Incres Steamship Company, Ltd. v. International Maritime Workers Union

PETITIONER:Incres Steamship Company, Ltd.
RESPONDENT:International Maritime Workers Union
LOCATION:Clauson’s Inn

DOCKET NO.: 33
DECIDED BY: Warren Court (1962-1965)
LOWER COURT:

CITATION: 372 US 24 (1963)
ARGUED: Dec 12, 1962
DECIDED: Feb 18, 1963

Facts of the case

Question

Audio Transcription for Oral Argument – December 12, 1962 in Incres Steamship Company, Ltd. v. International Maritime Workers Union

Earl Warren:

Number 62, Northern National Gas Company, Appellant, versus State Corporation Commission of the State of Kansas.

Oh, I beg you — I beg your pardon.

Oh — oh!

Yes, of course, of course.

Number 33, Incres Steamship Company Limited, Petitioner, versus International Maritime Workers Union.

I was led astray by the Solicitor General’s brief, the discussion of that case.

Mr. McAllister, you may proceed now.

Breck P. Mcallister:

Mr. Chief Justice, may it please the Court.

This case has been adverted too already but I should like to state the facts in it because I do not believe they’ve been fully stated as yet.

This case is here on writ of certiorari to the Court of Appeals of the State of New York to review the judgment of that Court dismissing the complaint herein on the ground that the subject matter of the action was arguably subject to the National Labor Relations Board and the National Labor — the Labor Act under the rule of this Court in the Garmon case.

Now, this action is a civil action in part in the state court seeking both damages and an injunction against the intentional interference by the respondent union with the internal order in business and property of the plaintiff company.

The plaintiff in this case is a foreign corporation, a Liberian corporation, fully owned by Italian nationals, resident in Italy and the officers and directors are also Italians, resident in Italy.

The defendant below is the International Maritime Workers Union which was jointly formed by the two leading American Seamen’s Unions, the National Maritime Union and Seafarers’ International Union.

It was organized as its Constitution provides for the stated purpose of organizing and representing the foreign seamen on certain types of foreign-flag vessels and the type referred to is those whose ultimate ownership and control has no substantial connection with the country of registry.

Now the ships that are involved here are two in number, the Nassau and the Victoria.

Both were built in England — I am sorry, one was built in England, and one was built in Ireland.

Both are registered in Liberia and by the Liberian flag.

Both have almost entirely Italian cruise recruited in Genoa and they signed — I have to make a minor correction of the Solicitor General’s statement of my Incres case.

They signed Liberian articles, seamen’s articles in the presence of the Liberian Council in Genoa.

The officers are licensed by the Republic of Liberia.

The articles stand approved by an Italian union and the record shows that a large proportion of the crew belong to this Italian union.

The ships are engaged in the Caribbean cruise trade.

The Nassau makes a weekly trip to British West Indies for some 30 weeks each year.

The Victoria likewise makes cruises to Caribbean ports during a period of about the same length, about seven months every year.

Both ships return to Genoa each year for refitting and for leave for the crew.

The company in New York City maintains an agent.

The agent is a wholly owned subsidiary.

It is a New York corporation and this agent, like other agents of steamship lines, sells tickets and takes care of the arrival and departure of the ships and the passengers.

The corporation, the foreign corporation also employs another New York corporation known as Cosmopolitan Shipping Corporation.

Like other foreign lines, this Cosmopolitan Shipping Corporation is known as a ship’s husband.

Breck P. Mcallister:

This takes care of such matters as the physical ending of the ship, the fueling of the ship between trips, the hiring of tugboats and linesmen, and pilots, and docking, and all such physical features in the handling of a ship.

Now the lawsuit below began when the respondent union commenced a campaign under its Constitution to organize the seamen on these ships.

This campaign began in February of 1960.

The overt incidence in this case began on Friday the 13th of May of 1960.

The respondent union has admitted in its answer in the case — in this case that on May 13th, the union representatives requested crew members of the SS Nassau to engage in this freight and indeed they did.

The Nassau arrived on the morning of May 13th at about quarter of 9 with the load of passengers.

The passengers were debarked.

By eleven o’clock, there was a picket line.

The crew takes its leave normally from 12 until four o’clock in the afternoon when again a new load of passengers comes on board for the scheduled of departure at six o’clock.

The crews are under articles and under duty to return at four o’clock.

They did.

But then as when the activities of the union began and it appears in the record that they actually went on board the ship and urged the crew members to leave.

The crew members did and to abbreviate the story, now all of the crew members did but a substantial number did.

To abbreviate this part of the story, the cruise was cancelled by midnight.

The crew did not return.

