Case Name: ITT WORLD COMMUNICATIONS, INC., a Delaware corporation, Plaintiff-Appellant, v. COMMUNICATIONS WORKERS OF AMERICA, AFL-CIO, and Local No. 1174, Communications Workers of America AFL-CIO, and Local No. 1172, Communications Workers of America, AFL-CIO, Defendants-Appellees
Court: United States Court of Appeals for the Second Circuit
Jurisdiction: United States
Decision Date: 1970-01-19
Citations: 422 F.2d 77
Docket Number: No. 189, Docket 33674
Parties: ITT WORLD COMMUNICATIONS, INC., a Delaware corporation, Plaintiff-Appellant, v. COMMUNICATIONS WORKERS OF AMERICA, AFL-CIO, and Local No. 1174, Communications Workers of America AFL-CIO, and Local No. 1172, Communications Workers of America, AFL-CIO, Defendants-Appellees.
Judges: Before LUMBARD, Chief Judge, and MEDINA and FEINBERG, Circuit Judges.
Reporter: Federal Reporter 2d Series
Volume: 422
Pages: 77–86

Head Matter:
ITT WORLD COMMUNICATIONS, INC., a Delaware corporation, Plaintiff-Appellant, v. COMMUNICATIONS WORKERS OF AMERICA, AFL-CIO, and Local No. 1174, Communications Workers of America AFL-CIO, and Local No. 1172, Communications Workers of America, AFL-CIO, Defendants-Appellees.
No. 189, Docket 33674.
United States Court of Appeals Second Circuit.
Argued Oct. 29, 1969.
Decided Jan. 19, 1970.
Alfred Giardino, New York City (Lorenz, Finn & Giardino, Charles M. Mattingly, Jr., New York City, Seyfarth, Shaw, Fairweather & Geraldson, Chicago, 111., on the brief), for plaintiff-appellant.
H. Howard Ostrin, New York City (Cooper, Ostrin, DeVareo & Ackerman, Ronald J. Brooks, Philip D. Tobin, David Kreitzman, New York City, Kane & Koons, Charles V. Koons, Washington, D. C., on the brief), for defendants-appellees.
Before LUMBARD, Chief Judge, and MEDINA and FEINBERG, Circuit Judges.

Opinion:
FEINBERG, Circuit Judge:
This case poses the familiar problem of construing the arbitration provisions of a labor agreement. Simply stated, the issue is whether the parties agreed to arbitrate claims of contract violation brought by an employer as well as those brought by a union. The employer is ITT World Communications Inc.; the unions are Communications Workers of America, AFL-CIO and two of its locals, hereafter referred to as the "Union." ITT appeals from an order of the United States District Court for the Southern District of New York, Milton Pollack, J., which stayed ITT's damage action against the Union pending arbitration. For reasons indicated below, we affirm the order.
The facts giving rise to the dispute are relatively simple. ITT alleges that the Union violated the "no strike" provision of the collective bargaining agreement in November 1968. Shortly thereafter, ITT brought suit in the district court under section 301 of the Labor Management Relations Act of 1947, 29 U.S.C. § 185. The complaint alleged breach of contract and sought $250,000 in damages. The Union filed its answer denying the allegations. In March 1969, ITT moved for summary judgment; the Union thereupon moved under 9 U.S.C. § 3 for a stay of the action pending arbitration of the dispute. The motions came on before Judge Pollack, who held that the arbitration provisions of the agreement covered the dispute and that the Union, by filing an answer in the law suit, did not waive its right to compel arbitration.
Article VI of the contract, which is titled "Arbitration," provides in pertinent part as follows:
Section 1.
Any matters disputed or in disagreement, or the subject of any controversy between the parties relating to and involving the interpretation, construction, or application of the terms of this Agreement, which the parties cannot adjust satisfactorily under the Grievance Procedure, may be submitted to arbitration for final and binding determination.
Section 2.
(a) Notification of intent to proceed to arbitration must be made within thirty (30) calendar days after mailing to the Union, by registered mail, the Company's answer in Step 3 of the Grievance Procedure, otherwise the grievance shall be deemed to be settled. Section 3, Article V, to the contrary notwithstanding only the Union shall have the right to invoke arbitration of grievances processed in Article V.
(b) Within two (2) weeks (unless mutually extended) of notification, by either party to the other, of intent to proceed to arbitration, either party may request arbitration. Such arbitration shall be submitted to the Federal Mediation and Conciliation Service (FMCS) . [Emphasis added.]
