Atlas Air, Inc. et al v. International Brotherhood of Teamsters et al
Filing
62
OPINION & ORDER re: 35 AMENDED MOTION for Summary Judgment (Notice of Plaintiffs' Amended Motion For Summary Judgment and to Compel Arbitration). filed by Atlas Air, Inc., Southern Air, Inc., 41 MOTION to Dismiss . filed by International Brotherhood of Teamsters, Airline Division, Airline Professionals Association of the International Brotherhood of Teamsters, Local Union No. 1224, International Brotherhood of Teamsters. For the reasons stated abov e, the Court GRANTS plaintiffs' motion for summary judgment and to compel arbitration at ECF No. 35 and DENIES defendants' motion for summary judgment at ECF No. 41. The Clerk of Court is directed to terminate all open motions and terminate this action. (Signed by Judge Katherine B. Forrest on 3/13/2018) (kgo)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
-------------------------------------------------------------------X
ATLAS AIR, INC. and SOUTHERN AIR, INC., :
:
Plaintiffs,
:
:
-v:
:
INTERNATIONAL BROTHERHOOD OF
:
TEAMSTERS, INTERNATIONAL
:
BROTHERHOOD OF TEAMSTERS, AIRLINE :
DIVISION, and AIRLINE PROFESSIONALS :
:
ASSOCIATION OF THE INTERNATIONAL
BROTHERHOOD OF TEAMSTERS, LOCAL :
:
UNION NO. 1224,
:
Defendants.
:
-------------------------------------------------------------------X
KATHERINE B. FORREST, District Judge:
USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #: _________________
DATE FILED: March 13, 2018
17-cv-903 (KBF)
OPINION & ORDER
This action relates to the merger of two air carriers—Atlas Air, Inc. (“Atlas”)
and Southern Air, Inc. (“Southern”) (collectively, “plaintiffs”). On January 19, 2016,
Atlas’ corporate parent, Atlas Air Worldwide Holdings, Inc. (“AAWH”), announced
plans to acquire Southern’s corporate parent, Southern Air Holdings, Inc. (“SAHI”).
Since that time, the parties to this action have been tangled in a protracted dispute
regarding the proper means of integrating Atlas’s and Southern’s respective
employees and operations. Plaintiffs assert that the applicable collective bargaining
agreements (“CBAs”) require defendants1 to negotiate a new joint collective
International Brotherhood of Teamsters (“IBT”) is the certified labor representative of both the
Atlas and Southern pilots. Airline Professionals Association of the International Brotherhood of
Teamsters, Local Union No. 1224 (“Local 1224”) is the local collective bargaining agent designated by
IBT through International Brotherhood of Teamsters, Airline Division (“IBTAD”) to represent both
the Atlas and Southern pilots. (Defs.’ 56.1 Counterstatement ¶ 2.) For purposes of convenience, the
three defendant entities (“IBT,” “Local 1224,” and “IBTAD”) are referred to collectively as
“defendants,” “IBTAD,” or the “Union” throughout this Opinion & Order.
1
bargaining agreement (“JCBA”) that covers both companies’ pilots. Defendants
disagree, and would prefer to amend the standalone CBAs that existed before the
merger. The sole question before the Court is whether the parties’ dispute should
be resolved in arbitration.
Having carefully reviewed the parties respective submissions, the relevant
law, and the CBAs at issue, the Court concludes that this dispute is subject to
mandatory arbitration under the Railway Labor Act (“RLA”), 45 U.S.C. §§ 151 et
seq. Accordingly, for the reasons stated below, plaintiffs’ motion for summary
judgment and to compel arbitration at ECF No. 35 is GRANTED, and defendants’
motion for summary judgment2 at ECF No. 41 is DENIED.
I.
BACKGROUND
In order to fully understand the parties’ respective positions, it is necessary
to understand some of the complicated history and corporate structure of the
involved air carriers. The following recitation of facts is derived from the parties’
submissions under Local. Civ. R. 56.1 (“Rule 56.1”) (ECF Nos. 37, 45)3 and certain
documents filed in connection with the pending motions. The facts are undisputed
unless otherwise noted.
