Vegas v. United Steelworkers et al
Filing
101
ORDER GRANTING MOTIONS FOR SUMMARY JUDGMENT re 62 , 64 , 67 , 69 - Signed by CHIEF JUDGE SUSAN OKI MOLLWAY on 12/18/2014. "The court grants the motions for summary judgment and the joinders therein filed by United Steel workers and Vegas's employer. Vegas fails to raise a genuine issue of fact as to whether the union breached its duty of fair representation or whether his employer terminated him for "just cause." The Clerk of Court is directed to en ter judgment for Defendants and to close this case." (emt, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
MICHAEL VEGAS,
)
)
Plaintiff,
)
)
vs.
)
)
UNITED STEELWORKERS, LOCAL
)
12-591; et al.
)
)
Defendants.
)
_____________________________ )
CIVIL NO. 13-00641 SOM/RLP
ORDER GRANTING MOTIONS FOR
SUMMARY JUDGMENT
ORDER GRANTING MOTIONS FOR SUMMARY JUDGMENT
I.
INTRODUCTION.
Plaintiff Michael Vegas alleges that he was wrongfully
terminated by his employer and that his union did not fairly
represent him in subsequent grievance procedings.
Defendants
move for summary judgment, arguing that Vegas cannot demonstrate
that his discharge was both contrary to the collective bargaining
agreement and that his union breached its duty of fair
representation.
This case involves what is known as a “hybrid” claim in
the context of claims by unionized employees.
The record
includes evidence supporting Vegas’s employer’s determination
that Vegas fraudulently claimed to have been sent wrong items in
a company-sponsored incentive program, that Vegas returned the
items and sought to exchange them for more expensive items, and
that Vegas lied during the employer’s investigation of his
actions.
Vegas’s employer reasonably relied on FedEx packing
slips indicating that the weights of the items shipped to Vegas
differed greatly from the weights of the items he returned, and
on the unavailability of the items returned in the shipper’s
stock at the time the items were allegedly sent.
Based on this
same evidence, Vegas’s union, United Steelworkers, Local 12-591,
rationally decided not to take Vegas’s grievance to arbitration,
instead deeming it unlikely that Vegas would recover in an
arbitration and opting to settle the matter.
The court,
concluding that Vegas identifies no triable issue as to his
“hybrid” claim, grants summary judgment in favor of Defendants.
II.
FACTUAL BACKGROUND.
Vegas began working for BHP at an oil refinery on the
West side of Oahu on October 7, 1991.
See Deposition of Michael
Vegas at 75-76, ECF No. 65-2, PageID #s 472-73.
Tesoro bought BHP in the mid-1990s.
# 474.
Id. at 78, PageID
Vegas received Tesoro’s Code of Business Conduct, Doing
the Right Thing.
Id. at 79, PageID # 475; ECF No. 65-2, PageID
# 491 (October 18, 2001, acknowledgment of receipt).
This code
expressed Tesoro’s “core values,” including honesty and
integrity.
Id., PageID # 494.
It required Tesoro employees to
“Always obey the law and act in a professional, honest, and
ethical manner when acting on behalf of or as a representative of
the company.”
Id., PageID # 504.
2
It also required Tesoro
employees to “Cooperate and tell the whole truth when responding
to an investigation or audit.”
Id.
Clayton Tamashiro, a human resources manager for
Tesoro, stated that Tesoro had a “safety incentive program”
called “LOKAHI,” which stood for “Leading Onward, Keeping All
Employees Healthy & Industrious.”
See Declaration of Clayton
Tamashiro ¶¶ 1, 2, ECF No. 65-3, PageID # 533.
Through this
program, Tesoro employees could earn points by completing
approved safety activities, and the points could be redeemed for
various rewards.
The incentive program was run by an outside
vendor, Inspirus, LLC, which provided for the online redemption
of points.
When a Tesoro employee redeemed points for
merchandise, the merchandise was shipped directly to the employee
by Inspirus, which was responsible for any return or exchange of
the merchandise.
Id. ¶¶ 2, 3, PageID #
533-34.
On or about July 2, 2012, Colleen Umathum of Inspirus
informed Tamashiro of a possible fraudulent return by Vegas.
Umathum told Tamashiro that, in January 2012, Vegas had returned
a Bissell vacuum cleaner and had claimed to have redeemed his
points for a more expensive Dyson vacuum cleaner.
Umathon also
told Tamashiro that, in June 2012, Vegas had returned a Lasko
fan, claiming that he had redeemed points for a more expensive
Dyson fan.
3
Umathum said that the shipping weights of the boxes
sent to Vegas via FedEx were different from the shipping weights
of the boxes returned by Vegas to Inspirus.
For example, the box
with the fan sent to Vegas weighed about 15 pounds, but the box
with the fan Vegas returned weighed 4.5 pounds.
Id. ¶ 4, PageID
# 53; ECF No. 68-3, PageID # 325 (email from Umathum to
Tamashiro).
According to Umathum, FedEx records indicated that
box with the vacuum cleaner sent to Vegas in January 2012 weighed
9.9 pounds, but the box he returned weighed 4.4 pounds.
No. 63-8, PageID # 326.
