Virginia M. Kendall, United States District Court Judge
Pursuant to Section 301 of the Labor Management Relations Act (29 U.S.C. § 185) and the Federal Arbitration Act, the United States Soccer Federation, Inc. seeks to vacate an arbitration award issued on September 12, 2014 in favor of the United States National Soccer Team Players Association. The Players Association filed a counterclaim for enforcement of the arbitrator's final award. U.S. Soccer
In support of their cross-motions for summary judgment, U.S. Soccer and the Players Association filed corresponding statements of undisputed material facts, responses, and replies. U.S. Soccer objects that the Players Association's Response to U.S. Soccer's Statement of Undisputed Facts and its Additional Material Facts do not comply with Local Rule 56.1(b)(3) because they are neither concise nor responsive and are otherwise objectionable as "irrelevant, argumentative, misleading, unsupported by admissible evidence." See Dkt. No. 44, Def. 56.1 Reply at p. 2-3; see also L.R. 56(c)(2) ("A party may object that the material cited to support or dispute a fact cannot be presented in a form that would be admissible in evidence."). U.S. Soccer also objects to eight statements in the Declaration of Mark S. Levinstein, as well as to the Declaration as a whole. (See Dkt. Nos. 43, 47). Though the Court briefly addresses these objections below, it notes that the rulings on these objections do not impact the ultimate outcome of this matter.
The Court will not strike any portion of the Players Association's Response to U.S. Soccer's Statement of Undisputed Facts and its Additional Material Facts. While the Court has substantial discretion to demand strict compliance with the Local Rules, including that responses or additional statements be concise and responsive, a severe sanction is not warranted in this case. See Ammons v. Aramark Uniform Servs., Inc., 368 F.3d 809, 817 (7th Cir.2004) (citing Bordelon v. Chicago School Reform Bd. of Trustees, 233 F.3d 524, 527 (7th Cir.2000)) ("Given their importance, we have consistently and repeatedly upheld a district court's discretion to require strict compliance with its local rules governing summary judgment."). However, to the extent that the Players Association's response and additional facts "mischaracterize the contents" of referenced documents, the Court considers the documents themselves. The Court similarly attaches no weight to legal or factual conclusions, arguments, or conjecture contained in the Players Association's response and additional facts. See Judson Atkinson Candies, Inc. v. Latini-Hohberger Dhimantec, 529 F.3d 371, 382 (7th Cir.2008). ("It is inappropriate to make legal arguments in a Rule 56.1 statement of facts.") (internal citations omitted); Cady v. Sheahan, 467 F.3d 1057, 1060 (7th Cir.2006) (a party's statement of material facts submitted pursuant to Local Rule
The Court next addresses U.S. Soccer's objections to the Declaration of Mark. S. Levinstein. (Dkt.Nos.43, 47). Objection number 1 (Dkt. No. 47) is denied. U.S. Soccer objects that Levinstein "did not lay foundation that he has personal knowledge regarding the negotiation and execution of the preexisting Uniform Player Agreement that predates 1996." (Dkt. No. 47 at 2). The objected-to excerpt, however, merely refers to the starting point of negotiations for the first UPA that was executed in 1997. Levinstein began working with the Players Association in 1996 and avers that he has personal knowledge of the facts contained in his Declaration, including the negotiation of the initial UPA. It is reasonable on the facts before the Court that the Acting Executive Director and Outside Counsel for the Players Association would have knowledge of the negotiations leading to an agreement that was signed during his tenure. To the extent the statements referenced in objection number 1 are relevant, the Court will consider them.
Objection number 2 (Dkt. No. 43) is denied. Levin stein's statement that "[t]he Players Association does not regularly conduct business in Chicago, Illinois and/or in the Northern District of Illinois" is not an impermissible legal conclusion; in this case, it is a statement of fact based on Levin stein's personal knowledge of the organization for which he is the Acting Executive Director and Outside Counsel.