Defendants’ dispositive motion was originally submitted as a motion to dismiss pursuant to Fed. R.
Civ. P. 12. By Order dated February 23, 2018, the Court converted that motion to a motion for
summary judgment pursuant to Fed. R. Civ. P. 56. (ECF No. 60.)
3 Defendants’ Rule 56.1 Counterstatement at ECF No. 45 contains a number of additional factual
assertions concerning, inter alia, the history of labor negotiations between the parties to this action.
(See Defs.’ 56.1 Counterstatement, ECF No. 45.) By letter dated March 1, 2018, plaintiffs indicated
that they “do not dispute the additional facts included by Defendants in their Rule 56.1 statement”
for purposes of the pending motions. (ECF No. 61.)
2
2
A.
The Air Carriers
1.
Atlas
Atlas Air, Inc. (“Atlas”) is a wholly owned subsidiary of Atlas Air Worldwide
Holdings, Inc. (“AAWH”). In 2001, AAWH acquired another air carrier, Polar Air
Cargo, Inc. (“Polar”).4 Following that acquisition, both Atlas and Polar continued to
maintain separate operations and separate United States Department of
Transportation (“DOT”) operating certificates. Furthermore, although Atlas’s and
Polar’s pilots were represented by the same union—Air Line Pilots Association,
AFL-CIO (“ALPA”)—they remained subject to distinct, preexisting collective
bargaining agreements (“CBAs”) with their respective companies.
In June 2005, AAWH decided to merge Atlas’s and Polar’s business
operations under a single DOT air certificate while continuing to maintain separate
public-facing brands. The Polar pilots objected to a full operational merger, and
eventually went on strike (the Atlas pilots, on the other hand, did not object). The
Polar strike eventually ended, and in March 2006 the Atlas and Polar pilots
commenced negotiations to integrate their respective seniority lists pursuant to
ALPA’s merger procedures. The parties were unable to reach an agreement, and
ultimately submitted their dispute to an arbitrator. On November 24, 2006,
In 2005, AAWH sold a portion of Polar’s business operations to DHL Network Operations, Inc.
(“DHL”). In connection with that transaction, a retained portion of Polar’s operations and employees
were administratively transferred to a separate AAWH subsidiary called Polar Air Cargo Worldwide,
Inc. (“PACW”). After the DHL transaction was completed in June 2007, PACW continued operations
using the original “Polar Air Cargo” name. Despite this internal reshuffling, for purposes of
convenience the Court will refer to the legacy Polar Air Cargo, Inc. entity as “Polar” throughout this
Opinion & Order.
4
3
Arbitrator Robert O. Harris issued an award integrating the two pilot groups’
seniority lists.
While the Atlas and Polar pilots were negotiating the integration of their
respective seniority lists, AAWH reversed its prior decision to fully merge the two
companies’ operations. Instead, Atlas and Polar sought to commence negotiations
on a new “single collective bargaining agreement” (“SCBA”) that would cover both
companies’ pilots. ALPA initially resisted, and as a result both Atlas and Polar filed
management grievances under their respective CBAs. The Atlas pilots ultimately
conceded that they were obligated to negotiate, but the Polar pilots continued to
resist.5
On May 9, 2008, the ALPA Executive Council directed ALPA’s president to
present the combined seniority list to Atlas and Polar and to commence negotiations
for a SCBA. ALPA presented the combined list on May 23, 2008, thereby triggering
a nine-month negotiation window after which open issues were subject to final and
binding arbitration. On September 29, 2008, in the middle of that negotiation
window, the National Mediation Board (“NMB”) decided that Atlas and Polar
constituted a “single carrier” for labor representation purposes. Subsequently, on
December 22, 2008, the International Brotherhood of Teamsters, Airline Division
Polar filed an action in the United States District Court for the Southern District of New York
(“S.D.N.Y.”) seeking to compel arbitration on the question of whether the Polar pilots had to
negotiate a SCBA. See PACW v. ALPA, et al., Case No. 07-cv-7327 (S.D.N.Y. Aug 16, 2007). After a
preliminary order directing the parties to arbitrate two narrow issues (but reserving judgment on
the merits), the case was voluntarily dismissed without prejudice on July 31, 2009. (See id. at ECF
No. 10.)
