Opinion ID: 215918
Heading Depth: 2
Heading Rank: 3

Heading: issues

Text: In October 2007, ALPA obtained an award for another TSA pilot, Jason Kagan, for improper discharge under the same CBA. In contesting Kagan's grievance, TSA argued ALPA's payments to Kagan were an illegal loan and any backpay award would violate public policy. After the arbitrator rejected TSA's argument, TSA and ALPA entered into a settlement agreement and TSA did not seek judicial review of the award. ALPA asserts the Board's conclusion in the Kagan arbitration precludes TSA from challenging the legality of Hopkins's award. Under [the doctrine of] issue preclusion, also known as collateral estoppel, `once a court has decided an issue of fact or law necessary to its judgment, that decision may preclude relitigation of the issue in a suit on a different cause of action involving a party to the first case.' W.F.M., Inc. v. Cherry Cnty., Neb., 279 F.3d 640, 643 (8th Cir.2002) (quoting Allen v. McCurry, 449 U.S. 90, 94, 101 S.Ct. 411, 66 L.Ed.2d 308 (1980)). [A]n arbitrator generally has the power to determine whether a prior award is to be given preclusive effect. Trailways Lines, Inc. v. Trailways, Inc. Joint Council, 807 F.2d 1416, 1425 (8th Cir. 1986); accord Am. Nat. Can Co. v. United Steelworkers of Am., 120 F.3d 886, 891-93 (8th Cir.1997). See also W.R. Grace & Co. v. Local Union 759, Int'l Union of the United Rubber Workers, 461 U.S. 757, 764-65, 103 S.Ct. 2177, 76 L.Ed.2d 298 (1983) (holding an arbitrator's conclusion that he was not bound by a prior arbitrator's decision was binding on the federal courts). But, where, as here, a challenge to an arbitration award raises a question of public policy, we do not give a prior award, specifically one which has not been subject to judicial review, any preclusive effect on a matter of public policy. See W.R. Grace, 461 U.S. at 766, 103 S.Ct. 2177. Because collective bargaining agreements do not formulate public policy, and arbitrators cannot consider matters not encompassed by the governing agreements, `the question of public policy is ultimately one for resolution by the courts.' Iowa Elec., 834 F.2d at 1427 (quoting W.R. Grace, 461 U.S. at 766, 103 S.Ct. 2177). We conclude the arbitrator's unreviewed decision in the Kagan arbitration does not preclude TSA's public policy challenge to Hopkins's award.