The other ship, the Victoria, arrived in New York harbor on Sunday the 15th of May.

There was a minor incident in the outer harbor.

The Victoria was unable to dock because the Nassau occupied the pier to which it was accustomed to go.

So, it laid anchor in the outer harbor in New York.

Efforts to unload the returning passengers by tender were interfered with by a picket boat of the respondent union but a police launched took care of that situation evidently and at any rate the passengers were debarked and there was no further incident on that occasion.

The real difficulty began with the Victoria on the following Tuesday when the Victoria again was scheduled to depart on another cruise.

The passengers have been embarked by tender as the ship still laid anchor at quarantine in the harbor.

The departure which had originally been scheduled for four o’clock in the afternoon had been postponed until 5:30 due to the problem of getting the passengers on board.

When the passengers were on board and again the crew, under articles — I mean by that they were on duty, the — was prepared to sail.

Again, a picket boat came out, this time it was manned by members of the crew of the Nassau.

But the record is clear that this picket boat was sent out by a Mr. Levangie (ph), the chief picket of this union and was sent out for the very purpose that was sought to be carried out and it was successfully accomplished.

A picket boat called through loud speakers in Italian to the Italian crew members and urged them to feign sickness and not to sail.

This had its effect of creating confusion on shipboard and there ensued many conversations on the shipboard which I need not detail with the same result as in the case of the Nassau that the Victoria did not sail on its cruise and it was cancelled, and the passengers were debarked by tender.

Now, this proceeding was as I’ve said in thought in the state court to seek an injunction and indeed a restraining order was obtained on Monday, the day before the Victoria incident but it apparently did not stop the activities.

A permanent injunction issued on May 25th and the matter is now here.

Breck P. Mcallister:

The federal question was raised below at the outset by the respondent union by cross motion to dismiss the complaint on the ground that the state court had no jurisdiction over the subject matter of the suit in view of the Federal Labor Act.

That point has of course been pressed in every — all the way out here.

The question presented are of course and very obviously the Garmon rule by the state court correctly applied that rule, we contend that it did not.

And of course, more basically the question of whether or not the Federal Act applies at all to the foreign seamen employed by a foreign corporation are unknown on these ships.

These men of course were I repeat, was serving under foreign article which were entered abroad and the ships were of course in territorial waters at the time of these events.

Now, I certainly do not wish to repeat so many of the arguments that have been made here already, many of which have a direct bearing upon the Incres case.

I want to emphasize, perhaps, three parts, maybe a few more.

First, I find myself in very fine company.

I find the Solicitor General is on my side.

I find that five foreign governments have filed briefs in the Incres case and in the related cases, all of which are also, I think on my side.

That is a very welcome situation and I think the presence of so many foreign governments, ones against any hasty conclusion that this Act should be construed without full regard to the interests of the foreign nations that are before this Court in the amicus briefs because — and I join the Solicitor General in one basic and fundamental point he made.

We are concerned not with the Garmon type of situation of this Court acting as the — what has been called the empire of our federal system in adjusting jurisdiction between state and nation but we are quite the contrary engaged in the adjustment if you like of power between sovereign nations.

And the presence of these — the governments, I think it must again be emphasized.

And as the Solicitor General pointed out only one nation may properly, effectively, if you like, regulate labor relations on shipboard.

And here, we are concerned not with a tort law such as in the Jones Act where there is a choice of law in the private international sense that we are concerned with a comprehensive regulatory law that reaches into the most important relationship on shipboard to wit the relation between the master and the crew.

We regard the Benz decision as controlling here in every respect.

Frankly, I do not believe that the distinction attempted by my worthy opponent is valid.

The suggestion is that in that case, the ship was only temporarily in a United States port but as Mr. Justice Black, I think inquired earlier, isn’t every foreign ship that comes to our harbors in here temporarily.

I believe they are.

I think the reach of that decision is far deeper than that.

The important point that I think I should like to stress is that the Benz case is in full conformity with the established principles of international law under which we have lived for so long.

I would like to mention that because several suggestions have been made.

One is sort of the notion that there is some fiction maybe about registration under the flag of Liberia.

And secondly, the suggestion that there is some, perhaps some — even the word fiction was used in connection with the matter of registry of a ship in Liberia, I think, and elsewhere.

I would like to point out that the Republic of Liberia has filed a brief here in which in its — in the Appendix, it has listed the international conventions to which the Republic of Liberia is a signatory power.

This appears in Appendix A to the brief of the Republic of Liberia on page 19.