5
4
(“IBTAD”) replaced ALPA as the certified labor representative of both the Atlas and
Polar pilots.
In February 2009, Atlas, Polar, and IBTAD executed a “Negotiation
Framework for Merged Collective Bargaining Agreement” (the “Framework
Agreement”), which established a procedure for SCBA negotiations. (Decl. of Robert
Kirchner Ex. F (“Framework Agreement”), ECF No. 42-2.) It specified that if the
parties were unable to execute a SCBA by August 13, 2009, “all outstanding issues
shall be submitted to binding interest arbitration.” (Id. § C.1 at 3.) Notably, AAWH
was not party to the Framework Agreement.
The parties were unable to agree on terms for a SCBA, and consequently
submitted their dispute to interest arbitration in late 2010. During those
proceedings, IBTAD argued that AAWH should be included as a “Related Entity”
subject to the scope provisions of the SCBA. (Decl. of Jeffrey D. Carlson (“Carlson
Decl.”) Ex. 30 (“Arbitration Award”) at 8-9, ECF No. 38-30.) Atlas and Polar, on the
other hand, argued that AAWH should not be bound by the SCBA because it was
not signatory to the underlying CBAs. (Id. at 18-19.) Ultimately, Interest
Arbitrator Richard R. Kasher sided with Atlas and Polar, and as a result AAWH
was not included as a “Related Entity” subject to the SCBA’s scope provisions. (Id.
at 32.) The resulting SCBA (hereinafter, the “Atlas CBA”) became effective on
September 8, 2011 and became amendable five years later on September 8, 2016.
5
2.
Southern
Southern Air, Inc. (“Southern”) is a direct subsidiary of Southern Air
Holdings, Inc. (“SAHI”). Like Atlas and Polar, Southern is a contract air carrier
that, inter alia, provides express cargo operations for DHL. In 2010, the Southern
pilots’ existing labor association merged with IBTAD. The NMB subsequently
certified IBTAD as the Southern pilots’ labor representative on February 24, 2010.
The Southern pilots are currently subject to a CBA (the “Southern CBA”) that
became effective on November 6, 2012 and became amendable four years later on
November 6, 2016.
B.
The Applicable Collective Bargaining Agreements
1.
The Atlas CBA
The Atlas CBA contains a provision regarding certain “Labor Protections”
that apply, inter alia, “in the event the Company decides there will be a complete
operational merger between the Company and an affiliated air carrier[.]” (Carlson
Decl. Ex. 4 (“Atlas CBA”) § 1.F.2, ECF No. 38-4.)6 The Atlas CBA further provides
that:
[i]f the crewmembers of the acquired carrier are represented by the Union,
then the parties shall on a timely basis begin negotiations to merge the two
pre-integration collective bargaining agreements into one agreement. If a
merged agreement has not been executed within nine (9) months from the
date that the Union presents to the Company a merged seniority list . . . the
parties shall jointly submit the outstanding issues to binding interest
arbitration.
The relevant provisions of the Atlas CBA are contained in two separate exhibits (Exs. 1 and 4) to
the Declaration of Jeffrey D. Carlson, which can be found at ECF Nos. 38-1 and 38-4. For purposes
of convenience, the Court will refer to those provisions collectively as “Atlas CBA.”
6
6
(Atlas CBA § 1.F.2.b.iii.) The Atlas CBA defines “Company” as referring to “Atlas
Air, Inc. and Polar Air Cargo Worldwide, Inc.” (Atlas CBA § 1.A.)
