WILLIAM H. YOHN, Jr., District Judge.
The Elliott-Lewis Corporation ("Elliott-Lewis") has brought two actions against the Metropolitan Regional Council of Carpenters, Southeastern Pennsylvania, State of Delaware, and Eastern Shore of Maryland ("MRCC"). The actions arise from decisions by Elliott-Lewis— in its capacity as the official labor broker for the Philadelphia Convention Center ("PCC")—to permit two sets of PCC exhibitors to perform work related to setting up and/or taking down their exhibits. After MRCC filed grievances claiming infringement of its PCC work jurisdiction under applicable labor agreements, the two arbitrators awarded damages to MRCC. Elliott-Lewis then brought the instant suits seeking to vacate the arbitral awards.
The parties have filed cross-motions for summary judgment in both cases. As their respective briefings for each raise the same arguments about the same issues, I address all four cross-motions in this consolidated memorandum. For the following reasons I will grant Elliott-Lewis's motions for summary judgment, deny MRCC's motions for summary judgment, and vacate the challenged arbitral awards.
At the time of the events at issue, Elliott-Lewis was responsible for hiring, scheduling, and assigning PCC employee-workers for PCC events. PCC employee-workers were represented by six craft unions. One of these unions was MRCC, and MRCC had a collective bargaining agreement ("CBA") with the Philadelphia Exposition Service Contractor's Association ("PESCA Agreement") that was binding on Elliott-Lewis. Additionally, Elliott-Lewis and MRCC were signatories to the Customer Service Agreement ("CSA"), a 2003 compact among various PCC stakeholders. Under the CSA, PCC exhibitors are entitled to install and dismantle their own booths, but only to the extent that (1) the booths are limited to 300 net square feet in size, and (2) their employees perform work using hand tools only, except for power or battery operated tools, hammers, ladders, and saws. Any further work required to install or dismantle exhibits can be performed by MRCC members only. The CSA amends and incorporates by reference the PESCA Agreement.
Under Section K of the CSA, disputes over the conduct of work at PCC are to be immediately decided by a designated PCC representative. Appeals from those decisions are governed by Section K(3), which states:
Both the CSA and the PESCA Agreement provide for submitting disputes to arbitration. Accordingly, arbitrations about "jurisdictional disputes" are subject to the CSA's rules and remedies, while arbitrations about all other disputes involving MRCC are subject to the PESCA Agreement's rules and remedies. The term "jurisdictional dispute" is not defined in the CSA. Section K(4)(g) of the CSA states "the decision of the arbitrator shall be final and binding and shall be treated as the controlling precedent for all future work at the Convention Center." Similarly, Article 14 of the PESCA Agreement states that an "arbitrator thus appointed shall hold hearings as promptly as possible and shall render his award in writing and such award shall be final and binding upon their respective principals or members."
Since May of 2012, there have been three arbitrations between the parties relating to whether Elliott-Lewis impermissibly allowed exhibitors to perform work that, under the CSA, could only rightfully be performed by MRCC members. Each arbitration raised the issue of whether such a dispute between Elliott-Lewis and MRCC is a "jurisdictional dispute" within the meaning of the CSA, and thus is governed by the CSA or instead the PESCA Agreement.
The first dispute—which is not the subject of either instant lawsuit—arose after Elliott-Lewis permitted exhibitors at PCC's May 2012 medical industry convention to crate and uncrate their medical and pharmaceutical equipment and machinery, and MRCC objected. The PCC representative decided in favor of Elliott-Lewis, MRCC filed a grievance contending infringement on its exclusive work jurisdiction, and the parties proceeded to arbitration before Arbitrator Stanley Aiges.
On February 25, 2013, Aiges issued his decision. Arbitrator Aiges noted that the MRCC contended it was not a jurisdictional dispute and, therefore, not subject to the CSA. Elliott-Lewis responded that the CSA was designed to deal with disputes over work jurisdiction between unions, but it was also used to resolve disputes over specific work between a union and an exhibitor at the PCC. Elliott-Lewis referred to the Econsult Report which laid the foundation for the adoption of the CSA which referred to "jurisdictional disputes" as occurring "between pairs of unions
The arbitrator concluded that the language was clear, unambiguous and enforceable in that an aggrieved party may appeal a PCC decision over the assignment of work under the grievance procedures in their Collective Bargaining Agreements, except for jurisdictional disputes which are to be resolved under the procedures adopted to deal with such problems set forth in the CSA.
