STATE OF RHODE ISLAND KENT, SC.

Girard Bouchard, in his capacity as President of the Board of Directors of The Central Coventry Fire District, Plaintiff, v. Central Coventry Fire District, Defendant. : : : : : : : : : : :

SUPERIOR COURT

K.B. No. 12-1150

COVENTRY FIREFIGHTERS OBJECTION TO MOTION TO ENFORCE AUTOMATIC STAY Now come Coventry Professional Firefighters, Local 3372 (Firefighters or Union) and hereby object to the Special Masters Motion to Enforce Automatic Stay. As reason therefore, the Firefighters state: 1. On or about November 15, 2013, the Union filed an unfair labor practice charge

with the State Labor Relations Board (SLRB) against the Central Coventry Fire Districts Board of Directors. The charge alleges that since October 3, 2013, the Board of Directors has interfered with and restrained firefighters attempts to enforce their rights by, among other things, threatening them with discharge, spreading misinformation about them and their bargaining representative, refusing to bargain in good faith with their bargaining representative, and purposefully proposing a budget that would be insufficient to fund firefighters agreed-upon compensation and benefits. 2. The Union has submitted a Statement of Facts to the SLRB as required by the

agencys rules and regulations. If the SLRB finds there is sufficient evidence to investigate the charge further, it will issue a Complaint against the Board of Directors.

3.

If, after formal hearing, the SLRB concludes that the Board of Directors has

violated the State Labor Relations Act (the Act), it may issue a remedy requiring the Board to bargain with the Union in good faith and/or ordering the Board to cease and desist from violating the Act. 4. As this Court knows, the SLRB has exclusive jurisdiction to adjudicate unfair

labor practice charges. Because the Boards illegal conduct is ongoing, it is imperative that the SLRB expeditiously consider the Unions charge, and issue an order prohibiting further illegal behavior. If the Union must wait until the Mastership proceedings end, and/or the District is liquidated, to obtain relief, it will be too late. 5. Further, the Boards illegal conduct has had, and will continue to have, a direct

impact on the instant mastership proceedings. For example, had the Board bargained in good faith with the Union, the parties would likely have a Concession Agreement that would permit the District to continue operating.1 Moreover, the misinformation spread by the Board in an effort to dismantle the Union and begin a new paradigm negatively impacts the Districts ability to continue operating, and the likelihood that the mastership proceedings will come to a speedy and acceptable conclusion. Consequently, it is important that the SLRB issue a decision regarding the Boards actions as soon as possible. 6. The Union believes that the stay issued by this Court at the commencement of the

mastership proceedings does not apply, and was not intended to apply, to 1) actions against the Board of Directors, as opposed to the District, 2) actions that would not deplete the assets of the estate, but rather would require the Board to comply with the law, 3) actions that fall within the

The Union submits that, even absent the $1,000,000 in concessions it offered, the District has sufficient revenue to continue operations.
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governmental unit exception under the Bankruptcy Code, and/or 4) actions based on conduct occurring post-receivership. 7. However, to the extent the stay was intended to apply to actions by the State

Labor Relations Board, and the SLRB issues a Complaint against the Board, the Union requests relief from the stay. The Pending Unfair Labor Practice is Not Against the District or its Property 8. By its terms, this Courts Order enjoins suit against Defendant or any of its

property. The Unions unfair labor practice charge is against the Board of Directors, not the Defendant. Likewise, it does not seek any of the Districts property, but rather an Order requiring the Board of Directors to cease and desist its unlawful behavior and bargain in good faith. The Order Should Not Be Interpreted To Prevent Governmental Entities From Carrying Out Their Duties 9. The purpose of the automatic stay provision under the Bankruptcy Code is to

grant complete, immediate, albeit temporary relief to the debtor from creditors, and also to prevent dissipation of the debtors assets before orderly distribution to creditors can be effected. S.E.C. v. Brennan, 230 F.3d 65, 70 (2d Cir. 2000) (quoting Penn Terra Ltd. v. Department of Envtl. Resources,733 F.2d 267, 271 (3d Cir. 1984)(emphasis added). Further, the bankruptcy courts injunctive power is ordinarily limited to protecting property belonging to a debtor, not actions against non-debtors, or actions that do not affect the debtors estate. 10. Moreover, 362(b) of the Bankruptcy Act contains eighteen exceptions to the

automatic stay. Actions that fall under any of these exceptions are not automatically stayed upon commencement of a case. One of those exceptions includes the [c]ommencement or continuation by a governmental unit to enforce police or regulatory power and enforcement of a
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non-money judgment in a suit by a governmental unit to enforce its police or regulatory powers. Code 362(b)(4). The purpose of the governmental unit exception to the automatic stay is to prevent a debtor from frustrating necessary governmental functions by seeking refuge in bankruptcy court. See In re Berg, 230 F.3d 1165 (9th Cir. 2000). Proceedings concerning the employer-employee relationship have been held to come within the (b)(4) exception. See e.g. In re D. M. Barber, Inc., 13 B.R. 962 (Bkrtcy. N.D. Tex. 1981). For example, in National Labor Relations Board v. Evans Plumbing Company, 639 F.2d 291 (5th Cir. 1981), the Fifth Circuit granted the petition for enforcement of the National Labor Relations Board's decision ordering the reinstatement of two employees with back pay who were discriminatorily discharged by the debtor. The court concluded that the NLRB's action was undertaken to enforce the federal law regulating the relationship between employer and employee, i.e., an exercise of police or regulatory power. 11. The SLRB is clearly a governmental agency that, by issuing Complaints of unfair