The Atlas CBA also includes a provision creating a System Board of
Adjustment (the “Atlas Adjustment Board”) to resolve certain grievances regarding
interpretation and application of the Atlas CBA. (Atlas CBA § 21.) As relevant
here, that provision provides that the Atlas Adjustment Board:
shall have jurisdiction over all disputes between a Crewmember and the
Company, or between the Company and the Union, growing out of the
interpretation or application of any of the terms of this Agreement [the Atlas
CBA] or amendments thereto.
(Id. at § 21.B.1.)
2.
The Southern CBA
The Southern CBA contains a provision stating that “[i]n the event of a
merger, this Agreement shall be merged with the merging air carrier’s crewmember
collective bargaining agreement, if any[.]” (Carlson Decl. Ex. 18 (“Southern CBA”) §
1.B.3, ECF No. 38-18.) 7 The Southern CBA further provides that:
if such merged agreement is not completed within nine (9) months from the
date an integrated Master Seniority List is submitted to the surviving entity,
the parties shall submit all outstanding issues to binding interest arbitration.
(Id.)
Like the Atlas CBA, the Southern CBA also includes a provision creating a
System Board of Adjustment (the “Southern Adjustment Board”) to resolve certain
grievances regarding the interpretation and application of the Southern CBA.
The relevant provisions of the Southern CBA are contained in two separate exhibits (Exs. 2 and 18)
to the Declaration of Jeffrey D. Carlson, which can be found at ECF Nos. 38-2 and 38-18. For
purposes of convenience, the Court will refer to those provisions collectively as “Southern CBA.”
7
7
(Southern CBA § 19.D.) As relevant here, that provision provides that the Southern
Adjustment Board:
shall have jurisdiction over disputes growing out of grievances or out of the
interpretation or application of any of the terms of this Agreement. The
jurisdiction of the Board shall not extend to proposed changes in hours of
employment, rates of compensation, or working conditions.
(Southern CBA § 19.D.2.)
C.
The Merger and Resulting Dispute
As previously noted, AAWH announced plans to acquire SAHI and its
subsidiary airlines (including Southern) on January 19, 2016. The acquisition was
completed on April 7, 2016, at which point Southern became a subsidiary of AAWH.
Following its announcement of the planned acquisition, AAWH announced
plans to “merge the Atlas and Southern airlines and pilots.” (Carlson Decl. Ex. 3 at
3, ECF No. 38-3.) AAWH has taken the position that the Atlas and Southern pilot
groups are required to negotiate a “joint collective bargaining agreement” (“JCBA”)
pursuant to the terms of their respective CBAs. As discussed more fully infra, the
Atlas and Southern pilots disagree8 and thus far have refused to commence
negotiations as requested.
D.
Management Grievances and Pre-Litigation Discussions
1.
Atlas
On April 14, 2016, Atlas filed a management grievance with the Atlas
Adjustment Board. The issue for resolution in that grievance is whether the Atlas
The Atlas and Southern pilots have instead requested to engage in “stand-alone collective
bargaining negotiations pursuant to RLA sections 5 and 6, 45 U.S.C. §§ 155-56.” (Defs.’ 56.1
Counterstatement ¶ 12.)
8
8
pilots are “violating Section 1.F.2.b.iii of the [Atlas CBA] by refusing to engage in
negotiations for a [JCBA] pursuant to the terms and conditions set forth therein in
light of the announced operational merger of Atlas and [Southern].” (Carlson Decl.
Ex. 5 (“Atlas Management Grievance”) at 2, ECF No. 38-5.) Atlas further requested
expedited arbitration pursuant to § 1.H of the Atlas CBA. (Id. at 8.)
On April 20, 2016, the Union sent a letter to Atlas stating, in relevant part,
that “the purported management grievance is intricately related to, and indeed
dependent upon, the resolution of RLA statutory issues underlying our dispute” and
therefore is “invalid and not arbitrable.” (Carlson Decl. Ex. 6 at 3, ECF No. 38-6.)
