Court Opinion

ID: 20898
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:38:59+00
Date Added: 2024-06-11T16:46:56.889778
License: Public Domain

214 F.3d 566 (5th Cir. 2000)
LOCAL 1351 INTERNATIONAL LONGSHOREMENS ASSOCIATION; SOUTH ATLANTIC           AND GULF DISTRICT INTERNATIONAL LONGSHOREMEN'S ASSOCIATION, AFL-CIO,           PLAINTIFFS-APPELLEES,v.SEA-LAND SERVICE INC; CARRIERS' CONTAINER COUNCIL, DEFENDANTS-APPELLEES,v.OFFICE & PROFESSIONAL EMPLOYEES INTERNATIONAL UNION, AFL-CIO (OPEIU),           MOVANT-APPELLANT.
No. 98-40208
IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT
June 9, 2000

Appeal from the United States District Court for the Southern District of Texas
Before Garwood, Barksdale, and Stewart, Circuit Judges.

Carl E. Stewart, Circuit Judge

1
Before the court is a jurisdictional dispute involving two unions. The disputes began roughly in 1994 and involve           the apportionment of employees assigned to work the gate at Sea-Land's Houston port facility.           Defendant-Appellee Sea-Land Service, Inc. ("Sea-Land") is a party toseparate collective bargaining agreements           with both Plaintiff-Appellee Local 1351 International Longshoremen's Association ("ILA") and           Movant-Appellant the Office & Professional Employees International Union ("OPEIU"). Both agreements           contain similar grievance procedures providing for the resolution of disputes through arbitration. The district court           ordered Sea-Land and the unions to participate in a tripartite arbitration. For the following reasons, we reverse.

FACTUAL AND PROCEDURAL BACKGROUND

2
Both unions in this case contest the assignment of work by Sea-Land at its Port of Houston ("Port") facility,           specifically the number of OPEIU and ILA employees that should be employed to do record keeping and           clerical work at the container terminal in accordance with their respective collective bargaining agreements. Prior           to 1992, ILA clerks obtained documentation at the terminal and gave handwritten forms to OPEIU clerks who           would either then type the data or enter it into a computer system. In 1992, Sea-Land purchased a new           computer system which made it unnecessary to have the information written first, and then inputted. Sea-Land           assigned the remaining work of collecting the data and entering it into the computer system to ILA.

3
OPEIU filed a grievance against Sea-Land protesting the loss of this work. On May 5, 1995, OPEIU and           Sea-Land entered into a bilateral arbitration. The arbitrator found that OPEIU and ILA were entitled to share the           work at the container terminal 50-50. On June 28, 1996, OPEIU obtained a judgment in the Southern District of           New York enforcing the arbitrator's award.1 Thereafter, on July 24, 1997, OPEIU filed another grievance           regarding the allocation of work at the Port facility, alleging that Sea-Land was not in compliance with the           arbitration award and accompanying court judgment. After Sea-Land denied the grievance, OPEIU contacted           the arbitrator on July 30, 1997, and a hearing was scheduled on the grievance for September 17, 1997 ("Marx           arbitration").

4
ILA did not participate in the arbitration proceedings held between OPEIU and Sea-Land. On March 4, 1997,           ILA asserted two grievances also protesting the assignment of work at the Port to employees represented by           OPEIU. The Local Industry Grievance Committee found that all clerical work at the gate of the Port facility must           be performed exclusively by ILA. Following completion of this arbitration, hich did not include OPEIU,2 on          August 22, 1997 ILA brought suit in the Southern District of Texas before Judge Samuel Kent seeking to           confirm the arbitration award which enforced the two grievance awards. As an affirmative defense, Sea-Land           argued that the arbitration award which had been confirmed in the Southern District of New York's judgment           ordered it to divide the work in question equally between ILA and OPEIU. OPEIU was neither named or served           in this present action. However, ILA and Sea-Land asked for a stay of the Marx arbitration scheduled to take           place between OPEIU and Sea-Land, and Judge Kent granted this stay.

