Court Opinion

ID: 2965014
Source: CourtListenerOpinion
Date Created: 2015-09-21 21:34:12.122338+00
Date Added: 2024-06-11T12:39:25.615782
License: Public Domain

USCA1 Opinion

	

                            United States Court of Appeals
                                For the First Circuit
                                 ____________________

        No. 97-1508

            JOSE RAMIREZ-DE-ARELLANO, MARTA SUAREZ DE RAMIREZ DE ARELLANO
                  AND THE CONJUGAL PARTNERSHIP CONSTITUTED BY THEM,

                               Plaintiffs, Appellants,

                                          v.

                               AMERICAN AIRLINES, INC.,

                                 Defendant, Appellee.

                                 ____________________

                     APPEAL FROM THE UNITED STATES DISTRICT COURT

                           FOR THE DISTRICT OF PUERTO RICO

                   [Hon. Daniel R. Dominguez, U.S. District Judge]
                                              ___________________

                                 ____________________

                                        Before

                                 Stahl, Circuit Judge,
                                        _____________
                            Godbold,* Senior Circuit Judge
                                      ____________________
                            and Cyr, Senior Circuit Judge.
                                     ____________________

                                 ____________________

            Carlos A. Del Valle Cruz on brief for appellants.
            ________________________
            Luis  D. Ortiz  Abreu,  Vivian  Nunez,  and  Goldman  Antonetti  &
            _____________________   _____________        _____________________
        Cordova on brief for appellee.
        _______
                                 ____________________

                                  December 22, 1997
                                 ____________________
        _____________________
        *Of the Eleventh Circuit, sitting by designation.

                      Stahl,  Circuit  Judge.  Jose Ramirez  de  Arellano
                      Stahl,  Circuit  Judge
                      _____

            ("Ramirez"),  together  with his  wife,  child,  and conjugal

            partnership,  appeal  from  the  district  court's  grant  of

            summary judgment  to American Airlines  ("American") in  this

            wrongful discharge  and retaliatory dismissal  action brought

            primarily  under  the  Fair Labor  Standards  Act  (FLSA) and

            Puerto Rico law.1  After  carefully reviewing the record  and

            considering  Ramirez's   arguments,  we  conclude   that  the

            district   court   properly  awarded   summary   judgment  to

            defendant.  We  prefer, however, not to rely  on that portion

            of the district court's order  which gave res judicata effect
                                                      ___ ________

            to  American's  internal grievance  procedure.   Instead,  we

            choose to  affirm on the  grounds that Ramirez  was dismissed

            for just cause under Puerto  Rico law and that Ramirez failed

            to set forth  sufficient evidence to trigger a presumption of

            discrimination or retaliation on the  part of American.   See
                                                                      ___

            Polyplastics,  Inc. v. Transconex, Inc., 827 F.2d 859, 860-61
            ___________________    ________________

            (1st  Cir.  1987)  (explaining that  an  appellate  court can

            affirm  on  any  independent  ground  made  manifest  in  the

            record).

                                
            ____________________

            1.   Ramirez's  original district  court claims  included the
            FLSA claim  for retaliatory dismissal,  an age discrimination
            claim   under  Puerto  Rico  law,  claims  for  wrongful  and
            retaliatory  dismissal  under  local  severance  law,  and  a
            defamation claim.   Two of  these claims are not  included in
            the  present appeal:  the  age  discrimination  claim,  which
            Ramirez voluntarily  dismissed,  and  the  defamation  claim,
            which the district court rejected on grounds of privilege. 

                                         -2-
                                          2

                      American  employed  Ramirez  from  1984-1997  as  a

            ticket agent,  and, later, as  a baggage handler.   After two

            written performance advisories,  American terminated Ramirez,

            citing  as reasons  his failure  to follow  company time  and

            attendance procedures and  his attempt to  circumvent company

            rules to his own benefit.

                      Following  his   dismissal,  Ramirez   submitted  a

            written  grievance  to  American, pursuant  to  the  internal

            grievance  procedure  set  forth  in the  employee  handbook.

            American  upheld the termination and denied Ramirez an appeal

            on  the basis  of tardy  application.   Ramirez  subsequently

            filed suit in Puerto Rico district court, and now appeals the

            order of  summary judgment  rejecting the  FLSA claim  on the

            merits  and  all  other  claims  under  the  doctrine of  res
                                                                      ___

            judicata.   See  Ramirez v.  American Airlines  Inc.,  957 F.
            ________    ___  _______     _______________________

            Supp.  359  (D.P.R.   1997)  (equating  American's  grievance

            procedure with a binding arbitration).