Objection numbers 1, 3, 7 (Dkt. No. 43) and objection numbers 2, 4, and 8 (Dkt. No. 47) refer to statements that paraphrase or partially quote documents. The Court grants all six objections and will consider the documents themselves to the extent they are relevant. Objection number 3 (Dkt. No. 47) is granted. Mr. Levin stein's commentary on the arbitrator's award is inadmissible as the language of the award speaks for itself. The rest of the objected-to statements in objection number 3 (Dkt. No. 47) contain speculative opinions regarding U.S. Soccer's "understanding" of its relationship with the Players Association or irrelevant factual conclusions regarding the past practices of the parties. Objection number 5 (Dkt. No. 47) and objection number 4 (Dkt. No. 43) are granted because the contested statements are irrelevant and inadmissible hearsay. Objection numbers 6 and 7 (Dkt. No. 47) and objection numbers 5 and 6 (Dkt. No. 43) are denied. The objected-to information is relevant to the arbitrator's decision and will be considered, though its probative value is slight.
Finally, the Court refuses to discount the entire Declaration as inadmissible hearsay under Federal Rule of Evidence 802. Statements in a Declaration are not necessarily inadmissible hearsay when offered in support of, or opposition to summary judgment. On the contrary, Declarations are appropriate vehicles for presenting evidence to the Court in support of, or opposition to summary judgment as long as they are "made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant or declarant is competent to testify on the matters stated" therein. Fed. R.Civ.P. 56(c)(4). Mr. Levin stein's Declaration is submitted based on his "personal knowledge of the facts contained [therein]" and the Court has no reason to think him incompetent to testify on the matters stated therein. (See Dkt. No. 40, at ¶ 1). To the extent the individual statements within the Declaration are admissible, so too is the Declaration as a whole.
The underlying dispute in this case arises from the parties' disagreement over whether U.S. Soccer must seek approval from the Players Association before authorizing printed advertising materials containing the likeness of six or more players from the U.S. Men's National Team ("Print Creatives"). U.S. Soccer is a non-profit corporation that fields seventeen U.S. National Teams, including the U.S. Men's National Team. (Dkt. No. 44, Def. 56.1 Reply at ¶¶ 1, 5). The Players Association is a labor organization and the "exclusive collective bargaining representative of all persons who are or may become members on the U.S. Men's National Team." (Id. at ¶¶ 6-7).
Over the course of their relationship, U.S. Soccer and the Players Association have negotiated and executed four collective bargaining agreements and uniform player agreements. (Id. at ¶ 19). The fourth CBA/UPA was amended in November 2011. (Id. at ¶¶ 11, 19). The 2011 amended version of the CBA/UPA is currently in effect and is the agreement referenced throughout this opinion. (See id. at ¶¶ 11, 19). The parties do not dispute the content of the CBA/UPA and this Court has reviewed both documents in their entirety. (See Dkt. No. 24, Exhibit A).
Article IV of the CBA incorporates the UPA, stating: "The parties agree and acknowledge that the Uniform Player Agreement was the product of collective bargaining between the parties, and its terms in their entirety are expressly made part of this Agreement as if fully set forth herein." (Dkt. No. 44, Def. 56.1 Reply at ¶ 20). Print Creatives are addressed in Section 6(f)(i) of the UPA:
The CBA/UPA does not contain a provision concerning an approval process for Print Creatives, though Section 6(h) of the UPA considers the approval of other types of advertisements:
Specific procedures for resolving grievances arising from the "interpretation or application of, or compliance with," any provision or exhibit of the CBA/UPA are provided by the CBA. (Id. at ¶ 13). Should a grievance arise under the CBA/ UPA and proceed to arbitration, Section 5.8 of the CBA instructs:
With respect to what may be considered by the Impartial Arbitrator in rendering his decision, Section 7.1 of the CBA states:
The scope of the parties' agreement is constrained by integration and no-modification clauses in both the CBA and UPA:
Section 13(c) of the UPA also provides a no-waiver clause:
Pursuant to the grievance procedure set forth in the CBA/UPA, U.S. Soccer filed a grievance on August 23, 2013 over the Players Association's disapproval of a Print Creative for an El Jimadore advertisement that had been submitted to the Players Association for review. (Id. at ¶ 6). On February 20, 2014, U.S. Soccer withdrew its grievance and demand for arbitration. (See id. at ¶ 32). An attorney for U.S. Soccer contemporaneously sent an email to the Executive Director and General Counsel for the Players Association, stating that U.S. Soccer had "no contractual obligation to submit print/digital creative pieces containing the likeness of six (6) or more national team players to the Plyers Association (PA) for its advance approval" and that it would no longer be submitting Print Creatives to the Players Association for advance approval. (See id. at ¶ 32).