They have listed eight international conventions: The Intergovernmental Maritime Consultative Organization, The International Convention Safety of Life at Sea, International Load Line Convention, International Telecommunication Convention, North Atlantic Ice Patrol, The ILO Convention relating to officers, competencies, certificates, the ILO Convention relating to shipowners’ liability, relating to sick and injured seamen and the ILO Convention relating to minimum age at sea.

I most respectably — respectfully submit that the Republic of Liberia is a recognized maritime power and its laws are entitled to the same recognition that all the laws of any — of a sovereign nation that may come before this Court.

I would add that the conventions to which I referred relate to the ships themselves, the control regulation exercised by the Republic over those ships.

I would refer also to the statement in the brief of the Republic of Liberia that they recognized the duty to regulate and control all matters of employment and in relation to the internal management of Liberian ships and that it does regulate these matters and has what is stated in this brief to be a growing body of law with respect to minimum age, working hours, overtime wages, maintenance and care of sick and injured seamen, repatriation, and unionization.

Breck P. Mcallister:

I most respectfully submit again that in this area, the Republic of Liberia being one of the four largest maritime nations in the world has and is recognizing its obligations in that respect.

And I believe there should be accorded to it before this Court exactly the same recognition as would be accorded to any other nation that comes before this Court.

I emphasize that because there has been some suggestions that there was something peculiar about registration under the law of that Republic.

Frankly, I haven’t the remotest this idea while these Italian owners chose to register these ships under the Republic — flag of the Republic of Liberia but I suppose that’s a decision, a business decision which they are entitled to make for whatever reasons may appeal to them and I do not believe that that decision is subject to criticism or review.

Many individual much capital in the world of one nation is registered under the flag of some other nation, in ships under the flag of some other nation.

American capital does it, British capital does it, Greeks do it, Norwegians do it, it is been going on for a very long time.

I sometimes think that Columbus did it.

Potter Stewart:

Mr. McAllister, the —

Breck P. Mcallister:

Yes, Mr. Justice Stewart.

Potter Stewart:

— Court of Appeals’ opinion was based squarely on the arguably subject (Voice Overlap) —

Breck P. Mcallister:

Yes, that is correct.

Potter Stewart:

— put to Garmon.

Breck P. Mcallister:

Well —

Potter Stewart:

And I understand the distinction that the Solicitor General have made in which you’ve repeated and adopted between statutory jurisdiction and such as is here is involved and the matters that are within the expertise of the navy board such as it was involved in Garmon and perhaps —

Breck P. Mcallister:

Yes.

Potter Stewart:

— in the last year’s MEBA case.

Breck P. Mcallister:

Right.

Potter Stewart:

But assuming that that is an invalid distinction, assuming that’s invalid.

Certainly it is true that as of the time this case was before the New York Court of Appeals, this matter was arguably subject to the — to Labor Board jurisdiction and because of the fact that the Labor Board had assumed jurisdiction over half a dozen and more such cases, isn’t it?

Breck P. Mcallister:

I perhaps should’ve said Mr. Justice Stewart that a — in the early — in May when this matter began the union filed a charge with the Regional Office of the Labor Board in New York charging us with having violated Section 8 (a) (5) of the Act for having failed to bargain with the — what they called the — to the chosen representatives of the crew.

That charge has remained in the local office in New York every since.

The Board has not acted upon that charge.

It has issued no complaint and has simply done nothing.

But of course, Mr. Justice Stewart, I think that your question goes deeper than that because I do think that under the decision of this Court in the Benz case that the matter was definitely not subject, to argue this subject.

We believe that the Benz decision goes far deeper than the particular facts of the case.

Potter Stewart:

That’s what the (Voice Overlap) —

Breck P. Mcallister:

Yes.

Potter Stewart:

— in the Court of Appeals, so I gather.

Breck P. Mcallister:

That’s what the dissent —

Potter Stewart:

Yes.

Breck P. Mcallister:

Yes.

That is correct.

Now —

Byron R. White:

(Inaudible)

Breck P. Mcallister:

Yes, Mr. Justice White.

Byron R. White:

(Inaudible) it’s necessarily to follow — necessarily follows from the fact that the Labor Act may not apply to these foreign-flag ships to attempt with the representation of election, something like that.

Does it necessarily follow that the Act doesn’t apply to present the union from committing unfair labor practices or applied to otherwise protected activities?

Breck P. Mcallister:

I think it does.

I think the Act does not apply, Mr. Justice White.

Byron R. White:

It’s wholly on the ground that here in this case it is — just because of the question of coverage that isn’t preempted, is that right?

Breck P. Mcallister:

No, I think that it goes — again goes deeper than that.

I think the Act must be treated as a whole.

I think it truly is an integrated whole.

