Court Opinion

ID: 9626709
Source: CourtListenerOpinion
Date Created: 2023-08-22 08:22:07.98544+00
Date Added: 2024-06-11T15:11:24.279124
License: Public Domain

McKEAGUE, Circuit Judge,
dissenting.
The district court determined that this matter should be returned to the Arbitrator because, in that court’s words, “The Arbitrator ... undertook to determine whether the Company had complied with the 2002-2007 CBA.” totes> Isotoner Corp. v. Int’l Chem. Workers Union Council, No. 1:04-CV-849, 2007 WL 1108462, at *5 (S.D.Ohio Apr. 10, 2007) (unpublished). That conclusion depends critically on whether the Arbitrator had the authority to direct prospective relief beyond the expiration date of the 1998 CBA (i.e., April 26, 2002). If he had such authority, or if that question is not before us because it has been waived, then the Arbitrator’s references to the 2002 CBA can be viewed as part of the Arbitrator’s finding that the Company had not complied with the ordered remedy in the Original Award, rather than a determination that the Company had violated the 2002 CBA.
I
Considering the latter issue first, the Arbitrator awarded prospective “quasi-in-junctive” relief in addition to retrospective monetary relief in the Original Award: “Management is hereby directed to cease and desist from unilaterally making any changes in employees’ healthcare insurance benefits provided for in Appendix C of the Agreement. Management is hereby directed to cease and desist from unilaterally increasing employees’ share of healthcare insurance premium costs.” Original Award at 13. When asked whether the Company had complied with the Original Award, the Arbitrator explained in relevant part in his Supplemental Award:
The Arbitrator notes that nothing in the 2002-2007 agreement gives Management the right to unilaterally change negotiated healthcare insurance benefits or negotiated copays. Clearly, if Management’s decision was violative of the 1998-2001 agreement it is violative of the 2002-2007 agreement. The improper action that occurred during the 1998-2001 agreement simply carried over into the 2002-2007 agreement.
Supplemental Award at 4.
This paragraph is at the heart of the dispute. Certainly, it can be read as the district court and majority suggest: the Arbitrator exceeded his authority under the 1998 CBA by determining whether the Company had complied with the 2002 CBA. However, assuming for the moment that the Arbitrator had the authority to order prospective relief beyond the expiration of the 1998 CBA, the paragraph can be viewed in a different light.
As explained above, the Arbitrator had directed the Company to cease and desist from unilaterally increasing employees’ share of healthcare insurance premium costs. This directive was reasonably intended to apply beyond the expiration of the 1998 CBA. To determine whether his directive had been complied with, the Arbitrator would have had to look at evidence outside the 1998 CBA. When considering the 2002 CBA, the Arbitrator first explained that the new agreement had not mooted his prospective relief (“nothing in the 2002-2007 agreement gives Management the right to unilaterally change negotiated healthcare insurance benefits or negotiated copays”), nor satisfied it (“Clearly, if Management’s decision was violative of the 1998-2001 agreement it is violative of the 2002-2007 agreement. The improper action that occurred during the 1998-2001 agreement simply carried over into the *4202002-2007 agreement.”)- In other words, the Arbitrator looked at the 2002 CBA and saw the status quo, and the status quo violated the prospective relief he ordered in the Original Award.
Under this construction of the Supplemental Award, the Arbitrator was “arguably ... applying ... and acting within the scope of his authority” under the Original Award. Mich. Family Res., Inc. v. Serv. Employees Int’l Union Local 517M, 475 F.3d 746, 752 (6th Cir.) (citation omitted), cert. denied, — U.S.-, 127 S.Ct. 2996, 168 L.Ed.2d 704 (2007). The Arbitrator was not, according to this construction, determining whether the 2002 CBA had been violated by the Company. Rather, the 2002 CBA was one piece of evidence that the Arbitrator consulted to determine whether the Company had complied with his earlier cease and desist directive. Because the 2002 CBA had the exact same provisions as the 1998 CBA, and because the Company admittedly had not extended relief beyond the expiration date of the 1998 CBA, the Arbitrator concluded that the Company continued to violate the cease and desist directive.
Whether this is the most natural way to read the Supplemental Award does not control, as long as it is a plausible reading. We must resolve any reasonable doubt about whether an award draws its essence from the contract in favor of enforcing the award. United Steelworkers of Am. v. Enter. Wheel & Car Corp., 363 U.S. 593, 598, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960) (“A mere ambiguity in the opinion accompanying the award, which permits the inference that the arbitrator may have exceeded his authority, is not a reason for refusing to enforce the award.”); Polk Bros., Inc. v. Chicago Truck Drivers, Helpers & Warehouse Workers Union (Independent), 973 F.2d 593, 597 (7th Cir.1992). Because the Supplemental Award can plausibly be read as concluding not that the Company violated the 2002 CBA, but rather failed to satisfy the prospective remedy in the Original Award, we should defer to the Arbitrator under the highly deferential standard of review applied to arbitration awards. Mich. Family, 475 F.3d at 753 (“[O]nce it was established that the arbitrator was construing or applying the contract (and acting within the scope of his authority), it made no difference whether the arbitrator had committed serious, improvident or even silly errors in resolving the merits of the dispute.” (internal quotation marks omitted)).
The crucial question becomes, then, whether the Arbitrator had the authority to order prospective relief beyond the expiration of the 1998 CBA.
II
