issued between the parties who had agreed to it smit their collective bargaining agreement disputes to arbitration the scope of a court in review and an arbitration award as you know is exceedingly narrow when the parties have agreed to submit disputes involving the interpretation and application of a collective bargaining agreement to arbitration it's a rare case when the court is justification for overturning or vacating an award i submit this is not one of those cases i'd like to make the main point i want to make this morning is that in vacating the arbitration award judge magnussen read the absolute cause language of the disciplinary section of the contract which is article twenty six in isolation and this language as the court knows and has said in many of its cases before must be read in the context of the entire agreement and in this case it must be read specifically in the context of the first sentence of article twenty six which provides that the company must just cause so it wouldn't to agreement typically wouldn't say just because no well some get some agreements would say just in something when that doesn't say just cause that is what is in fact read into it and in fact in this case over the course of  the forty years that the parties have been arbitrating cases and using this language it's been in the agreement for that long just cause there's always been the issue that has been stipulated between the parties as to what the arbitrators issue is ok and in fact in this case your honor at the beginning of the hearing the arbitrator asked the parties if they had stipulated to the issues to be decided and in fact the company stipulated that the issue was what did the company have just cause to terminate the employee and if not what should be the appropriate remedy so just because i thought the company submitted different issues the company if you read the brief and you read through the transcript of the hearing before the arbitrator the company specifically agreed that that was the issue now where did they where would i look for that patient handy for the stipulation that years of his so in the  if you don't that's fine will we have the whole record but it is in the record i know i referenced it in writing go ahead and brief but what happened is is that the the district court judge magnussen failed to read the entire the absolute cause language which is contained in article twenty six in conjunction with the entire agreement in addition he assumed that if the arbitrator found that one of these absolute causes existed that he one wasn't able to impose a just cause analysis and two that the inquiry stopped there and i submit that the inquiry does not stop there because there are many limitations on the company's discretion there's limitations contained in the contract explicitly prohibiting the company from discriminated against individuals based on union affiliation age race sex religion etc in addition there is lan guage in the contract to provide to the company must comply with the federal state and federal law in that individuals can file grievances concerning also even if they come if even if an arbitrator work to find place working longer than he was as demonstrated by the company's tracking system and so the company discharged him for dishonesty and the collective duty and that is what the arbitrator case went on for four days because there was a great deal of dispute concerning the accuracy of the company's tracking system what the policies were regarding reporting and the fact that this individual had trouble with this computer struct sending and receiving signals and then he couldn't always transmit those things as quickly as he wanted to so he would have to go somewhere else to do them so all of those things were arbitrated and ultimately the arbitrator did find that well you know a lot of it didn't carry water but that some of it did and focus on the legal issue that we have to resolve here about right when the court can so the other side and suppose you have an arbitration agreement that the is the court supposed to defer to the arbitrator because he's purporting to construe the contract or is there some limit on that because we have a couple cases that talk like maybe there's some limit but there's the arbitrator says he's considering the contract even if he's wrong when with the court can get involved right and i would say that in that it it's rare if ever as long as the arbitrator is construing the contract in this case the arbitrator did he referred to the various provisions in the agreement he revert referred to the past practice of the parties he referred to other arbitrator's decision which had also analyzed that language and so  i would say that it is rare unless there's nothing in the contract that the that the court could point to and say there is nothing there is no possibility of any ambiguity then then in that case possibly if the arbitrator simply ignored the language and ignored the language is that mean that's the hard part about these cases once you say well it could be a case if you quote ignored the legs or words that mean to ignore the language if  you just gets it wrong is that ignoring the language but if you're talking about the arbitrator if the arbitrator just gets it wrong that's not that's not something that the court can overturn because it's the parties have agreed to submit the issue to the arbitrator is final and binding and so i think the case that's most opposite in this matter is the case of p s t custom versus united steel paper forestry and in that case there were similar language in the contract there was a judge article that provided that the that the company had to have just cause to terminate employees but then