                      We  review the award  of summary judgment  de novo,
                                                                 __ ____

            and  draw  all  reasonable  inferences  in  Ramirez's  favor.

            Grenier v.  Vermont Log Bldgs.,  Inc., 96 F.3d 559,  562 (1st
            _______     _______ _________________

            Cir.   1996).    The   record  is  replete   with  documented

            illustrations of Ramirez's  performance problems and repeated

            failure  to   follow  American's  policies   and  procedures.

            Moreover, American had given Ramirez two  official advisories

            prior  to his dismissal.   Thus,  there can  be no  basis for

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                                          3

            inferring that American's stated reason for the discharge was

            wrongful or pretextual under federal law.

                      The result is  no different under Puerto  Rico law,

            which provides that an employee  is not entitled to statutory

            wrongful discharge indemnity  if the employee  was terminated

            for just cause.  P.R.Laws Ann.tit 29   185 et seq. 
                                                       __ ____

                      Under  Puerto Rico  law, just  cause for  dismissal

            includes  repeated violations  of  the  employer's rules  and

            regulations,  provided that, as  here, the employee  has been

            provided with  a written  copy of the  relevant policies  and

            procedures.    See P.R.  Laws Ann.  tit 29    185b;  see also
                           ___                                   ___ ____

            Menzel  v. Western  Auto Supply  Co., 662  F. Supp.  731, 744
            ______     _________________________

            (D.P.R. 1987), aff'd, 848 F.2d 327 (1st Cir. 1988).  As noted
                           _____

            above,  the  record  here  admits  of  only  one  conclusion:

            Ramirez's  repeated  transgressions  of  company  policy  and

            procedures provided American with just cause for termination.

            Summary judgment  was,  therefore, properly  granted  to  the

            defendant.

                      Although summary judgment  was properly awarded, we

            have  some doubt  about  the  district  court's  ruling  that

            American's internal company grievance procedure, set forth in

            its employee  handbook, is  the legal  equivalent of  binding

            arbitration  and,  therefore,   bars  judicial  resolution of

            potential  statutory and constitutional  claims.   As Ramirez

            points  out, there is  little in  the way  of back  and forth

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                                          4

            bargaining  between a  company  and  its  employees  when  an

            employment  handbook   is  created,  making   this  situation

            distinguishable  from   the  arbitration   provisions  of   a

            collective  bargaining  agreement.    This  is  especially so

            where, as  here, the handbook  expressly provides that  it is

            not  a  contract  between  the  parties  and  is  subject  to

            unilateral amendments by American at any time.

                        Although the district court was correct in noting

            the   existence   of  a   strong   federal   policy  favoring

            arbitration, the threshold question for review must always be

            whether the agreement to arbitrate was, indeed, voluntary and

            intentional.    Mitsubushi  Motors Corp.  v. Solar  Chrysler-
                            ________________________     ________________

            Plymouth  Inc.,  473  U.S.  614,   626  (1985).    Given  the
            ______________

            apparently  unilateral  and  adhesive  nature  of  American's

            employee  handbook, we  do  not  embrace  the  argument  that

            Ramirez voluntarily waived his right to pursue  his claims in

            federal court.2

                                
            ____________________

          2.    We note  that two  other Circuits  have recently  addressed this
          issue.   In Nelson v.  Cyprus Bagdad Copper  Corp., 119 F.3d  756 (9th
                      ______     ___________________________
          Cir. 1997), the Ninth Circuit held that signing an acknowledgment form
          which provided  that the  employee agrees to  "read and  understand" a
          revised employee handbook  did not serve to  bind the employee to  the
          handbook's  internal grievance  provisions.   Id. at  761.   The Ninth
                                                        ___
          Circuit reasoned that: 

                    Merely  signing  the  form  did  not  in  any  way
                    constitute a 'knowing agreement to arbitrate,' and
                    thereby  to surrender  [the employee's]  statutory
                    right [under  the ADA] to  a judicial forum .  . .
                    Any bargain to waive the right to a judicial forum
                    for civil  rights claims, including  those covered
                    by  the   ADA,  in  exchange  for   employment  or

                                         -5-
                                          5

                      Moreover,  we   have  strong  concerns   about  the

            fundamental  fairness  of  giving  preclusive effect  to  the

            particular grievance  procedure  in this  case.   Arbitration

            proceedings must meet "the minimal requirements of fairness--

            adequate notice, a hearing on the evidence, and  an impartial

            decision  by the arbitrator."   Sunshine Mining Co. v. United
                                            ___________________    ______

            Steelworkers, 823 F.2d  1289, 1295 (9th Cir.  1987) (internal
            ____________

            quotations and citations omitted); Bowles Fin. Group, Inc. v.
                                               _______________________

            Stifel, Nicolaus &  Co., Inc., 22 F.3d 1010,  1013 (10th Cir.
            _____________________________

            1994).