For example, we so urge in our brief that you can’t dismember the Act and give it what seems to me a lopsided application.

That certain features of it might be applicable here relating to picketing, for example, but then nothing else should apply.

Byron R. White:

Well, do you mean the piggy-back case, isn’t — wasn’t upheld with the Railway Labor Act applied in some aspects with the — that the Taft-Hartley Act applies to the union activities of boycotting?

Breck P. Mcallister:

That is correct, Mr. Justice.

But I think the distinction there is simply this, that in that case, this Court was making an adjustment between two different acts of Congress; one, the Railway Labor Act; and secondly, the Labor Board to the —

Byron R. White:

But nevertheless the employer couldn’t be forced to do anything into the Taft-Hartley Act in this case.

But the union —

Breck P. Mcallister:

True but —

Byron R. White:

But the union could be prevented from doing something under the Taft-Hartley Act.

Breck P. Mcallister:

True, but I think the —

Byron R. White:

Similarly, its conduct would’ve been protected under the Taft-Hartley Act.

Breck P. Mcallister:

Well, that makes —

Byron R. White:

That’s better if it hadn’t been an unfair labor practice.

Breck P. Mcallister:

Yes.

Well, that maybe but I think again, you are dealing with the situation in which the full power of the United States was available there.

Under the Railway Labor Act, there’s the certain aspect of the relation and under the Labor Act as to others and there was a dismemberment of the Act, I —

Byron R. White:

So you would say that the foreign-flag ships — the owners of the — came in (Inaudible) — should not be able to file a complaint before the National Labor Relations Board.

Breck P. Mcallister:

Correct.

Precisely, because in that situation, there is no power of this Court —

Byron R. White:

Or to sue for damages for a boycott under the Act.

Breck P. Mcallister:

That they could not.

That is correct.

We claim — we have filed no charge.

We propose — we do not propose to institute any action —

Byron R. White:

Well, what was on the —

Breck P. Mcallister:

— because —

Byron R. White:

— you perhaps said that I — I’ve forgotten, what was on the picketing of the — were there signs, the picket carry signs, what was on them?

Breck P. Mcallister:

The picket signs are in the —

Byron R. White:

Are they in the record?

Breck P. Mcallister:

Are in the record, Mr. Justice.

Byron R. White:

(Inaudible)

Breck P. Mcallister:

I’ve gotten — I think they’ve just simply said they had no dispute with anybody else except the crew of the Nassau and the crew of the Victoria.

They were attempting to avoid of course the possibility of a boycott charge.

But let us see if we can find that —

Byron R. White:

Points alright, (Inaudible)

Breck P. Mcallister:

Very well.

No.

We don’t think you can dismember this Act, because we think it would simply wrench it apart and the interrelationship of the various clauses in the Act would be destroyed because what Congress was doing in this Act, it seems to me, was writing an Act as a whole.

It was not writing part of an Act.

It was adjusting very deep seethed conflicts in Congress in the determination of what kind of picketing was to be controlled.

What should be the scope of the secondary boycott provisions and all of this is related to an ultimate exercise of the rights guaranteed under Section 7, to organize, bargain, to represent.

Byron R. White:

There’s no question though, the entire — they intended to — Congress intended the Act to be applicable to the union.

Breck P. Mcallister:

The what?

Byron R. White:

— there’s no question that Congress intended the Act to be applicable to union such as picketing here.

Breck P. Mcallister:

But not — not I would say, Mr. Justice when the union —

Byron R. White:

The — but didn’t intend it to be applicable at the suit of a foreign flag.

Breck P. Mcallister:

No.

Breck P. Mcallister:

I would say that the — our position is a very flat one, Mr. Justice.

We think in the words of Mr. Manoli that the Labor Board has no business here.

In other words, we do not recognize the basic primary right of an American union to seek to organize the seamen on a foreign-flag ship, the foreign seaman on a foreign-flag ship or to represent them, to intrude into the internal affairs of these ships by bargaining with these men, with the owners of these ships, or to do anything in that direction, and the court below, the New York court, found that the acts of this union were illegal and tortious under state law.

And I should like to call the attention of the Courts to the decision of the Appellate Division here which was reversed on the preemption ground but a decision that has been followed in a later case and represents the law of New York as to the illegality of this conduct.

We argue that this was tortuous and the Court so held.

It declared the Appellate Division in this case that the striking or other interference with the internal management of the crew of the vessel, away from its own port was illegal.

And I should like to call the attention of the Court to the fact that the Appellate Division relied upon the decision of this Court in the Southern Steamship case against the Labor Board in 316 U.S., which is indeed a federal decision and it may show that we have here the problem of a federal maritime tort.

