Appellant Sage Hospitality Resources ("Hotel") seeks review of a district court order compelling it to submit to arbitration a dispute over the meaning of ambiguous language in the duration clause of a neutrality agreement between the Hotel and appellee UNITE HERE Local 217 ("Union"). As the parties agreed to a broad arbitration clause that unambiguously encompasses their dispute, we hold that the issue was properly consigned to the arbitrator for resolution. We therefore affirm.
The Hotel and the Union entered into a neutrality agreement ("Agreement") on June 9, 2003, in anticipation of the renovation of a dilapidated structure in downtown Providence into the Renaissance Providence Hotel. The Agreement set forth a process allowing the Union to organize the Hotel's employees and to seek recognition as their collective bargaining representative; in turn, the Union would refrain from engaging in any picketing or economic activity against the Hotel.
Three provisions of the parties' Agreement are relevant to this case. First, the Agreement established a "card check" procedure, by which "[t]he Union may request recognition as the exclusive collective bargaining agent for [the Hotel's] Employees."
Finally, the duration clause of the Agreement stipulated that the "Agreement shall be in full force and effect from the date it is fully executed ... until thirty months from the full public opening of the hotel, or if sooner upon the Employer's recognition of the Union." The Agreement did not define the term "full public opening."
A dispute over the meaning of this term arose on January 5, 2010, when the Union requested recognition from the Hotel pursuant to the card check procedure. The Hotel declined the request, characterizing it as untimely. In the Hotel's view, the "full public opening" occurred on June 1, 2007, when it held a ceremony marking the "opening of the hotel doors." This event, says the appellant, was preceded by a "soft opening" in which it had already begun renting out a small number of rooms and holding events. According to the Hotel, the Agreement expired on December 1, 2009, thirty months after June 1, 2007, and it thus was no longer obligated to participate in the card check procedure.
The Union then demanded arbitration over the meaning of the term "full public opening," alleging that the "full public opening" instead occurred on August 21, 2007, when the Hotel held a ribbon-cutting and gala. The Hotel rejected the arbitration demand, again relying on untimeliness
On January 7, 2010, the Union filed in federal court a petition to compel the Hotel to submit to arbitration. The Union argued that the meaning of the term "full public opening" was for the arbitrator, who should decide the threshold issue of whether the Agreement was in effect, as well as the ultimate issue of the results of the card check procedure. The Hotel countered that the court should determine whether an agreement to arbitrate continued to bind the parties. It maintained that the term "full public opening" did not need to be construed by an arbitrator, because either it was not an ambiguous term or it was tantamount to a "date certain." To the extent evidence was needed to determine the date of the full public opening and hence the duration of the Agreement, the Hotel argued that the court, not an arbitrator, should conduct an evidentiary hearing.
In an Opinion and Order dated May 4, 2010 ("May 4 Order"), the district court granted the Union's petition. See UNITE HERE Local 217 v. Sage Hospitality Res., 722 F.Supp.2d 161, 163 (D.R.I.2010) [hereinafter UNITE HERE I]. Relying primarily on this court's holdings in International Brotherhood of Electrical Workers, Local 1228 v. Freedom WLNE-TV, Inc., 760 F.2d 8 (1st Cir.1985), and New England Cleaning Services, Inc. v. Services Employees International Union, Local 254, 199 F.3d 537 (1st Cir.1999), the district court determined, inter alia, that this case was "directly in the path of the rule consigning termination disputes to arbitration if the agreement includes a `broad' arbitration clause" and ordered the parties to arbitration. UNITE HERE I, 722 F.Supp.2d at 168; see also id. at 165.
A week later, the Union moved to enforce the district court's judgment. In response, the Hotel filed a motion to stay the court's order pending appeal and, in the alternative, for reconsideration. It assayed an argument not previously raised: that this circuit's law on the arbitrability of termination disputes was "implicitly overruled" by the Supreme Court's decision in Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 123 S.Ct. 588, 154 L.Ed.2d 491 (2002), under which the parties' dispute, the Hotel claimed, would presumptively be for a court to decide. In an Order and Opinion dated September 24, 2010 ("September 24 Order"), the district court granted the Union's motion to enforce the judgment and denied the Hotel's motion to stay. See UNITE HERE Local 217 v. Sage Hospitality Res., 722 F.Supp.2d 169, 171 (D.R.I.2010) [hereinafter UNITE HERE II]. The court granted in part the Hotel's motion to reconsider by "clarif[ying]" certain parts of its May 4 Order; however, it declined to withdraw any part of that order.
The Hotel appeals, asserting that the district court erred in concluding that the question of what "full public opening" means, and thus whether the Agreement was still in effect at the time the Union demanded the card check and arbitration, is for the arbitrator, and not the court, to resolve.
The central question here is whether a court or an arbitrator should decide
We review a district court's order compelling arbitration de novo, S. Bay Boston Mgmt. v. Unite Here, Local 26, 587 F.3d 35, 42 (1st Cir.2009), and we are "not wedded to the lower court's rationale, but, rather, may affirm its order on any independent ground made manifest by the record," Kristian v. Comcast Corp., 446 F.3d 25, 31 (1st Cir.2006) (quoting InterGen N.V. v. Grina, 344 F.3d 134, 141 (1st Cir. 2003)). In our review, we focus only on the threshold issue of arbitrability; we do not rule on the merits of the underlying claims. AT & T Techs., Inc. v. Commc'ns Workers, 475 U.S. 643, 649-50, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986).