labor practices, is exercising its police and regulatory powers. In fact, R.I. Gen. Laws 28-7-2, which sets forth the policy of the State Labor Relations Act, provides: [t]his chapter shall be deemed an exercise of the police power of the state for the protection of the public welfare, prosperity, health, and peace of the people of the state. Id. at (f). 12. Likewise, upon information and belief, some members of the public have filed

complaints against the Board of Directors with the Attorney General. While not all of those complaints were filed by the Union, upon information and belief at least some of the Complaints assert violations of the Open Meetings Act (OMA) and Access to Public Records Act (APRA). Again, the Attorney General is clearly a governmental official who is responsible for enforcing the Open Meetings Act. See R.I. Gen. Laws 42-46-8.

13.

Enforcement of the Open Meetings Act constitutes enforcement of police or

regulatory powers. R.I. Gen. Laws Ann. 42-46-1 sets forth the policy behind the Act: [i]t is essential to the maintenance of a democratic society that public business be performed in an open and public manner and that the citizens be advised of and aware of the performance of public officials and the deliberations and decisions that go into the making of public policy. 14. Thus, any attempt by the Attorney General to enforce compliance with the OMA

and APRA does not affect the Districts assets (unless a penalty is assessed), would be against the Board of Directors, not the District, and would constitute an exception to the automatic stay as an exercise of the States police powers.2 Claims Arising Post-Petition are Not Subject to the Automatic Stay 15. Under 362(a)(l), the automatic stay only applies to [c]ommencement or

continuation . . . of a judicial, administrative, or other proceeding against the debtor . . . to recover on a prepetition claim against a debtor. (emphasis added). Thus, proceedings or claims arising post-petition are not subject to the automatic stay, although a successful plaintiff must normally obtain relief from stay if it seeks to enforce judgment against the estate. See Bellini Imports, Ltd. v. Mason & Dixon Lines, Inc., 944 F.2d 199 (4th Cir. 1991) (automatic stay did not bar institution of action arising out of alleged postpetition breach of contract); Erickson v. Polk, 921 F.2d 200 (8th Cir. 1990) (lessor of farmland did not violate automatic stay when it retook possession of property following postpetition expiration of lease). Further, the Judiciary Code, 28 U.S.C. 959(a), provides relief to holders of postpetition claims against a debtor from

Upon information and belief, Representative Patricia Morgan and/or Senator Nick Kettle filed a complaint with the Attorney General relating to the Districts pension contributions. Although that complaint was filed post-receivership, is unclear whether the Special Master sought to, or seeks to, enforce the stay against that complaint.
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having to obtain leave from bankruptcy court to pursue claims arising from "acts or transactions in carrying on business connected with [estate] property." 28 U.S.C. 959. 16. Both the unfair labor practice charges and the Open Meetings Act violations relate

to acts committed by the Board of Directors after commencement of mastership proceedings. They also relate to the Boards actions in carrying on business connected with the District. Consequently, for the same reasons such actions are not stayed under the Bankruptcy Act and Judiciary Code, they should not be stayed by this Court. Pending Grievance Arbitrations 17. The Union filed grievances under the current CBA in an effort to both enforce and

preserve its rights. The grievances allege that the District violated the CBA by failing to deposit contributions to the Post Employment Health Plan, and failing to maintain the contractually required minimum staffing. The Union submits that it is clear that the District has violated the CBA. To the extent the Special Master and/or District sign a consent decree admitting to the violations and agreeing to comply with the CBA, the Union would be willing to withdraw the arbitration demands. Short of that, however, the Union must preserve its rights by proceedings to the next step in the partys contractual grievance provision: arbitration. 18. To the extent this Court rules that its stay applies to the pending grievance

arbitrations, the Union requests relief from the stay. Request for Relief Based on the foregoing, the Firefighters request: 19. That this Court enter an Order permitting the SLRB to continue to investigate and

issue a decision regarding the pending unfair labor practice charges against the Board of

Directors, and, if warranted, enforce any decision against the Board that would not impact the assets of the estate; 20. An Order from this Court clarifying that actions by the SLRB and Attorney

General involving the enforcement of their police and regulatory powers are not subject to the automatic stay and may proceed; 21. To the extent the Attorney General is stayed from enforcing the OMA and APRA,

an Order from this Court requiring the Board to comply with the OMA and APRA; and 22. An Order permitting the grievance arbitrations to proceed in the event the District

will not admit its violations. The Firefighters understand that enforcement of any arbitration decision will be subject to the instant mastership proceedings before this Court.

Respectfully submitted, Coventry Professional Firefighters, Local 3372, By its Attorneys, /s/ Elizabeth Wiens______ Marc Gursky, Esq. (#2818) Elizabeth Wiens, Esq. (#6827) Gursky Law Associates 420 Scrabbletown Road North Kingstown, RI 02852 ewiens@rilaborlaw.com

CERTIFICATION A true copy of the foregoing was served on the following via email on December 13, 2013: kmiley@courts.ri.gov, bstern@courts.ri.gov, rland@crfllp.com,

/s/ Elizabeth Wiens