Opinion ID: 2973536
Heading Depth: 3
Heading Rank: 1

Heading: Who has the authority to decide arbitrability?

Text: The question of who, the court or the arbitrator, has the authority in a particular case to decide the arbitrability of a grievance determines the standard of review of the arbitrator’s decision. If the parties have agreed to allow the arbitrator to decide arbitrability, the district “court should give considerable leeway to the arbitrator, setting aside his or her decision only in certain narrow circumstances.” Id. at 943. On the other hand, if the parties did not agree to submit the arbitrability question to the arbitrator, then the district court conducts an independent review. Id. Cleveland Electric raised the issue of who should decide arbitrability for the first time in its brief to the district court. It argued that the arbitrator had no authority to determine arbitrability of the retirees’ grievance and, therefore, that his decision is void ab initio. Citing cases from the Supreme Court and this court, Cleveland Electric asserts that the question of whether the parties agreed to arbitrate a certain matter is to be decided by the court, not the arbitrator. See AT&T Techs. Inc. v. Commc’ns Workers, 475 U.S. 643, 649 (1986) (reaffirming the principle that the court is to determine whether or not the company was bound to arbitrate, as well as what issues it must arbitrate, on the basis of the parties’ contract); see also Armco Employees Indep. Fed’n v. AK Steel Corp., 252 F.3d 854, 859 (6th Cir. 2001) (finding that courts determine substantive arbitrability). The Union did not address this issue in the district court because it had not been raised before, and its brief was filed the same day as Cleveland Electric’s brief. In its brief to this court, the Union agrees with the general statement of the law set out above but argues that the district court was correct in its conclusion that the parties “clearly and unmistakably consented to the arbitrator’s jurisdiction on the issue” and waived the right to have the issue decided by the court. In AT&T Technologies, the Supreme Court referenced the “Steelworkers Trilogy,” a series of cases decided in 1960,2 and reiterated four principles for which these cases stand, one of which is that the question of arbitrability of a particular dispute is a matter for judicial determination. AT&T Techs., 475 U.S. at 649. In this circuit, however, although a court is usually the proper venue for decisions about arbitrability, if the parties “clearly and unmistakably” submit the issue to the arbitrator “without reservation,” then the parties have waived their right to have a court make the decision. See Vic Wertz Distrib. Co. v. Teamsters Local 1038, 898 F.2d 1136, 1140 (6th Cir. 1990); see also Interstate Brands Corp. v. Chauffeurs, Teamsters, Warehousemen & Helpers Local Union No. 135, 909 F.2d 885, 890 (6th Cir. 1990). 2 The “Steelworkers Trilogy” cases are Steelworkers v. American Manufacturing Co., 363 U.S. 564 (1960); Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574 (1960); and Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593 (1960). No. 04-3566/3567 The Cleveland Electric Illuminating Co., et al. v. Page 4 Utility Workers Union of America In Interstate Brands, the union filed a grievance related to the dismissal of one of its members. The company participated in the arbitration proceedings on the issue of arbitrability as well as the merits, but later complained that the issue of arbitrability was a question for the court. Interstate Brands, 909 F.2d at 890. The court, relying on Vic Wertz, held that an agreement to have the arbitrator decide the issue of arbitrability will be implied where the parties did not bring the issue to the district court in the first place. Id. Thus, the company waived its right to have the court decide the arbitrability question by participating in the arbitration proceedings. Id. In First Options, a case cited by Cleveland Electric in support of its argument, the Supreme Court held that deference to an arbitrator’s decision on arbitrability is not necessary unless there is evidence of a clear and unmistakable willingness to arbitrate the issue. First Options, 514 U.S. at 944. However, First Options did not involve a union or a collective bargaining agreement, so there was no underlying agreement between the parties providing for arbitration. The issue was whether private parties could be forced to arbitrate the issue of arbitrability just because they filed a brief with the arbitrator objecting to the arbitrator’s jurisdiction. Id. at 946. The Supreme Court found that the objecting party (the Kaplans) forcefully opposed the arbitrator deciding whether they had to arbitrate their dispute, and the arbitrator’s ruling, therefore, was entitled to a court’s independent review. Id. at 946-47. The circumstances in this case are more like those in Interstate Brands than First Options. Cleveland Electric submitted the question of arbitrability to the arbitrator for his determination, and we can find nothing in the record to indicate that Cleveland Electric wanted to reserve the question of arbitrability for the court. The district court found, and this court agrees, that Cleveland Electric waived the issue of who had the power to decide the arbitrability of the retirees’ grievance by submitting the matter to arbitration “without reservation.”