5
On September 12, 1997, pursuant to Federal Rule of Civil Procedure 19 ("Rule 19"), the district court joined           OPEIU as an indispensable party. At the same time, the district court stayed further bilateral arbitration           proceedings between OPEIU and Sea-Land.3 The court then denied OPEIU's motion to dismiss4 on           October 3, 1997. On October 9, the district court ordered all parties to re-arbitrate their dispute in one tripartite           arbitration proceeding. OPEIU then filed a motion to reconsider and asked that the court vacate its other orders           regarding OPEIU. OPEIU attended the arbitration because of the threat of a show cause order levied by Judge           Kent. At the arbitration, held November 17-18, 1997, OPEIU objected on the record but did not participate           further in the arbitration. OPEIU offered no evidence or witnesses at the tripartite arbitration hearing.

6
On January 7, 1998, the arbitrator rendered his award, awarding all the work in dispute to ILA. On January 13,           1998, the district court confirmed the award sua sponte, simultaneously dismissing ILA's claims against           Sea-Land with prejudice and denying OPEIU's motion to reconsider and request that the district court vacate its           order staying arbitration and ordering tripartite arbitration.

7
OPEIU moved for an order in the Southern District of New York for enforcement of its original judgment against           Sea-Land. On May 4, 1998, Judge Patterson of the Southern District of New York denied OPEIU's motion.           The district court stated "we agree with the Texas court that tripartite arbitration provided a pragmatic solution."           In April 2000, the Second Circuit affirmed the New York district court's denial of OPEIU's motion seeking           enforcement of the prior judgment which had been awarded in its favor. See OPEIU v. Sea-Land, 210 F.3d 117           (2nd Cir. 2000)

Discussion
I. Standard of Review

8
We exercise plenary, de novo review of a district court's assumption of subject matter jurisdiction. See Ceres           Gulf v. Cooper, 957 F.2d 1199, 1204 (5th Cir. 1992). We also review a district court's grant of a motion to           compel arbitration de novo. See Pennzoil Exploration & Prod. Co. v. Ramco Energy Ltd., 139 F.3d 1061,           1064 (5th Cir. 1998).

II. Subject Matter Jurisdiction

9
Appellant argues that the district court did not have subject matter jurisdiction over OPEIU's dispute with           Sea-Land and therefore, was without authority to order OPEIU to participate in the tripartite arbitration. We           must satisfy ourselves, independent of the district court's analysis, that we have jurisdiction over the case. See           Silver Star Enters., Inc. v. M/V Saramacca, 19 F.3d 1008, 1013 n.6 (5th Cir. 1994). The district court's basis           for ordering OPEIU to participate in the present case is that under Fed. R. Civ. P. 19 OPEIU is an indispensable           party to this litigation. Rule 19 provides for the joinder of persons necessary for a just adjudication. In pertinent           part, the Rule states that

10
(a) Persons to be Joined if Feasible. A person who is subject to service of process and whose joinder will not           deprive the court of jurisdiction over the subjectmatter shall be joined as a party in the action if (1) in the           person's absence complete relief cannot be accorded among those already parties, or (2) the person claims an           interest relating to the subject of the action and is so situated that the disposition of the action in the person's           absence may (i) as a practical matter impair or impede the person's ability to protect that interest or (ii) leave any           one of the persons already parties subject to a substantial risk of incurring double, multiple, or otherwise           inconsistent obligations by reason of the claimed interest. If the person has not been joined, the court shall order           that the person be made a party.

11
Fed. R. Civ. P. 19(a).

12
Joinder was appropriate in the present case because the underlying issue in this action is a dispute between           OPEIU and ILA over how many workers each is entitled to have at the Port facility gate. Although ILA filed this           action, both unions have an interest in how the work will be allocated. It is also clear that the separate grievances           filed regarding the allocation of this work left Sea-Land with inconsistent obligations. Consequently, joinder was           proper in accordance with Rule 19 because a final resolution of this dispute would be severely hindered without           OPEIU's presence. See Provident Tradesmens Bank & Trust Co. v. Patterson, 390 U.S. 102, 107-09, 88           S.Ct. 733, 19 L.Ed.2d 936 (1968).

