Reuters
Sun, October 1, 2023
(Reuters) -The International Longshore and Warehouse Union (ILWU) representing U.S. dockworkers has filed for a chapter 11 bankruptcy protection to resolve a pending litigation with the Oregon affiliate of the International Container Terminal Services Inc (ICTSI).
The union has listed its assets and liabilities in the range of $1 million to $10 million, according to the Sept. 30 filing made in a San Francisco court.
"While we have attempted numerous times to resolve the decade-long litigation with ICTSI Oregon, at this point, the Union can no longer afford to defend against ICTSI's scorched-earth litigation tactic", said ILWU International President Willie Adams.
"We intend to use the chapter 11 process to implement a plan that will bring this matter to resolution and ensure that our Union continues to do its important work for our members and the community," he added.
ICTSI said in a statement to Reuters that the bankruptcy filing was union's "latest maneuver to avoid accountability".
The union is facing a looming trial over allegations it illegally slowed down operations over several years at the Port of Portland, then operated by an affiliate of Philippines-based maritime company, according to a Wall Street Journal report.
The ILWU, which has over 4,000 members across the United States and Canada, said it will file customary "First Day" motions with the court to maintain its cash management system as part of its reorganization process.
The union in August ratified a six-year contract for U.S dockworkers that improved pay and benefits for 22,000 employees at 29 ports stretching from California to Washington State.
(Reporting by Jose Joseph in Bengaluru; Editing by Aurora Ellis and Stephen Coates)
ILWU Files for Bankruptcy to End ICTSI's Work-Slowdown Lawsuit
After years of legal wrangling over allegedly unlawful labor actions at an ICTSI-operated container terminal in Portland, Oregon, the International Longshore and Warehouse Union (ILWU) has filed for bankruptcy.
According to the National Labor Relations Board, ILWU organized slowdowns at ICTSI’s Portland terminal in order to damage ICTSI's business and coerce the Port of Portland into giving ILWU longshoremen the work of plugging and unplugging reefer containers – a task normally assigned to the port’s union electricians, IBEW Local 48. The dispute covered two full-time positions (two FTE) employed on reefer-plugging duty.
"By inducing and encouraging, since September 2012, longshoremen employed by ICTSI Oregon, Inc. at the Port of Portland to unnecessarily operate cranes and drive trucks in a slow and nonproductive manner, refuse to hoist cranes in bypass mode, and refuse to move two 20-foot containers at a time on older carts, in order to force or require ICTSI and carriers who call at terminal 6 to cease doing business with the Port, Respondents ILWU and Local 8 have engaged in unfair labor practices affecting commerce,” NLRB found in 2015.
The ICTSI terminal gradually lost its deep-draft boxship services, and container volumes fell to near-zero by 2017. That year, ICTSI pulled out of its contract with the port and abandoned its operatorship at the terminal. It brought a civil suit against ILWU, alleging millions of dollars in damages from the union-versus-union conflict.
Two years later, a federal jury ruled in ICTSI's favor, finding that slowdowns organized by ILWU and Local 8 had caused damage to ICTSI's business. The jury awarded ICTSI $94 million in damages. ILWU appealed, and in 2020 a district court judge reduced the damage award to $19 million.
In a Chapter 11 bankruptcy petition in California last week, ILWU said that its assets came to just $11.6 million - still not enough to pay for the damage award. "We intend to use the Chapter 11 process to implement a plan that will bring this matter to resolution. The officers are confident that we are taking the right step to put our organization on the best path forward — and we are optimistic for all that is ahead," said ILWU's leadership in a statement.
The ILWU will ask the bankruptcy court to preserve its cash management system and allow it to continue meeting its employee and payroll obligations. These are customary requests, and the union expects that they will be granted.
The filing follows shortly after ILWU's leaders concluded a landmark agreement with the Pacific Maritime Association (PMA) for a generous long-term labor contract, which covers seaports up and down the U.S. West Coast. According to Reuters, the improvements include a 32 percent pay increase for ILWU members over the course of the next six year
Eric Revell
Mon, October 2, 2023
The International Longshore and Warehouse Union (ILWU) representing U.S. dockworkers on the West Coast filed for bankruptcy protection last week amid a pending lawsuit over unfair work slowdowns and stoppages.
The ILWU, which represents 22,000 dock and warehouse workers at ports along the West Coast from San Diego to Washington state, including the nation’s busiest container port at Los Angeles and Long Beach, is in the midst of litigation with the Oregon branch of the International Container Terminal Services Inc. (ICTSI) over illegal work stoppages and slowdowns amid labor disputes.
A federal court found in 2019 that the ILWU had engaged in illegal labor practices from 2013 to 2017 through work slowdowns and stoppages, holding the union liable for $93.6 million in damages against ICTSI Oregon, which operated a shipping terminal at the Port of Portland during that period.
An Oregon judge later reduced the amount of damages to $19.1 million, which ICTSI rejected and prompted a new trial to be scheduled as it seeks damages in a range of $48 million to $142 million. The ILWU has argued that damages shouldn’t exceed $3.9 million and says it lacks funds to cover legal expenses that would ensue with the new trial.
CALIFORNIA PORT PROBLEMS PILING UP AMID LABOR NEGOTIATIONS
The International Longshore and Warehouse Union filed for bankruptcy amid a legal dispute with a former Port of Portland terminal operator about liability for unlawful work slowdowns and stoppages.
"While we have attempted numerous times to resolve the decade-long litigation with ICTSI Oregon, Inc., at this point, the union can no longer afford to defend against ICTSI’s scorched-earth litigation tactic," ILWU President Willie Adams said in a press release.