He noted that the MRCC's position was that a jurisdictional dispute did not exist because there was only one union, the MRCC, laying claim to the work at issue and the dispute was not between two unions. The arbitrator concluded that this argument was too restrictive because the CSA had historically been construed more broadly in that there was arbitrable precedent to consider. In two separate cases involving a dispute between a union and the exhibitors the cases were adjudicated as jurisdictional disputes under the CSA. In fact, the union in those cases did not even seek to limit the application of the CSA. Second, the arbitrator found that nothing in the record remotely suggested that the parties ever intended to construe CSA as the union requested. Ten years of precedent is "significant." Third, he noted that there was a NLRB precedent which did not treat disputes between two unions claiming jurisdiction over certain work differently from one involving a union and a group of non-represented employees. Finally, he noted that there is the CSA itself to consider as its purpose was to limit disputes, including jurisdictional disputes and that it was specifically designed to deal with the type of problem presented in the case. He concluded that the dispute should be resolved under the CSA's dispute resolution procedures. Assessing whether the arbitration was governed by the CSA or the PESCA Agreement, Aiges ruled that the term "jurisdictional dispute" in the CSA referred to any dispute about the bounds of PCC work jurisdiction between CSA signatories, such as Elliot-Lewis and MRCC, and thus ruled that the arbitration was governed by the CSA.
On the substance of the dispute, Aiges held that Elliott-Lewis erred when it allowed the crating and uncrating work to be performed by exhibitors rather than MRCC members. However, Aiges denied MRCC's request for damages on the basis that the CSA does not authorize non-prospective relief.
On March 29, 2013, MRCC filed a federal complaint in the Eastern District of Pennsylvania seeking to vacate Aiges's order. See Metro. Reg'l Council of Carpenters v. Elliott-Lewis Corp., Civ. A. No. 13-1658 (E.D. Pa.). On August 16, 2013, the Hon. Harvey Bartle III ruled that Aiges's interpretation of "jurisdictional dispute" was consistent with the essence of the CSA, and Judge Bartle upheld Aiges's award on that basis. See 2013 WL 4401331 (E.D. Pa. Aug. 16, 2013). Judge Bartle noted that Elliott-Lewis had presented Arbitrator Aiges with two arbitration decisions involving similar facts to support its position that the term "jurisdictional dispute" encompasses the situation presented, finding that those arbitrators "apply the jurisdictional dispute resolution procedure despite the fact that, as here, the dispute was between a union and an employer and concluded that the arbitrator fully considered those precedents." He found that Arbitrator Aiges considered the definition section of the CSA, which defines "Labor Unions" as "the Unions, collectively and individually." He also noted that Arbitrator Aiges considered NLRB precedent applying Section X(k) of the National Labor Relations Act which interprets "jurisdictional disputes" broadly and treated a dispute between a Union and an employer in the same manner as it treats a dispute between two unions. No appeal was filed by MRCC.
The second dispute—presently before the court as Civil Action 13-4943—arises from MRCC's objection to Elliott-Lewis's allowing exhibitors at PCC's September 2012 inflatable device exhibition to roll-out and inflate their large inflatable-balloon products used for children's play. Again the PCC representative decided in favor of Elliott-Lewis, MRCC filed a grievance contending infringement on its exclusive work jurisdiction, and the parties proceeded to arbitration, this time before Arbitrator Anthony Visco, Jr. Arbitrator Aiges's prior award involved the exact same parties, analyzed the exact same contractual provisions, and addressed the exact same issue that was before Arbitrator Visco; namely, that the work assignment issue was a jurisdictional dispute that "should be resolved under the CSA's dispute resolution procedures." On July 24, 2013, Visco issued his decision. Declining to follow Aiges's interpretation of "jurisdictional dispute" in the CSA, Visco stated only the following with reference to that issue:
Ruling that "jurisdictional dispute" does not encompass disputes between one union and Elliott-Lewis, Visco ruled the arbitration was governed by the PESCA Agreement. Finding that Elliott-Lewis erred in not assigning the work in question to MRCC members, Visco awarded MRCC damages to be calculated by the parties. On August 23, 2013, Elliott-Lewis filed suit under the Labor Management Relations Act, 29 U.S.C. § 185, to vacate Visco's award. See Elliott-Lewis Corp. v. Metro. Reg'l Council of Carpenters, Civ. A. No. 13-4943 (E.D. Pa.). On March 14, 2014, the parties filed cross-motions for summary judgment.
