International Union of Operating Engineers v. Ohio Contractors Association, No. 1:2018cv00722 - Document 27 (N.D. Ohio 2018)
Court Description: Opinion & Order signed by Judge James S. Gwin on 11/30/18. The Court, for the reasons set forth in this order, denies International Union of Operating Engineers, Local 18's petition to vacate the arbitration award and grants Ohio Contractors Association's motion to confirm the award. (Related Docs. 23 and 24 ) (D,MA)
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International Union of Operating Engineers v. Ohio Contractors Association Doc. 27 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF OHIO : : INTERNATIONAL UNION OF OPERATING ENGINEERS, LOCAL 18, : : : Petitioner, : : vs. : : OHIO CONTRACTORS : ASSOCIATION, : : Respondent. : CASE NO. 1:18-cv-722 OPINION & ORDER [Resolving Docs. 23, 24] JAMES S. GWIN, UNITED STATES DISTRICT JUDGE: The Int—rnat“onal Un“on o‘ Op—rat“n’ En’“n——rs, Local 18 ( Un“on ) p—t“t“ons th— Court to vacate an arbitration award. After an arbitration, the arbitrator gave an opinion in favor of the Oh“o Contractors Assoc“at“on ( Assoc“at“on ). R—spon–—nt Assoc“at“on oppos—s th— Un“on s p—t“t“on to vacat— an– mov—s to con‘“rm th— awar–. After the parties agreed that this case should be submitted on a joint record1 and briefs,2 the Court decides this case. For the following reasons, the Court DENIES the Un“on s petition to vacate the arbitration award and GRANTS R—spon–—nt Assoc“at“on s mot“on to con‘“rm th— awar–. I. Background Petitioner Union represents about 15,000 workers in Ohio and Kentucky who run 1 Doc. 22. The parties filed their opening briefs on July 16, 2018. See P—t“t“on—r s Op—n“n’ Br“—‘, Doc. 23; R—spon–—nt s Opening Brief, Doc. 24. The parties filed opposition briefs on August 13, 2018. See Petitioner s Opposition to R—spon–—nt s Op—n“n’ Br“—‘, Doc. 26; R—spon–—nt s Oppos“t“on to P—t“t“on—r s Opening Brief, Doc. 25. 2 Dockets.Justia.com Case No. 1:18-cv-722 Gwin, J. —qu“pm—nt, t—chnolo’y, an– mach“n—ry us—– “n Oh“o s bu“l–“n’, construction, and heavy highway industries. Respondent Association represents employers engaged in these Ohio industries. A collecting bargaining agreement called the Highway Heavy Agreement3 ( Agreement ) —stabl“sh—s th— Un“on s authority and governs its m—mb—rs work“n’ conditions for matters within its jurisdiction. The present dispute concerns whether equipment known as a hydro-excavator falls within th— Un“on s authority. When arbitrating the dispute, the Union argued that the arbitrator should decide a classification and wage rate for hydro-excavators because, under the Agreement, th— Un“on s ”ur“s–“ct“on cov—red the hydro-excavators. Responding, the Association argued that th— Un“on s ”ur“s–“ct“on –id not cover the equipment. On December 26, 2017, Arbitrator Nels Nelson sided with the Association and issued an opinion and award in th— Assoc“at“on s favor ( Awar– ).4 The Petitioner Union now seeks to vacate the Award under section 301(a) of the Labor Management Relations Act of 1947,5 section 10(a)(4) of the Federal Arbitration Act,6 and Ohio Revised Code § 2711.10(D). Because the parties have jointly submitted the record, the Court does not need to decide contested factual issues for Federal Rule of Civil Procedure 52(a) purposes. II. Discussion When a party seeks to vacate an arbitration award under Labor Management 3 Doc. 22-3. Doc. 22-2. 5 29 U.S.C. § 185(a). 6 9 U.S.C. § 10(a)(4). 