The state court did not reach that question.

It isn’t before this Court but Mr. Justice White asked the question and I thought I should describe the holding in the state court that this is indeed illegal.

It’s just we respectfully request that the judgment of the Court of Appeals be reversed.

Earl Warren:

Mr. Ostrin.

H. Howard Ostrin:

Mr. Chief Justice, may it please the Court.

The Solicitor General in the Empresa case, the United States Court of Appeals for the Second Circuit in the Empresa case, the Appellate Division of the Supreme Court of the United States of the — Supreme Court of New York State in the Incres case have all held and all agreed that the flag law does not govern this situation by itself.

Mr. Cox, of course, has some reservations but Judge Friendly in the Empresa case stated the Board is right in saying, “The scope of its powers in respect of seamen is not to be determined by the simple notion that a Honduran registered ship is a floating piece of Honduran territory.

That is a mere fiction — a figure of speech whose fictitious character was exposed long ago”.

Mr. Cox —

Potter Stewart:

The final paragraph in that opinion (Inaudible) — it’ll be more helpful to your — the point you’re now making but (Inaudible)

H. Howard Ostrin:

Mr. Cox, in his brief to this Court at page 13 stated, “The flag in registry of a vessel are not always decisive”.

At page 45 of this brief, he said, “This is not to say that Congress necessarily intended the Act never to be applicable to foreign-flag vessels.

There maybe situations in which other considerations may outweigh the law of the flag and may call for the application of the Labor Act to foreign-flag vessels”.

And again at page 45 of his brief, he said, “One would have to consider not only the weight of this country’s interest but also the possible significance if any of the fact that the doctrine that the law of the flag to control was established long prior to the growth of true flag of convenience shipping”.

The Attorney General in his brief to the Board in the West India case said, “It is elementary that the Board has the duty in the first instance of making the determination of whether seamen and ships involved are employees and employers within the Act”.

And that the terms employee and employer in the Act draw substance from the policy and purposes of the Act, the circumstances and background of the particular employment relationships, and all the hard facts of industrial life.

Citing National Labor Relations Board against E. C. Atkins, 331 United States, and he continued in his brief to say, “Through its past, the Board must not only bring an appreciation of economic realities but is free to take account of the more relevant economic and statutory considerations in determining whether or not, the Act is applicable”.

The Appellate Division for the Supreme Court of the State of New York in this case said, “The Liberian nationality of plaintiff and the Liberian registry of the ships should not be conclusive of the character of the shipping involved”.

The NLRB has inappropriate cases involving American ships flying foreign flags of convenience ships has so determined and the conclusions are entirely persuasive.

So that when the — this case came to the New York State Court of Appeals, there was no question was that the Board, as Mr. Justice Stewart noted, had already asserted jurisdiction of the foreign-flag cases.

Now, I respectfully submit that it has had been suggested, if not perhaps stated by Judge Friendly and suggested by the Solicitor General that Congress did intend the Board to have jurisdiction over certain types of foreign-flag operations.

And isn’t — it’s not correct to say that in those circumstances, surely the Board has the right and has the primary jurisdiction to determine whether or not in a given situation, it should assert jurisdiction over a foreign-flag operation.

I hardly think that Congress when it wrote the Act carved out to all convenient classifications as it was suggested by the Solicitor General.

H. Howard Ostrin:

And I respectfully submit that on the strength of his own argument, on the strength of his own observation that the National Labor Relations Board does have primary jurisdiction in this area.

Now, if the Court of Appeals was correct and if we are to apply the context test as we submit was promulgated by this Court in the Larson case and I think was necessarily followed by Judge Friendly in the Empresa case.

Then I say, that it is certainly arguable that the National Labor Relations Board has jurisdiction from the first instance and that the New York State Court of Appeals was correct.

Now, we must remember that the union had filed a charge against the Incres Company which was pending before the National Labor Relations Board.

And as we learned from Myers against Bethlehem Steel Company which to my knowledge has never been reversed or modified or distinguished, the Board must first be allowed to exhaust its administrative processes before resort can be had to the courts.

And I say that even if a charge had not been filed, then certainly under the arguable subject doctrine, first promulgated in Garmon and later I submit extended in Marine Engineers Beneficial Association against Interlake that this was a case of preemption pure and simple.

I know that my adversary refers to the arguable subject doctrine as not being applicable here because they don’t reach the threshold question.

But surely the Board was required to grapple with the threshold question of commerce in Myers against Bethlehem, and was also required to grapple with the threshold question of what constitutes a labor organization in Interlake.

And so we say that this Court need go no further than the preemption doctrine.