there was another article in the contract article twenty nine and standards of conduct conduct that provided specific types of misconduct and precise penalties that had to be imposed for that type of misconduct and in that case a p s c custom the grievance had been found to be guilty of insubordination and the penalty for insubordination listed in the contract was discharge and that was in the standard contact as well but there was a there was this tension between the two in article twenty nine and the these standards and specific penalties in article twenty nine this court basically and they and the company in that case appealed the decision and the made the same argument that the company is making here that the arbitrator ignored the specific and unambiguous language of the contract that provided discharge for insubordination and imposed a lesser penalty which arbitrator nord the plain language of the c b a is based on a reading of article twenty nine and the standards of conduct in isolation which provide that the penalty for insubordination insubordination is discharged collective bargaining agreements however are be construed as a whole with the terms read in the context of the entire agreement i submit that that's the exact case here there is a second is that case to judge magnusson yes that was given to judge announcing you doesn't address and that was my that was another point that i have to make is the judge magnussen completely ignored p s c custom he didn't he didn't address it in addition he cited two cases that p s the court's role the way should he instead well as i understand the courts rule the issue that was before the arbitrator was whether or not there's been a violation not what the punishment was to be no that was the issue was what the punishment would be what the remedy would be for there it wasn't contested that there was no violation i thought it was a contest it was contestant that there was contested whether there was a violation and it was contested if there was a ended because the company preserved for itself in the c v a the ability to discharge an employee for dishonesty and once dishonesty is determined through the vehicle of arbitration the company's ability to exercise its option to discharge was available well and that's where arbitrator miller disagreed because he said the first sentence of the discharge and the discipline provision provided that the company  had just cause and so he read those two two sections the absolute cost provision which are written which judge magnussen relied on in isolation judge arbitrator miller read out and said they're not sure you can keep help me with  the isolation part because when i read the full paragraph of article twenty six it all runs together there it's not like they are separating when you read the whole thing together you have the parent that equal in conjunction with the company having absolute cause for which there shall be no appeal to negotiation or arbitration between the company and the union it sounds like it is all together and that if you've got one of these special four categories that even arbitration isn't available to avoid the company's option to discharge and i would submit that the union and the arbitrator have said that those two sentences are in fact separate and it's the arbitrators power and authority to analyze those and well they are separate but they're not part of separate parts of the contrail they're part of the very same discipline article twenty six and they are inconsistent because one says you has to have just cause and the other one lists these absolute causes but if those absolute causes are taken to the to the natural outcome then an employee could be terminated for even the most minimal type of dishonesty the minimal most minimal type of neglect of duty neither of which are defined in the agreement and neither both of which could relate to pretty much every form of conduct that exists within the company so those those things all have to be analyzed and interpreted and that's the goal of the object but i would like to say one more thing and i was going to reserve some time obviously but the in addition to this finding that the arbitrator made of neglect and dishonesty he also made a finding that the company had engaged in misconduct by nass in a properly in a desk desperate and unexplainable fashion before he was terminated and that the terminations selfless arbitrary and discriminatory so he made those separate findings that this is what the company did  they made arbitrary and discriminatory treatments ok and he has as an arbitrator the authority to make a remedy for the wrong that he believes that the company has done and the remedy that the arbitrator chose to impose was reinstatement without backpay and i submit that if this arbitration decision is vacated the company is will be free to engage in any type of arbitrator ceri or discriminatory conduct in relation to these offenses whether regardless of their significance without consequence and there must be consequences if in fact the company engages in some type of misconduct as well thank you  may please the court no appeals on behalf of centerpoint energy your honour's the district court properly vacated the arbitration award here because the arbitrator disregarded clear and unambiguous language in article twenty six created special limitations on the arbitrator's authority in circumstances where the there is a factual finding of absolute cause for terminations article twenty six at the outset does refer to cause generically but then it goes on to specifically exclude without excluding other causes for discharge list for absolute causes and then it states and this is important there shall be no appeal