One week later, on February 27, 2014, the Players Association filed a grievance over U.S. Soccer's declaration that it would no longer be submitting Print Creatives to the Players Association for its advance approval. (Id. at ¶ 33). In accordance with the procedures set forth in the CBA/ UPA, an arbitration hearing to resolve these issues was eventually held over the course of six days in April and July of 2014. (Id. at ¶ 16). The arbitrator issued a 56-page award and opinion on September 12, 2014 in favor of the Players Association. (Id. at ¶ 18).
The arbitrator framed the issue before him as:
The arbitrator follows this with a "Contract Construction" segment, beginning with U.S. Soccer's argument that the arbitrator did "not need to look any further than the four-corners of the contract" and including an eight-page chart highlighting "the historical development of notice, review and/or approval provisions in the parties' CBA/UPA." (Id. at 23-32). The arbitrator later returns to the ambiguity in the CBA/UPA:
The arbitrator acknowledged that it was not his role to create new rights in the parties' CBA/UPA, noting:
The arbitrator ultimately entered an award in favor of the Players Association. This suit followed.
On cross-motions for summary judgment, each movant must satisfy the requirements of Rule 56 of the Federal Rule of Civil Procedure. See Cont'l Cas. Co. v. Northwestern Nat'l Ins. Co., 427 F.3d 1038, 1041 (7th Cir.2005). Summary judgment is proper when "the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). In determining whether a genuine issue of fact exists, the Court must view the evidence and draw all reasonable inferences in favor of the party opposing the motion. See Bennington v. Caterpillar Inc., 275 F.3d 654, 658 (7th Cir.2001); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The Court will "limit its analysis of the facts on summary judgment to evidence that is properly identified and supported in the parties' [Local Rule 56.1] statement." Bordelon v. Chicago Sch. Reform Bd. of Trustees, 233 F.3d 524, 529 (7th Cir.2000). Where a proposed statement of fact is supported by the record and not adequately rebutted, the court will accept that statement as true for purposes of summary judgment. See Drake v. Minnesota Mining & Mfg. Co., 134 F.3d 878, 887 (7th Cir.1998) ("`Rule 56 demands something more specific than the bald assertion of the general truth of a particular matter[;] rather it requires affidavits that cite specific concrete facts establishing the existence of the truth of the matter asserted.'").
The only issue before this Court is whether the arbitrator exceeded the scope of his authority under the LMRA and the terms of the CBA by impermissibly adding a term to the UPA based on the parties' past practice. (See Dkt. No. 22, at 13). The Court begins by emphasizing its extremely limited authority to review the decisions of arbitrators. Courts "should not review the arbitrator's decision on the merits despite allegations that the decision rests on factual errors or misinterprets the
"We resolve any reasonable doubt about whether an award draws its essence from the [CBA] in favor of enforcing the award." Dexter Axle Co. v. Int'l Ass'n of Machinists & Aerospace Workers, Dist. 90, Lodge 1315, 418 F.3d 762, 768 (7th Cir.2005) (internal quotation marks and citation omitted). "Thus, we will vacate only if there is no possible interpretive route to the award." NIPSCO v. United Steelworkers of Am., 243 F.3d 345, 347 (7th Cir.2001) (internal quotation mark and citation omitted). Of course, the reviewing court should also vacate the arbitration award where "the arbitrator's interpretation of the collective bargaining agreement was contrary to public policy." Titan Tire Corp., 734 F.3d at 716.
