## Facts

- Garth Drabinsky produced the Broadway musical *Paradise Square*.
- Equity, the labor union representing theater actors and stage managers, received member complaints alleging unpaid wages, unsafe working conditions, and racially insensitive conduct toward Black cast members.
- After investigating, Equity placed Drabinsky on its “Do Not Work” list, which instructs union members not to work for listed producers or productions.
- Drabinsky sued Equity in federal court asserting Sherman Act §§ 1–2 claims (characterizing the listing as a group boycott) and New York tort claims including defamation-related theories.
- The district court dismissed the complaint under Rule 12(b)(6), finding the antitrust claims barred by the statutory labor exemption and the state tort claims barred by New York’s rule for unincorporated associations.

## Issues

1. In an antitrust suit against a labor union, must the plaintiff plead and prove that the statutory labor exemption does not apply, or is the exemption an affirmative defense for the union?
2. Did Equity’s placement of Drabinsky on its “Do Not Work” list fall within the statutory labor exemption, warranting dismissal of the Sherman Act claims at the pleading stage?
3. Were the New York tort claims against Equity barred because the complaint did not allege authorization or ratification by every union member?

## Decision

- The Second Circuit affirmed dismissal of all claims.
- The court held that an antitrust plaintiff suing a union bears the burden to plead (and ultimately prove) facts showing the statutory labor exemption is inapplicable.
- The court held the complaint did not plausibly allege conduct outside the exemption because Equity acted in its labor self-interest and the complaint did not plausibly allege a combination with non-labor groups.
- The court held New York tort claims against Equity were barred because the complaint did not allege that all union members authorized or ratified the alleged tortious conduct.

## Legal Principles

- In the Second Circuit, the statutory labor exemption is treated as limiting the substantive reach of the Sherman Act as applied to union conduct; therefore, a plaintiff must plead facts taking the challenged conduct outside the exemption.
- The statutory labor exemption applies where a union acts in its self-interest as a labor organization and does not combine with non-labor groups to impose the restraint.
- Under New York law governing tort liability of unincorporated associations, a plaintiff must allege authorization or ratification of the tortious conduct by each member of the association to impose entity liability.

## Conclusion

The court affirmed dismissal because the complaint failed to plead facts showing Equity’s blacklisting conduct fell outside the statutory labor exemption to federal antitrust law, and because New York’s stringent authorization-or-ratification requirement for unincorporated associations foreclosed the state tort claims as pleaded.


Drabinsky v. Actors’ Equity Ass’n, 106 F.4th 206 (2d Cir. 2024)