to negotiation or arbitration between the company and the union except as to the question of whether the employee is guilty of the facts constituting such absolute causes this is clear and specific limitation on the arbitrators authority that was not present for example in p s c custom and i think it's very important to know there's two distinguishing factors in p s e custom number one the parties there stipulated to the just cause framing of the issue and there was no record evidence to contradict that stipulation here it's very clear from both the arbitration transcript if you look at the appellate appellants appendix at the very end these transcript excerpts that they submit there's clear testimony on article twenty six in the absolute cause issue there's a record evidence in terms of the briefs and the arbitrators award th raised and preserved that was not present in the custom what about the stipulation at the beginning of the hearing i after we talked about it with mr kraft so i found it here on page one ten of the appendix arbitrator miller says can we stipulate to the issue mr kraft still says i think we've stipulated was the greven discharged for cause if not what is the appropriate remedy mellor would that be agreeable mr collins i assume he's with the company that's agreeable mr collins was counsel for the company so isn't that an agreement that the issue is was he discharged for just cause and if not what's the appropriate remedy in arbitration the record is only closed after the post hearing briefs are submitted later on in the hearing your honor the parties put on evidence and argument regarding the absolute cause issue as distinguished from just cause then in the post hearing brief there were two different ways the issue was framed by the company number one where the facts proven to show absolute cause and number two if they weren't was there just cause for the discharge nonetheless and that's that was considered an preserved in the record for there to be a waiver the company would have had to raise this issue in the district court for the first time so i don't think there was a stipulation on that and i think it's different than p f c custom in that regard the other thing i just want to note is that in p s e custom all you had was a listing of offenses that could result in terminations and then a just cause provision and you had no language you had no linkage between the two whereas here you have a specific call out within the context of article twenty six and one thing that's notable is that nowhere in the union's briefs or arbitrator miller's opinion do they try to reconcile these provisions do they try to explain what does it mean except that the question of whether the employee's been guilty of the facts what does that i think were opposing counsel told us they're not reconcilable they're in conflict and  ambiguous they're not ambiguous and they are reconcilable for several reasons your honor number one it's one thing to set forth a general standard of cause but then it's clarified by saying if we have these four categories instead of the normal cause finding we're going to call out one of the seven tests of just cause because the finding of factual support for the companies the company's burden to prove its case on the facts is one of the elements of just cause there be no purpose served to call out that one element of just cause and then conclude that just cause applies anyway there was no ambiguity in that language just like there was no ambiguity in st louis the actual company or e talbert where there was a similar arbitration language which confine the arbitrator to solely being a fact finder if you find these facts that's all that is being arbitrated and i think the same is true here when you talk about judge magnussen as decision he was presented in his briefing at the district court with competing lines of authority is our case more similar to a retail a the actual company or is it more similar to the alcan packaging in p s e custom he found it was more similar to early talbert in st louis the article on the reason he did so is because the language is most similar in those two cases in ours because all three limit the arbitrator's authority to finding facts did the misconduct occur if that misconduct occurred that is the end of the inquiry and i think would you can let me ask you this even if you're right about the proper reading  contract why isn't there just argument that the arbitrator misread the contract and you're stuck with his misreading of the contract because you agreed to submit the starboard tray should it's not a misreading of the contract you are when you read language out of the contract or nullify a contract language in other words under arbitrator miller's ruling the absolute cause provision is literally out of the contract it's all just cause anyway there be no purpose served behind the carve out in the listing of the four offenses of it's all just cause anyway that's not interpretation and i think it's clear it what's the difference between interpretation and eroni a center were taisha i mean he said this is how i read the agreement  that's the difficult thing about these cases i think it is your honor and i think you've touched on it the difference between a rony a center petition and just interpretation is there has to be an underlying ambiguity in the contract i think you alluded to this and some of your who decides whether there's an ambiguity i mean the arbitrator thinks there's an ambiguity but he didn't let's be clear he didn't find ambiguity in this case there's no record evidence he found an ambiguity in this case and an arbitrator is not permitted on a clear and unambiguous language to simply declare there's an