4 -2- Case No. 1:18-cv-722 Gwin, J. Relations Act § 301 and Federal Arbitration Act § 10(a)(4), the Court applies the Michigan Family Resources, Inc. v. SEIU Local 517M 7 test.8 Because Ohio Revised Code § 2711.10(D) can only provide grounds for vacating the Award insofar as its application is compatible with these ‘—–—ral statut—s purpos—s, the Michigan Family test controls the state law inquiry as well.9 Petitioner Union seeks to vacate the Award under Michigan Family s th“r– requirement. This inquiry asks whether, in resolving the pertinent legal or factual dispute, th— arb“trator was ar’uably constru“n’ or apply“n’ th— contract. 10 If an arbitration opinion meets this low standard, the award will be enforceable. In most cases, an arbitration opinion meets this standard when the arbitrator appears to engage in contract interpretation.11 An arbitrator sufficiently engages in contract interpretation when he r—‘—rs to, quot—s ‘rom an– analyz—s th— p—rt“n—nt prov“s“ons o‘ th— a’r——m—nt, an– at no po“nt … say[s] anyth“n’ “ndicating that he was doing anything other than trying to reach a good-‘a“th “nt—rpr—tat“on o‘ th— contract. 12 In rare cases, an arbitration op“n“on s merits analysis may reveal that the arbitrator was not arguably construing the contract even though the arbitrator may have facially 7 Mich. Family Res., Inc. v. SEIU Local 517M, 475 F.3d 746 (6th Cir. 2007) (en banc). See id. at 750, 753 56 (applying the inquiry to a petition to vacate under the LMRA § 301); Martin Marietta Materials, Inc. v. Bank of Okla., 304 F. App'x 360, 361 65 (6th Cir. 2008) (applying the inquiry to a petition to vacate 8 under FAA § 10(a)(4)). See Textile Workers Union of Am. v. Lincoln Mills of Ala. , 353 U.S. 448, 457 (1957) ( F—–—ral “nt—rpr—tat“on o‘ the federal law will govern, not state law. But state law, if compatible with the purpose of § 301, may be resorted to in order to find the rule that will best effectuate the federal policy. Any state law applied, however, will be absorbed as ‘—–—ral law an– w“ll not b— an “n–—p—n–—nt sourc— o‘ pr“vat— r“’hts. (c“tat“ons om“tt—–)). 10 Mich. Family, 475 F.3d at 753. See also Bh–. o‘ Locomot“v— En’ rs & Tra“nm—n v. Un“t—– Transp. Un“on, 700 F.3d 891, 905 06 (6th Cir. 2012) (applying the Michigan Family inquiry). 11 Mich. Family, 475 F.3d at 753. 12 Id. at 754. 9 -3- Case No. 1:18-cv-722 Gwin, J. appeared to interpret the contract.13 This occurs when the arb“trator s “nt—rpr—tat“on “s so ignorant of or untethered from the contract that “t mak—[s] “mplaus“bl— any cont—nt“on that the arbitrator was constru“n’ [“t]. 14 A. The Arbitrator Arguably Construed Paragraphs 4 and 30 When Resolving the Dispute Petitioner Union claims that the arbitrator did not construe paragraphs 4 and 30 of the Agreement when resolving the dispute. The Court disagrees. Under paragraph 30 of the Agreement, either party may request a negotiation for a n—w class“‘“cat“on an– rat— o‘ pay [1] [i]f equipment within the jurisdiction of the International Union of Operating Engineers is [2] used by an Employer and [3] there is not an appropriate classification listed under the wage schedule [in the Agreement]. 15 Paragraph 4 informs the first requirement. It shows that th— Un“on s ”ur“s–“ct“on —xt—n–s to (1) all equipment classified within the Agreement an– (2) all l“k— —qu“pm—nt. 16 The arbitrator s op“n“on dealt with both paragraphs: he quotes them in full, recites both part“—s ar’um—nts about them, and then refers to and analyzes them in his merits discussion.17 Further, nothing suggests that the arbitrator was doing anything but interpreting the Agreement in good faith. Th— arb“trator s merits analysis also is not so untethered from the Agreement that it is implausible that the arbitrator was construing it when issuing the opinion.18 Petitioner Union argues that the arbitrator incorrectly imposed a requirement that 13 14 Id. at 753. Id. at 753. 