The third dispute—presently before the court as Civil Action 14-247—arises from PCC's December 2012 "Winter Wonderland" event, for which Elliott-Lewis permitted party planning staff to tie birch-branch floral arrangements created by the exhibitor as an artistic endeavor, to two large trusses constructed by MRCC members, at the entrance and exit of the exhibit, over objections by MRCC. Again the PCC representative decided in favor of Elliott-Lewis, MRCC filed a grievance contending infringement on its exclusive work jurisdiction, and the parties proceeded to arbitration, this time before Arbitrator Thomas McConnell, Jr. On December 20, 2013, McConnell issued his decision. Adopting Visco's position rather than Aiges's on the meaning of "jurisdictional dispute," McConnell explained:
On the above reasoning, McConnell ruled the PESCA Agreement governed the arbitration. His analysis contained no discussion of why he believed that Aiges's construction of the CSA was wrong, why he believed that Aiges's reliance on the CSA's incorporation of the Econsult Report and its explicit identification of the issues between a single union and non-union employees as "jurisdictional disputes" was misplaced, or why he believed that Arbitrator Aiges incorrectly applied this CSA definition of the term "Labor Unions" in his interpretation of § K. McConnell did not state anything suggesting that the parties in this arbitration were different, the issues were different, or the agreements were different. He failed to analyze any of the provisions of the CSA itself, and merely quoted § K(4)(a). He likewise failed to analyze the prior arbitration awards finding that Union/non-Union work assignments constitute jurisdictional disputes. He said nothing of the "final and binding" language in the agreement in the CSA and its application to all future similar disputes. McConnell then found that Elliott-Lewis's decision as to the tying of branches to the truss infringed on MRCC's work jurisdiction, and, applying the PESCA Agreement, awarded damages to MRCC in the amount of $4,625.51. On January 15, 2014, Elliott-Lewis filed suit under the Labor Relations Management Act, 29 U.S.C. § 185, to vacate McConnell's award. See Elliott-Lewis Corp. v. Metro. Reg'l Council of Carpenters, Civ. A. No. 14-247 (E.D. Pa.). On May 30, 2014, the parties filed cross-motions for summary judgment.
Summary judgment is appropriate when "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (internal quotation omitted). "In evaluating the motion, the court must draw all reasonable inferences in favor of the nonmoving party, and it may not make credibility determinations or weigh the evidence." Guidotti v. Legal Helpers Debt Resolution, LLC, 716 F.3d 764, 772 (3d Cir. 2013) (internal quotation omitted).
In this case, both the plaintiff and the defendant have submitted motions for summary judgment. "Cross-motions are no more than a claim by each side that it alone is entitled to summary judgment, and the making of such inherently contradictory claims does not constitute an agreement that if one is rejected the other is necessarily justified or that the losing party waives judicial consideration and determination whether genuine issues of material fact exist." Rains v. Cascade Indus., Inc., 402 F.2d 241, 245 (3d Cir. 1968). Accordingly, the legal standard "does not change when the issue is presented in the context of cross-motions for summary judgment." Appelmans v. City of Phila., 826 F.2d 214, 216 (3d Cir. 1987).
The Third Circuit has explained the standard for vacating an arbitration award as follows:
United Indus. Workers, Serv., Transp., Prof'l Gov't of N. Am. of Seafarers' Int'l Union of N. Am., Atl., Gulf, Lakes & Inland Waters Dist. AFL-CIO, (Local No. 16) on Behalf of Bouton v. Gov't of Virgin Islands, 987 F.2d 162, 170 (3d Cir. 1993) (internal citations omitted).
In Wilbur Chocolate Co., Inc. v. Bakery, Confectionary & Tobacco Workers' Int'l Union, Local 464, 1988 WL 33881 (E.D. Pa. Mar. 31, 1988), a decision of this court affirmed without opinion by the Third Circuit, see 862 F.2d 312 (3d Cir. 1988) the court held that where the governing agreement provides that the arbitrators' decision shall be final and binding, there is such an exemption. When that factor exists, the subsequent arbitrator is bound by the decision of the previous arbitrator because that decision has become "part of the contract." The two arbitrations must share "strict factual identities." Other courts have interpreted this phrase to mean "material factual identity" or "substantial factual identity."
According to Elliott-Lewis, Aiges's interpretation of "jurisdictional dispute" in the first arbitration between the parties here had preclusive effect in subsequent arbitrations between the parties raising the construction of that term as an issue, including the Visco and McConnell arbitrations.