However, should this Court go or choose to go beyond preemption then I respectfully submit that on the facts of this case which were glossed over by the Solicitor General, that on the facts in this case, the kind of shipping that Incres is engaged in is truly the shipping of the United States.

Let us examine the operation of Incres.

Its two vessels are registered under the law of Liberia.

It has, at least it claims to have a home office in England or in London.

What it does in that office, we don’t know.

Nothing was said about it in the summary hearing before the Supreme Court of the State of New York.

It is owned concededly by Italian National.

But what are its operations?

These two vessels both come to New York City and operate not temporarily, not casually, not transiently, but regularly in the cruise business between New York City and the Caribbean.

And in so conducting its business is competing with our own American flag vessels engaged in the same trade, engaged in the same cruise business.

And how does it operate?

It operates admittedly through a wholly owned New York State subsidiary, the Incres agency, and both utilize the same offices at 39 Broadway.

They both have the same letterhead.

Mr. Berman Jerry is not only the President of Incres Line, the foreign corporation and the member of its Board of Directors, but he is also the President and/or rather an officer, and a Member of the Board of Directors of the New York State Corporation.

And he, together with Mr. Wilson, conduct the day to day operations of these two luxury vessels.

Hugo L. Black:

Who owns them?

H. Howard Ostrin:

They are owned by Italian nationals, Mr. Justice Black.

But they are operated exclusively with the one exception of once a year it takes a trip to Italy.

Potter Stewart:

Actually technically it’s — they’re owned by Liberian corporation, are they not?

H. Howard Ostrin:

Technically by a Liberian corporation.

Potter Stewart:

But you —

H. Howard Ostrin:

Never have been to Liberian waters — in Liberian waters, never been to Liberian.

Hugo L. Black:

How you — how do you distinguish your case then from Benz?

H. Howard Ostrin:

Whoa!

I think it’s — we think it’s rather simple to distinguish this case from Benz.

Benz as this Court noted, the Marine Corps noted that its only connection with American commerce or with American trade was that it happened transiently or temporarily to be in American waters and that American union happen to have participated in the picketing.

I have said —

William O. Douglas:

Well, if that’s true every foreign ship coming through this country go temporarily here?

H. Howard Ostrin:

Well, I can’t accept that, Mr. Justice Douglas because concededly even our American owned vessels are here temporarily but that doesn’t preclude the NLRB from asserting jurisdiction over them.

It’s in a very nature of this industry that ships come and go but I think the critical question is, in whose commerce are they engaged in?

Now, clearly in Benz this vessel happened to be here almost fortuitously.

It was not engaged in the commerce of the United States.

It was not engaged in our shipping.

It happened to have been here at the time when a dispute erupted.

But in this case, in Incres, these vessels make regular, weekly trips.

Hugo L. Black:

Well, do you not have to say that the opinion went further than it should with this language if you say to distinguish it.

That we are left unconvinced, leaves us convinced that Congress did not fashion the Labor Act.

It is our labor dispute between nationals of other countries operating ships under foreign law.

The whole background of the Act is concerned with industrial strikes between American employers and employees?

H. Howard Ostrin:

I think so, Mr. Justice Black for this reason.

The Board has never hesitated to assert jurisdiction of a foreign nationals.

And when — at least we hope to that we are reading Benz correctly when we say that what was intended and we don’t presume to —

Hugo L. Black:

I mean by this language.

H. Howard Ostrin:

Yes.

We don’t presume to be speaking for Mr. Justice Clark but we feel it was intended was when words, American seamen, American employers were usually mean that seamen engaged in American commerce.

For example, the National Maritime Union represents hundreds of aliens, foreign nationals and the other seafaring unions do.

The NLRB has never hesitated to assert jurisdiction over foreign employers or foreign employees.

As a matter of fact, in the Italian Lines case, the Board asserted jurisdiction over all of the resident alien employees of the Italian Lines who are based here in New York.

Well concededly, you can’t face a vessel in a stationary place but I submit that the seamen on these transient vessels as they must be should be accorded the same rights and protections under our Act as are the seamen who worked on American flag vessels.

Hugo L. Black:

Well, assuming that’s true, how do you get around in effect?

How do you say — was this — this boat is owned by a national of another country?

H. Howard Ostrin:

Yes.

Hugo L. Black:

Registered under the (Voice Overlap) —

H. Howard Ostrin:

Under the laws of Liberia.

Hugo L. Black:

Trans — carries passengers of course —

H. Howard Ostrin:

Carry American passengers —

Hugo L. Black:

Other people whether many ships (Inaudible) foreign countries carry American passengers, (Voice Overlap) —

H. Howard Ostrin:

The distinction is I think is a relatively simple one, Mr. Justice Black.

