A divided Supreme Court let stand yesterday a ruling that a union sued by the Labor Department for violating members' rights can be compelled to pay attorney's fees incurred by rank-and-file unionists who intervened in the suit.
The action was a defeat for the United Steelworkers of America, AFL-CIO, and for the government, and a victory for USWA district official Edward Sadlowski and his Washington lawyer, Joseph L. Rauh.
The union claimed the fees for Rauh and his associates might approach $500,000. But Rauh's lawyer said the bill "would not approach" that amount.
The case goes back to February 1973 when, for the first time in nearly 25 years, there was an election contest for director of District 31, the USWA's largest. It embraces about 300 locals and 130,000 members in Illinois and Indiana.
The union establishment candidate, described by then union president I. W. Abel as a member of the "official family," was Samuel Evett. Chosen by his predecessor, who had been in office 30 years. Evett had financial and other support from fellow district directors and USWA officials.
Evett defeated Sadlowski, the challenger, 23,394 to 21,606 in a three-day balloting marked by charges by Sadlowski of widespread ballot forgery and fraud, illegal electioneering and other violations of Labor-Management Reporting and Disclosure Act of 1959.
After complaining within the union, and after Abel himself upheld the tabulation results, Sadlowski protested to the secretary of labor. The secretary sued to void the election and won. Then, in a second election in August 1974 Sadlowski defeated Evett almost 2 to 1 - 39,637 to 20,158.
Rauh then sued the union for attorney's fees for his representation of Sadlowski, U.S. District Court Judge Louis Rosenburg in Pittsburg held that the 1959 law did not provide for such fees. A year ago, however, the 3rd U.S. Court of Appeals reversed, terming such fees "wholly consistent" with the law.
The USWA's 1,400,000 members derived a "common benefit" from the Sadlowski challenge and should pay for it, the appeals court held.
The court cited a deposition in which Rauh asked Abel if he felt that "Sadlowski shouldn't have gone to the government even though there was a ballot-box stuffing?"
"Correct, correct," Abel replied.
If ballot forgery and other such tactics had succeeded in District 31, the court said, there is "little doubt that they would have been employed again and again."
The Labor Department had not taken a stand on the fees issue. Three months ago, however, it claimed that awarding fees "significantly impedes" government enforcement.
In the Supreme Court, a 6-to-3 majority declined to review the appeals court ruling. The dissenters were Justices Byron R. White, Potter Stewart and William H. Rehnquist.
The court took other actions:
HEALTH CARE GRANTS
To prevent unnecessary duplication of resources, the National Health Planning and Resources Development Act of 1974 requires states, as a condition of federal health-care grants, to take certain precautions.
If a state wants such grants, it must for example, administer a "certificate of need" program under which it agrees to review all proposed institutional health services to ensure that only necessary ones will be offered or developed.
Backed by Nebraska and the American Medical Association, North Carolina, which has about $50 million a year at stake (out of state revenues of about $3.1 billion), challenged the law's constitutionality. If complained of "coercion," among other things.
A federal judge held that Congress "had a perfect right" to see to it that appropriated funds didn't add needlessly to health cost. The Supreme Court let the decision stand.
In a New Hampshire case, the court let stand a ruling that a state can require coverage of mental inllness and emotional disorders in group health plans sold by insurors to employe-benefit programs, even though the programs are covered by the federal Employment Retirement Income Security Act of 1974.
The Dual Compensation Act of 1964 requires a retired regular military officer who goes to work for the government to forfeit half his retirement pay in excess of $3,860. This affects about 5,000 retired regular officers.
Claiming that retired reserve official are not similarly burdened, retired regulars challenged the law's constitutionally. The U.S. Court of Claims ruled against them. The Supreme Court let the ruling stand.