Nonetheless, the Union indicated that it “look[ed] forward to an amicable resolution
of our dispute through consensual negotiations.” (Id.)
On May 10, 2016, representatives from the Union and Atlas met to discuss,
in sum and substance, their collective bargaining dispute. During that meeting,
Atlas made a “compromise proposal” to remove the disputed scope terms from the
interest arbitration. The Union rejected that proposal by e-mail dated July 14,
2016, and included a counter-proposal (the “LOA”) for JCBA negotiations. (Carlson
Decl. Ex. 7, ECF No. 38-7.) The Union’s proposal included an agreement to
“suspend/toll/defer [the] dispute relating to the management grievance” “[w]hile this
LOA remains in effect.” (Id. at 5 of 17.)
The parties continued negotiations regarding merger and/or amendment of
the Atlas CBA throughout 2016 and into early 2017. During that time, the parties
exchanged multiple draft compromise proposals that would have resulted in JCBA
9
negotiations. Ultimately, however, the parties were unable to reach an agreement,
and in February 2017 negotiations effectively ended.
2.
Southern
On January 24, 2017, Southern filed a management grievance with the
Southern Adjustment Board. The issue for resolution in that grievance is whether
Southern pilots are “violating Section 1.B.3 of the [Southern CBA] by refusing to
engage in negotiations for a [JCBA] pursuant to the terms and conditions set forth
therein in light of the merger of [Atlas] and [Southern]?” (Carlson Decl. Ex. 19
(“Southern Management Grievance”) at 1, ECF No. 38-19.) Southern further
requested expedited arbitration of that grievance. (Id. at 3.)
On February 8, 2017, the Union sent a letter to Southern stating, in relevant
part, that “the purported management grievance is intricately related to, and
indeed dependent upon, the resolution of RLA statutory issues underlying our
dispute” and therefore is “invalid and nonarbitrable.” (Carlson Decl. Ex. 20, ECF
No. 38-20.) Nonetheless, IBTAD indicated that it “look[ed] forward to an amicable
resolution of our dispute through consensual negotiations.” (Id.)
E.
NMB Proceedings
1.
Atlas
On April 13, 2016, the Union filed an Application for Mediation Services (the
“Atlas NMB Application”) with the NMB. (See Carlson Decl. Ex. 21 (“Atlas NMB
Application”), ECF No. 38-21.) The Union requested “NMB mediation services to
assist in the negotiation of an amended collective bargaining agreement between
10
[Atlas] and [IBTAD]” pursuant to § 5 of the RLA. (Id. at 2 of 5.) Atlas opposed that
application on April 15, 2016, arguing in sum that § 1.F.2.b.iii of the Atlas CBA
required the Union to negotiate for a JCBA, and that the Union’s decision to file the
Atlas NMB Application constituted a breach of same. (Carlson Decl. Ex. 22 at 3-4,
ECF No. 38-22.) Atlas accordingly requested that NMB “decline to schedule
mediation sessions” pending resolution of Atlas’s management grievance. (Id. at 4.)
On April 19, 2016, NMB docketed the Atlas NMB Application.9
Subsequently, on May 31, 2016, the NMB-assigned Mediator, James Mackenzie,
informed the parties that he would hold a “Fact Finding Meeting” on June 23, 2016.
(Carlson Decl. Ex. 24, ECF No. 38-24.) At that meeting, Atlas reiterated its position
that NMB should decline to conduct mediation until the Atlas Management
Grievance was resolved. The parties have not met with NMB since that date.
2.
Southern
On January 10, 2017, the Union filed an Application for Mediation Services
(the “Southern NMB Application”) with the NMB. (See Carlson Decl. Ex. 27, ECF
No. 38-27.) On January 11, 2017, NMB docketed the Southern NMB Application.
Similar to the situation with Atlas described above, Southern opposed that
application on January 24, 2017, arguing that § 1.B.3 of the Southern CBA required
the Union to negotiate for a JCBA. (Carlson Decl. Ex. 29 at 1-2, ECF No. 38-29.)
