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In a landmark case between ICTSI Oregon, Inc. (ICTSI) and the International Longshore and Warehouse Union and its affiliate ILWU Local 8 (collectively “ILWU”), a jury awarded $93.6 million in damages to ICTSI for the ILWU’s illegal labor slowdowns. These slowdowns caused the eventual shutdown of Terminal 6 at the Port of Portland, Oregon’s only container terminal. Schwabe, Williamson & Wyatt attorneys Jeff Eden, Amanda Gamblin, Michael Garone, Dick Hansen and Andy Lee led the trial team for the federal lawsuit.

“This is a huge win for west coast ports, which historically have had no choice but to yield to the demands of a powerful union,” said Amanda Gamblin, a Schwabe attorney who represented ICTSI in the trial. “The jury sent a loud and clear message that unions engaging in illegal slowdowns can be held accountable.”

ICTSI is an Oregon-based affiliate of International Container Terminal Services, Inc., one of the world's leading port and terminal operators. In 2010, the company landed its first terminal operation in the United States through a 25-year lease of the Port of Portland’s Terminal 6. Once ICTSI began operating Terminal 6, the ILWU claimed it had the right to perform the plugging, unplugging, and monitoring of refrigerated containers (called the “reefer work”). However, this work had been performed by the International Brotherhood of Electrical Workers (“IBEW”) since 1974 under a labor agreement with the Port of Portland.

In May 2012, the ILWU threated ICTSI that if it failed to assign the reefer work to the ILWU, the ILWU would run every Hanjin container out of Portland. Because the Port, not ICTSI, controlled assignment of the reefer work, ICTSI was powerless to yield/ to the ILWU’s demands. In June 2012, the ILWU surrounded the reefers with their trucks and prevented the IBEW electricians from performing the work. Instead, the ILWU took the reefer work for themselves.

In July 2012, an Oregon Federal Court entered an injunction ordering the ILWU to cease performing the work and engaging in slowdowns, work stoppages, and gimmicks to coerce ICTSI to give the reefer jobs to the ILWU. In two separate hearings, the National Labor Relations Board (NLRB) found that the ILWU engaged in illegal slowdowns, work stoppages, and gimmicks. In December 2014, an Oregon Federal Court found the ILWU in contempt of court for continuing its slowdowns in violation of the July 2012 injunction. Despite all efforts to curtail the ILWU’s illegal conduct, it continued. Ultimately, the deliberate slowdowns forced ICTSI to shut down Terminal 6, resulting in the loss of Oregon’s only container terminal.

The ILWU sued ICTSI in an attempt to obtain the reefer work, but lost. ICTSI counterclaimed for damages caused by the ILWU’s illegal slowdowns.

The ILWU never conceded that it owed any damages for its illegal conduct and never took any responsibility for the loss of container traffic through Terminal 6. Despite the ILWU erecting every roadblock along the way, the Schwabe team was able to tell the jury the true story of why Oregon’s only container terminal is gone, resulting in a verdict in favor of ICTSI for $93.6 million.

“The dispute in this case involved only a handful of jobs, but its impact was felt far more broadly,” said Jeff Eden, a Schwabe attorney and member of the ICTSI trial team. “While our client prevailed in this trial, it’s hard to say there are any winners. ICTSI had to leave Oregon, forcing the loss of numerous jobs and the region’s only container terminal. We hope no other region has to suffer this same fate.”

The ILWU’s intentional slowdown had an enormous impact on the Pacific Northwest economy, leading to the elimination of jobs and a vital import-export hub for companies engaged in international trade.