See ECF
Umathum told Tamashiro that neither the
Lasko fan nor the Bissell vacuum cleaner returned by Vegas was
carried by Inspirus’s distribution center.
PageID # 325.
See ECF No. 63-8,
Inspirus appears to have offered some Lasko fans
and Bissell vacuum cleaners, see ECF No. 81-2, PageID # 639 and
649 (copy of Inspirus’s online catalog), but there is no evidence
in the record that Inspirus carried the models Vegas returned or
that those models were in stock at the relevant times.
Umathum
stated that, nevertheless, when the distribution center received
the Bissell vacuum cleaner as a return from Vegas, it sent Vegas
a Dyson vacuum cleaner.
Id.
Tamashiro says that, based on the information from
Inspirus, Tesoro initiated an investigation into possible
misconduct by Vegas.
See Tamashiro Decl. ¶ 4, ECF No. 65-3,
PageID # 534.
4
On July 5, 2012, Tamashiro met with Vegas and Clyde
Foreman, Tesoro’s regional security manager, regarding Vegas’s
redemption of points and the return of the Lasko fan and the
Bissell vacuum cleaner.
PageID # 535.
See Tamashiro Decl. ¶ 5, ECF No. 65-3,
Asked about the differences in shipping weights,
Vegas had no explanation other than to suggest that someone at
Inspirus or FedEx may have switched the merchandise.
In July
2012, Vegas was placed on administrative leave with pay pending
further investigation.
Id.
Vegas says he grieved this
suspension, although the court does not have before it an initial
grievance document relating to the suspension.
See Vegas Decl.
¶ 14, ECF No. 81, PageID # 632.
Article 19 of Tesoro’s collective bargaining agreement
governs the grievance process.
Section 19.01 establishes a
“Worker’s Committee” with not more than five Tesoro employees.
See ECF No. 63-20, PageID # 409.
Under section 19.05 of the CBA,
an employee is required to “seek direct adjustment with his/her
supervisor” in a process called “Step One.”
Id.
If the
grievance is not resolved by the supervisor to the employee’s
satisfaction, a “Step Two” grievance may be instituted within 15
days of the supervisor’s decision through a request by the
Worker’s Committee for a meeting with local management to discuss
the grievance.
Id.
“The time and place of the meeting [would]
be designated by the Local Management,” which was to issue a
5
written decision within 14 days of the meeting.
# 410.
Id., PageID
Within thirty days of that decision, the union could
request arbitration, which would be “Step Three” of the grievance
process.
Id.
At some point after Vegas’s suspension, Umathum told
Tamashiro that Inspirus had asked FedEx to look into Vegas’s
claim that the wrong box had been delivered.
FedEx responded
that it found no evidence of tampering or of Vegas’s receipt of
the wrong fan.
Umathum sent copies of the FedEx labels for the
shipping and return of the fans to Tamashiro.
#s 535-36.
Id. ¶ 6, PageID
The FedEx tracking label for the fan sent to Vegas
indicates that the box weighed 14.3 pounds.
See ECF No. 63-8,
PageID # 335; ECF No. 81-3, PageID # 645 (better copy of same).
The tracking label for the fan returned by Vegas indicates that
it weighed 9.5 pounds.
See ECF No. 63-8, PageID # 333.
On or about July 17, 2012, United Steelworkers notified
Tesoro that it wished to proceed to Step Two of the grievance
procedure for Grievance Number THC-007-12.
PageID # 656.
See ECF No. 81-7,
This document was copied to members of the
Worker’s Committee.
Id.
No Step Two meeting with local management actually
occurred concerning Vegas’s July 2012 suspension, possibly
because, on August 2, 2012, Tesoro terminated Vegas.
Tesoro had
determined that, in violation of its Code of Business Conduct,
6
Vegas had attempted to defraud Inspirus by returning products of
a lesser quality and value than the ones shipped to Vegas.
See
Tamashiro Decl. ¶¶ 7, 9, ECF No. 65-3, PageID # 537; ECF No. 634, PageID # 307 (termination letter).
Tamashiro says that, at
the time Vegas was terminated, Tamashiro knew of no other Tesoro
employee who had had “issues with product returns . . . to
Inspirus.”
Supp. Tamashiro Decl. ¶ 3, ECF No. 96-3, PageID
# 811.
On August 6 or 7, 2012, United Steelworkers filed a
written grievance on Vegas’s behalf, which was also given number
THC-007-12 (the same number assigned to the suspension
grievance).
The August 2012 grievance sought to rescind the
termination, to remove all record of the incident from Vegas’s
file, and to have Vegas reimbursed for lost wages.
See Tamashiro
Decl. ¶ 10, ECF No. 65-3, PageID # 538; ECF N0 81-6, PageID # 653
(copy of grievance); ECF No. 63-6, PageID # 311 (same).
Because
it has the same grievance number as Vegas’s purported grievance
of his suspension, it appears that this document amended the
earlier grievance, assuming an earlier grievance existed, and
became a Step One grievance relating to the termination.
On August 12, 2012, Tamashiro responded to the
grievance, as required by the CBA’s Step One grievance procedure.
Tamashiro’s response stated that Tesoro did not believe that
Tesoro had violated any provision of the CBA.
7
See Tamashiro
Decl. ¶ 11, ECF No. 65-3, PageID # 538.