15 Doc. 22-3 at 32 (emphasis added); see Doc. 22-2 at 31 32. See Doc. 22-3 at 15 16; Doc.22-2 at 32 36; Doc. 23 at 16. 17 See Doc. 22-2. 16 18 Bhd. of Locomotive Eng rs & Trainmen v. United Transp. Union, 700 F.3d 891, 906 (6th Cir. 2012). -4- Case No. 1:18-cv-722 Gwin, J. the equipment must already be identified in the Agreement ‘or “t to b— w“th“n th— Un“on s ”ur“s–“ct“on, an– that th“s shows that th— arb“trator “’nor—– para’raph 30 s pla“n lan’ua’—. 19 Th— Un“on also ar’u—s that th— arb“trator s op“n“on “’nor—– para’raph 4 an– m“stak—nly relied only on paragraph 29 as the sole basis of th— Un“on s ”ur“s–“ct“on.20 When interpreting paragraph 30, the arbitrator did not say that the hydro-excavator must alr—a–y b— “–—nt“‘“—– “n th— A’r——m—nt to b— w“th“n th— Un“on s ”ur“s–“ct“on. 21 In determining whether the hydro-—xcavator was —qu“pment within the jurisdiction of the Int—rnat“onal Un“on o‘ Op—rat“n’ En’“n——rs p—r para’raph 30, th— arb“trator stat—–: The crux of the dispute is whether the hydro-excavator is in the un“on s ”ur“s–“ct“on. Para’raph 4 l“sts num—rous p“—c—s o‘ —qu“pm—nt but does not include the hydro-excavator. Furthermore, while Paragraph 4 “nclu–—s all l“k— —qu“pm—nt as ass“’n—– to th— un“on by th— AFL-CIO, the listed equipment does not include anything like the hydro-excavator.22 The arbitrator therefore considered the possibility that the equipment could be within the Un“on s jurisdiction even though it was not explicitly identified in the Agreement. Th— arb“trator also –“– not sol—ly r—ly on para’raph 29 as th— sourc— o‘ th— Un“on s jurisdiction.23 Paragraph 4 is the very first provision the arbitrator considered when the arbitrator decided whether the hydro-—xcavator was “n th— Un“on s ”ur“s–“ct“on. Th— arbitrator found that the hydro-excavator was not explicitly classified in the Agreement and importantly that “t coul– not b— cons“–—r—– l“k— —qu“pm—nt p—r para’raph 4. The arbitrator only considered paragraph 29 as a potential sourc— o‘ th— Un“on s 19 Doc. 23 at 14 15. Doc. 23 at 15 17. 21 Doc. 23 at 14 15. 22 Doc. 22-2 at 32. 23 Doc. 23 at 15 17. 20 -5- Case No. 1:18-cv-722 Gwin, J. jurisdiction over hydro-excavators after ruling out paragraph 4 as a potential jurisdictional basis.24 Para’raph 29 stat—s that th— A’r——m—nt s purpos— “s to —stabl“sh wa’— rat—s an– conditions for all work defined in the Agreement and for the operation of equipment under the jurisdiction of the Union, the branches of the International Union of Operating Engineers, and as negotiated by and between these parties and the Association.25 This para’raph –“– not support th— Un“on s argument that th— Un“on s jurisdiction covered the hydro-excavator either. B. Th— Arb“trator s Cons“–—rat“on o‘ Extrinsic Evidence Does Not Make It Implausible that He Construed the Agreement Next, Petitioner Union argues that the arbitrator solely relied on extrinsic evidence when issuing the Award, instead of applying paragraphs 4 and 30. Specifically, the Union cla“ms that th— arb“trator “mp—rm“ss“bly cons“–—r—– th— part“—s bar’a“n“n’ h“story, th—“r past practices, and language from an earlier district court decision in this matter. An arbitrator may look for guidance from many sources in issuing an opinion and award, so long as the arbitrator still arguably construes the