Veolia Transportation Services, Inc. v. Transport Workers Union of America, Local 252, AFL-CIO

Filing 48

OPINION & ORDER denying 38 Motion for Summary Judgment; granting 25 Motion for Summary Judgment. SO ORDERED that plaintiffs summary judgment motion is denied, and defts motion is granted. The case is dismissed with prejudice. The clerk is directed to close the case. Ordered by Judge Sandra J. Feuerstein on 11/6/2015. (Florio, Lisa)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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VEOLIA TRANSPORTATION SERVICES,
INC., d/b/a NASSAU INTER-COUNTY
EXPRESS BUS,
Plaintiff,

FILED 
CLERK 

11/6/2015 9:51 am

U.S. DISTRICT COURT 
EASTERN DISTRICT OF NEW YORK 
LONG ISLAND OFFICE 

against
OPINION AND ORDER
14-CV-6829 (SJF)
TRANSPORTATION WORKERS UNION OF
AMERICA, LOCAL 252, AFL-CIO,
Defendant.
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FEUERSTEIN, District Judge:
On November 20, 2014, plaintiff Veolia Transportation Services, Inc., d/b/a Nassau InterCounty Express Bus (“plaintiff” or “company”) commenced this action seeking to vacate an
October 21, 2014, arbitration award (arbitration award) which required it to arbitrate multiple
employee grievances on a single calendar day. [Docket No. 1]. On January 23, 2015, defendant
Transportation Workers Union of America, Local 252 (“defendant” or “union”) filed an answer
with a counterclaim seeking confirmation of the arbitration award. [Docket No. 10]. On June
25, 2015, the parties moved for summary judgment. [Docket Nos. 25, 38]. For the reasons that
follow, defendant’s motion is granted, and plaintiff’s motion is denied.
I.

Factual Background

On January 1, 2012, plaintiff took over operation of the Nassau County Inter-County
Express (NICE) Bus Service from the Metropolitan Suburban Bus Authority, a division of the
Metropolitan Transit Authority. Plaintiff’s Rule 56.1 Statement of Undisputed Material Facts
(Pl.’s Stmt.) 1–2, ¶¶ 1–5. Under the collective bargaining agreement in effect at the time, the
union brought multiple grievances before a single arbitrator on a single day. Pl.’s Stmt. 2, ¶¶ 8–
9.