13
As another basis for jurisdiction over this matter, appellees cite 29 U.S.C.  185 (the Labor and Management           Relations Act  301 ("LMRA")), and 9 U.S.C.  9 (Federal Arbitration Act, "FAA"). Both the LMRA and the           FAA grant jurisdiction over parties who are signatories to the collective-bargaining agreement in dispute. See,           e.g. Ramsey v. Signal Delivery Serv., Inc., 631 F.2d 1210, 1212 (5th Cir. 1984) (observing that suits under the           LMRA "are confined to defendants who are signatories of the collective-bargaining agreement under which they           are brought"); Commercial Metals Co. v. Balfour, Guthrie & Co. Ltd., 577 F.2d 264, 268-69 (5th Cir. 1978)           (holding that a federal question must exist before jurisdiction is conferred by the FAA). The federal courts also           have broad discretion in implementing the policies embodied in our national labor laws. See Textile Workers           Union v. Lincoln Mills of Alabama, 353 U.S. 448, 456-57, 77 S.Ct. 912, 1 L.Ed. 2d 972 (1957).

14
ILA filed the present action seeking confirmation of the arbitrator's award which enforced ILA's two grievance           awards. These grievance awards were based on the collective bargaining agreement between ILA and           Sea-Land. Therefore, the district court clearly had jurisdiction to confirm ILA's two grievance awards. Although           OPEIU is not a signatory to the collective bargaining agreement between ILA and Sea-Land, OPEIU does have           a separate collective bargaining agreement with Sea-Land that mandates arbitration. Because assignment of work           at the Port facility is the central issue of ILA's dispute and any decision would effect OPEIU and its collective           bargaining agreement, the district court had broad discretion to exercise jurisdiction under LMRA.

15
III. Authority to Compel Tripartite Arbitration

16
Appellant argues that the district court did not have authority to order OPEIU, ILA and Sea-Land into a joint           tripartite arbitration absent an agreement between the three parties to participate in this type of arbitration. This           court has previously addressed whether three parties who are signatories to two separate agreements can be           ordered to submit to tripartite arbitration. See Del E. Webb Constr. v. Richardson Hosp. Auth., 823 F.2d 145,           148 (5th Cir. 1987). In Del E. Webb, we reversed a district court's consolidation of separate claims among a           contractor, a construction company, and an architect. See id. at 147-48. We there observed that "the sole           question for the district court is whether there is a written agreement among the parties providing for consolidated           arbitration." Id. at 149. We also held that, under  4 of the FAA, a district court maynot order tripartite           arbitration unless all three parties consent in writing to arbitration in the agreement itself, even if the result is           piecemeal litigation. See id. at 147, 150.5

17
While Del E. Webb is instructive the facts of the present case differ significantly because this is a labor dispute.           The Supreme Court has noted that labor arbitration should not be treated in the same manner as arbitration of           general commercial disputes. In Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574 (1960) the           Court stated that:

18
[T]he run of arbitration cases . . . becomes irrelevant to our problem. There the choice is between the           adjudication of cases or controversies in courts with established procedures or even special statutory safeguards           on the one hand and the settlement of them in the more informal arbitration tribunal on the other. In the           commercial case, arbitration is the substitute for litigation. Here arbitration is the substitute for industrial strife.           Since arbitration of labor disputes has quite different functions from arbitration under an ordinary commercial           agreement, the hostility evinced by courts toward arbitration of commercial agreements has no place here. For           arbitration of labor disputes under collective bargaining agreements is part and parcel of the collective bargaining           process itself.

19
363 U.S. at 578 (internal citations omitted). Specifically, the Supreme Court has recognized the place of tripartite arbitration in labor disputes. The Court has           observed that,

20
In order to interpret [a collective-bargaining] agreement it is necessary to consider the scope of other related           collective bargaining agreements, as well as the practice, usage and custom pertaining to such agreements. This is           particularly true when the agreement is resorted to for the purpose of settling a jurisdictional dispute over work           assignments.

21
Transportation-Communication Employees Union v. Union Pacific Railroad Co., 385 U.S. 157,           161, 87 S.Ct. 369, 17 L.Ed. 2d 264 (1967).