This question presents a close call. I agree with the majority that the Union misses the mark with several of its arguments. For example, the Union asserts that the Arbitrator was standing in the shoes of the NLRB and therefore had the authority to remedy violations of the workers’ statutory rights. Alternatively, the “Recognition” section of the 1998 CBA incorporated statutory rights into the agreement, according to the Union. Yet, while an arbitrator’s award can, under certain limited circumstances, remedy statutory violations,4 there is nothing to suggest that *421this Arbitrator was construing anything but contractual rights and duties. The parties’ briefs to the Arbitrator focus on the 1998 CBA provisions, and both the Original and Supplemental Awards deal with the contractual rights and duties of the parties. It is also difficult to read the “Recognition” section as incorporating all of the statutory rights under the National Labor Relations Act of 1947 (the “NLRA”) into the CBA. In any event, the Arbitrator did not discuss or otherwise signal any rebanee on any specific provision of the NLRA.5
The best argument of the Union is that the Company has waived the issue. Neither party sought to vacate, modify, or correct the Original Award in state or federal court. The deadline for doing so has since passed. O.R.C. § 2711.13 (requiring that notice of a motion to vacate, modify, or correct an arbitration award must be served within three months after the award is delivered to the parties). Moreover, the parties did not seek “clarification” of the Original Award (a request that is not subject to the three-month deadbne, see Sterling China Co. v. Glass, Molders, Pottery, Plastics & Allied Workers Local No. 24, 357 F.3d 546, 552-53 (6th Cir.2004)). In fact, the Company asserts in its amended complaint that the Original Award “was not ambiguous” — instead, according to the Company, the supplemental proceeding was necessary solely to resolve whether the award had been satisfied. Amended Complaint ¶ 23.
In its brief on appeal, the Company convincingly argues that the Arbitrator’s authority could not be expanded to include an issue which the Company clearly indicated it did not intend to arbitrate — i.e., whether its unilateral actions violated the 2002 CBA. Yet, by not seeking a modification or clarification of the Original Award and by asserting in its complaint that the Original Award is unambiguous, the Company has, by its actions, agreed to be bound by the Original Award. Accordingly, we should treat the Original Award “as if it represented an agreement between [the company] and the union as to” the proper remedy for the Company’s violation of the 1998 CBA. E. Associated Coal Corp. v. United Mine Workers of Am., Dist. 17, 531 U.S. 57, 62, 121 S.Ct. 462, 148 L.Ed.2d 354 (2000). In other words, “[f]or present purposes, the award is not distinguishable from the contractual agreement.” Id. This is key — the question before us becomes, in effect, whether the Supplemental Award draws its essence from the 1998 CBA or the Original Award.6
Enterprise Wheel emphasized a crucial point with respect to remedies — “an arbi*422trator needs flexibility when formulating remedies.” Dexter Axle Co. v. Int’l Ass’n of Machinists & Aerospace Workers, Dist. 90, Lodge 1315, 418 F.3d 762, 768-69 (7th Cir.2005) (citing Enterprise Wheel, 363 U.S. at 597, 80 S.Ct. 1358) (footnote omitted). “[Wjhere it is contemplated that the arbitrator will determine remedies for contract violations that he finds, courts have no authority to disagree with his honest judgment in that respect.” United Paperworkers Int’l Union v. Misco, Inc., 484 U.S. 29, 38, 108 S.Ct. 364, 98 L.Ed.2d 286 (1987). “A court ‘must consider whether it is at all plausible to suppose that the remedy [the arbitrator] devised was within the contemplation of the parties and hence implicitly authorized by the agreement.’ ” Dexter Axle, 418 F.3d at 769 (quoting Local 879, Allied Indus. Workers of Am. v. Chrysler Marine Corp., 819 F.2d 786, 789 (7th Cir.1987)).
The Arbitrator concluded in the Supplemental Award that the Company failed to comply with the Original Award because the Company had not altered its unilateral action over health insurance. If, as the Company argues, the Original Award, including its remedial provisions, extends no farther in time than the 1998 CBA, then clearly the Arbitrator acted outside his authority in the Supplemental Award. Supporting the Company’s position is the Arbitrator’s framing of the issue in the Original Award: “Did [the Company] violate the [1998] Agreement when [it] unilaterally made changes in the healthcare insurance benefits beginning on January 1, 2002?” Original Award at 4.
Yet, there are several indications that the prospective relief in the Original Award was intended and understood to extend beyond the 1998 CBA. As explained above, one of the relief provisions made no specific reference to the 1998 CBA: “Management is hereby directed to cease and desist from unilaterally increasing employees’ share of healthcare insurance premium costs.” Id. at 13. The omission by itself provides little insight. Yet, when considered in the context of the timing of the Original Award, the omission takes on greater significance. The Arbitrator issued the Original Award in March 2004, well after the expiration of the 1998 CBA. By definition, any forward-looking, “quasi-injunctive” relief awarded at that time must have had life beyond the date the 1998 CBA expired to avoid being a nullity. Simply put, the cease-and-desist directive makes little sense unless it extends to Company actions after April 26, 2002.
Ill
Considering the Original Award as a bargained-for agreement between the parties, the court should reverse the district court. The Supplemental Award certainly draws its essence from the 1998 CBA and the Original Award. During the supplemental proceedings, the Arbitrator focused the issue on whether the remedies in the first award had been satisfied. The Arbitrator reasonably concluded that the terms of the Original Award called for prospective relief beyond a date that had already passed when the award was issued. Therefore, the Arbitrator had reason to look at evidence, including the terms and conditions of the 2002 CBA, to determine whether the Company had yet complied. Vacating the Administrator’s Second Award interferes with the parties’ bargained-for agreement, including the quasi-injunctive relief ordered under the Original Award. Accordingly, I dissent from the majority’s decision to affirm the district court and to send this matter back for further arbitration proceedings.

