# U n ited S ta tes Co urt o f Ap p ea ls F or the Se ven th C ir cu it Ch i cago ,I l l i nois 60 604 M ay 31, 20 12 B efo re M IC H A E L S. K A N N E , Cir cu i tJudg e D IA N E S. SY K E S, Cir cu i tJudg e D A V ID F. H A M IL T O N , Cir cu i tJudg e N o. 11

- 2423 E X E L ON G E NE RA T I ON C OMPAN Y, L L C , P la intif f/C o un ter-D efend a nt-A pp ellee, v. L OCAL15 , I NT ERNAT I ONALB R OT H E R H OO D OF E LE CT R I CALW O RKERS, AF L- CI O,

D ef endant/ C ounter-Plaintif f-A ppell ant.

A pp eal from the United S t ates Di strictC our t fo r the N o rthernDi stricto f Illino is, Eas tern Div isi on. No . 1:10- cv-4846

—Robert W . G ettleman, Judge .

O R D E R On consi derat i on o fthe peti ti on f orr ehear i ng en banc, fi l ed on Ap ri l 1 3, 2012 , al l j ud ges o n the or i gi nal panel2 N o. 11

- 2423

J udges Rovner and W i l l i am s di d not par t i c i pat e in the  consi derati on of the Peti ti on f or Rehearing En B anc. ha ve v o te d t o de ny the pe ti ti o n f o r p an elr eh ea r i ng, a nd no j ud g e i n a c t i v e s e r v i c e ha s r e qu e s t e d a v o t e f or r ehear i ng en banc.  A ccor dingly, the peti ti on forr ehearing en banc i s D ENI ED .

P OSNER, Cir cu i tJudg e . Although Ias ked f or a re sponse to the pe ti ti o n f o r r eh ea r i ng, I a m pe r su ade d tha t th e pan elde ci si o n i s so und and th atthe c r i te r i a f o r g r an ting re h ea ri ng en banc have notbee n sat i sfi ed. But the re su lt is disturbi ng, and w hi l e there i s no thi ng j ud ges can do w i thout exceedi ng the proper bounds of ou r offi ce, Congre ss and the N ucl earRegul ato ryCom m i ssi on ca n do s o methinga nd o ne o r b o th o fthe m s ho ul d. Feder al l aw presc ribes str i ngent re quir em ents th at op erators of nu clear faci lities m us t fol low before gr anti ng per sons, incl ud i ng pl ant e m plo yee s, “unesco rt ed ac ce ss ” to the f ac i l i ty
. 1 0 C. F
. R. § § 73
. 56 , - . 57
. Exe l o n, ho we v e r, wh i c h i s o ne o fthe s e o pe r a t o r s , h as si g ne d a col l ecti ve bar gai ni ng ag reem en t with a uni on r epresenting i ts em plo yee s that pr ovi des f or bi nd i ng arbi tr ati on o f di s pu t e s o v e r “ wo r k i ng c o nd i t i o ns , ” a t e r m tha t has been i nt erp reted ( E xe lon d oes not cha ll en ge th e inter-N o. 11

- 2423 3 preta ti on) to i ncl ud e d i sputes o verwh ethera w or ker d epri ved of hi s ri ght of unescor ted acces s ( that i s, h is secur i ty cl ear ance) was proper l y depri ved ofi t. Exe l o n di sc ha r g ed two e m pl o y ees , the fi r stf o r f ai l i ng a drug an d al coholte st and l yi ng ab out hi s s ubstance abuse, and the seco nd f orl yi ng ab out hi s a l cohol abuse. Exel on’ s Nu cl earS ecu rity Dep ar tm ent furtherdeter m i ned that the e m plo yee s’ l i es r ev eal ed them to be unt r us two r th y, a nd o n tha t g r o und it revo k ed th e ri ght o funesco rt ed acce ss that they had n eed ed to perf or m thei r j obs. The two em plo yee s fi l ed gr i evance s w i th the uni on, se eking r ei nstat em ent a nd r etur n of th eir clearan ces, and the grieva nc es w ere m oving tow ard arbi tr ati on wh en Exel on br ought thi s decl ar ato ryj ud gm ent a cti on a gai nst the u ni on, cl ai m i ng tha t a l though arbi tr ato rs can or der reinstat em ent ofterm i nated em plo yees theyar e f orbi dd en byr egul ati ons ofthe N ucl ear Regul ato ryCom m i ssi ons to re sto re unesco rt ed acce ss pr i v i l ege s that Exel on has r evo ked