"We intend to use the [C]hapter 11 process to implement a plan that will bring this matter to resolution and ensure that our Union continues to do its important work for our members and the community," Adams added. "The Officers are confident that we are taking the right step to put our organization on the best path forward — and we are optimistic for all that is ahead."
In its Chapter 11 bankruptcy petition, the ILWU listed assets of more than $11 million with about $9.5 million in cash on hand. The bankruptcy process gives the filing entity the opportunity to restructure and resolve outstanding debts with creditors.
The ILWU's bankruptcy comes as the union faces legal liability from a labor dispute that could exceed its ability to pay.
ICTSI, which is based in the Philippines and is the parent company of ICTSI Oregon, told Reuters in a statement that the ILWU’s bankruptcy filing was the union’s "latest maneuver to avoid accountability."
This August, the ILWU ratified a new six-year contract for U.S. dockworkers that boosted pay and benefits for 22,000 employees at 29 ports along the West Coast.
Negotiations over the new contract began in 2022, and port terminal operators accused ILWU members of withholding labor and slowing down operations, according to a report by The Wall Street Journal.
Reuters contributed to this report.
How a fight over 2 jobs bankrupted union of 40,000 dockworkers
Greg Miller
Mon, October 2, 2023
In October 2021, Willie Adams, president of the International Longshore and Warehouse Union (ILWU), sat across the table from President Joe Biden at the White House. The two met again at the White House last month, celebrating the new six-year labor contract for America’s West Coast ports.
“I’ve known Willie for a long time,” said Biden after the latest meeting. “I was kidding him: I said I want to know who his haberdasher is. He looks awfully good, doesn’t he? I like that cut.”
President Joe Biden delivers remarks on International Longshore and Warehouse Union (ILWU) and Pacific Maritime Association (PMA) finalizing a new contract on September 6, 2023. REUTERS/Leah Millis
Just a few weeks later, Adams is engaged in a far less prestigious task: securing Chapter 11 protection for his union in the Bankruptcy Court of Northern California.
Adams proposed a restructuring plan in a court filing Monday calling for the ILWU to hand over substantially all of its remaining cash — $9.5 million — save for “a reserve for working capital necessary to enable the ILWU to maintain its operations and rebuild.”
The recipient of the proposed payout: International Container Terminal Services Inc. (ICTSI), a global terminal operator based in Manila, Philippines.
The irony is that the bankruptcy of one of America’s highest-profile unions, representing over 40,000 workers, whose president hobnobbed with Biden, began with a feud over two electrician jobs a decade ago at a niche container facility in Portland, Oregon.
New trial too expensive for ILWU to bear
A jury decided in November 2019 that the ILWU owed ICTSI $93.6 million in damages for unlawful practices including work stoppages, slowdowns and other coercive actions starting in 2013 at the ICTSI terminal in Portland.
The terminal lost its shipping line clients and ICTSI terminated its lease in 2017, paying over $11 million in penalties to get out early (it had signed a 25-year lease in 2010).
Legal damages stem from a decade-old dispute over jobs at Portland's Terminal 6. (Photo: Port of Portland)
Oregon District Court Judge Michael Simon ruled in March 2020 that the jury award was far too generous. He set maximum damages at $19.06 million — if the two sides would agree. If not, there would be a new trial on damages. ICTSI didn’t agree.
The appeals process is over on arguments about guilt or innocence: By law, ILWU owes ICTSI. The new trial on damages was set to begin in late February 2024. ICTSI was seeking $48 million-$142 million.
The ILWU estimated that it would have to pay $8.5 million in additional legal fees during the new trial on top of any damages awarded, thus the Chapter 11 filing that halts the trial process.
A decade-old ‘symbolic’ dispute
The events leading up to the current situation were recounted in the 2020 ruling by Simon.
They occurred years before Adams was elected president of the ILWU in 2018, before COVID and the supply chain crisis put West Coast dockworkers in the spotlight in 2021-2022, and before contentious negotiations on the new labor contract spawned fresh supply chain fears in early 2023.
Willie Adams, president of the International Longshoremans and Warehousers Union (PATRICK T. FALLON/AFP via Getty Images)
When ICSTI began operating Portland’s Terminal 6 in 2010, jobs for electricians plugging, unplugging and monitoring refrigerated containers (reefers) continued to be controlled by the Port of Portland, which assigned them to two electricians of a rival of union of ILWU, the International Brotherhood of Electrical Workers (IBEW).
This conflicted with the labor contract between the ILWU and the Pacific Maritime Association (PMA), the organization that represents West Coast terminals. The contract called for ILWU members to handle reefer jobs at PMA-member terminals, including Portland’s.
The Portland dispute wasn’t just about the two electrician jobs, it was about the principle, according to ILWU testimony.
As recounted by Simon, “ILWU National’s then-President Robert McEllreth testified that the Terminal 6 reefer jobs were ‘symbolic’ of jobs ‘up and down the coast’ and that to ‘let those jobs go … would bleed up and down the whole entire West Coast and … would undermine the contract.’”
Leal Sundet, then an official of ILWU National, testified that “any time you have a contractual matter that any one given PMA employer refused to comply with, that’s an assault on the fabric of the [labor] agreement. Because why would the next PMA employer need to comply with the agreement, and the one after that? If you let the PMA member companies start picking and choosing what parts they’re going to comply with, then you don’t have a contract any longer.”
After ICTSI terminated its lease in 2017, the Port of Portland, the PMA and the ILWU agreed that the reefer jobs would be handled by ILWU members in future container operations at Terminal 6. But by that time, the damage was done. The ICTSI lawsuit — which would eventually result in ILWU’s Chapter 11 filing — had been set in motion.
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