The provisions of Section 1 are couched in very broad terms which seem at first blush to make arbitrable ITT's claim that the Union violated the contract. There is unquestionably a basic dispute over whether the Union violated Article VII of the agreement, which contains the "no-strike" provision; moreover, that dispute certainly involves the "interpretation, construction, or application" of Article VII. However, Section 1 of Article VI does also contain the phrase "which the parties cannot adjust satisfactorily under the Grievance Procedure." ITT claims that this language is crucial because it "interlinks" Article VI of the contract with Article V, which is set forth in the margin. Since Arti ele V concededly only covers employee grievances, ITT argues that the provisions for arbitration in Article VI must also be so construed. The Union retorts that the phrase relied on by ITT is not a limiting one, but merely describes when a claim is ready for arbitration. The Union points out that since an employer's claim of contract violation obviously cannot be adjusted under the Article V procedure, such a claim fits the Article VI description of "matters disputed" which are ripe for arbitration. The Union finds further support for its position in Section 2(b) of Article VI, which explicitly recognizes that "notification of intent to proceed to arbitration" may be sent "by either party to the other" and thereafter "either party may request arbitration."
These contending positions have brought forth further rebuttals and rejoinders in the briefs. For example, under its theory that arbitration applies only to employee grievances, ITT views its right to "request arbitration" as merely a protection against having an employee grievance hang unsettled over its head indefinitely like a "Sword of Damocles." The Union characterizes that danger as "fanciful." The Union emphasizes that Articles V and VI are separate, with distinct procedures and differing coverage; the latter includes employer claims, while the former does not.
Both parties also rely on past practice. Thus, ITT says that it has never sought to arbitrate an employer claim, that when it brought a similar damage action in 1965, the Union did not seek arbitration, and that a Union official warned members during the 1968 strike that the walkout "gives the company an opportunity to go into Federal Court." The Union rebuts with very recent actions of ITT which it says show ITT recognition of the arbitrability of employer claims.
Finally, both sides call our attention to analogous judicial decisions. ITT relies most heavily on G. T. Schjeldahl Co., Packaging Machinery Division v. Local 1680, IAM, 393 F.2d 502 (1st Cir. 1968), and Boeing Co. v. International Union, UAW, 370 F.2d 969 (3d Cir. 1967). The Union invokes the imposing language of the Steelworkers' Trilogy and cites numerous cases for the proposition that whether a union has violated a no-strike clause is an arbitrable dispute under the contract, e. g., Drake Bakeries Inc. v. Local 50, American Bakery Workers, 370 U.S. 254, 258, 82 S.Ct. 1346, 8 L.Ed.2d 474 (1962); Signal-Stat Corp. v. Local 475, United Electrical Workers, 235 F.2d 298, 301 (2d Cir. 1956), cert. denied, 354 U.S. 911, 77 S.Ct. 1293, 1 L.Ed.2d 1428 (1957); and Local No. 463, United Papermakers and Paperworkers, AFL-CIO v. Federal Paper Board Co., 239 F.Supp. 45 (D.Conn.1965).
From these volleys back and forth it appears to us that the Union has somewhat the better of it. Judge Pollack noted that Section 2(a) of Article VI fixes one time limit (30 days) for the Union to exercise "its exclusive, right to invoke arbitration of employee grievances" and Section 2(b), which does not mention employee grievances, fixes another period (two weeks) in which "either party" may act. We agree with the judge that this is significant and that if "the arbitration agreement was intended only to deal with employee oriented disputes, there would seem to be no need for time limits imposed on the employer within which to invoke arbitration." In other words, we are not persuaded by the "Sword of Damocles" argument although the court in Schjeldahl, swpra, apparently was, to a modest extent.
As to the past practice relied on by ITT, the record indicates only one employer claim prior to the 1968 controversy and, even as to that, the law suit was withdrawn in less than a month. Considering the realities of collective bargaining, that period of time was too short to label the Union's failure to invoke arbitration a conclusive recognition that it could not; the one instance cited is too meager to be considered as authoritative past practice. The Union's past practice claim is that after settlement of the 1968 strike, ITT itself invoked Article VI arbitration to confirm its right to discharge two employees. ITT says this was an "employee-oriented" grievance and that its action was meant to bring matters to a head — the "Sword of Damocles" theory again. We also regard this incident as not determinative. In short, we view the past practice in this case as inconclusive, assuming it is entitled to any weight at all.
However, there is a much more important reason for affirming the judgment below. The unequivocal command of the Supreme Court in United Steelworkers of America v. Warrior & Gulf Navigation Co., supra, 363 U.S. at 582-583, 80 S.Ct. at 1353 (1960), was that:
An order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage.