On or about August 15,
2012, Tesoro sent a letter to Vegas’s union denying any violation
of the CBA.
See ECF No. 82-3, PageID # 701.
On September 12, 2012, Tesoro sent Vegas's union
information and documents that the union had requested, including
the information and documents obtained from Inspirus.
See
Tamashiro Decl. ¶ 12, ECF No. 65-3, PageID # 538-39; ECF No. 638, PageID #s 319-51.
In a letter dated October 16, 2012, the union (through
Patricia Koge) asked that Vegas’s grievance, THC-007-12, proceed
to Step Two of the grievance process.
# 359.
2012.
See ECF No. 63-10, PageID
Tamashiro says Tesoro received that letter on October 22,
See Tamashiro Decl. ¶ 13, ECF No. 65-3, PageID # 539.
That letter does not appear to have been a timely invocation of
Step Two of the grievance process concerning Vegas’s termination,
as it does not appear to have been submitted within 15 days of
Vegas’s receipt of Tamashiro’s response of August 12, 2012, as
required by section 19.05 of the CBA.
On January 7, 2013, Tamashiro sent Vegas’s union a
letter indicating that its Step Two request was untimely.
ECF No. 63-11, PageID # 361.
See
Gaylan Prescott, who worked for
Vegas’s union’s international representative, says that, although
Tesoro initially asserted the untimeliness of the Step Two
grievance procedure request, Tesoro nevertheless “worked to
8
resolve” it.
See Declaration of Gaylan Prescott ¶ 13, ECF No.
63-19, PageID # 385.
At the beginning of 2013, Tesoro was preparing to shut
down its refinery.
It therefore met with the union to conduct
“effects bargaining” and to resolve all outstanding grievances,
including Vegas’s.
PageID # 539-40.
See Tamashiro Decl. ¶ 14, ECF No. 65-3,
Tesoro put aside its procedural objection to
the timeliness of the request for a Step Two grievance
proceeding.
See Prescott Decl. ¶ 16, ECF No. 63-19, PageID
# 386.
Because Prescott thought Vegas would lose in any
arbitration and believed that settling the grievance was in
Vegas’s best interest, the union proposed to settle Vegas’s
grievance for $12,500.
14, PageID # 367.
See id. ¶ 22, PageID # 388; ECF No. 63-
A few weeks later, Tesoro made a counteroffer
to settle Vegas’s grievance for $2,500.
See ¶ 22, PageID # 389.
On March 24, 2013, Patricia Koge of the union sent
Vegas an e-mail that mistakenly informed him that the union had
actually settled his grievance:
We just completed effects bargaining and your
grievance was “settled.”
The company disagreed with the union’s
position concerning your grievance and the
union’s representative felt it wasn’t in the
best interest of the union to arbitrate based
on the merits of the grievance.
9
The company argued that it was highly
improbable that the vendor would send you the
wrong items twice in a year and both times it
was brands that they didn’t stock/have. They
also cited the investigation conducted by
Inspirus and FedEx stating that the
difference in weight from what they sent you
and the weight when returned (too big a
difference), the label on the returned fan
box appeared to have been removed and
attached to the box sent back to them and
questioned the probability of the companies
(Inspirus and FedEx) conspiring to switch the
item. They were within their rights to
terminate you because Inspirus is contracted
by Tesoro to manage the awards program and is
a “part” of the company.
Our union representative felt that there was
sufficient evidence on the company’s part to
make winning at arbitration very slim.
ECF No. 63-15, PageID # 369.
On April 6, 2013, Koge sent Vegas another e-mail
stating that his grievance had not been settled because a
counteroffer had been made.
See ECF No. 63-16, PageID # 372.
On May 24, 2013, Koge sent Prescott an e-mail
explaining that Tesoro had made a counteroffer to settle Vegas’s
grievance for $2,500.
See ECF No. 63-14, PageID # 367.
Prescott
responded that same day, “Pat, I do not believe we can prevail in
arbitration with this grievance.
of settlement.”
I would gladly accept the offer
Id.
On May 26, 2013, Vegas sent Koge an e-mail that asked
about the status of his grievance.
# 376.
See ECF No. 63-18, PageID
Koge responded in an e-mail that may have been misdated
10
May 25, 2013, a day before Vegas had asked about the status of
his grievance, that Tesoro was offering $2,500 to settle the
grievance and that the union had accepted the proposed
settlement.
response.
Id.
It is not clear when Vegas read Koge’s
Nor is it clear whether the e-mail dated May 25, 2013,
was actually received on that date.
The only evidence
definitively establishing Vegas’s notice that his grievance had
been settled is his e-mail of May 28, 2013, which stated that he
was confused by the $2,500 offer.
Id.
On June 17, 2013, Koge sent an e-mail to Vegas,
clarifying the reason that the union had decided to settle
Vegas’s grievance rather than arbitrate the matter.
Koge stated
that Prescott would have handled the arbitration on Vegas’s
behalf and that Prescott thought that Tesoro would win at
arbitration.
Accordingly, Prescott decided that it was in
Vegas’s best interest to accept the $2,500 settlement offer
rather than get nothing via the arbitration process.
See ECF No.
63-18, ECF No. 378; Decl. of Gaylan Prescott ¶¶ 20-21, 23-25, ECF
No. 63-19, PageID #s 387-90.