It is axiomatic that arbitration is a creature of contract. See United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960). Where there is a validly formed and enforceable arbitration agreement, "a court may order arbitration of a particular dispute only where the court is satisfied that the parties agreed to arbitrate that dispute." Granite Rock Co. v. Int'l Bhd. of Teamsters, ___ U.S. ___, 130 S.Ct. 2847, 2856, 177 L.Ed.2d 567 (2010) (citing First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 943, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995); AT & T Techs., 475 U.S. at 648-49, 106 S.Ct. 1415). Our focus in this inquiry is to determine and effectuate the parties' intent, not to substitute our own preferences. Municipality of San Juan v. Corporación Para El Fomento Económico De La Ciudad Capital, 415 F.3d 145, 151 (1st Cir.2005).
Here, the parties' dispute concerns the interpretation of the duration clause of the Agreement. We may only affirm the district court's order compelling arbitration if this issue is within the scope of the parties' arbitration clause. That clause of the Agreement provides that "any dispute over [the Agreement's] interpretation or application" shall be submitted to binding arbitration. The parties did not place any limitations on that language, and certainly did not exclude controversies relating to the duration or termination of the contract. A question as to the meaning of the term "full public opening" is manifestly a "dispute over [the Agreement's] interpretation or application." Accordingly, by its own phraseology, the arbitration clause applies to the issue in dispute, which was appropriately referred to the arbitrator for resolution.
The appellant acknowledges that the Agreement's arbitration clause covers a broad range of matters. On appeal, the Hotel stakes its hopes on the claim that under the Supreme Court's decision in Howsam, 537 U.S. 79, 123 S.Ct. 588, its dispute with the Union must be considered a question of arbitrability that is presumptively for a court to resolve.
In Howsam, the Court observed that "[a]lthough [it] has ... long recognized and enforced a `liberal federal policy favoring arbitration agreements,'" 537 U.S. at 83, 123 S.Ct. 588 (quoting Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983)), it has also carved out an exception to this policy: the threshold "question of whether the parties have submitted a particular dispute to arbitration, i.e., the `question of arbitrability,' is `an issue for judicial determination [u]nless the parties clearly and unmistakably provide otherwise.'" Howsam, 537 U.S. at 83, 123 S.Ct. 588 (quoting AT & T Techs., 475 U.S. at 649, 106 S.Ct. 1415; First Options, 514 U.S. at 944, 115 S.Ct. 1920). In other words, questions of arbitrability are subject
But Howsam emphasized that "question of arbitrability" is a term of art with a narrow scope:
Howsam, 537 U.S. at 83-84, 123 S.Ct. 588. Consequently, Howsam specified that only certain "substantive" gateway matters are subject to the anti-arbitrability presumption, id. at 85, 123 S.Ct. 588 (quoting Revised Unif. Arbitration Act of 2000 § 6 cmt. 2, 7 U.L.A. 13 (Supp.2002)), and identified "two categories of disputes where [that presumption clearly applies]: (1) disputes `about whether the parties are bound by a given arbitration clause'; and (2) disagreements `about whether an arbitration clause in a concededly binding contract applies to a particular type of controversy,'" Kristian, 446 F.3d at 39 (quoting Howsam, 537 U.S. at 84, 123 S.Ct. 588); see also id. (clarifying that "[e]xamples of the former include whether an arbitration contract binds parties that did not sign the agreement[,] and whether an arbitration agreement survived a corporate merger and bound the subsequent corporation," and "examples of the latter include whether a labor-management layoff controversy was covered by the arbitration clause of a collective-bargaining agreement[,] and whether a clause providing for arbitration of various grievances covers claims for damages for breach of a no-strike agreement"). In contrast, "`procedural' questions [that] grow out of the dispute and bear on its final disposition are presumptively not for the judge, but for an arbitrator, to decide." Howsam, 537 U.S. at 84, 123 S.Ct. 588 (quoting John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 557, 84 S.Ct. 909, 11 L.Ed.2d 898 (1964)) (internal quotation mark omitted).
In defending against the arbitration demand, the Hotel maintains that the dispute between it and the Union implicates a substantive question of arbitrability and, as such, should presumptively be for the court to decide. The contrary results required by Freedom WLNE-TV and like cases, the Hotel insists, demonstrate that our precedents are inconsistent with the Court's recent caselaw and should be repudiated.
The Hotel's absolutist position that contract expiration issues are necessarily substantive questions of arbitrability proves too much. Not all questions of contract duration are alike.
In any event, even if we were to agree with the Hotel that a duration dispute of the type at issue here could be characterized as a question of substantive arbitrability and thus presumptively reserved for judicial determination, the presumption would be overcome by the clear and unmistakable intent of the parties to arbitrate controversies such as the one raised here. See First Options, 514 U.S. at 943, 115 S.Ct. 1920. The breadth of the arbitration clause, which covers "any disputes over [the] interpretation or application" of the Agreement, presents an insurmountable impediment to the Hotel's position.
The parties to this grievance negotiated a broad arbitration clause memorializing their intention to arbitrate all questions of contract construction. Whether categorized as an issue of substantive arbitrability or not, the instant dispute over the meaning of language in the duration clause is one that the parties clearly anticipated would be resolved by an arbitrator, not a court. See Howsam, 537 U.S. at 83, 123 S.Ct. 588. In these circumstances, we must enforce the bargain the parties struck and allow the arbitrator to decide the issues they committed to her resolution. The district court's order compelling arbitration is, accordingly,