22
Other circuits have affirmed tripartite arbitration orders in situations where two unions have received conflicting           arbitration awards or where a union is seeking to be awarded work that may lead to a grievance from another           union. See, e.g. United States Postal Serv. v. National Rural Letter Carriers Ass'n, 959 F.2d 283, 286-87 (D.C.           Cir. 1992); Retail, Wholesale & Dep't Store Union, Local 390 v. Kroger Co., 927 F.2d 275, 281 (6th Cir.           1991) (involving conflicting bilateral arbitration awards); United States Postal Serv. v. American Postal Workers           Union, 893 F.2d 1117, 1119 (9th Cir. 1990); Local 850, Int'l Ass'n of Machinists v. T.I.M.E.-D.C., Inc., 705           F.2d 1275, 1277 (10th Cir. 1983) (involving conflicting awards); Columbia Broadcasting Sys., Inc. v. American           Recording & Broadcasting Ass'n, 414 F.2d 1326, 1328-29 (2nd Cir. 1969).

23
While tripartite arbitration is generally favored in these types of labor disputes, the major procedural obstacle to           ordering it in the present case is that the Southern District of New York had already entered a final judgment           affirming the arbitrator's decision in the grievance filed by OPEIU against Sea-Land. None of the cases in which           courts ordered tripartite arbitration have involved an earlier arbitration award which has already been confirmed           by a district court's final judgment. See e.g., Retail, Wholesale & Dep't Store Union, 959 F.2d at 276-77 (union           who received arbitration award first ordered into tripartite arbitration when it sought confirmation of that           arbitration award); Columbia Broadcasting System, 414 F.2d at 1327 (employer sought tripartite arbitration           before entering bilateral arbitration with either of the two unions).

24
The district court itself recognized that a final judgment had been entered by another district court. The district           court sidestepped this issue, however, by questioning the validity of the New York court's decision because ILA           had not been joined as a party. The Supreme Court has previously indicated that an arbitration award may be           unenforceable if an indispensable party is missing from the litigation. See Transportation-Communication, 385           U.S. at 159. The Second Circuit, in affirming the Southern District of New York decision, explained that the           essence of the New York court's decision was that ILA was a necessary party to the initial arbitration in New           York between Sea-Land and OPEIU, and that ILA's absence "rendered continued enforcement of the judgment           entered on that award in New York inequitable." OPEIU, 210 F.3d at 122. The Second Circuit held that "the           New York court had the power to decline to enforce the judgment confirming an arbitration award because a           change in circumstances had made clear that the dispute was a jurisdictional labor dispute, that tripartite           arbitration was the proper and necessary vehicle to resolve the dispute." Id. at 123.

25
Despite the Second Circuit's holding that the New York district court appropriately declined to enforce its           previous judgment the Second Circuit declined to rule on the issue that is squarely before us in this case, namely           whether the Texas district court erred in ordering tripartite arbitration. Id. at 124 ("The issue of whether the           Texas action constituted an impermissible collateral attack on the Southern District of New York judgment, or           whether the Texas Court erred in ordering tripartite arbitration, is not before us."). The actions of the district           court in regards to the dispute between Sea-Land and OPEIU violate the rule of collateral estoppel and res           judicata. See Hicks v. Quaker Oats Co., 662 F.2d 1158, 1166 (5th Cir. 1981) (stating that those doctrines           apply where the issues are identical, the issue has been previously litigated, and the determination of the issue           previously was a critical and necessary part of the judgment in that earlier action); see also Universal American           Barge Corp. v. J-Chem, Inc., 946 F.2d 1131, 1135 (5th Cir. 1992) (holding that collateral estoppel applies to           arbitration proceedings); Miller Brewing Co. v. Fort Worth Distributing Co., Inc., 781 F.2d 494, 498 (5th Cir.           1986) (holding that res judicata precludes a party's seeking relief through arbitration when such relief would be           barred in the courts). Consequently, the district court should not have disturbed the final judgment and ordered           OPEIU to participate in a tripartite arbitration. Although as the Second Circuit noted, Judge Patterson may have           properly refused to enforce his initial judgment, and acknowledged that tripartite arbitration was the appropriate           solution, this only occurred after the Southern District of Texas had ordered the tripartite arbitration in October           1997. OPEIU, relying on the final judgment, essentially refused to participate in the tripartite arbitration. OPEIU           should not be penalized for relying on a final judgment. See United Food and Commercial Workers Union           AFL-CIO v. Pilgrim's Pride Corporation, 193 F.3d 328, 331 (5th Cir. 1999) (stating that although a districtcourt might later modify its enforcement order of an arbitration award, this does not diminish the order's finality or           present effect). Therefore, the district court's decision to order a tripartite arbitration, although well intentioned,           was inappropriate in the wake of the final judgment which OPEIU had obtained.6

