Court Opinion

ID: 1031423
Source: CourtListenerOpinion
Date Created: 2013-07-05 08:31:05.28378+00
Date Added: 2024-06-11T15:12:42.147486
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                             No. 08-2400

VERIZON CORPORATE SERVICES CORPORATION,

                Plaintiff - Appellee,

           v.

COMMUNICATIONS WORKERS OF AMERICA, AFL-CIO,

                Defendant - Appellant.

Appeal from the United States District Court for the District of
Maryland, at Greenbelt.     Peter J. Messitte, Senior District
Judge. (8:08-cv-00097-PJM)

Argued:   October 28, 2009                 Decided:   January 25, 2010

Before WILKINSON and NIEMEYER, Circuit Judges, and Anthony J.
TRENGA, United States District Judge for the Eastern District of
Virginia, sitting by designation.

Affirmed by unpublished per curiam opinion.

ARGUED: Stephen Koslow, CWA, AFL-CIO, Rockville, Maryland, for
Appellant. Julia McAree Broas, JONES DAY, Washington, D.C., for
Appellee.   ON BRIEF: Willis J. Goldsmith, JONES DAY, New York,
New York, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

       The district court set aside an award entered pursuant to a

labor arbitration between the Communication Workers of America

(the    “Union”)         and     Verizon        Corporate       Services       Corporation

(“Verizon”)      on      the    ground    the       arbitrator       “ignored”   “critical

language       in        the     Collective           Bargaining        Agreement”        and

“introduce[d] some of his own brand of industrial justice.”                              The

court   concluded         that   the     award      was     beyond    the   scope   of    the

arbitrator’s authority.

       After a careful review of the record and consideration of

counsels’ arguments, we affirm.

                                                I

       When,   in     December      2004,       Verizon       began    transferring       the

tasks of transporting, unboxing, and checking inventory items

from    higher      paid       “storekeepers”          to     lower     paid     “assistant

technicians”        at    its    assembly        facility      in     Martinsburg,       West

Virginia -- the Verizon Advanced Resources and Technology Center

(“VARTAC”) -- the Union filed a grievance, arguing that the work

should have remained assigned to storekeepers, as provided for

in a 2001 letter agreement between Verizon’s vice president,

Michael Millegan, and the Union (the “Millegan Letter”).                                 The

Millegan Letter, agreed to after the Union had likewise objected

                                                2
when Verizon had assigned the tasks to assistant technicians in

2000, provided that storekeepers would perform the tasks.

        In 2003, some two years after the Millegan Letter, the 2000

collective bargaining agreement (“CBA”) between Verizon and the

Union expired, and the parties negotiated a new one.                                During

negotiations, Verizon proposed broadly expanding the duties of

assistant      technicians,          but    the       Union    rejected     the   proposal.

Nonetheless, the parties agreed to a “letter of understanding”

(the “AT Letter”), which became part of the 2003 CBA, assigning

to   assistant      technicians        at    company          assembly    facilities    (the

VARTAC       plant)     the    duties        to       “transport[],        uncrate[]     and

inventor[y] equipment.”

        The 2003 CBA also included a “Continuation Letter,” which

provided that all “local agreements” that were valid under the

prior 2000 CBA and “which ha[d] not been separately renegotiated

by the parties in 2003 negotiations,” would continue in effect

for the life of the 2003 CBA.                         The Continuation Letter also

provided that local agreements that had been renegotiated during

the 2003 CBA negotiations would “speak for themselves.”

       Beginning in December 2004, Verizon began reassigning the

tasks    of    transporting,          unboxing,         and     checking    inventory     to

assistant technicians, in accordance with the AT Letter that was

part    of    the     2003    CBA.         The       Union    filed   a    grievance   over

Verizon’s action, contending that the tasks should have remained

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with storekeepers, as provided in the Millegan Letter, because,

it asserted, the Millegan Letter survived the 2003 CBA pursuant

to the Continuation Letter.          When the parties were unable to

resolve the grievance, they selected arbitrator James J. Sherman

to resolve it.

