Benz v. Compania Naviera Hidalgo, S. A.

Background

A Panamanian company owned a Liberian-flag ship that entered Portland, Oregon for repairs and to load wheat. The ship’s crew were all foreign nationals who had signed British employment articles. The crew struck aboard the ship and picketed; American labor unions later picketed the vessel. The ship owner sued in Oregon courts for injunctions and damages after the picketing kept repairers and loaders from crossing the lines.

Reasoning

The Court had to decide whether the federal Labor Management Relations Act (Taft-Hartley) governs a dispute involving a foreign ship, foreign crew, and foreign employment contracts while the ship was temporarily in an American port. The majority said Congress never clearly intended the Act to reach such foreign situations. Relying on the Act’s focus as a bill of rights for American workers and on earlier cases and statutory history, the Court concluded the federal law did not pre-empt state common-law claims and affirmed judgments for damages.

Real world impact

As a result, American unions that picket foreign ships in U.S. ports may still face state-law suits for damages in similar circumstances. Foreign shipowners can bring common-law claims in U.S. courts when picketing disrupts their business. The ruling leaves open the possibility that Congress could extend federal coverage if it chooses.

Dissents or concurrances

Justice Douglas disagreed, arguing the Act does apply to American unions’ conduct in the United States and that federal remedies and the National Labor Relations Board should regulate such picketing to avoid conflicting local results.