Sysco Minnesota, Inc. v. Teamsters Local 120

Background

International Brotherhood of Teamsters Local 41 held a one-day picket at Sysco Minnesota’s food distribution center in Mounds View, Minnesota. Local 41 represented employees at a different Sysco facility in Kansas City, Missouri, and did not represent Sysco Minnesota employees or have a grievance against Sysco Minnesota.

Nearly all members of Teamsters Local 120, which represented production, warehouse, and maintenance employees at the Mounds View facility, refused to cross Local 41’s picket line. Sysco stated that it could not make food deliveries to commercial customers preparing for Thanksgiving and claimed more than $1.2 million in lost profits and lost customers.

Sysco sued, claiming that Local 120’s participation breached the parties’ collective bargaining agreement (CBA). Article 23 prohibited any lockout, strike, or other interference with the business during the agreement’s term. Article 24 stated that no employee would be asked to cross a primary picket line where a union was on primary strike.

Arbitration

The CBA contained a grievance procedure, including arbitration, for disputes about interpreting, applying, or complying with the agreement. Local 120 argued that Sysco had failed to pursue the required arbitration process and asked the court to stay the case while arbitration occurred.

The court ruled that Local 120 waived its right to pursue arbitration. Although Local 120 mentioned arbitration in an early case-management filing, it did not attempt to require Sysco to arbitrate. Instead, it litigated the case for eight months, including through extensive discovery, and argued the merits before presenting arbitration as an alternative. The court therefore denied Local 120’s motion on arbitration.

Breach of the CBA

Local 120 argued that Article 24 protected employees who refused to cross the picket line. It described the work stoppage as an extension of Local 41’s primary strike and also characterized it as a sympathy strike.

The court concluded that the work stoppage was not a primary strike. Reading Articles 23 and 24 together, the court held that Article 23 prohibited strikes and other work stoppages, while Article 24 created an exception for honoring primary strikes. Because Local 120 had essentially conceded that the work stoppage was a sympathy strike rather than a primary strike, the court held that the CBA clearly and unambiguously prohibited it.

The court rejected the relevance of the parties’ conflicting views of their bargaining history, concluding that the CBA’s language had only one reasonable interpretation: work stoppages that were not primary strikes were prohibited.

Damages and Disposition

The court held that Local 120 was liable for damages resulting from the breach. Sysco submitted evidence, including an expert’s calculation, totaling $1,238,315. Local 120 did not rebut that evidence or offer another damages calculation. The court therefore found that Sysco was entitled to the requested amount.

Judge Magnuson ordered that Sysco’s motion for summary judgment be GRANTED, that Local 120’s motion for summary judgment be DENIED, and that Sysco receive judgment of $1,238,315.