Prescott appears to have conferred
with the union’s lawyers in making this decision.
See ECF No.
63-18, PageID # 379.
Vegas filed the initial Complaint in this matter on
November 22, 2013, 178 or 179 days after his e-mail of May 28,
11
2013, definitively establishing that he had received notice that
the union was not going to take his grievance to arbitration.
In his deposition, Vegas was asked whether he had any
complaints against the union, other than his dispute about the
union’s refusal to take his grievance to arbitration.
Vegas
indicated that he had no other issues with his union.
See Depo.
of Michael Vegas at 39, lines 9-23, ECF No. 65-2, PageID # 471.
III.
SUMMARY JUDGMENT STANDARD.
Summary judgment shall be granted when “the movant
shows that there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.”
R. Civ. P. 56(a) (2010).
Fed.
See Addisu v. Fred Meyer, Inc., 198
F.3d 1130, 1134 (9th Cir. 2000).
The movants must support their
position that a material fact is or is not genuinely disputed by
either “citing to particular parts of materials in the record,
including depositions, documents, electronically stored
information, affidavits or declarations, stipulations (including
those made for the purposes of the motion only), admissions,
interrogatory answers, or other materials”; or “showing that the
materials cited do not establish the absence or presence of a
genuine dispute, or that an adverse party cannot produce
admissible evidence to support the fact.”
Fed. R. Civ. P. 56(c).
One of the principal purposes of summary judgment is to identify
12
and dispose of factually unsupported claims and defenses.
Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986).
Summary judgment must be granted against a party that fails to
demonstrate facts to establish what will be an essential element
at trial.
See id. at 323.
A moving party without the ultimate
burden of persuasion at trial--usually, but not always, the
defendant--has both the initial burden of production and the
ultimate burden of persuasion on a motion for summary judgment.
Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1102
(9th Cir. 2000).
The burden initially falls on the moving party to
identify for the court those “portions of the materials on file
that it believes demonstrate the absence of any genuine issue of
material fact.”
T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors
Ass’n, 809 F.2d 626, 630 (9th Cir. 1987) (citing Celotex Corp.,
477 U.S. at 323).
“When the moving party has carried its burden
under Rule 56(c), its opponent must do more than simply show that
there is some metaphysical doubt as to the material facts.”
Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574,
586 (1986) (footnote omitted).
The nonmoving party must set forth specific facts
showing that there is a genuine issue for trial.
Serv., Inc., 809 F.2d at 630.
T.W. Elec.
At least some “‘significant
probative evidence tending to support the complaint’” must be
13
produced.
Id. (quoting First Nat’l Bank of Ariz. v. Cities Serv.
Co., 391 U.S. 253, 290 (1968)).
See Addisu, 198 F.3d at 1134 (“A
scintilla of evidence or evidence that is merely colorable or not
significantly probative does not present a genuine issue of
material fact.”).
“[I]f the factual context makes the non-moving
party’s claim implausible, that party must come forward with more
persuasive evidence than would otherwise be necessary to show
that there is a genuine issue for trial.”
Cal. Arch’l Bldg.
Prods., Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468
(9th Cir. 1987) (citing Matsushita Elec. Indus. Co., 475 U.S. at
587).
Accord Addisu, 198 F.3d at 1134 (“There must be enough
doubt for a ‘reasonable trier of fact’ to find for plaintiffs in
order to defeat the summary judgment motion.”).
All evidence and inferences must be construed in the
light most favorable to the nonmoving party.
Inc., 809 F.2d at 631.
T.W. Elec. Serv.,
Inferences may be drawn from underlying
facts not in dispute, as well as from disputed facts that the
judge is required to resolve in favor of the nonmoving party.
Id.
When “direct evidence” produced by the moving party
conflicts with “direct evidence” produced by the party opposing
summary judgment, “the judge must assume the truth of the
evidence set forth by the nonmoving party with respect to that
fact.”
Id.
14
IV.
ANALYSIS.
A.
Hybrid § 301/Fair Representation Claims.
Vegas is claiming that Tesoro breached provisions of
its collective bargaining agreement and that United Steelworkers
breached its duty of fair representation.
In DelCostello v.
International Brotherhood of Teamsters, 462 U.S. 151, 163-4
(1983), the Supreme Court explained that employees have the right
to bring suit against their employers for breaches of collective
bargaining agreements, but the employees must ordinarily attempt
to exhaust grievance and/or arbitration remedies provided in
collective bargaining agreements.
Subject to very limited
judicial review, these employees are bound by the finality
provisions in collective bargaining agreements.
Id.
When a
union representing an employee in the grievance and/or
arbitration proceedings “acts in such a discriminatory,
dishonest, arbitrary, or perfunctory fashion,” that conduct
amounts to an “unacceptable injustice,” as it essentially
prejudices the employee based on the lack of review.
The union
is therefore said to have breached its duty of fair
representation.
The Supreme Court recognized that, in such instances,
an employee may bring suit against both the employee’s employer
and union, notwithstanding the finality of any grievance or
arbitration proceeding.
Id.