Let’s try to analogize with the Queen Mary.

The Queen Mary is based and it operates in the commerce of Great Britain.

It goes from Great Britain to the United States and back.

These vessels, while owned by Italian Nationals and while applying the flag of Liberia don’t engage regularly in the commerce of Italy and certainly, it doesn’t touch Liberian ports or Liberian waters, and there’s a vast difference in the Queen Mary.

It is truly the shipping of Great Britain and when it comes to these American ports, this is merely not — it’s nothing more than an incident of the shipping of Great Britain.

But I don’t think we can say that this is truly the shipping of Italy.

Potter Stewart:

But you could say —

H. Howard Ostrin:

(Inaudible)

Potter Stewart:

Excuse me.

You could say on your analogy that this is the shipping of the West Indies because the Queen Mary is just as much in the — carries I suppose without knowing, it carries as many Americans to England as it does Englishmen to the United States, (Voice Overlap).

H. Howard Ostrin:

I couldn’t say that.

I couldn’t say that either Mr. Justice Stewart for this reason.

That every voyage originates in New York City.

The terminal points in the Caribbean are not always the same.

The voyage begins in New York and ends in New York.

The vessels are provisioned in New York.

All consular communications are directed from the Liberian consulate to the office in New York, not Italy, not Liberia, not Central America, or the Caribbean, but all of the provisioning and everything that is done is done in New York City.

And I submit —

Potter Stewart:

A great deal of this is done I’m sure over the Queen Mary too, wouldn’t it, (Voice Overlap) —

H. Howard Ostrin:

Well, except — except there is this — and I think it’s a real distinction that on the case of the Queen Mary, the vessel is — first of all, is engaged in the commerce of the flag nation.

That’s another vast distinction.

Secondly, it is truly engaged in the commerce of Great Britain.

Now, I don’t think that we can say the same for the two Incres vessels which are clearly engaged in the commerce of the United States and are nothing more than floating hotels and I might say, financed with American capital.

H. Howard Ostrin:

There is a $4 million mortgage loan advanced by the American — by the Bank of America covering these two vessels and the interesting thing is that the New York agency guarantees the payment of this loan.

So that when the loan was first made, it was signed by a Mr. Barnett as both officer of Incres, and is the foreign corporation, and also as an officer of the New York Incorporated agency.

When that loan was extended, it was signed by Mr. Berman Jerry as President of the foreign corporation and also as an officer and director of the New York State Corporation so that not only are these two vessels regularly engaged in the trade of the United States they are financed by American capital.

They’ve worked hand in hand together with a New York Corporation.

And as I said before, they received all of their consular communications in their New York office.

So that we cannot merely say that there are no connections with American commerce.

Now something — and much has been said on the subject of the internal order.

I submit that a distinction must be drawn and has been drawn between discipline on board ship and wages and powers.

And just as this has been recognized in the Treaty between the United States and Honduras, so is it recognized but even stronger in the Treaty between the United States and Liberia.

And I refer to page 55 of our brief.

It begins at page — the bottom of page 54.

Treaty — this is the — this is Article X of the Consular Convention between the United States and Liberia.

And it says, “A consular officer shall have exclusive jurisdiction over controversies arising out of the internal order of private vessels of this country and shall a law in exercised jurisdiction in cases wherever arising between officers and crews pertaining to the enforcement of discipline on board provided the vessels, person in charge of long doing shall have entered the port within its consular district”.

And then the language continues at the bottom of page 55 of our brief and it says, “Such consular officer shall also have jurisdiction also over issues concerning the adjustment of wages and the execution of contracts relating thereto provided however, that such jurisdiction shall not exclude the jurisdiction”, and here’s where the language is stronger than in the Honduran Treaty, “shall not exclude the jurisdiction conferred on local authorities under existing or future laws”.

Hugo L. Black:

I thought that is very much the same as the closing part of Section 12 —

H. Howard Ostrin:

Very much to same.

Hugo L. Black:

— of the Treaty.

But that still brings you back doesn’t it to the question whether our local law does this?

H. Howard Ostrin:

Well, I submit —

Hugo L. Black:

The Treaty is (Voice Overlap) is opened I presume but we must interpret our Act to whether to include this jurisdiction?

H. Howard Ostrin:

Well, I submit that they must have been thinking of our local and existing laws.

Not only for this but if we look at page 369 — of Section 369 of the Liberian Labor Code which is referred to at page 2 of our supplemental statement we find this very interesting provision.