— whi c h wo ul d p r e c lud e r e i ns t a t e men to fem pl o y e e s , l i k e the t wo j us tme nt i o ne d, w hose j obs r equi re thattheyhave unesco rt ed acce ss. The Com m i ssi on does notr evi ew g ra nts o r denia l s o f these se curi ty cl ear ances. The nucl earener gy com pan i es gr ant them , and c laim the ri ght t o re vok e them subj ect to no j ud i ci alo r adm i ni str ati ve revie w . Th e uni on di sag re es onlyto the extent that i t thi nks a n arbi tr ato r

— a pri vate ci ti zen, nota go ver nm ent e m plo yee

— can restore a s ecuri ty c lea rance y anked bythe em plo yer . U nd er e i t h e r vie w th e g ov er n m en t p lay s n o ro le. T h e re su lt is a vo i d that i s bo th st ra nge a nd danger ous. The sa fetyo f4 N o. 11

- 2423 nucle ar ener gy f aci l i ti es cannot be t ake n f orgr anted. S ee, e. g. , Carl Behrens & M ar k H ol t, “N ucl ear Pow er P lants: Vulner abi l i ty to Terr or i st A tta ck” ( CR S [ Congre ssi onal R esearc h Service] Rep ort forCon gress, F e b . 4, 2005), w w w . f as. or g/ i r p/ c r s / RS 2 1 1 3 1
. pd f ( v i s i t e d M ay 18, 2 0 1 2 )
. T he e mpl o y e r s ho ul d h a v e a r i g htt o i nv o k e a dm i ni str ati ve re vi ew o fa l aborarbitr ato r’ s r est or ati on ofa re vok ed sec uri ty cl ear ance. Equall y an em plo yee c laim in g t o h av e b e e n w ro n gfu lly d ep riv ed of h is secur i ty cl ear ance s houl d have a r i ght t o adm i ni str ati ve re vi ew bec ause the depri vation m ay barhi m fro m fu tu re em p loy m en t i n h i s c h os en line of w or k. B u t itis the f ai l ure to provi de publi c r em edi es f orgr ants of s e c ur i t y c l e a r a n c e s th a ti s e s p e c i a l l y d i s t u rb i n g . An er ra nt em plo yee o fa nucle ar pow erpl ant, i ncl ud i ng a su b st an c e a b u se r w h o is a lso a liar , cou ld d o c at as tr op h ic dam age . A rbitra to r s ar e se l ec te d b y o r wi ththe c o ns en t o fthe par ti es . An a rbi tr at or w ho g et s a r epu ta ti o n f o r f av o r i ng one si de i n a c l ass o fcas es, such a s ca ses o fem plo ym ent t er m i na ti o n, o r di spu te s be twe eni nv es to r s an d b ro ker s o r between m anage m ent a nd uni ons, wil l be unacceptabl e t o one ofth e parti es i n any future dispute, an d s o the de m an d f o r hi s se r vi ce s wi l l wi th er . A r es ul ting te n d en c y of a rb itr at or s t o s p lit th e d iffer en c e in th eir a wa r ds

— th at is , t o g i ve e ac h s i de a par ti alv i ct o r y ( an d ther ef or e parti aldefeat )

— h as be en ob se rv ed
. Armend ar iz v. Fou ndat i on He al t h Ps yc hc ar eSe r vi ces , Inc . , 6 P. 3d 669, 69 3 ( Cal. 20 00) ; Donal d W ittm an, “Lay J uri es, Pro fess i onal A rbi tr ato rs , and the A rb itr ato r; S el ecti on Hyp othe si s, ” 5 Am e r i ca n L aw & Econ
. Re v. 61 , 81 ( 20 03 ) ; Est el l e D. F r an k l i n,N o. 11

- 2423 5 “M aneuver i ng Thro ugh the Laby rinth: The Em plo yer s’ P ar ad ox i n Responding to H ost i l e Envi ro nm ent S exual H ar as sment

— A Pro posed W ay Ou t, ” 6 7 For dh a m L. Re v. 151 7, 1 56 5 ( 19 99 ) ; Ro be r t H ai g, “ Cor po r at e Cou nsel’ s Gu i de: LegalD ev el opm ent Repor t o n Cost- Effecti ve M anage m ent ofCor pora te Lit i gat i on, ” 6 10 P LI/Lit17 7, 18 6- 87 ( 1999 )
. S pli tti n g th e d i ffer ence m ake s i t di ffi cul t f or p arties on either side i n a class of disp ut es to infer a p attern off a v o r i t i s m. R i s k

- a v e r s e di s pu t a nt s l i k e the s pl i t
- thedi ff e r e nc e a pp r o a c h b e c ause i tt r un c a t e s b o th the u ps i de ri sk and the down sid e r i sk ofthe dispute- re sol uti on proce ss. Thi s in turn hel ps differ enti ate arbi tr ati on fro m adj ud i cati on, typi cal l y a n al l