The company entered into a new collective bargaining agreement with the union, which
became effective January 1, 2012 through April 15, 2017. Pl.’s Stmt. 2–3, ¶¶ 10, 12. Article I,
Section 9, provided that “past practices governing operations in the bargaining unit shall be
respected by the parties to the extent identified in Exhibit “B” [“Work Rules”], but the Company
shall have the right to establish new rules and work practices in accordance with the provisions
but not inconsistent with the terms of this agreement.” Pl.’s Stmt. 3, ¶¶ 13–15. Similarly,
Article XXI “Work Rules” provided that “Exhibit ‘B’ attached hereto and made a part hereof
contains work rules and past practices in existence prior to the execution of this Agreement
which shall be continued under this Agreement, all other past practices shall be void effective
January 1, 2012.” Pl.’s Stmt. 3, ¶ 14. Neither party submitted a list of past practices, and
Exhibit B remained blank. Pl.’s Stmt. 4, ¶¶ 18–19.
Article II, Section 2 governed grievance procedure and defined a “grievance” or
“complaint” as “any dispute arising out of the interpretation or application of the provisions of,
or attachments, [sic] to this Agreement.” Pl.’s Stmt. 4, ¶ 21, Amended Declaration of Edward J.
Groarke in Support of Defendant’s Motion for Summary Judgment (Groarke Decl.), Exhibit
(Ex.) A, at 7. It conferred upon the arbitrator “the authority to decide all grievances and
complaints,” but not “to render any opinion or make any award, (i) which amends, modifies, or
changes this Agreement or any of its terms; or (ii) limiting or interfering in any way with the
Company’s managerial responsibility to run its transit facilities safely, efficiently, and
economically.” Groarke Decl., Ex. A, at 8.
The collective bargaining agreement set forth the grievance procedure: At the first step,
an aggrieved employee and the union steward present the grievance to a manager within fourteen
(14) days of its occurrence, and if not satisfied with the outcome, at a hearing with the Location’s
Chief Operating officer or his designee within seven (7) days. Groarke Decl., Ex. A, at 8. If the
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union is not satisfied with the disposition of the grievance at the first step,
or in the case where there is a dispute concerning the interpretation
or application of the provision of this collective bargaining
agreement, then in any such case, at the written request of the party
thereto desiring arbitration as herein provided, the matter shall be
submitted for decision to the Impartial Arbitrator.
Groarke Decl., Ex. A, at 8. Additionally,
If the requested arbitration arises out of interpretation or application
of the provisions of this collective bargaining agreement, the request
for such arbitration by the Company or by the Union, as the case
may be, shall be made within seven (7) days after such dispute
arises. The request for such arbitration shall be made to the
Impartial Arbitrator with a copy of the request sent to the opposing
side.
Groarke Decl., Ex. A, at 8–9.
The agreement provided that the arbitrator “shall be empowered to excuse a failure to
comply with the time limitations for good cause shown.” Groarke Decl., Ex. A, at 9. It provided
that the arbitrator’s award “shall be binding and conclusive upon the Company, the Union, and
the employee.” Groarke Decl., Ex. A, at 9.
By letter date June 7, 2012, union counsel provided company counsel with a list of seven
(7) grievances for arbitration. Affirmation of James N. Foster, Jr. in Support of Plaintiff’s
Motion for Summary Judgment (Foster Aff.), Exhibit (Ex.) D; Pl.’s Stmt. 6–7, ¶¶ 29–31. A
dispute arose regarding whether the arbitrator should hear multiple grievances on the same day,
and the arbitrator concluded that, in the absence of consent of the parties, he could not resolve
the dispute; he recommended that the parties raise the issue before another arbitrator. Pl.’s Stmt.
7–9, ¶¶ 32–53; Transp. Workers Union of Am. v. Veolia Transp. Servs., Inc., 24 F. Supp. 3d 223,
225 (E.D.N.Y. 2014).
On July 16, 2012, the union filed a grievance on behalf of all company employees
regarding the company’s practice of scheduling one (1) grievance arbitration per hearing date,
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which the company denied after a hearing at the first step of the grievance procedure, stating that
the arbitrator had already decided the issue. Pl.’s Stmt. 10–11, ¶¶ 63–70. On November 9, 2012,
the union sent the company a notice of arbitration, but the company refused to submit the
multiple-grievance-per-day dispute to arbitration, again arguing that the arbitrator had previously
decided the issue in its favor. Id. at 226.
On December 12, 2012, the union commenced an action to compel arbitration under the
Federal Arbitration Act 9 U.S.C. §§ 1–16, and the Labor Management Relations (Taft–Hartley)
Act of 1947 § 301(a), 29 U.S.C. §§ 185(a). On March 18, 2014, the Honorable Arthur D. Spatt
ordered the parties to arbitrate their dispute, finding that it fell within the scope of the grievancearbitration clause, that the arbitrator had not previously decided the issue, and that an arbitrator,
and not the court, was required to decide any timeliness issue. Transp. Workers Union of Am.,
24 F. Supp. 3d at 230.
Arbitrator Carol Wittenberg held a hearing on July 21, 2014, and, finding that the
company had violated the collective bargaining agreement by refusing to arbitrate multiple
grievances on a single calendar date, sustained the union’s grievance on October 21, 2014.
Groarke Decl., Arbitration Award, Ex. A, at 1, 19. Initially, the arbitrator rejected as
“disingenuous” the company’s argument that the union’s November 9, 2012 arbitration request
was untimely because it was not made within seven (7) days after the company’s July 23, 2012
denial of the grievance. Id. at 14. She explained that the parties reached an impasse on the issue
of the arbitrability of the company’s single-grievance-per-calendar-day policy subsequent to the
company’s July 23, 2012 refusal to arbitrate the issue. Id. at 14–15. The arbitrator also found
that the company’s policy constituted a continuing violation of the collective bargaining
agreement, which the union could challenge each time that the company refused to schedule
multiple grievances on the same calendar date. Id. at 15.
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The arbitrator found that the Article II, Section 2’s plain language was not clear and
unambiguous as to whether the company could refuse to schedule multiple grievances on the
same calendar date, as it employed both the singular and plural when referring to “grievance(s)”
and “complaint(s)” in the definition and grievance-procedure sections, and used the plural form
in the section defining the arbitrator’s authority. Id. at 16. Consequently, she looked to the
bargaining history to understand the parties’ intent, and found (1) that the parties, construing
identical language in their former agreement, formerly conducted multiple grievance-arbitrations
on the same calendar date, and (2) that Ben Fernandez, MTA’s former general counsel,
negotiated on behalf of the company in reaching the current collective bargaining agreement. Id.
II.