We certainly cannot say "with positive assurance" that Article VI "is not susceptible of an interpretation that covers" employer, as well as employee, claims of contract violation. In addition to what we have already noted, we point out that the parties elsewhere in the contract showed that they knew how to clearly exclude a subject from arbitration when they so desired. Had the parties wanted. to do the same with claims of violation of the "no-strike" clause, they could easily have been equally specific. The importance of clear exclusionary language to negate a presumption of arbitrability of a dispute about a no-strike clause was emphasized by the Supreme Court in Drake Bakeries, supra, 370 U.S. at 258-259, 82 S.Ct. at 1349 (1962):
The company eárnestly contends that the parties cannot have intended to arbitrate so fundamental a matter as a union strike in breach of contract, and that only an express inclusion of a damage claim by the employer would suffice to require arbitration. But it appears more reasonable to us to expect such a matter, if it is indeed so fundamental and so basic to the company under the contract, to have been excluded from the comprehensive language of Article V if the parties so intended.
The combination of a broad arbitration clause and vague or no exclusionary language has usually, since the Trilogy, led to arbitration. See International Union of Electrical, Radio and Machine Workers v. General Electric Co., 407 F.2d 253, 257 (2d Cir. 1968), cert. denied, 395 U.S. 904, 89 S.Ct. 1742, 23 L.Ed.2d 217 (1969). In short, ITT's arguments at most raise a doubt whether the arbitration clause covers the dispute, but we are instructed to resolve that doubt "in favor of coverage." Doing so, we are required to affirm. However, it should be clearly understood that this disposition by no means condones Union misconduct, if that is what occurred, in this sensitive industry. As the Supreme Court said in Drake Bakeries, supra, 370 U.S. at 266, 82 S.Ct. at 1353:
If the union did strike in violation of the contract, the company is entitled to its damages; by staying this action, pending arbitration, we have no intention of depriving it of those damages. We simply remit the company to the forum it agreed to use for processing its strike damage claims.
The Union has suggested that Schjeldahl, supra, and Boeing, supra, both relied on by ITT, are distinguishable on their facts. As to the latter decision, that may be true, since the arbitration clause there did not say that "either party" could request arbitration, but we do not rest upon that. For our decision, we rely on the reasons already set forth above. See also Local 463, United Papermakers and Paperworkers, AFL-CIO v. Federal Paper Board Co., supra (company, rather than union, successfully sought arbitration of violation of no-strike clause); Fifth Avenue Coach Lines, Inc. v. Transport Workers, Local 100, 235 F.Supp. 842 (S.D.N.Y.1964).
ITT also contends that the Union waived its right to arbitrate by filing an answer in the ITT damage action and by a four-month delay in seeking arbitration. However, it is well settled in this circuit that neither would constitute a waiver of the right to arbitrate in the absence of prejudice to the opposing party. Carcich v. Rederi A/B Nordie, 389 F.2d 692 (2d Cir. 1968). ITT claims that the rule in Carich is inapplicable because the dispute there arose from a commercial contract, not a collective bargaining agreement, and that any delay in a tense labor, situation is by its nature prejudicial. While the argument is ingenious, we believe that the Carcich rule applies to labor as well as commercial disputes. The district court judge correctly found that ITT made no showing of prejudice resulting from the delay.
Accordingly, the judgment of the district court is affirmed.
. The judge also held that this disposition, rendered moot ITT's motion for summary judgment.
. This provides:
The Company agrees that during the life of this Agreement there shall be no lockouts, and the Union agrees that during the life of this Agreement there shall be no strikes, sitdowns, slowdowns, walkouts or stoppage of work, or impeding the conducting of operations of the Company for any reason whatsoever.
. Grievance Procedure
Section 1.
If an employee shall have a grievance it must be presented in Step 1 of the Grievance Procedure within two weeks of the occurrence of the grievance except that:
(a) grievances concerning wages may be taken up within six months of the occurrence of such grievance, and
(b) grievances concerning seniority may be taken up at any time.
Section 2.
The grievance shall be taken up in the following manner:
Step 1. The employee, or the shop committeeman, or the employee and the shop committeeman may present the grievance to the employee's supervisor. The supervisor shall give his answer to the grievance within two working days after the grievance has been presented.