- or - nothi ng aff ai r. Differ enti ation is essen tial to t h e s u cce ss of arbi tration as an alternati ve to adj ud i cati on be cause a dj ud i cati on i s s ubsi dize d b y t h e g ov er n m en t a n d arb itr at ion is n ot . Th e p u b lic s ubsi dy o fthe c o ur t s p l a c e s a rb i t r a t o r s a ta c o s tdi s a dva nt a g e . On e wa y t o o v e r c o me i ti s t o o ffe r a se rv i ce unavai l abl e fro m the cour ts, and spl i t- the- differ ence deci si onm aki ng i s s uch a s er vi ce. T ug ging th e othe r w ay is the incen tive of arbitrators to cul ti vate a re pu tat i on f orco m p etence, wh i ch m ay ho l d the s pl i t- th e- di ffer en ce t en den cya t ba y . A r ec en t study fi nd s that the te nd ency does not chara cter i ze “inv es tmentt r ea ty ” arbi tr at i o n, Da phna Kapel i uk, “ The Re pea t App ointmentF ac to r : Expl o r i ngDe ci si o n P at te r ns ofEl i te I nvest m ent Arbi tr ato rs , ” 9 6 Corn e l l L. Re v. 4 7, 83 ( 2010 ) , tho ugh that is an eso ter i c ar ea ofdi spute re sol uti on, r em ote fro m l aborarbi tr ati on, and so K ap eli uk ’s find ings m ay not be ap p li cab le to th e latter.6 N o. 11

- 2423 There ar e e nough i nd i catio ns o fspl i t- the- differ ence be ha vi o r i n l ab o r a rbi tr at i o n t o make o ne wor ry abo ut the pos sibl e t endency o fan a rbi tr ator re vi ew i ng a nucle arf aci l i ty’ s r evo cati on o fan e m plo yee ’ s s ecuri ty c lea ra n c e t o im p os e a s a n c tio n th at w ou ld en ab le h im to re tai n a r i ght o funesco rt ed acce ss to the f aci l i ty eve n i f he w er e a drug add i ct, a drunkard, and a co n ge ni tal l i aral l r ol l ed up int o one. The Com m i ssi on co uld a m end i ts re gulat i ons to f orbi d col l ecti ve bar gai ni ng ag re em ents to em pow er arbi tr ato rs to r esol ve disputes o verse curi ty cl ear ances. S ee 4 2 U. S
. C. § § 2 20 1(b) , ( i ) , ( p)
. I t co ul d e st ab l i shthe type ofadm i ni str ati ve proce ss that Ihave suggest ed. S ee id
. A s co uld Congr ess . S o f arthe Com m i ssi on has bee n conte nt with re quir i ng i ts l i censee s t o est abl i sh se curity cl ea r an ce s y st ems wi tho ne l ay ero fi nt erna l r ev i ew a nd al l o wi nga rbi tr at i o n pur su an t to c oll ec ti ve b ar g aini ng agr eem ents to ( i n effect) o ver rul e a li censee ’ s rev oca ti on o f a cl ear ance. I t i s t i m e that the Com m i ssi on, o r f ai l ing that Congre ss, i nsti tuted adm i ni str ati ve re vi ew o fdeci si ons by pri vate arbi tr ato rs gr anti ng or denyi ng se curi ty cl ear ances to em p loy ee s o f n u c lea r fac ilitie s. A n al ter nati ve w oul d be t o f orbi d spli t- the- differ en ce aw ar d s. T h e c om m o n s p lit aw ar d in la b or arb itr at ion is re i nstat em ent w i thout back pay but w i th a la st- chance cl ause. The Com m i ssi on m i ght pr ovi de by re gul ati on that u n les s t h e a rb itr at or d ec id es th at th e e m p loy ee is righ t in al l r espect s

— f or exam ple , never had a dri nki ng p ro bl em and al w ays to l d the t ruth a nd so i s e nti tl ed to r ei nstatem ent w i th fullbac k pay

— the secur i ty cl ear ance cannot be r e i ns t a t e d.N o. 11

- 2423 7 N ot al l nucl earf aci l i ti es are u ni oni zed. I n thos e that a r e n o t, e mpl o y e r s h a v e c a r t e b l a nc he t o r e v o k e s e c uri ty cl ear ances. Those deci si ons too sho uld be subj ect to a d mi n i s t r a t i v e r e v i e w. Bu t whateverthe cor re ct s oluti on t o th e pro bl em s cr eat ed by the m yst er i ous absence o fgo ver nm ent r eview o f dec i s i o ns i nv o l v i ngs e c ur i t y c l e a r a nc e s f o r e mpl o y e es ofnucl earf aci l i ti es, i t is bey ond j ud i ci alautho ri ty to c o mm a nd
.

5- 31- 12