DISCUSSION

The company moves for summary judgment seeking vacatur of the October 21, 2014
arbitration award, arguing that the arbitrator ignored the collective bargaining agreement by: (1)
finding the union’s grievance timely; and (2) finding that the company violated the collective
bargaining agreement. Pl.’s Br. 5–12, 12–22. The union moves to confirm the arbitration award,
urging deference, and arguing that it draws its essence from the collective bargaining agreement.
Def.’s Br. 18–22.
A. Summary Judgment Standard.
A court may grant summary judgment if there is “no genuine issue as to any material fact
and that the movant is entitled to judgment as a matter of law.” Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 248 (1986) (quoting FRCP 56(a)). Thus, where the pleadings, depositions,
answers to interrogatories, affidavits and admissions on file show that there is no genuine issue
as to any material fact, the moving party is entitled to judgment. Williams v. R.H. Donnelly
Corp., 368 F.3d 123, 126 (2d Cir. 2004). The court must resolve all ambiguities and draw all
inferences in favor of the non-moving party. Id.; Castle Rock Entm=t, Inc. v. Carol Publ=g Grp.,
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150 F.3d 132, 137 (2d Cir. 1998). “A party opposing a properly brought motion for summary
judgment bears the burden of going beyond the [specific] pleadings, and ‘designating specific
facts showing that there is a genuine issue for trial.’” Amnesty Am. v. Town of West Hartford,
288 F.3d 467, 470 (2d Cir. 2002) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986)).
If there is any evidence in the record from which a reasonable inference may be drawn in favor
of the non-moving party on a material issue of fact, summary judgment is improper. Chambers
v. TRM Copy Ctrs. Corp., 43 F.3d 29, 37 (2d Cir. 1994).
A “genuine” issue of fact exists only if the “evidence [presented] is such that a reasonable
jury could return a verdict for the nonmoving party.” Giordano v. City of New York, 274 F.3d
740, 746-47 (2d Cir. 2001). “[A]ttempts to twist the record do not create a genuine issue of
material fact for a jury.” Kim v. Son, No. 05 Civ. 1262, 2007 WL 1989473, at *6 (E.D.N.Y. July
9, 2007). Therefore, “where the cited materials do not support the factual assertions in the
Statements, the Court is free to disregard the assertion.” Holtz v. Rockefeller & Co., 258 F.3d 62,
73 (2d Cir. 2001). In addition, “conclusory statements, conjecture, or speculation by the party
resisting the motion will not defeat summary judgment.” Kulak v. City of New York, 88 F.3d 63,
71 (2d Cir. 1996). In reviewing the parties’ respective Local Rule 56.1 statements, the Court
finds no genuine issue of material fact.
B. Vacatur of Arbitration Awards.
The Second Circuit has stressed that “it is difficult to overstate the strong federal policy
in favor of arbitration.” Arciniaga v. Gen. Motors Corp., 460 F.3d 231, 234 (2d Cir. 2006)
(citing Leadertex, Inc. v. Morganton Dyeing & Finishing Corp., 67 F.3d 20, 24 (2d Cir. 1995)).
Accordingly, courts must give an arbitrator’s decision “great deference,” Duferco Int'l Steel
Trading v. T. Klaveness Shipping A/S, 333 F.3d 383, 388 (2d Cir. 2003), and a play only a
“limited role” in reviewing them that does not include “reexamin[ing] the merits” even if the
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award “arises out of a misinterpretation of the contract or a factual error.” Int'l Bhd. of Elec.
Workers, Local 97 v. Niagara Mohawk Power Corp., 143 F.3d 704, 714 (2d Cir. 1998) (citing
United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 36, 108 S. Ct. 364, 369–70 (1987)).
A district court must affirm an arbitration award if it “draws its essence from the collective
bargaining agreement” and does not does not constitute the arbitrator’s “own brand of industrial