                      First, with respect to notice, we are not convinced

            that  Ramirez's application  for a hearing  was appropriately

            denied  for untimeliness because it appears that American may

                                
            ____________________

                    continued  employment, must  at least  be express:
                    the  choice must  be  explicitly presented  to the
                    employee and the employee must explicitly agree to
                    waive the specific right in question.  Id. at 761-
                                                           ___
                    62 (internal quotations and citations omitted). 

               Similarly,  the  Eighth  Circuit  recently  instructed  that  the
          absence of  such an express waiver precludes  a finding that there has
          been a  knowing agreement.   See Patterson v. Tenet  Healthcare, Inc.,
                                       ___ _________    _______________________
          113  F.3d 832, 835  (8th Cir. 1997).   The Patterson  court upheld the
                                                     _________
          employee handbook arbitration provision because the arbitration clause
          was both separate  and distinct from other provisions  in the handbook
          and was introduced by the heading, "IMPORTANT!  Acknowledgment Form." 
          Id.   Unlike other  provisions  within the  handbook, the  arbitration
          ___
          clause  used  contractual  language, such  as  "I  understand"  and "I
          agree."  Id.   Moreover, the form  was signed by the employee, removed
                   ___
          from the handbook,  and given to the Human Resources  Department to be
          stored in the employee's personnel file.  Id.  It was only because the
                                                    ___
          court  deemed  these   actions  in  toto  sufficient  to   render  the
                                          __  ____
          arbitration  clause "separate and distinct"  from the remainder of the
          handbook,  that  the  court  held  that  the  internal  grievance  and
          arbitration clause constituted an enforceable contract.  Id.       
                                                                   ___

                                         -6-
                                          6

            have been equally, if not more, to blame for the late filing.

            Second, there was no opportunity  for discovery.  See Hoteles
                                                              ___ _______

            Condado Beach v. Union de Tronquistas Local 901, 763 F.2d 34,
            _____________    ______________________________

            39 (1st Cir. 1985)(instructing that an arbitrator must afford

            each party an  adequate opportunity to present  both evidence

            and  argument); see also Williams  v. Katten, 1996 WL 717447,
                            ___ ____ ________     ______

            at  *4-5,  (N.D.  Ill.  Dec.  9,  1996)  (discussion  of  the

            permissible parameters of limited discovery in an arbitration

            proceeding).     Third,  the   decision  maker   was  not   a

            disinterested  party,  but  rather,  an  American  managerial

            employee.   See  Employers  Ins. of Wausau v.  National Union
                        ___  _________________________     ______________

            Fire    Ins.   Co.,   933   F.2d   1481,   1491   (9th   Cir.
            __________________

            1991)(stipulating  that  fair  arbitration  proceedings  must

            include non-biased  decisionmakers).    Finally,  the  record

            reveals  that Ramirez  was actually  denied any  review  by a

            hearing  officer  or  panel,  which, following  the  district

            court's  analysis, effectively rendered all of his claims res
                                                                      ___

            judicata on the basis of one manager's view.3
            ________

                                
            ____________________

            3.   This is a distinctly  different scenario from Garcia  v.
                                                               ______
            American Airlines,  Inc., 673 F. Supp. 63  (D.P.R. 1987), the
            ________________________
            case  upon which  the  district  court  relied  for  its  res
                                                                      ___
            judicata ruling. In Garcia, the employee utilized step two of
            ________            ______
            American's  grievance  procedure  and,  while represented  by
            counsel, had  an  opportunity  to  appeal his  dispute  to  a
            stateside hearing officer.   Id. at 66. In  contrast, Ramirez
                                         ___
            was denied any opportunity to present his claims to a hearing
            officer (step  two) or  panel (step  three); he  simply spoke
            with the General Manager, and was denied any further appeal. 

                                         -7-
                                          7

                       Because American had ample just cause to terminate

            Ramirez's  employment  and   Ramirez  presented  insufficient

            evidence   to  raise  an   inference  of   discrimination  or

            retaliation,  we  uphold  the award  of  summary  judgment to

            American.

                      Affirmed.  No costs.
                      Affirmed
                      ________

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