collective bargaining agreement.26 Moreover, well-settled rules of contract interpretation allow an arbitrator to consider extrinsic evidence to resolve contract ambiguities.27 The Court finds that the arbitrator s consideration of extrinsic evidence is not 24 See Doc. 22-2 at 32. Immediately after the above quote, the arbitrator continued, S“nc— th— r—cor– “n–“cat—s that hydro-excavators are used by members of the association and that there is no classification for them in the contract, the dispute is whether the hydro-—xcavator “s w“th“n th— un“on s ”ur“s–“ct“on. Para’raph 29 s—ts out the jurisdiction of the union.... Id. 25 Doc. 22-3 at 31 32. 26 See United Steelworkers of Am. v. Enter. Wheel & Car Corp., 363 U.S. 593, 597 (1960). 27 See Westfield Ins. Co. v. Galatis, 797 N.E.2d 1256, 1261 (Ohio 2003) ( [W]h—r— a contract “s amb“’uous, a court may consider extrinsic evidence to ascertain the parties “nt—nt. ); Local 783, Allied Indus. Workers of Am. v. Gen. Elec. Co., 471 F.2d 751, 757 (6th Cir.1973) ( A‘t—r a ‘“n–“n’ o‘ amb“’u“ty has b——n ma–—, [—]v“–—nc— o‘ th— surroun–“n’ circumstances and the practical construction of the parties is admissible to a“– “n “ts “nt—rpr—tat“on. (citation omitted)). -6- Case No. 1:18-cv-722 Gwin, J. sufficient to vacate the Award. The arbitrator found the Agreement to be ambiguous before he used the extrinsic evidence. Although the arbitrator could have been clearer, he stated that [t]h— part“—s o‘‘—r[—–] –“‘‘—r—nt “nt—rpr—tat“ons o‘ Para’raph 29 an– that th— “ntent of Paragraph 29 [was] uncl—ar b—‘or— he proceeded to consider the extrinsic evidence.28 Moreover, the arbitrator used the extrinsic evidence to interpret the meaning of the A’r——m—nt s provisions.29 Th— part“—s bar’a“n“n’ h“story su’’—st—– that under paragraph 29 the Association must first a’r—— to th— Un“on s ”ur“s–“ct“on ov—r a p“—c— o‘ —qu“pm—nt. Th— part“—s past pract“c— an– th— –“str“ct court s —arl“—r –—c“s“on30 further supported an interpretation of Paragraph 29 that the hydro-excavator was not within the Un“on s jurisdiction. The arbitrator did not substitute the extrinsic evidence for the CBA when issuing the Award. III. Conclusion For the reasons stated, the Court DENIES P—t“t“on—r Un“on s p—t“t“on to vacat— th— Award and GRANTS Respondent Assoc“at“on s motion to confirm the Award. IT IS SO ORDERED. s/ Dated: November 30, 2018 James S. Gwin JAMES S. GWIN UNITED STATES DISTRICT JUDGE 28 29 Doc. 22-2 at 33 34. See Doc. 22-2 at 34 37. See Int—rnat“onal Un“on o‘ Op—rat“n’ En’“n——rs, Local 18 vs. Oh“o Contractors Ass n , No. 1:14 CV 1672 (N.D. Oh. Dec. 19, 2014). This decision a––r—ss—– th— Un“on s mot“on to comp—l arb“trat“on an– ’rant—– th— Assoc“at“on s mot“on to –“sm“ss ‘or ‘a“lur— to stat— a cla“m. On appeal, the Sixth Circuit reversed. See Local 18 Int'l Union of Operating Engineers v. Ohio Contractors Ass'n, 644 F. App'x 388 (6th Cir. 2016). It held that the Union stated a breach of contract claim and that the dispute as to whether the Agreement applied to certain equipment was arbitrable. The Sixth Circuit found that the district court had “mprop—rly r—l“—– on ‘acts b—yon– th— Un“on s compla“nt in rendering its decision. In issuing the Award, the arbitrator relied in part on th— –“str“ct court s analysis because, unlike in the district court proceeding, the evidence that the district court considered was properly before the arbitrator and could properly be considered by him to inform the meaning of the Agreement. See Doc. 22-2 at 35 37. 30 -7-
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