In this case, the arbitrator's award must be confirmed. The arbitrator was faced with determining whether U.S. Soccer was required to submit Print Creatives to the Players Association for approval, despite the existence of a CBA/UPA that contained no "specific contractual provision that requires U.S. Soccer to submit print creatives of six (6) or more players to the Players Association for its approval before allowing sponsors to publish and/or display said advertising." (See Dkt. No. 41-7, at 20-22). In making this determination, the arbitrator did not "disregard the contractual language and dispense his own brand of industrial justice, nor did he exceed his authority in rendering his decision." See United Food, 569 F.3d at 755. On the contrary, the arbitrator considered the CBA/UPA, interpreted the CBA/UPA, and reached a conclusion. He did exactly what the parties bargained for under the CBA/UPA. (See Dkt. No. 44, Def. 56.1 Reply at ¶¶ 28, 31).
"[A]s long as an arbitrator's award is based on her interpretation of the contract, a court cannot disturb it. All that is required is that the arbitrator's interpretation [of the collective bargaining agreement] is derived from the language of that agreement." Jasper Cabinet Co. v. United Steelworkers of America, AFL-CIO-CLC, Upholstery and Allied Div., 77 F.3d 1025, 1029 (7th Cir.1996) (internal quotation marks and citations omitted); see also Clear Channel Outdoor. Inc. v. Int'l Unions of Painters & Allied Trades, Local 770, 558 F.3d 670, 675 (7th Cir.2009); United Food, 569 F.3d at 755. Where an arbitrator finds an ambiguity in the agreement, he may consider evidence outside the agreement — including evidence of past practices — to resolve the same. See, e.g., NIPSCO, 243 F.3d at 348 (An arbitrator cannot add terms to a contract; he is, however, "empowered to fill gaps left in contracts."); Judsen Rubber Works, Inc. v. Mfg., Prod. & Serv. Workers Union Local
U.S. Soccer insists that, in reaching his decision, the arbitrator disregarded the plain language of the CBA/UPA in favor of past practice and that there is "no interpretive route from the CBA/UPA to the Award." It maintains that the award is derived, not from the language of the contract, but solely from past practice — thereby impermissibly "drawing its essence" from past practice rather than the language of the agreement. This argument, however, is belied by both the structure and language of the arbitrator's decision.
The arbitrator broke the discussion section of his opinion into four subsections mirroring classic inquiries of contract interpretation: "The Plain Language of the CBA and UPA;" "Contract Construction;" "Past Practice and Custom;" and "Contractual Prohibitions." Of course, were these labels merely window dressing for the arbitrator's policy desires, he would have exceeded the scope of his authority and his award would be vacated; that is not the case. See Anheuser-Busch, Inc. v. Beer Workers Local Union 744, 280 F.3d 1133, 1138 (7th Cir.2002). The arbitrator recognized that the CBA/UPA did not contain a provision regarding an approval process for Print Creatives. He found, however, that an ambiguity existed with respect to an approval process because the agreement clearly contemplated the use of Print Creatives:
The CBA/UPA contemplated the use of Print Creatives, but contained no provision regarding their approval. Of course, the arbitrator did not expressly state that the agreement's silence on this point created an ambiguity. Indeed, U.S. Soccer argues very persuasively that the arbitrator's interpretation may have been unsound, at times invoking the terms "silence" and "ambiguity" far too cavalierly. This is not enough. "[T]he question before a federal court is not whether the ... arbitrators erred in interpreting the contract; it is not whether they clearly erred in interpreting the contract; it is not whether they grossly
U.S. Soccer relies heavily on the analysis set forth in Anheuser-Busch to support its position that the arbitrator should have confined his analysis to the four-corners of the CBA/UPA and that evidence of past practice was "absolutely irrelevant." The facts of that case, however, are readily distinguishable from the circumstances at bar. In Anheuser-Busch, the underlying contract contained a provision expressly delineating a two-tiered commission payment structure. See Anheuser-Busch, Inc., 280 F.3d at 1134. Despite the presence of that express provision, a merger clause, and an arbitration clause, the arbitrator relied on the parties' past practice to find a different payment structure than the two-tiered approach set forth in the agreement. See id. at 1141. In this case, there is no such defiance of an express provision. The arbitrator did not read the CBA/UPA and then blatantly disregard the express wishes of the parties in favor of some other practice. He read the agreement; found that it did not contain a provision regarding the approval of Print Creatives, despite clearly contemplating the use of the same; and looked outside the agreement to determine the parties' intent.