ambiguity and then he be shielded from any judicial review that's not that's not what the law is and i think that's important here is that the arbitrator didn't say that anything was ambiguous what he said at the outset page twenty two of the opinion is where you can see him frame the issue and he starts to become untethered from the language of the contract what he says is he frames the issue in two ways number one did the company prove the facts involving dishonesty in neglect of duty and that's perfectly permissible under the absolute cause language but then number two was the grievance misconduct the type of conduct serious enough to warrant terminations he went off the rails there because article twenty six the parties are ready bargained for four categories of offenses there are serious enough to warrant term nation in the not permitted once he finds the facts establishing those offenses to then consider all these other factors that the union wants him to consider and that are part and parcel of a customary just cause argument so there was no interpretive there is no ambiguity all the arbitrator did in later on in the opinion when he addressed the absolute cause question all he said was that couldn't possibly be what the parties intended and my notions of industrial fairness tell me i should apply a just caus tried to reconcile those terms he never once explained what the absolute cause provision meant and how it conflicted or if it even conflicted with just cause he just said it's unfair and what he said was he adopted the union line of argument which is that absolute cause could be any rule violation taken to its extreme and then he disproved his own point and i think this is an important point to bear in mind there are many checks on the company's ability to simply terminate someone for absolute cause number one they have to prove the facts and the arbitrator flagler an arbitrator jacobs awards show that if the company oversteps and call something dishonesty or neglect of duty and it isn't were doesn't prove its case or gives an unreasonable interpretation of that provision they're going to lose it arbitration number one the second check is if the company abuses the absolute cause language by finding absolute causes for minor offenses the union has a remedy they can bargain that language out of the contract or bargain other limitations on it so there are other external checks on unreasonable interpretation the arbitrator to be clear has authority to find facts to say that what happened is not one of the absolute causes or to interpret frankly the terms dishonesty neglect of duty which is what arbitrator flagler did but that's different than what happened here arbitrator miller made a clear finding that there was neglect of duty and dishonesty he then once he found that his job was done and i think judge magazine got it correct once he made that finding which was his sole authority under the contract to determine the question of whether the facts constituting the absolute causes have been proven once he finds that his role is finished there's nothing further for him to do and that language is clear and unambiguous and the only language that's similar to it is in will reach albert and st louis the actual company and i'll note in st louis theatrical company where the  upheld the vicar of an arbitration award the arbitrator did something very similar in that case he found factually that the employee participated in a strike in violation of the no strike clause but then he went further and considered management's conduct in mitigating the penalty held that he was not permitted to do that because the language in the contract just like language here limited his authority to fact finding and i think that case couldn't be more analogous to this case and the same was true  where the parties call out specific limitations on the arbitrator's authority to formulate remedies that's permissible under the united states supreme court case and miscall and that's clearly what the parties did here so what about  what was your point about misc zero in misc over the part of the supreme court part of its holding was that parties may negotiate limitations on an arbitrator's authority when it comes to remedies that's permissible so in other words well an arbitrator made in the general sense have the authority to disagree with a penalty imposed by the company under a general just cost enters the parties are free to negotiate specific limitations on that authority in our contention is that's what was done here in article twenty six through the absolute cause language now with respect to the flag and jacobs awards and all the other arbitration awards that are in the record in this case not one of those arbitrators avoided the issue in other words all of the arbitrator's whether they found in favor of the company on a particular grievance or in favor of the union all understood there were two different arenas one a just cause arena or a cause arena into an absolute cause arena so well arbitrator miller cited that the jacobs and flagler awards and claimed support for his decision from those awards those decisions arbitrator jacob specifically said this is at page one hundred four of their appendix this case does not fall within the purview of absolute causes as defined by article twenty six and does not proceed on an absolute cause analysis and arbitrator flagler and this is at page two thirteen to fourteen of the appendix he found that there was no neglect of duty proven so any restriction on his authority to reduce the penalty which might arguably be contained in article twenty six is in a political in that case so there's no arbitrator that has found ambiguity in this language all the