15
Such a suit, as a formal matter, comprises
two causes of action. The suit against the
employer rests on § 301, since the employee
is alleging a breach of the collective
bargaining agreement. The suit against the
union is one for breach of the union's duty
of fair representation, which is implied
under the scheme of the National Labor
Relations Act. Id. . . . . To prevail
against either the company or the Union,
employee-plaintiffs must not only show that
their discharge was contrary to the contract
but must also carry the burden of
demonstrating a breach of duty by the Union.
The employee may, if he chooses, sue one
defendant and not the other; but the case he
must prove is the same whether he sues one,
the other, or both. The suit is thus not a
straightforward breach of contract suit under
§ 301 . . . , but a hybrid § 301/fair
representation claim, amounting to a direct
challenge to the private settlement of
disputes under the collective-bargaining
agreement.
Id. at 165 (quotation marks, alterations, and citations omitted).
“A breach of the statutory duty of fair representation
occurs only when a union’s conduct toward a member of the
collective bargaining unit is arbitrary, discriminatory, or in
bad faith.”
Vaca v. Sipes, 386 U.S. 171, 190 (1967).
The
Supreme Court has explained that, for purposes of examining
whether a union acted arbitrarily with respect to its duty of
fair representation, a union breaches its duty only when its
conduct “can be fairly characterized as so far outside a wide
range of reasonableness that it is wholly irrational or
arbitrary.”
Marquez v. Screen Actors Guild, Inc., 525 U.S. 33,
45 (1998) (quotation marks and citations omitted).
16
This court must first decide whether the union’s
conduct in handling the grievance at issue involved the exercise
of judgment, or whether it was procedural or ministerial in
nature.
When an exercise of judgement is involved, a plaintiff
can prevail on a duty of fair representation claim only when the
union’s conduct is discriminatory or in bad faith.
However, when
the union’s challenged conduct is procedural or ministerial, a
plaintiff can prevail on a duty of fair representation claim when
the conduct is arbitrary, discriminatory, or in bad faith.
See
Wellman v. Writers Guild of Am., W., Inc., 146 F.3d 666, 670 (9th
Cir. 1998); see also Wong v. Haw. Medical Ctr.-W., LLC, 2009 WL
3294794 (D. Haw. Oct. 14, 2009).
An employee has no absolute right to have a union take
a grievance to arbitration.
See Evangelista v. Inlandboatmen’s
Union of Pac., 777 F.2d 1390, 1395 (9th Cir. 1985).
“A union's
decision to pursue a grievance based on its merits or lack
thereof is considered an exercise of its judgment.”
Stevens v.
Moore Bus. Forms, Inc., 18 F.3d 1443, 1447 (9th Cir. 1994).
“[U]nions are not liable for good faith, non-discriminatory
errors of judgment made in the processing of grievances.”
Id.
In other words, unions are given “room to make discretionary
decisions and choices, even if those judgments are ultimately
wrong.”
Id. at 45-46.
17
In Air Line Pilots Association v. O’Neill, 499 U.S. 65,
66-67 (1991), for example, the Supreme Court held that the union
did not act arbitrarily such that it breached its duty of fair
representation when it rationally settled a case, even though the
settlement turned out to be a bad one for some employees.
The Ninth Circuit has further explained that, in
evaluating a union’s conduct, courts should recognize that unions
have “substantial discretion” in making decisions because a union
must balance many collective and individual interests when it
decides whether and to what extent to pursue a particular
grievance.
Dutrisac v. Caterpiller Tractor Co., 749 F.2d 1270,
1273 (9th Cir. 1983).
Even the case on which Vegas relied most heavily at the
hearing on the present motions, Kirbyson v. Tesoro Refining &
Marketing Co., 795 F. Supp. 2d 930, 939, (N.D. Cal. 2011), notes,
“A union’s decision about how to best handle a grievance is
generally a matter of judgment, as is its decision to not take a
grievance to arbitration.”
A union does not breach a duty of
fair representation merely because it settles a grievance instead
of arbitrating it.
Vaca v. Sipes, 386 U.S. 171, 192 (1967).
Therefore, ordinarily, an employee can show a breach of
the union’s duty of fair representation only when the union’s
exercise of judgment in refusing to pursue arbitration was
discriminatory or in bad faith.
See Wellman v. Writers Guild of
18
Am., W., Inc., 146 F.3d at 670.
Kirbyson does note, as Vegas
stresses, that a union may not ignore a grievance.
A disregard
of an employee’s rights may, as noted by the district court in
that case, enhance judicial scrutiny of the unions action because
unions
must conduct some minimal investigation of
grievances . . . . Consequently, when a
union member brings a meritorious grievance,
the union’s decision to ignore that grievance
or to process it in a perfunctory manner is
considered a ministerial action that breaches
the union’s duty if it is arbitrary,
discriminatory, or performed in bad faith.
Nevertheless, a court reviewing a union’s
conduct will not find that the union has
exercised its duties perfunctorily unless it
has treated the union member’s claim so
lightly as to suggest an “egregious
disregard” of her rights.
Kirbyson, 795 F. Supp. 2d at 940 (citations omitted).
B.
Defendants Have Not Demonstrated that the SixMonth Statute of Limitations Bars Vegas’s Claims.
The applicable statute of limitations for hybrid
§ 301/fair representation claims is six months.