Step 2. (a) Failing a satisfactory answer in Step 1, the grievance may be presented verbally to the superintendent, or the station manager, or the department head or the appropriate designee of any of the above Company representatives as the case may be. An answer in writing or verbally shall be given by the Company representative either at the meeting or within three working days following the meeting. Grievances not taken up in this Step 2(a) within one week of receipt of the answer in Step 1 shall be deemed to be settled.
(b) Failing a satisfactory settlement in (a) above, the grievance may be presented again in Step 2 but in writing only. The Company shall give its answer, also in writing, within one week after the grievance has been presented in this Step 2(b). In the event the grievance is not taken up in Step 2(b) within one week following receipt of the Company's answer in Step 2(a), the grievance shall be deemed to be settled. Grievances in this Step 2(a) and (b) shall be presented at meetings between the appropriate Company representative and the Union Grievance Committee. Such meetings shall not take place more than once per week and shall be scheduled, in advance, for a time mutually satisfactory to the Company representative and the Union Grievance Committee.
Step 3. Failing a satisfactory settlement in Step 2, the grievance may be presented, in writing only, to the Director of Industrial Relations or his designee. Grievances not taken up in this Step 3 within two weeks from the date of receipt by the Union of the Company's answer in Step 2 above shall be deemed to be settled. An answer shall be given in writing by the Company to the Union within two weeks from the date of the presentation of the grievance by the Union Grievance Committee in the manner herein provided. Grievances shall be presented in this Step 3 at meetings between the Company representative and the Union Grievance Committee. Such meetings shall be arranged for the mutual convenience of the Company and the Union as to time and place. Step 3 Meetings shall take place not later than four weeks from the date the Union appealed the grievance to the Step 3.
Grievances presented in writing in Step 2 and Step 3 shall be on a form which has been agreed upon between the parties. The form is designed so that the Company's answer will be given on it for Step 2 and Step 3. The Union's statements of the grievance shall contain the essential facts of the grievance and shall specify any alleged violation of the Agreement. This statement shall also contain the Union's proposed remedy.
Section 3.
Notwithstanding the above, it is expressly understood that any employee has the right to process a grievance through the three steps of the Grievance Procedure herein, without Union representation. The Company agrees to notify the Union of the existence of any grievance filed by an individual employee under this section when such grievance reaches Step 2 and Step 3 in the Grievance Procedure, and also of the time the grievance is to be discussed with the employee.
Section 4.
In the event the Company fails to give its answer to grievances within the times specified in each step of the Grievance Procedure herein, the Union shall have the right to proceed to the next step in this Grievance Procedure after the expiration of such specified times. This shall also be applicable to grievances in Step 3 of the Grievance Procedure in the event the Union elects to proceed to Arbitration under Article VI.
. United Steelworkers of America v. American Mfg. Co., 363 U.S. 564, 80 S.Ct. 1343, 4 L.Ed.2d 1403 (1960); United Steelworkers of America v. Warrior & Gulf Nav. Co., 363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960) ; United Steelworkers of America v. Enterprise Wheel & Car Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960).
. The contemporaneous letter from a Union official to its members stating that the 1968 walkout "gives the Company an opportunity to go into Federal Court" is not very significant. The issue before us is whether ITT has the right to stay there, a proposition with which the letter, whatever its weight, does not deal.
. E. g., in Article XI, Section 3, which deals with training programs, the contract provides:
When a specific training program is needed by the Company, the matter will be discussed with the Union. The Company and the Union will endeavor to agree upon the following details concerning such training program:
(a) The length of the training period required to qualify employees for permanent full-time assignment to the job;
(b) The amount of full-time instruction and the amount of on-the-job training;
(c) The trainee or apprentice wage scale.
In the event no agreement can be reached in a reasonable time, the Company, nevertheless, shall have the right to institute the specific training program and the Union shall be entitled to process a grievance through the Grievance Procedure on any of the above details that may be in dispute. Nothing in this section shall be subject to arbitration except disputes under Section 3(e) herein. [Emphasis added.]
. It should also be noted that Boeing did not discuss or even cite Yale & Towne Mfg. Co. v. Local 1717, IAM, 299 F.2d 882 (3d Cir. 1962), an earlier decision in the same circuit which pointed the other way.
. As to Schjeldahl, the asserted and perhaps overly technical "distinction" is that the grievance and arbitration provisions there were in the same article and there were no other specific exclusions from arbitration, as there are in this case.
. Although it is thus unnecessary to deal with ITT's appeal from denial of its motion for summary judgment, we note that we would have no jurisdiction over that appeal in any event. Alart Associates, Inc. v. Aptaker, 402 F.2d 779 (2d Cir. 1968).