justice.” United Steelworkers of Am. v. Enter. Wheel & Car Corp., 363 U.S. 593, 597, 80 S. Ct.
1358, 1361 (1960). A “court is forbidden to substitute its own interpretation even if convinced
that the arbitrator's interpretation was not only wrong, but plainly wrong.” Local 1199, Drug,
Hosp. & Health Care Employees Union, RWDSU, AFL-CIO v. Brooks Drug Co., 956 F.2d 22,
25 (2d Cir. 1992) (quoting Chicago Typographical Union No. 16 v. Chicago Sun-Times, Inc.,
935 F.2d 1501, 1505 (7 Cir. 1991)) (internal quotations omitted). “[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.”
Misco, 484 U.S. at 38, 108 S. Ct. at 371.
The Federal Arbitration Act, 9 U.S.C. § 10(a) sets forth four (4) circumstances in which a
court may set aside an arbitration award: “(1) where the award was procured by corruption,
fraud, or undue means; (2) where there was evident partiality or corruption in the arbitrators, or
either of them;” (3) where the arbitrator’s misconduct prejudices a party; or “(4) where the
arbitrator’s exceeded their powers, or so imperfectly executed them that a mutual, final, and
definite award upon the subject matter submitted was not made.” Additionally, a court may set
aside an award if it exhibits a “manifest disregard of law.” Wilko v. Swan, 346 U.S. 427, 436, 74
S. Ct. 182 (1953), overruled on other grounds, Rodriguez de Quijas v. Shearson/Am. Express,
Inc., 490 U.S. 477, 109 S. Ct. 1917 (1989). This requires “‘something beyond and different from
a mere error in the law or failure on the part of the arbitrators to understand or apply the law.’”
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Westerbeke Corp. v. Daihatsu Motor Co., 304 F.3d 200, 208-09 (2d Cir. 2002) (quoting Saxis
S.S. Co. v. Multifacs Int'l Traders, Inc., 375 F.2d 577, 582 (2d Cir. 1967) (quotation marks
omitted)); see Folkways Music Publishers., Inc. v. Weiss, 989 F.2d 108, 111 (2d Cir. 1993) (“In
order to advance the goals of arbitration, courts may vacate awards only for an overt disregard of
the law and not merely for an erroneous interpretation.”).
“A party moving to vacate an arbitration award has the burden of proof, and the showing
required to avoid confirmation is very high.” D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 110
(2d Cir. 2006) (citing Willemijn Houdstermaatschappij, BV v. Standard Microsystems Corp., 103
F.3d 9, 12 (2d Cir. 1997)). If the party seeking vacatur does not meet that burden, the court
“must” confirm the award. 9 U.S.C. § 9.
1. Timeliness.
The company argues that the arbitrator erred by finding the grievance arbitrable pursuant
to the seven (7)-day time-limit set forth in Article II, Section 2(d). Pl.’s Br. 8. The company
contends that the union should have requested arbitration of its July 16, 2012 grievance, which
the company denied as non-arbitrable on July 23, 2012. It reasons that she “mischaracterized the
Union’s November 9, 2012, demand for arbitration as a ‘grievance,’ even though the letter
clearly states that it is a demand for arbitration.” Pl.’s Br. 9.
However, as Judge Spatt explained, the collective bargaining agreement “broadly
provides that ‘the Impartial Arbitrator shall have the authority to decide all grievances and
complaints[,]’ including ‘any dispute arising out of the interpretation or application of the
provisions of, or attachments to [agreement].’” Veolia, 24 F. Supp. 3d at 228. The grievance
procedure provisions, Article II, Section 2(c) and (d) provide different procedures for different
types of grievances or complaints; for “[a]ny grievance or complaint which any employee may
have, or any appeal from discipline,” the union must bring the grievance with the manager, and
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then the Location’s Chief Operating Officer, after which the union has seven (7) days to seek an