Conclusion

26
Although achieving fair and complete resolution of this multi-faceted dispute through tripartite proceedings was           the laudable objective of the district court, the procedural posture of the parties at the time the judgment was           entered militated against pursuing tripartite arbitration. Arguably, piecemeal litigation will result from this holding,           but the alternative course of action--making a party who has relied on a final judgment subsequently submit to           another arbitration--is not congruent with the controlling case law. Accordingly, the district court's judgment is           REVERSED and REMANDED for proceedings consistent with this opinion.

Notes:

1
  The judgment confirming the award was issued in OPEIU v. Sea-Land Servs., Inc., No. 96-CV-3043           (S.D.N.Y. 1996) by Judge Robert P. Patterson, Jr.

2
  OPEIU was not a party to the collective-bargaining agreement between ILA and Sea-Land; it did not           receive notice of or participate in the ILA/Sea-Land grievance proceedings.

3
  In response to ILA's and Sea-Land's request to stay the proceedings in OPEIU's case, Judge Kent said:           I'm troubled right now with the notion of whether I have jurisdiction to go around telling arbitrators and people           who are not immediately before the Court what to do, but I'm willing to try, and until the Circuit says I can't, I           guess I can . . . . Give me a proposed order that stops everything in its track right now. After the arbitration,           Judge Kent denied OPIEU's motion to reconsider, writing that: [B]ecause this Court had no knowledge of [the           Southern District of New York's] decision, this Court acted promptly in accordance with substantial authority . .           . . If this Court overstepped its bounds, the Court respectfully notes that the Fifth Circuit can sort it out.           Apparently, Judge Kent did have knowledge of Judge Patterson's decision. At the hearing involving a stay           several months earlier, Judge Kent told counsel for Sea-Land (who had informed him of the OPEIU arbitration           award) that "I'm not interested in getting into some catfight with another district Judge."

4
  OPEIU had moved to dismiss for lack of jurisdiction because it had been neither named nor served in the           suit and because it is not a party to the ILA/Sea-Land collective-bargaining agreement.

5
  See also, Champ v. Siegel Trading Co., Inc., 55 F.3d 269, 277 (7th Cir. 1995) (noting that the Supreme           Court "has repeatedly emphasized that we must rigorously enforce the parties' agreement as they wrote it, even if           the result is piece-meal litigation"); Government of United Kingdom v. Boeing Co., 998 F.2d 68, 74 (2nd Cir.           1993) (holding that a district court cannot consolidate arbitration proceedings arising from separate agreements           to arbitrate, absent the parties' agreement to allow such consolidation); American Centennial Ins. Co. v. National           Cas. Co., 951 F.2d 107, 108 (6th Cir. 1991) (holding that a court is not permitted to interfere with private           arbitration agreements in order to impose its own view of speed and economy, even where the result would be           the inefficient maintenance of separate proceedings); Baesler v. Continental Grain Co., 900 F.2d 1193, 1195           (8th Cir. 1990) (holding that the Supreme Court "has explicitly rejected the assertion that the overriding goal of           the [FAA] is to promote the expeditious resolution of claims"); Protective Life Ins. Corp. v. Lincoln Nat'l Life           Ins. Corp., 873 F.2d 281, 282 (11th Cir. 1989) (per curiam) (stating that "[p]arties may negotiate for and           include provisions for consolidation of arbitration proceedings in their arbitration agreements, but if such           provisions are absent, federal courts may not read them in").

6
  Because we have concluded that the district court erred in ordering the tripartite arbitration we will not           address the appropriateness of the district court's confirmation of the tripartite arbitration award.