DelCostello, 462
U.S. at 164-65 (holding that section 10(b) of the National Labor
Relations Act, 29 U.S.C. § 160(b), sets the applicable statute of
limitations for hybrid § 301/fair representation claims at six
months).
The limitations period begins to run when the employee
discovers, or in the exercise of reasonable diligence should have
discovered, the acts constituting the alleged violation.
See
Galindo v. Stoody Co., 793 F.2d 1502, 1509 (9th Cir. 1986).
19
Thus, “in a duty of fair representation case, the six-month
period begins to run when an employee knows or should know of the
alleged breach of duty of fair representation by a union.”
Id.
Defendants argue that Vegas’s hybrid § 301/fair
representation claim is barred by the six-month statute of
limitations because he filed his original Complaint on November
22, 2013, more than six-months after he received an e-mail dated
March 24, 2013, telling him that the union had settled his
grievance.
This argument ignores the union’s e-mail to Vegas of
April 6, 2013, which stated that Vegas’s grievance had not been
settled given a counteroffer.
See ECF No. 63-16, PageID # 372.
In an e-mail dated May 25, 2013, Vegas was told that
Tesoro was offering $2,500 to settle his grievance and that the
union has accepted the offer.
See ECF No. 63-18, PageID 376.
There is no evidence establishing whether Vegas read this e-mail
on the day it was sent.
On May 28, 2013, Vegas sent an e-mail
indicating that he was confused by the $2,500 offer.
Id.
The record before this court does not establish that,
when Vegas filed this action on November 22, 2013, that date was
more than six-months from when Vegas knew that the union was not
going to arbitrate his grievance.
A statute of limitations
defense is an affirmative defense with respect to which a
defendant asserting the defense bears the burden of proof.
See
Payan v. Aramark Mgmt. Servs. Ltd. P’ship, 495 F.3d 1119, 1122
20
(9th Cir. 2007) (“because the statute of limitations is an
affirmative defense, the defendant bears the burden of proving
that the plaintiff filed beyond the limitations period”); Tovar
v. U.S. Postal Serv., 3 F.3d 1271, 1284 (9th Cir. 1993) (“In
every civil case, the defendant bears the burden of proof as to
each element of an affirmative defense.”); see also Overall v.
Estate of Klotz, 52 F.3d 398, 403 (2d Cir. 1995) (“Because the
statute of limitations is an affirmative defense, the defendant
bears the burden of establishing by prima facie proof that the
limitations period has expired since the plaintiff's claims
accrued.”).
Defendants do not meet their burden on the
limitations issue.
C.
Vegas Does Not Establish a Triable Issue
Concerning a Breach of the Union’s Duty of Fair
Representation.
1.
The Union’s Decision Was Supported by
Rational Bases.
Vegas’s First Amended Complaint does not clearly
identify the wrongdoing he is alleging.
See ECF No. 9.
At
Vegas’s deposition, he was asked whether he had any complaints
against the union, other than his complaint that the union had
refused to take his grievance to arbitration.
that he had no other issues with his union.
Vegas indicated
See Depo. of Michael
Vegas at 39, lines 9-23, ECF No. 65-2, PageID # 471.
It thus
appears that Vegas is asserting a hybrid § 301/fair
representation claim against his employer and his union based on
21
the union’s failure to arbitrate his grievance concerning his
termination.
To prevail against either his employer or his union
under the hybrid § 301/fair representation claim asserted in the
First Amended Complaint, Vegas must show both that his
termination was contrary to Tesoro’s collective bargaining
agreement with United Steelworkers and that United Steelworkers
breached its duty of fair representation.
at 165.
DelCostello, 462 U.S.
Vegas has raised no question of fact as to whether the
union’s decision to settle his grievance rather than proceed to
arbitration was a breach of the union’s duty of fair
representation.
He offers no facts tending to show that the
union acted in “a discriminatory, dishonest, arbitrary, or
perfunctory fashion,” id. at 164, or “arbitrary, discriminatory,
or in bad faith.”
Vaca, 386 U.S. at 190.
United Steelworkers settled Vegas’s grievance because
it believed that Vegas could not prevail in arbitration.
Gaylan
Prescott was the union representative who would have represented
Vegas in any arbitration.
In thinking that Vegas would lose in
arbitration, Prescott was relying on what he viewed as the
improbability that Inspirus had sent Vegas incorrect items that
it did not even have in stock twice in the same year; on the
differences in the FedEx weights of the boxes sent and the boxes
returned; and on Vegas’s inability to credibly explain the weight
22
differences.
Prescott concluded that accepting the settlement
offer of $2,500 was in Vegas’s best interest.
These
circumstances support the union’s decision to settle the
grievance as a rational exercise of judgment.
See Wellman, 146
F.3d at 670.
2.
Vegas Does Not Establish Discrimination or
Bad Faith by the Union.
Vegas does not meet the union’s showing of the
rationality of its decision with evidence of discrimination or
bad faith by the union.
In fact, his attempts to do so backfire.
For example, he notes that the union was concerned that
Tesoro was about to shut down the refinery and was pursuing
“effects bargaining” under the circumstances.
But an impending
refinery shutdown would have given the union greater
justification for accepting a settlement.
And a shutdown would
not have changed the facts underlying Vegas’s termination, such
as the evidence indicating that Vegas had returned items having a
lesser value than the items sent to him.