Southern accordingly requested that NMB “decline to schedule mediation sessions”
The parties dispute whether NMB’s decision to formally “docket” the Atlas and Southern NMB
Applications constituted an assertion of jurisdiction. For the reasons stated infra, the Court need
not resolve that dispute.
9
11
pending resolution of the parties’ dispute regarding interpretation of the Southern
CBA. (Id. at 5.)
F.
Litigation History
Plaintiffs commenced the present action on February 7, 2017, seeking to
compel arbitration of the above-referenced management grievances regarding
interpretation and application of the Atlas and Southern CBAs. (See generally
Compl., ECF No. 1.) Currently before the Court are the parties’ dueling motions for
summary judgment. (ECF Nos. 35, 41.)
Plaintiffs argue, in sum, that the disputes regarding interpretation and/or
application of the underlying Atlas and Southern CBAs are “minor disputes” under
the RLA, and therefore subject to mandatory arbitration by the applicable
adjustment boards. (See generally Pls.’ Mem. of Law, ECF No. 36.) In response,
defendants argue that: (1) this Court lacks subject-matter jurisdiction due to
ongoing NMB proceedings; (2) plaintiffs’ complaint is untimely; and (3) in any
event, the disputes are not arbitrable under the relevant CBAs. (See generally
Defs.’ Mem. of Law, ECF No. 46.)
II.
LEGAL PRINCIPLES
A.
Summary Judgment Standard
Summary judgment may be granted when a movant shows, based on
admissible evidence in the record, “that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law.” Fed. R.
Civ. P. 56(a). The moving party bears the burden of demonstrating “the absence of
12
a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).
In reviewing a motion for summary judgment, the Court construes all evidence in
the light most favorable to the nonmoving party, and draws all inferences and
resolves all ambiguities in its favor. Dickerson v. Napolitano, 604 F.3d 732, 740 (2d
Cir. 2010). The Court's role is to determine whether there are any triable issues of
material fact, not to weigh the evidence or resolve any factual disputes. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986).
B.
The Railway Labor Act
The Railway Labor Act (“RLA” or the “Act”), 45 U.S.C. §§ 151 et seq., governs
labor relations in the railroad and airline industries. Multiple provisions of the
RLA are relevant to the Court’s resolution of this action.
1.
Major and Minor Disputes
As the Supreme Court has noted, “Congress’ purpose in passing the RLA was
to promote stability in labor-management relations by providing a comprehensive
framework for resolving labor disputes.” Hawaiian Airlines, Inc. v. Norris, 512 U.S.
246, 252 (1994) (citations omitted); see also 45 U.S.C. § 151a. To accomplish that
purpose, the RLA divides most labor disputes in two categories—“major” and
“minor”—and establishes distinct resolution mechanisms for each.
Major disputes are those “concerning rates of pay, rules, or working
conditions.” See 45 U.S.C. § 151a. The Supreme Court has clarified that major
disputes “seek to create contractual rights,” Consol. Rail Corp. v. Ry. Labor
Executives' Ass'n (“Conrail”), 491 U.S. 299, 302 (1989) (emphasis added) (citation
13
omitted), and “arise where there is no [CBA] or where it is sought to change the
terms of one, and therefore the issue is not whether an existing agreement controls
the controversy,” Elgin, J. & E. Ry. Co. v. Burley, 325 U.S. 711, 723 (1945). In other
words, major disputes relate to “the formation of collective [bargaining] agreements
or efforts to secure them.” Conrail, 491 U.S. at 302 (quoting Burley, 325 U.S. at
723). Although the RLA requires parties to “undergo a lengthy process of
bargaining and mediation”10 in the event of a major dispute, federal district courts
do have limited jurisdiction, e.g. “to enjoin a violation of the status quo pending
completion of the required procedures.” Id. at 302-03.