Notwithstanding anything in this chapter, nothing shall prevent a shipowner or an employer from entering into agreements with employees covering the provisions of this chapter as a consequence of collective bargaining or otherwise embodying standards not lower than those required by this chapter.

Now I submit that Section 369, if read together with Article X of the Consular Convention, not only contemplates the making of collective bargaining agreements but also contemplates that the local law shall have the right to make those collective bargaining or collective bargaining agreements maybe made under the local law.

Now, since the vessels doesn’t ever touch Liberian waters are we to expect that the seamen can get any sort of appropriate, realistic representation by let us say, a Liberian based union where they never go there?

And similarly, since the vessel only goes to Italy once a year at which time the crew members take their vacations or leave the employee of that vessel, are they to receive the necessary and realistic protection that goes with representation by a labor organization from an Italian based union?

Or isn’t this more realistic to assume particularly if we are mindful of the language in the Atkins case on the basis of hard economic reality, that the best place and the only place where these seamen can get the proper and appropriate representation is from an American based union when these vessels come into port, as they do every week and when their grievances are processed as they do everyday.

Now, Mr. Justice White asked a very pertinent question in my adversary report.

This Act work both ways.

Now, what about the application of the Labor Act against unions?

H. Howard Ostrin:

And Mr. McAllister was quite right — quite correct when he said that, “We have not sought to invoke the Taft-Hartley Act against this union.

But the record factor that in the Navios case which is cited in our brief and which resulted from the picketing of the (Inaudible) in Philadelphia that not only were did — were secondary boycott charges filed by secondary employers against this very union, International Maritime Workers Union, and not only where those charges processed but those charges were settled and there is presently pending in the courts of Pennsylvania, damage suits under Section 301.

Mr. Justice Douglas in his dissent in the Benz case noted quite properly I submit, that there too that employers and foreign employers have utilized the Act against American unions, who are engaged in picketing of foreign-flag vessels.

(Inaudible)

H. Howard Ostrin:

Pardon?

(Inaudible)

H. Howard Ostrin:

We say that if they are to be subjected to their obligations under the Act and if these foreign employers or foreign-flag operators through American — or not their instance can use the Act against them.

Then certainly I submit that they are entitled to the protection of the Act.

Mr. Rhine in his remarks said that this is a two-way street and what we can do to Honduras, Honduras can do to us.

Well, I think this requires us to look into it but for a moment to how the Airlines Stewardess cases were handled.

There, this Court held that the Railway Labor Act I think was — had no application.

There the employees were based abroad.

In this case, the foreign employees, the Italian nationals are based in the United States.

They work out of the United States.

They are in the commerce of the United States, why then should not either Liberia or Italy respect our laws and respect our rights to exercise Board jurisdiction in this sensitive area of labor relations?

I submit that if this is true — a two-way street and I believe it is then since they are operating here, certainly, just as we had no jurisdiction over airline stewardess, stewardesses who are operating abroad by the same token neither Liberia nor Italy should exercise jurisdiction in labor relations matters over seamen who work regularly and only in the United States and out of United States ports.

I think — perhaps I’m just sticking my neck out just a little bit on this.

William O. Douglas:

What was — what was that case decided though, it maybe 10 years ago where the — that this Court held that the Fair Labor Standards Act (Voice Overlap) —

H. Howard Ostrin:

That was the Foley case.

William O. Douglas:

Foley case.

H. Howard Ostrin:

Yes, sir.

And that’s covered in our brief.

I would like to close on this note.

I think it is recognized now and certainly has been recognized by the Geneva Convention that there is little more to the law of the flag and the Convention has already adopted — I see my time is up, if I may —

Earl Warren:

You may finish your statement to (Inaudible).

H. Howard Ostrin:

Thank you.

The Convention has already adopted a rule that there must be a genuine link between the flag nation and the vessel.

They recognized that flag law is involved.

And now, we have the European common market commenting on the same thing and I think it’s merely here set the very guts of this question.

The (Inaudible) studies pointed out, I quote, “The extent to which shipowners, charters, etcetera, have recourse to the courts of the flag state of the defendant probably reflects to a greater degree than most aspects of shipping, the true relationship between the ship and her flag where a shipping company has no assets in the flag state and the owners, directors, and managers are not nationals.

H. Howard Ostrin:

It is useless to have recourse to the courts in those countries as they cannot enforce their decisions.

It is significant that even the owners of vessels under flags of convenience prefer to have their disputes settled in the courts of the maritime countries and this is precisely what they’re going to give.”

They don’t go to Italy to this — to settle their disputes here.

They don’t go to Liberia to settle their disputes here but they come here and they utilize our ports.