See id. Because the arbitrator did not address the potential preclusive effect of the first arbitration—despite the "final and binding" language in the CBA and the parallels between the first and second arbitrations—the court found that the arbitrator's decision did not draw its essence from the CBA. See id.
MRCC disputes that preclusion applies. It does not, however, challenge Wilbur Chocolate Co.'s reasoning or analysis. Rather, MRCC contends that Wilbur Chocolate Co. does not compel vacatur because Visco and McConnell explained their disagreement with Aiges's interpretation of "jurisdictional dispute;" because whether a CBA provides for preclusion is itself an arbitral question; and because Wilbur Chocolate Co. is allegedly distinguishable. Wilbur Chocolate Co.'s reasoning is persuasive. "A clause stating that a decision of an arbitrator is `final and binding' is no doubt intended to establish a principle similar to that of res judicata, and to bar reconsideration of the disputes fully on the merits." Local 616, Int'l Union of Elec., Radio & Mach. Workers, AFL-CIO v. Byrd Plastics, Inc., 428 F.2d 23, 26 (3d Cir. 1970). At a minimum, such language also implicates the possibility of issue preclusion when an "arbitration involves the same company, the same union, essentially the same issue, and interpretation of the same contract." Trailways Lines, Inc. v. Trailways, Inc. Joint Council, 807 F.2d 1416, 1425-26 (8th Cir. 1986). See also id. ("If an arbitrator does not accord any precedential effect to a prior award in a case like this, or at least explain the reasons for refusing to do so, it is questionable when, if ever, a `final and binding' determination will evolve from the arbitration process."). Because of this, I agree with Wilbur Chocolate Co. that an arbitral decision does not draw its essence from the CBA where (1) an arbitration involves the same company, the same union, the same issue, and interpretation of the same CBA as an earlier arbitration; (2) the CBA states that arbitral judgments are to be "final and binding;" and (3) the arbitrator does not discuss the potential preclusive effect of the "final and binding" language. See Wilbur Chocolate Co., 1988 WL 33881; United Indus. Workers, 987 F.2d at 170. And such is the case here: there is no dispute that the Visco and McConnell arbitrations involved the same company, union, issues, and agreements as the Aiges arbitration; the CSA and the PESCA Agreement each state that arbitral decisions are "final and binding." Section K(4)(g) of the CSA goes even further stating that "the decision of the arbitrator shall be final and binding and
As to MRCC's objections, it is inapposite to the above analysis that Visco and McConnell stated they disagreed with Aiges. That is not enough. Meanwhile, there is no conflict with the position that "whether an arbitration award should be given binding effect under the contract is a matter of contractual interpretation for the arbitrator." See Wilbur Chocolate Co., 1988 WL 33881. See also Teamsters Local 623 v. United Parcel Serv., Inc., 786 F.Supp. 509 (E.D. Pa. 1992) (denying request to enjoin pending arbitration on basis of preclusion because whether a CBA provides for preclusion and whether preclusion applies are themselves arbitral questions); Steris Corp. v. Int'l Union, United Auto., Aerospace & Agr. Implement Workers of Am., Local No. 832, 489 F.Supp.2d 501 (W.D. Pa. 2007) (same). To the contrary, it is because of that precept that an arbitrator "dispenses his own brand of industrial justice" when he fails to address the effect of contractual language plausibly providing for preclusion. See United Steelworkers of Am. v. Enter. Wheel & Car Corp., 363 U.S. 593, 597 (1960) ("[A]n arbitrator is confined to interpretation and application of the collective bargaining agreement; he does not sit to dispense his own brand of industrial justice."). Finally, MRCC's purported distinction between these cases and Wilbur Chocolate Co.— that the arbitrators in Wilbur Chocolate Co. arrived at contrary conclusions about a point of fact, whereas the arbitrators here arrived at contrary interpretations of an agreement—is beside the point given that Visco and McConnell did not address the potential preclusive effect of the Aiges decision despite the "final and binding" language in the CSA. See Wilbur Chocolate Co., 1988 WL 33881.
In short, I find the reasoning of Wilbur Chocolate Co. persuasive, and, under that reasoning, Visco's and McConnell's failure to address the potential preclusive effect of the "final and binding" language in the CSA and/or the PESCA Agreement means their decisions did not draw their essences from the applicable agreements. See id.; United Indus. Workers, 987 F.2d at 170. Accordingly, I will grant Elliott-Lewis's motions for summary judgment, deny MRCC's motions for summary judgment, enter judgment for Elliott-Lewis, and vacate the orders of Visco and McConnell.
Appropriate orders follow.