Minor disputes, on the other hand, “grow[] out of grievances or out of the
interpretation or application of agreements covering rates of pay, rules, or working
conditions.” See 45 U.S.C. § 151a; see also Lindsay v. Ass’n of Prof’l Flights
Attendants, 581 F.3d 47, 51 (2d Cir. 2009). Accordingly, minor disputes “seek . . . to
enforce” existing contractual rights, not to create new ones. Conrail, 491 U.S. at
302 (citing Burley, 325 U.S. at 723). Minor disputes “contemplate[] the existence of
a collective agreement already concluded,” and “relate[] either to the meaning or
proper application of a particular provision with reference to a specific situation or
to an omitted case.” Burley, 325 U.S. at 723; see also Hawaiian Airlines, 512 U.S.
at 253 (“Minor disputes involve ‘controversies over the meaning of an existing
collective bargaining agreement in a particular fact situation.’” (quoting
Brotherhood of R.R. Trainmen v. Chicago R. & I.R. Co., 353 U.S. 30, 33 (1957));
As defendants correctly note, major disputes are subject to “mediation under the auspices of the
National Mediation Board.” Burley, 325 U.S. at 725; see also 45 U.S.C. §§ 155-56.
10
14
Ass'n of Flight Attendants, AFL-CIO v. United Airlines, Inc., 976 F.2d 102, 104 (2d
Cir. 1992) (holding that minor disputes involve “legitimate disagreement over an
ambiguity in a collective agreement”).
Unlike major disputes, minor disputes are subject to “compulsory and
binding” arbitration before the appropriate adjustment board. Conrail, 491 U.S. at
303-04; see also Bhd. of Locomotive Engineers v. Louisville & N. R. Co., 373 U.S. 33,
38 (1963) (holding that the RLA “grievance procedure is a mandatory, exclusive,
and comprehensive system for resolving grievance disputes”). The adjustment
board’s jurisdiction is exclusive, Conrail, 491 U.S. at 304, and district courts may
only review or set aside the binding decision of the adjustment board in limited
circumstances, see Union Pacific R. Co. v. Sheehan, 439 U.S. 89, 93 (1978); see also
45 U.S.C. § 153(q).11 To facilitate this statutory scheme, a federal court may compel
arbitration of a minor dispute. See W. Airlines, Inc. v. Int'l Bhd. of Teamsters, 480
U.S. 1301, 1302 (1987) (“While courts lack authority to interpret the terms of a
collective-bargaining agreement, a court may compel arbitration of a minor dispute
before the authorized System Board.”).
The party asserting that a labor dispute is minor bears the “relatively light
burden” of establishing arbitral jurisdiction under the RLA. Conrail, 491 U.S. at
305-07 (quotation and citation omitted). To satisfy that burden, the party must
demonstrate that “the action is arguably justified by the terms of the parties’
[CBA]” and not “frivolous or obviously insubstantial.” Id. at 307.
Federal district courts may also enjoin strikes arising out of minor disputes. See Conrail, 491 U.S.
at 304.
11
15
2.
Representation Disputes
Distinct from major and minor disputes are so-called “representation”
disputes. Representation disputes “involve controversies surrounding the
designation and authorization of representatives of employees covered under the
RLA,” and are “committed to the exclusive jurisdiction of the NMB.” Virgin Atl.
Airways, Ltd. v. Nat'l Mediation Bd., 956 F.2d 1245, 1250 (2d Cir. 1992) (quoting
Air Line Pilots Ass'n v. Texas Int'l Airlines, 656 F.2d 16, 20 n. 6 (2d Cir. 1981)
(citations omitted); see also 45 U.S.C. § 152, Ninth. The Second Circuit has held
that federal jurisdiction to review an NMB representation decision is “extremely
limited,” and “confined to ‘instances of constitutional dimension or gross violation of
the statute.’” Id. (quoting British Airways Board v. Nat’l Mediation Bd., 685 F.2d
52, 55 (2d Cir.1982)).
III.