      After   concluding      that      the        Millegan     Letter     was     an

enforceable local agreement, arbitrator Sherman concluded that

the Millegan Letter survived the 2003 CBA, reasoning as follows:

      Management argued that regardless of the status of Mr.
      Millegan’s local agreement, that agreement became null
      and void in 2003 when the parties entered into another
      master contract. The Arbitrator cannot agree. The
      evidence shows that even though the Millegan letter
      was discussed, and Management expressed its opinion
      that the letter did not qualify as a binding
      agreement, there is nothing in this new (2003)
      contract which indicated that both parties accepted
      this view.

           On the contrary, the contract appears to say
      quite the opposite. Section C of Article 41 contains
      two paragraphs which appear to incorporate the letter
      and intent contained in Mr. Millegan’s letter.

           The third paragraph states, in essence, that all
      local agreements that were valid and enforceable under
      the 2000 contract will continue in effect for the life
      of the new agreement. Then the forth [sic] paragraph
      makes the same point in slightly different language.

The arbitrator then noted that, because “[h]e could not say with

the   necessary   confidence     that       either    side     prevailed    with    a

preponderance     of   the   evidence,”       he    would     rely   on   Verizon’s

conduct following the 2003 CBA to rule in favor of the Union.

He determined that the evidence slightly favored the Union due

                                        4
to the fact that Verizon had continued to assign the disputed

tasks to storekeepers for some period after the 2003 CBA became

effective,        demonstrating      that    “[m]anagement       did     not    repudiate

Mr. Millegan’s local agreement immediately or even soon after

the   new   [2003]        contract    went    into    effect.”          The    arbitrator

thereupon entered an award directing Verizon to comply with the

terms of the Millegan Letter.

      Verizon commenced this action to have the award vacated,

and the Union filed a counterclaim to have it enforced.                               On

cross-motions for summary judgment, the district court vacated

the award.

      While       the   district      court       recognized     that    the     Millegan

Letter was a binding agreement, it concluded that the Letter did

not survive the 2003 CBA by reason of the AT Letter and the

Continuation Letter, which were part of the 2003 CBA.                              First,

the   court       noted    that     the    arbitrator       erroneously        referenced

“section      C    of     Article     41”     to     make    a   reference       to   the

Continuation Letter when no such section existed.                             And on the

merits, the court noted that the arbitrator failed to recognize

that the parties, as part of the 2003 CBA, entered into the AT

Letter, which in fact reassigned the disputed tasks to assistant

technicians.        The Continuation Letter explicitly indicated that

any local agreements that had been renegotiated would “speak for

themselves.”            Because      the    duties    of    assistant         technicians

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addressed     in   the   Millegan      Letter    were   renegotiated     in    2003,

resulting     in   the    AT   Letter,     the    court    concluded    that        the

language of the AT Letter set aside task assignments made in the

Millegan Letter.          It characterized the arbitrator’s discussion

about Verizon’s delay in reassigning the tasks as nothing more

than the arbitrator “implementing his own brand of industrial

justice.”

      From the district court’s judgment vacating the award, the

Union filed this appeal.

                                         II

      When a collective bargaining agreement calls for resolution

of a dispute through arbitration, the judicial role in reviewing

the arbitration award is a limited one:

      Because the parties have contracted to have disputes
      settled by an arbitrator chosen by them rather than by
      a judge, it is the arbitrator’s view of the facts and
      of the meaning of the contract that they have agreed
      to accept.   Courts thus do not sit to hear claims of
      factual or legal error by an arbitrator as an
      appellate court does in reviewing decisions of lower
      courts. . . .    [A]s long as the arbitrator is even
      arguably construing or applying the contract and
      acting within the scope of his authority, that a court
      is convinced he committed serious error does not
      suffice to overturn his decision.

United Paperworkers International Union v. Misco, Inc., 484 U.S.

29,   37-38    (1987).         Mere    disagreement       with   an   arbitrator’s

construction       of    the   labor    contract    is     insufficient       for     a

reviewing court to overturn the arbitrator’s decision.                        United

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Steelworkers of America v. Enterprise Wheel & Car Corp., 363

U.S. 593, 598-99 (1960).                Accordingly, federal courts do not

judge the merits when reviewing labor arbitrations but simply

examine    whether     the     arbitrator        actually       delivered          what     was

called    for   by    the     parties’      agreement          --       the   arbitrator’s

interpretation        of      the       collective           bargaining            agreement.

