious violence threatened E. T. Weir refuses conference with duly elected representatives. Request immediate assistance from your office. Wire reply Western Union. Wm. J. Long Chairman.” This telegram was supplemented by another of like tenor to Senator Wagner from the officers of the Clarksburg lodge. Á week later, October 9, defendant posted notices advising- employees that all departments would open on Tuesday morning, October 10. October 10 the mills were opened. October 11 the chairman of the National Labor Board telegraphed the defendant: “In the matter of the strike at Weirton Steel Company National Labor Board recommends that strike be called off strikers be taken back without discrimination and all matters' in dispute be submitted to Board for decision. * * * ” Weir replied on the same day: “ * * * The strike leaders started the strike without having made any demands upon the company or without any notice to us and we can not consider any reference or arbitration until the men return to work stop The mills are operating now nearly five thousand men being at work all regular employees stop We will take back all of our former employees if they report to work promptly.” ’ October 14, the chairman of the National Labor Board again telegraphed- to Weir: “National Labor Board pursuant to authority vested in it by the President has assumed jurisdiction over the strike at Weirton Steel Company, Weirton, West Virginia. Hearing will be held Monday October sixteenth two P. M., room seven ought six four Commerce Building Washington Board requests company send authorized representative would appreciate your coming personally.” To which Weir responded: “Replying to your wire of this date advising that the National Labor Board will hold a hearing on Monday regarding the Weirton strike comma our position is as stated in our former wire that there is nothing now properly before the National Labor Board for decision relating to our strike stop However in a desire to cooperate in the President’s Recovery Program I will appear before the Board Monday and make a statement of our position in the matter without submitting it to arbitration.” It is appropriate to observe that when the National Labor Board purported to assume jurisdiction over the strike at defendant’s plants it had not been created by Act of Congress or even by formal executive order. August 5, 1933, the President in naming the members of the board orally stated that it was to “pass primarily on any case of hardship or dispute that may arise from interpretation or application of the President’s Re-Employment Agreement.” The steel code had not then been approved. The board had no authority to assume jurisdiction over disputes arising under that code. On October 16 Weir and certain of the strikers headed by Long appeared before the labor board. None of the 49 representatives elected by the employees in the June election were invited to attend this hearing before the labor board and none were present. Long was heard at considerable length. In summing up his side Long said: “What we are after today is nothing more than what the law provides. We are allowed, according to Section 7, to choose our own representation. We chose this organization, the Amalgamated, for our representation. We have been denied the right to have them represent us in grievances. All we are asking is the right to have these men from the Amalgamated represent us in our grievances. We are not going into wages or hours or grievances; all we want is the right to have them represent us. Union recognition is the main issue.” Weir stated the company’s position: “In June, 1933, our employees adopted a plan of organization for collective bargaining and elected representa! ivcs to deal with tlie company in all matters of collective bargaining. Committees were selected from the various mills, in all totaling about fifty men. * * * One hundred eighty-one different matters have come up since the organization of these committees pertaining to wages, hours, and working conditions, and they have all received prompt attention and have been either adjusted satisfactorily to both parties or are still pending. When Mr. Long made his request that we negotiate with the committee which he claimed to represent, he was advised that all collective bargaining for our employees would have to be conducted by the committees which our employees had chosen. * * * To summarize, our position is this: We can not submit to arbitration tlie settled policy of the Company to maintain an open shop and not to contract with the Amalgamated Association of Iron, Steel and Tin Workers.” The hearing before the labor board lasted three hours. The only part of the Bethlehem plan criticized or objected to was the provision limiting the election of representatives to employees of the defendant. Weir agreed to recommend to the employees’ representatives an amendment in this respect. During the course of the hearing there was no suggestion that a written memorandum was contemplated. After the hearing formally closed, however, a clerk of the labor board produced a writing which purported to embody the result of the conference. Before the memorandum was signed, Weir asked Senator Wagner tlie meaning of the words “procedure and method of election” in the memorandum and was assured that it did not contemplate any substantial change in the form of election provided for in the Bethlehem plan. The following memorandum was then signed: “It is agreed: “1. That the strike now pending in the Weirton Steel Company he called off immediately. “2. The striking employees are to be permitted to return to work without discrimination, prejudice, or physical examination. “3. An election wall he held during the second week of December under the supervision of the National Labor Board, the procedure and method of election to be prescribed by the Board. (Italics supplied.) “4. The employees shall be permitted, as guaranteed by the provisions of section 7 (a) of the National Recovery Act, to select representatives of their own choosing, and the employers agree to bargain collectively with the representatives so elected. “5. In the event that any dispute arises out of this agreement, i