For immediate release
June 1, 2005
On April 25, 2005 the US Supreme Court denied the petition for Writ of Certiorari of Sage Hospitality Resources owner and operator of the Pittsburgh Renaissance Hotel in Pittsburgh, Pennsylvania thereby upholding the November 2004 Decision of the Third Circuit Court of Appeals which upheld the earlier decision of the US District Court for the Western District of Pennsylvania in the case of Sage Hospitality Resources, LLC v. Hotel Employees and Restaurant Employees Union, Local 57.
Specifically, the Third Circuit Court’s Decision held that:
1. Card Check/Neutrality Agreements are valid and enforceable in the Federal Courts
2. Such Agreements are not an illegal gift from the employer to the union in violation of federal law as suggested by Sage Hospitality, Inc. and
3. The City of Pittsburgh as a lender in this hotel development project could legally condition its loan on the developer obtaining from the Union a promise of labor peace.
This case started several years ago when Sage Hospitality was developing the Renaissance Hotel in Pittsburgh. Hotel Employees and Restaurant Employees Union, Local 57, interested in organizing the workers at the new hotel, was prepared to use picketing, boycotts and other measures to accomplish this goal. Pittsburgh City Council was asked by the developer for assistance in financing the project. The City agreed to provide a $3.56 million dollar “TAX INCREMENT FINANCING” (TIF) Loan but conditioned the loan on the developer obtaining from Local 57 a promise not to disrupt the business of the hotel and thereby interfere with the stream of revenue that the Hotel would use to pay the City’s loan.
City Council had passed an ordinance requiring “labor peace” agreements for projects such as this hotel in which the City had a proprietary interest.
The Hotel’s developer, Sage Hospitality, entered into a card check/neutrality agreement with Local 57 thereby procuring the City’s portion of the financing of the project and for a time after the Hotel opened abided by the agreement.
When Local 57 said it was ready for a card check, Sage reneged and claimed that the agreement was illegal under federal law because it was a “thing of value” given by an employer to a union and that the City of Pittsburgh used “duress” to force Sage to sign it. The Union, Hotel Employees and Restaurant Employees Union Local 57, sued with success in Federal District Court, a decision appealed unsuccessfully by the Hotel to the Third Circuit Court of Appeals and to the U.S. Supreme Court as set forth above.
This is an outstanding decision in favor of Organized Labor in the United States of America. It started in Pittsburgh by Hotel Employees Restaurant Employees Union Local 57.