arbitration hearing. But pursuant to subsection (d), for “the case where there is a dispute
concerning the interpretation or application of [the] collective bargaining agreement,” the party
may submit an arbitration request “within seven (7) days after such dispute arises.” Here, the
union submitted an employee grievance on July 16, 2012, and received an adverse decision, from
which it did not seek arbitration. Subsequently, a new dispute arose regarding the interpretation
of the collective bargaining agreement—a “grievance” or “complaint”—and the union filed a
demand for arbitration on November 9, 2012 under subsection (d). The arbitrator’s finding of
timeliness, therefore, drew its essence from the parties’ agreement, and the Court has no basis to
disturb it. Moreover, this collective bargaining agreement empowered the arbitrator to relax any
time limitation for good cause.
2. Single-Grievance Policy.
The company argues: (1) that the arbitration award does not draw its essence from the
collective bargaining agreement because it adds a new term: a requirement that it arbitrate
multiple grievances on a single calendar day. Pl.’s Br. 16–18; and (2) that the arbitrator ignored
the plain language of Article XXI, which voided this past practice. Pl.’s Br. 21; and (3)
However, “[i]t is well settled that the arbitrator may look beyond the terms of the
agreement for guidance.” Radio & Television Broad. Engineers Union, Local 1212 v. WPIX,
Inc., 716 F. Supp. 777, 781 (S.D.N.Y.) aff'd sub nom. Radio & Television v. WPIX, Inc., 895
F.2d 1411 (2d Cir. 1989). The Supreme Court explained that, “[t]here are too many people, too
many problems, too many unforeseeable contingencies to make the words of the contract the
exclusive source of rights and duties.” United Steelworkers of America v. Warrior & Gulf
Navigation Co., 363 U.S. 574, 579, 80 S. Ct. 1347, 1351 (1960). “The labor arbitrator's source
of law is not confined to the express provisions of the contract, as the industrial common law—
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the practices of the industry and the shop—is equally part of the collective bargaining agreement
although not expressed in it.” Id. at 581–82, 80 S. Ct. at 1352. An arbitrator may interpret the
collective bargaining agreement “in light of the parties intent revealed through bargaining
history, past practices, rights established under earlier agreements, and other rudimentary sources
of contract construction.” Western Electric Co., Inc. v. Communications Workers of America,
AFL–CIO, 450 F. Supp. 876, 882 (E.D.N.Y.), aff'd mem., 591 F.2d 1333 (2d Cir. 1978).
The arbitrator determined that the collective bargaining agreement set forth the procedure
for bringing each individual “grievance” or “complaint,” and the authority for the arbitrator to
decide “grievances,” generally, but not whether the company could refuse to argue multiple
grievances before the same arbitrator on the same calendar date. Accordingly, she looked to
evidence of the parties’ intent and bargaining history: the fact that the parties had always
construed the identical contractual language to allow up to six (6) grievance-arbitrations per
calendar date, and that MTA’s former general counsel was also the company’s chief negotiator,
and was able to negotiate new contractual language. In doing so, the arbitrator acted well within
her authority, and her award drew its essence from the parties’ contractual arrangement. The
Court has no basis to disturb it.
III.

CONCLUSION

For the foregoing reasons, plaintiff’s summary judgment motion is denied, and
defendant’s motion is granted. The case is dismissed with prejudice. The clerk is directed to
close the case.
SO ORDERED.
s/ Sandra J. Feuerstein_____
Sandra J. Feuerstein
United States District Judge
Dated: November 6, 2015
Central Islip, New York
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