arbitrator's that have ruled have understood it can except arbitrator miller have understood that it contains a limitation on their authority once they find facts all of these this specific c b a language been in effect i think the records show to have been in effect for over forty years so it's been in effect for a very very long time and the parties have had arbitrations obviously under it and the company has won some and it's lost some and it's lost some where the factual findings didn't support the absolute causes and a just cause analysis was explicitly applied in those cases but in this case what cases have you one where the absolute cause language was applied we cited cases in our brief i believe there was a decision from arbitrator powers an arbitrator  an arbitrator franklin that all acknowledged that article twenty six prohibited them from considering anything other than the fact of the misconduct issue so the company had many of those decisions in their appendix for us or just the citations i believe the decisions the record i guess in sort of wrap things up i think it is important again have you ever seen an agreement that says more explicitly that just because analysis does not apply in certain circumstances i have your honor there are agreements and it's more frequent to have cause or just cause language unencumbered by anything else but i have negotiated agreements myself where there are restrictions on only finding the facts involved a specific category of offenses that are deemed so serious that the company in the union of bargained there's not going to be further consideration other than the due process which is still in effect of company you've got to prove your case you've got to prove the facts behind  offense but for this listing of offenses that's all that is to be arbitrary and i have seen that before that is what exists here the in terms of the interpretation of what i mean the ones you're talking about what it specifically say and the hair will not appl just cause analysis or something to that effect typically what it would say was arbitrator is limited to fact finding typically is that's how the language would read because that's that's one of the seven just cause test fact finding and then there's a host of others but it makes it clear what the scope of the arbitration is which is a fact finding this idea that discrimination can run rampant for example if the company's interpretation is accepted if i may finish this push there are multiple checks against that there are state and federal statutes against discrimination arbitrator miller by the way rejected a finding of discrimination in this case and again if the company abuses these four categories by applying them in a disparate manner it's going to have to reckon with the union at the bargaining table but for preston i would just like to make a couple of points one is that the arbitrator clearly did look at the two sections of article twenty six and basically said he can't you can't reconcile this that the parties definitely expressed their intent that the company would have just got the upper trade american express running of ambiguity yeah i mean basically he did because he said this is the party's intent they the parties intended that the company have just c ok and then he said i have to reconcile that with these absolute causes so he may not have used the word ambiguity but in fact that is what he came to he came to say that there is a tension and a conflict between these two provisions because the company expressed that it would have to have just cause and so that's the case with regard to and i'll briefly just say with regard to the prior arbitrations what happened in the flagler and jacobs case was is that the arbitrator's acknowledged the same problem with this language that arbitrator miller did and they agreed that it didn't make any sense but what they did was they tended to use the just cause language to interpret article or the absolute cause and say ok well that doesn't make sense so we're going to interpret instead of getting into this issue we're just going to interpret neglect of duty in a way that it can't be you know that it has to have just cause if it's go target it rarely and so they had to use the just cause to even use that had to interpret those things and that's how they avoided this particular make in the exact same finding the arbitrator miller did which i acknowledge is the case that the is the arbitrator to really address this case head on but it's not because it hadn't been addressed every case before and it's not because arbitrators flagler and jacobs haven't laid the groundwork for it because they did  is a resolved one case lays the groundwork and then it builds on it and about as this sentence from the arbiters is and where he says to interpret article twenty six in any other manner would violate all of the basic notions of fairness and due process firmly established in the history of industrial relations you think that's what the supreme court has in mind when it says the arbiter can impose his own notions of industrial justice no i do not because the supreme court  also said that the contract encompasses the rule of the shop in the rule of industrial the common industrial common law and what arbitrator miller's they're referring to is the common law that the supreme court has acknowledged and has accepted as limits on the company's discretion and that also the the findings that he made of the company's arbitrary discriminatory conduct in those the notions of fairness it imposed were those you wish to thank both parties for the arguments you've provided to the court this morning and the briefing that's been submitted and the case will take the case under