Mountaineer     Gas     Co.       v.    Oil,     Chemical           &    Atomic      Workers

International Union, 76 F.3d 606, 608 (4th Cir. 1996) (“Above

all, we must determine only whether the arbitrator did his job -

- not whether he did it well, correctly, or reasonably, but

simply whether he did it” (citing Remmey v. PaineWebber, Inc.,

32 F.3d 143, 146 (4th Cir. 1994))).

        Even though an arbitrator’s decision is largely free from

review,    courts     must    still     review        for    instances        in    which    an

arbitrator abdicates his duty and actually fails to construe the

collective bargaining agreement.                 Misco, Inc., 484 U.S. at 38

(“The    arbitrator     may       not   ignore    the       plain       language      of    the

contract . . .”).            Courts must thus assure themselves that an

arbitrator’s    award       “is    grounded      in    the    collective           bargaining

agreement . . . ,” as the arbitrator has no authority to exceed

the scope of the parties’ agreement.                         Champion International

Corp. v. United Paperworkers International Union, AFL-CIO, 168

F.3d 725, 729 (4th Cir. 1999).                 When an arbitrator exceeds the

                                           7
scope of contractually conferred authority, a court is bound to

set aside the award:

       [A]n arbitrator is confined to interpretation and
       application of the collective bargaining agreement; he
       does not sit to dispense his own brand of industrial
       justice. . . . [H]is award is legitimate only so long
       as it draws its essence from the collective bargaining
       agreement.   When the arbitrator’s words manifest an
       infidelity to this obligation, courts have no choice
       but to refuse enforcement of the award.

Enterprise Wheel & Car Corp., 363 U.S. at 597.

       In   this    case,      the   arbitrator      was   bound       to    consider          and

apply the relevant contractual provisions defining the duties of

assistant        technicians,        and    the    governing    documents              are     not

disputed.         After    Verizon         began   assigning    inventory              tasks    at

VARTAC      to    assistant      technicians        in   late   2000,            the    parties

agreed, in 2001, to the Millegan Letter, under which the tasks

were     reassigned       to    storekeepers,        who   were    the           higher      paid

employees.         The 2003 CBA, however, which included both the AT

Letter      and     the        Continuation        Letter,      provided               for     the

reassignment of inventory tasks back to assistant technicians.

The parties expressly negotiated this change and memorialized it

in the AT Letter.           That Letter provided that “[t]he duties of an

Assistant Technician will include the following:                             perform work

in connection with placement, rearrangement and removal of wire

and    cable,      and    associated         equipment     in     or        on     customers’

buildings and in Company Assembly facilities.                               In connection

                                               8
with these duties:         . . . [t]ransports, uncrates and inventories

equipment.”       (Emphasis added).              And the Continuation Letter, in

turn,    stated    that        local     agreements      that      were   “renegotiated

during 2003 negotiations will speak for themselves” and that

only    prior    local    agreements        that    “ha[d]       not    been    separately

renegotiated      by     the    parties     in    the    2003     negotiations”         would

continue to be applied.                Thus, under the 2003 CBA, the parties

explicitly agreed to reassign to assistant technicians the tasks

that,    under     the         Millegan     Letter,        had     been     assigned      to

storekeepers.

       In rendering his decision, arbitrator Sherman did not even

acknowledge the existence of the AT Letter, which was part of

the 2003 CBA, much less address its terms.                        Yet, the language of

the AT Letter explicitly addressed the grievance before him.

For    this   reason,     we     agree    with     the   district       court    that    the

arbitrator’s decision did not derive from the 2003 CBA when the

arbitrator       failed        to   recognize        and     discuss        a   provision

explicitly addressing the disputed issue.                        This is an archetypal

case of an arbitrator ignoring the plain language of the CBA.

See,    e.g.,    Champion       International       Corp.,        168   F.3d    at   730-31

(vacating       arbitration         award        granting         bonuses       where     no

contractual provision called for them); Mountaineer Gas Co., 76

F.3d    at      608-10     (vacating        arbitration           award     because       the

arbitrator ignored plain language of the agreement by making an

                                             9
exception to the company’s substance abuse policy where none had

been provided by the contract language).

     Accordingly, we affirm the judgment of the district court.

                                                         AFFIRMED

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