This Court appreciates that "[c]arefully written, well-reasoned, and thoroughly negotiated contracts are presumptively complete" and that the presence of integration, no-modification, and no-waiver clauses — as exist in this case — is "further strong evidence that the parties intended the writing to be the complete and exclusive agreement between them." Id. at 1141 (internal quotation marks and citation omitted). Where an ambiguity exists, however, an arbitrator may look at evidence of past practices to resolve the ambiguity. See, NIPSCO, 243 F.3d at 348; Judsen Rubber Works, Inc., 889 F.Supp. at 1063 (citing Chicago Web Printing, 772 F.2d 384). Courts cannot vacate arbitration awards merely because an arbitrator writes an unsound decision with careless language and rule statements. See Chicago Typographical, 935 F.2d at 1506 (subjecting arbitration opinions to "beady-eyed scrutiny" might create disincentives for arbitrators writing opinions at all). And, this Court cannot conclude that the arbitrator's reliance on past practice fell out-side his authority to interpret and apply the terms of the parties' CBA/UPA. Accordingly,
That the CBA contains integration, no-waiver, and no-modification clauses does nothing to save U.S. Soccer's bid to vacate this award. They are relevant, as mentioned above, to whether the arbitrator was prohibited from looking beyond the CBA/UPA to resolve an ambiguity, but beyond that they warrant no special consideration by this Court. The arbitrator considered all three clauses in issuing his award and, right or wrong, analyzed and determined whether they barred his consideration of evidence beyond the CBA/ UPA. (See Dkt. No. 41-7, at 53-54). This was all he was required to do. See Wise v. Wachovia Sec., LLC, 450 F.3d 265, 269 (7th Cir.2006) ("When parties agree to arbitrate their disputes they opt out of the court system, and when one of them challenges the resulting arbitration award he perforce does so not on the ground that the arbitrators made a mistake but that they violated the agreement to arbitrate, as by corruption, evident partiality, etc.-conduct to which parties did not consent when they included an arbitration clause in their contract,"), cert. denied, 549 U.S. 1047, 127 S.Ct. 582, 166 L.Ed.2d 458 (2006); Lefkovitz v. Wagner, 395 F.3d 773, 782 (7th Cir.2005) (an objection to the merits of the arbitrator's decision is not grounds for vacating the award).
The arbitrator ultimately concluded that the integration and no-modification clauses did not bar his consideration of evidence beyond the CBA/UPA because he was resolving a contractual ambiguity. (See Dkt. No. 41-7, at 53-54). He found the no-waiver clause similarly inapplicable because the benefit of the approval process at issue was of "peculiar personal value to the employees." (See id.) This Court does not sit in judgment over whether the arbitrator's contract analysis was good or bad; it is sufficient merely that the arbitrator analyzed these provisions and reached a determination, which he did. See Ethyl Corp., 768 F.2d at 184 ("... so long as the award is based on the arbitrator's interpretation — unsound though it may be — of the contract, it draws its essence from the contract.")
For the foregoing reasons, the Players Association's motion for summary judgment [37] is granted and the arbitration award is confirmed. U.S. Soccer's motion for summary judgment [22] is denied.