L.A. Wrongly Interfered in Taxi Labor Dispute: Court

The Supreme Court today limited cities’ power to become involved in private labor disputes, ruling that Los Angeles broke federal labor law when it refused to renew a taxi company’s franchise until it settled a strike.

The city’s refusal to renew the company’s license to operate--an action urged by the striking workers--illegally interfered with the use of “economic weapons” commonly employed in labor disputes, the court said in an 8-1 ruling.

The case began when members of Local 572 of the International Brotherhood of Teamsters struck the Golden State Transit Corp. on Feb. 11, 1981.

Golden State, with 400 cabs operating under the Yellow Cab name, was the largest of more than a dozen cab companies in Los Angeles. Its franchise was up for renewal at the time of the strike, and the Teamsters argued before the City Council that the license should not be renewed. The council agreed and let the license expire.

Golden State sued in federal court, charging that the city’s action violated the National Labor Relations Act. The company eventually lost in lower courts and appealed to the Supreme Court.

In ruling for the company, the court said the city’s action violated the national labor law. Justice Harry A. Blackmun, writing for the majority, said the drivers were entitled to strike and the company entitled to resist, but the city “thwarted” the bargaining process when it put conditions on the license renewal.

“Our holding does not require a city to renew or to refuse to renew any particular franchise,” he said. “We hold only that a city cannot condition a franchise renewal in a way that intrudes into the collective bargaining process.”

Blackmun said the “settlement condition imposed by the Los Angeles City Council . . . destroyed the balance of power designed by Congress and frustrated Congress’ decision to leave open the use of economic weapons.”

Justice William H. Rehnquist was the lone dissenter from the ruling.