Vegas says that employees at the refinery were facing
layoffs, and Worker’s Committee members might have benefitted
from Vegas’s termination by moving up the seniority ladder in
Vegas’s absence and therefore having greater protection from
layoffs.
But these purported effects of terminating Vegas do
not, without more, establish bad faith by the union in
determining that it was unlikely that Vegas could get his job
23
back through arbitration.
Vegas offers only speculation about
motives, which is insufficient to raise a genuine issue of fact
as to whether the union acted in bad faith.
Certainly this court
must draw reasonable inferences in Vegas’s favor, but this court
balks at finding it reasonable to infer bad faith on so thin a
reed.
Vegas also argues that bad faith on the part of the
union can be inferred because it is ludicrous to think that he,
an employee with a six-figure job, an unblemished employment
record, and a military career, would risk so much for something
like a $200 fan.
But a person’s record does not establish that
the person will never act wrongfully.
A record reflects only
what the record-keeper knows about a person’s past, not what a
person will likely avoid doing in the future.
Vegas’s record
does not raise a genuine issue of fact about whether the union
fairly represented Vegas under the circumstances.
3.
Vegas Demonstrates No Viable Claim That the
Union “Ignored” His Grievance.
Although Vegas stated at his deposition that his only
complaint with the union was that it did not arbitrate his
grievance, see Vegas Depo. at 39, lines 9-23, ECF No. 65-2,
PageID # 471, his Joint Opposition indicates that he is now also
complaining that the union “ignored” his grievance.
78, PageID # 599.
See ECF No.
To avoid unfairness to opposing parties, the
court does not normally allow parties to vary their claims from
24
those specifically identified or narrowed at depositions.
Nevertheless, even if considered, Vegas’s “ignoring” claim is an
unavailing attempt to show that the union acted arbitrarily,
discriminatorily, or in bad faith in the grievance process.
Article 19 of the collective bargaining agreement
governs the grievance process.
Section 19.01 establishes a
“Worker’s Committee” made up of not more than five employees of
Tesoro.
See ECF No. 63-20, PageID # 409.
Under section 19.05 of
the agreement, an aggrieved employee is required to “seek direct
adjustment with his/her supervisor,” in what is called “Step One”
of the grievance process.
Id.
If the grievance is not settled
by the supervisor to the employee’s satisfaction, a “Step Two”
grievance may be instituted within 15 days of the supervisor’s
decision by a Worker’s Committee request for a meeting with local
management to discuss the grievance.
Id.
Although Vegas contends that the union did not quickly
conduct a Step Two meeting as requested in the letter of July 17,
2012, that argument does not win the day.
The July 2012 letter
concerned a Step Two grievance relating to Vegas’s suspension.
Vegas was terminated shortly after the date of that letter, on
August 2, 2012.
Another grievance was then filed under the same
number as the earlier one.
This new grievance, addressing
Vegas’s termination, restarted the process at Step One.
Thereafter, as discussed above, an untimely request was made for
25
a Step Two grievance proceeding relating to the termination.
Under these circumstances, the absence of a Step Two grievance
proceeding related to the July 2012 request was justified.
Moreover, section 19.05 of the collective bargaining agreement
did not require Tesoro to hold any Step Two meeting within a
specified time from its receipt of a Step Two request.
That
section only says that, when a meeting is held, a written
decision must issue within 14 days of the meeting.
See ECF No.
63-20, PageID # 410.
Even with the waiver of the untimeliness of the Step
Two grievance request relating to Vegas’s termination, the court
cannot find evidence that the union “ignored” Vegas’s grievance
to his detriment.
The union and management ultimately met to
discuss Vegas’s grievance and agreed to settle his individual
dispute.
Although Vegas posits that a delay in negotiations
caused him to receive a less favorable settlement, that assertion
is not supported by actual evidence in the record.
Vegas
introduces no evidence indicating that, had the Step Two
grievance meeting occurred earlier, he would have likely gotten
his job back or been offered a higher settlement.
Nor does the record suggest that the union handled
anything else relating to Vegas’s grievance in such a perfunctory
manner that its decision could be considered a ministerial action
that breached the union’s duty of fair representation by being
26
arbitrary, discriminatory, or in bad faith.
See Wellman, 146
F.3d at 671; Kirbyson, 795 F. Supp. 2d at 940.
A union does not
exercise its duties perfunctorily “unless it has treated the
union member's claim so lightly as to suggest an ‘egregious
disregard’ of her rights.”
Wellman, 146 F.3d at 671.
At most, Vegas points to the union’s failure to
interview Vegas’s wife or to ask his coworkers whether they had
ever been sent wrong items.
As discussed above, the union had
enough evidence before it to conclude that Vegas would not likely
prevail in arbitration.
to investigate.
This is not a case turning on a failure
Even if Vegas’s wife would have corroborated
Vegas’s version of events, the union could have reasonably
concluded that Vegas’s wife would have been viewed by any
arbitrator as having an interest in the outcome of any
arbitration, and that such an interest would have diminished the
value of what she said.
The union knew from Vegas’s statement of
July 9, 2012, that Vegas’s wife was with him when he went to pick
up the fan, and it is unclear what unexpected information might
have been obtained by interviewing her.
