Air Line Pilots Association, International v. O'Neill

The Air Line Pilots Association, International union (ALPA) (defendant) represented pilots who flew for Continental Airlines. In 1983, Continental reorganized in bankruptcy. The bankruptcy court approved Continental repudiating its collective-bargaining agreement with ALPA and cutting pilot salaries by more than half. ALPA called a strike that lasted over two years. Most of Continental’s 2000 pilots initially supported the strike, but about 400 crossed over and resumed work before the strike ended. Continental also hired replacements; by August 1985, it had about 1600 pilots, with 1000 still striking. Continental assigned pilots to new positions using a bid system. ALPA authorized strikers to submit bids, but Continental awarded all bid positions to working pilots. ALPA agreed to ending the strike if Continental reallocated the bid positions. Pilots could settle individual claims against Continental and participate in the reallocation or accept severance. Pilots who retained individual claims were eligible for positions only after those who settled. After reinstatement, pilots retained the same seniority rights they had before. O’Neill and other former striking pilots (plaintiffs) sued ALPA for breaching the duty of fair representation. The court found no evidence that ALPA discriminated, acted in bad faith, or accepted less than the best deal it could construct, and granted summary judgment. The appellate court reversed, emphasizing that ALPA settled on worse terms than voluntarily ending the strike. The Supreme Court granted review.