. See, e.g., Five Star Parking v. Union Local 723, 246 F. App’x 135, 139 (3d Cir.2007) (unpublished) ("While it is true that, for purposes of efficiency and economy, an arbitrator may at times hear issues pertaining to unfair labor practices, this is only permissible when the arbitrator decides NLRA issues in addition to issues of contract interpretation.”), cert. denied, — U.S. -, 128 S.Ct. 1229, 170 L.Ed.2d 62 (2008).

. For example, an employer violates its bargaining obligations under Sections 8(a)(1) and (5) of the NLRA if it changes a term or condition of employment without bargaining with the employees’ bargaining representative. Litton Fin. Printing Div. v. NLRB, 501 U.S. 190, 198, 111 S.Ct. 2215, 115 L.Ed.2d 177 (1991) (citing NLRB v. Katz, 369 U.S. 736, 743, 82 S.Ct. 1107, 8 L.Ed.2d 230 (1962)); NLRB v. Plainville Ready Mix Concrete Co., 44 F.3d 1320, 1325-26 (6th Cir.1995).

. The Company misreads Eastern Associated Coal to hold that "an arbitration award not challenged on its merits constituted a valid interpretation of the labor agreement and iherefore could be treated 'as if it represented an agreement 'as to the proper meaning’ of the labor agreement.” Appellee’s Br. at 20. Nowhere did the Supreme Court hold that the arbitration award constituted "a valid interpretation” of the agreement. Rather, the Court treated the issue as one akin to waiver: "Eastern does not claim here that the arbitrator acted outside the scope of his contractually delegated authority. Hence we must treat the arbitrator's award as if it represented an agreement between Eastern and the union as to the proper meaning of the contract’s words 'just cause.’ ” E. Associated Coal, 531 U.S. at 62, 121 S.Ct. 462 (citation omitted).