With respect to
coworkers’ receipt of wrong items, the court has no evidence that
the union ever discounted the possibility of errors by Inspirus.
Rather, the union thought it unlikely that an employee would
receive wrong items twice in a year, especially if the items were
not in stock and the shipping weights varied.
27
Gathering data of
other shipping errors would not have addressed that constellation
of circumstances.
In Kirbyson, 795 F. Supp. 2d at 941, relied on heavily
by Vegas at the hearing, the Northern District of California
court noted that, even though the union in that case could have
more zealously pursued a grievance, that failure did not rise to
the level of egregious disregard for a union member’s rights such
that it could be said to have failed to conduct a minimal
investigation.
The circumstances presented here similarly show
no egregious disregard for Vegas’s rights.
Finally, Vegas complains that, after Tamashiro sent
Patricia Koge his response to the Step One grievance, no one from
the Worker’s Committee contacted him.
# 600.
See ECF No. 78, PageID
But Koge, who was both a unit chair and a member of the
Worker’s Committee, did send an October 16, 2012, letter
requesting a Step Two grievance proceeding.
See ECF No. 63-10,
PageID # 359.
See also Supp. Prescott Decl. ¶ 3, ECF No. 95-1,
PageID # 773.
While this Step Two request was untimely, Tesoro
ultimately waived the untimeliness, so that Vegas cannot now
identify any actual prejudice.
Finally, Vegas contends that the $2,500 settlement
amount was so low that it represented a bad faith settlement.
Facing a high probability of losing in arbitration, the union
28
decided that accepting $2,500 was better than nothing.
Vegas
presents nothing more than his bare assertion arguing otherwise.
Because Vegas does not raise a genuine issue of fact as
to whether the union’s decision to settle his grievance rather
than take it to arbitration was arbitrary, discriminatory, or in
bad faith, Defendants are entitled to summary judgment on the
hybrid § 301/fair representation complaint that the union refused
to arbitrate Vegas’s grievance.
D.
No Breach of the Collective Bargaining Agreement
Has Been Shown.
There is no dispute that, under section 19.07 of the
collective bargaining agreement, Vegas could only be suspended or
terminated based on “just cause.”
As described above, there is
no genuine issue of fact as to whether Tesoro suspended and
terminated Vegas for just cause.
Tesoro had a basis for
concluding that Vegas had attempted to commit fraud in one of its
employee programs.
The implausibility of his explanation also
caused Tesoro to believe that he was lying during the
investigation process.
Accordingly, besides being entitled to
summary judgment because Vegas fails to show that the union’s
decision was arbitrary, discriminatory, or in bad faith, Vegas’s
union and his employer are entitled to summary judgment on his
hybrid § 301/fair representation claim because Vegas fails to
raise a genuine issue of fact as to whether he was terminated for
“just cause.”
29
E.
Vegas’s Employer, However Named, is Entitled To
Summary Judgment.
Vegas complains that Tesoro Hawaii Corporation is the
entity seeking summary judgment, but that he is suing Tesoro
Corporation, the 100% owner of Tesoro Hawaii Corporation, and its
successor and its subsidiary, Par Petroleum Corporation and
Hawaii Independent Energy.
Vegas says his employer was Tesoro
Corporation, a matter he says is established by the use of Tesoro
Corporation letterhead on the letter transmitting the employee
code of conduct.
See ECF No. 65-2, PageID # 491.
Vegas also
argues that Tesoro Hawaii Corporation became Tesoro Hawaii LLC.
Vegas’s arguments concerning which corporate entity was
his employer make no difference to the adjudication of this
motion, although the court does note that the collective
bargaining agreement was with Tesoro Hawaii Corporation, the
movant before the court, and that the Tesoro Corporation
letterhead that Vegas points to arguably only shows that the
entire Tesoro family of companies shared the same code of
conduct.
See ECF No. 63-20.
Because Vegas cannot demonstrate
that United Steelworkers breached its duty of fair representation
or that he was terminated without “just cause,” Vegas cannot
maintain a claim against his employer, whatever entity that may
be, as the identical elements are required for hybrid § 301/fair
representation claims against employers and unions.
DelCostello, 462 U.S. at 165.
See
Whether the employer is Tesoro
30
Corporation or Tesoro Hawaii Corporation, both the employer and
the union are entitled to summary judgment because Vegas cannot
prove essential elements of his claims.
V.
CONCLUSION.
The court grants the motions for summary judgment and
the joinders therein filed by United Steelworkers and Vegas’s
employer.
Vegas fails to raise a genuine issue of fact as to
whether the union breached its duty of fair representation or
whether his employer terminated him for “just cause.”
The Clerk of Court is directed to enter judgment for
Defendants and to close this case.
IT IS SO ORDERED.
DATED: Honolulu, Hawaii, December 18, 2014.
/s/ Susan Oki Mollway
Susan Oki Mollway
Chief United States District Judge
Vegas v. United Steelworkers, Local 12-591, et al., Civil No. 13-00641 SOM/RLP; ORDER
GRANTING MOTIONS FOR SUMMARY JUDGMENT UNDER RULE 60(b)(4) OF THE FEDERAL RULES OF
CIVIL PROCEDURE
31
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