damage to the plaintiff.315/ Analysis of these elements in the

consultant context illuminates the doctrine's potential utility

for unions and employees in their legal struggle against union-busters. The doctrine reaches nearly all legal contracts and should be

applicable to collective bargaining agreements 316/ In some juris

dictions the related doctrine of wrongful interference with prospective advantage protects even precontractual relations, such as at 317/ the negotiation stage, although more restrictive standards of proof may apply in regard to the wrongfulness of defendant's means 318/ or intent. Moreover, in most jurisdictions even voidable contracts and contracts terminable at will are protected; the central 319/ concern is the property interest in future business relations. Therefore, if a union can prove the consultant's improper procurement of the employer action, it should be no defense that the employer followed the statutory procedures in terminating or modifying an agreement, or acted after a union loss in a properly conducted representation or deauthorization election.321/

320/

322/

a substantial impairment or

The second element, procurement, does not necessarily require an actual breach to be satisfied; modification of the contract may suffice.

323/

Moreover, the

"inducement" branch of the doctrine comprehends both gross and subtle means of interference if it is committed with the requisite state of mind.

324/

If the wrongful conduct prevents plaintiff from performing 325/ his own contractual obligations, the doctrine also applies. Thus, if a consultant intentionally and improperly undermines

employee support of the union, it may thereby prevent the union from carrying out its representational functions, a failure which may lead an employer to dishonor the agreement as well.

Numerous cases have arisen from interferences with exclusive employment and distributorship contracts, where defendant contracted with a third party knowing that the contract was incompatible with the previous agreement between the third party and

the plaintiff.326/ The employer-union relationship is analogous

due to the exclusive representation rights accorded by the LMRA328/ and the Railway Labor Act. Thus a consultant who contracts with an employer to decertify a union or otherwise disrupt the employer's relationship with a union does so with the knowledge and intention that the collective bargaining agreement cannot be fulfilled.

327/

The third element, intent, requires only that defendant know of the contract and deliberately act detrimentally to plaintiff's 329/ rights thereunder. Defendant's motive is important only

insofar as it establishes a "justification" defense to the allegation of improper interference.330/

A court may apply a

balancing test, weighing various factors: the "nature" of defendant's conduct, his "motive," plaintiff's "interests" which are interfered with, the "interests" defendant seeks to advance by his conduct, the "social interests" involved, the "proximity" of defendant's conduct to the interference, and "the relations 331/ between the parties."

This inquiry may become an important legal battleground in the consultant context. A union may argue that

national labor policy explicitly favors collective bargaining and workers' free exercise of organizational rights, 332/ and that the consultant intends to eliminate both, usually by illegal means. A consultant's likely justification claims are less apparent, and probably must refer to the employer's rights, such as statutory and constitutional rights of expression. There is authority that a mere statement of truthful information which actually exerts no

333/

other influence or pressure may fall into an "advice" privilege.334/ Thus the status of particular consultant-employer agreements may be required to undergo a rigorous factual inquiry.

The final element, "damage," might be satisfied by a union plaintiff as lost dues income. Employee plaintiffs might

335/

allege the loss of prospective wages, benefits, and other privileges which collective bargaining might have achieved. Employer reductions or withdrawals of any benefits following a successful unionbusting effort would also offer clear proof of damage.

A valid claim against a consultant under this doctrine entails a variety of possible remedies. Compensatory damages include "the pecuniary loss of the benefits of the contract" and "emotional distress or actual harm to reputation, if they are reasonably to be expected to result from the interference."

336/

As a further deterrent to a consultant, one who is liable under this doctrine is responsible for the entire loss even though the injured party may also have a remedy against the contract breaker.337/

The two are "joint wrongdoers," and even a judgment against the contract breaker, if unsatisfied, is no defense to the tortious interference claim, although actual payments by the contract breaker will reduce the amount recoverable against the torfeasor.338/ Punitive damages may also be awarded if the circumstances warrant. Injunctive relief such as a specific performance decree may also be granted if the general requirements of equitable relief are met.340/

339/

Unions may, however, have to face and overcome the federal preemption claim that because consultant conduct is "arguably" subject to Section 7 or 8 of the LMRA, state and federal courts must defer 341/

to that jurisdiction of the NLRB.

On the other hand, under Section 301342/ of the LMRA, federal and state courts enjoy broad jurisdiction over the enforcement of collective bargaining and other labor contracts even where the underlying conduct complained of also constitutes an unfair labor 343/ practice. Whether or not wrongful consultant interference is

a literal "violation" of the contract, the "enforcement" of agreements is strongly implicated, and the courts might "fashion

a body of federal law-344/ parallel to the wrongful interference doctrine in order to further the national policy favoring collective bargaining and stable labor-management relationships. This discussion is intended to raise this litigative strategy as a possible recourse against consultants who lead employers to try to break the unions they deal with. It offers flexibility not only of theory but of forum, opening as it does both federal and

state courts to unions and employees who would fight consultant

inspired attacks. Whether this doctrine is viable for this purpose 345/ awaits "litigating elucidation."

G. PUBLIC FUNDING

Public subsidization of consultant and other anti-union

activity has only recently gained public attention

346/ but there

is nothing to suggest that this little-understood phenomenon is new or involves insignificant amounts of public funds. Available evidence suggests that research and remedial action in this area are long overdue.

At the federal level it is known that public funds pay for consultant and other anti-union activity via statutory subsidies in health, legal services, and job training programs, and through federal reimbursement of costs incurred by private employers in performing government contracts. In Massachusetts, the State Rate Setting Commission audited Massachusetts hospitals and disallowed their expenditure of $256,892 of Medicaid funds for payments to the a leading union-busting firm, Modern Management, Inc. (then called 347/ Melnick, Mickus & McKeown). The Commission noted that because "audit techniques rely heavily on sampling, it is certain that these results do not represent the full penetration of Melnick, 348/ Mickus & McKeown in the industry. The Commission's decision

rested on the hospitals' non-compliance with the state regulation governing reimbursement for consultant costs rather than on sub

stantive grounds, 349/ but the state legislature subsequently

enacted a law prohibiting the use of state funds by hospitals for 350/ persuader activities for or against unionization.