DISCUSSION
Although the facts underlying this action are complicated, the Court’s
resolution is not. It is absolutely clear that the present dispute—i.e., whether
defendants must negotiate for a new JCBA pursuant to the terms of their respective
CBAs—is a minor dispute under the RLA, and is therefore subject to mandatory
arbitration by the appropriate adjustment boards. See 45 U.S.C. § 153.
First, it is undisputed that the Atlas and Southern pilots are subject to the
Atlas and Southern CBAs, respectively. As such, the issue here is whether those
pre-existing CBAs require defendants to negotiate a JCBA, not (1) whether
defendants must negotiate a CBA in the first instance, or (2) what the terms of the
16
new CBA/JCBA should be. And as the text of the RLA makes abundantly clear (and
the Supreme Court has repeatedly confirmed), minor disputes grow out of the
“interpretation or application” of existing CBAs. See 45 U.S.C. § 151a; see also, e.g.,
Burley, 325 U.S. at 723.
Here, plaintiffs’ reading of the relevant CBA provisions is “arguably
justified.” Conrail, 491 U.S. at 306-07. Section 1.F.2.b.iii of the Atlas CBA provides
that when crewmembers of the merging airlines are represented by the same union,
“the parties shall on a timely basis begin negotiations to merge the two preintegration [CBAs] into one agreement.” (Atlas CBA § 1.F.2.b.iii.) Similarly,
§ 1.B.3 of the Southern CBA provides that “[i]n the event of a merger, this
Agreement shall be merged with the merging air carrier’s crewmember collective
bargaining agreement, if any[.]” (Southern CBA § 1.B.3.) Plaintiffs’ position that
those contractual provisions require the Union to negotiate a JCBA (rather than
amending the standalone CBAs) is not “frivolous or obviously insubstantial,” and
therefore this dispute is properly categorized as “minor” under the RLA.12
The only confounding factor here is that the minor dispute relates to a
contractual provision that provides for negotiation of a JCBA. At first glance, that
may appear to constitute a major dispute since it relates, albeit indirectly, to “the
formation of [a] collective bargaining agreement.” Conrail, 491 U.S. at 302
(emphasis added). But the actual terms of the JCBA are not at issue here, and
The Court takes no position as to whether plaintiffs’ reading of the CBAs is actually correct as a
matter of law, or that plaintiffs should prevail in the ensuing arbitration proceedings. Resolution of
those questions must and shall be left to the appropriate adjustment board.
12
17
neither Atlas nor Southern is seeking to unilaterally change the provisions of an
existing CBA; the sole issue is whether defendants are required to negotiate for a
JCBA or whether they can insist upon amending the terms of their existing
standalone CBAs. The answer to that question inexorably turns on “interpretation
or application” of the existing Atlas and Southern CBAs (§§1.F.2.b.iii and 1.B.3,
respectively), and therefore constitutes a minor dispute subject to mandatory
arbitration under the RLA.13
The Court understands that this is a significant point of contention between
the parties, but “the formal demarcation between major and minor disputes does
not turn on a case-by-case determination of the importance of the issue presented or
the likelihood that it would prompt the exercise of economic self-help.” Conrail, 491
U.S. at 305; see also Burley, 325 U.S. at 724 (noting that minor disputes “seldom
produce strikes, though in exaggerated instances they may do so.”) Instead, the
“distinguishing feature” of a minor dispute is “that the dispute may be conclusively
resolved by interpreting the existing agreement.” Conrail, 491 U.S. at 305 (citation
omitted).
Defendants have argued, in sum, that (1) the NMB has asserted exclusive
jurisdiction over this action, thereby depriving this Court of subject-matter
jurisdiction; (2) plaintiffs’ motion to compel arbitration is time-barred; and (3) the
If defendants had agreed to negotiate a new JCBA and this action related to a breakdown of those
substantive negotiations, the analysis may be different. The Court takes no position on whether
such a dispute would be considered “major” or “minor” under the RLA. Here, the parties dispute the
threshold issue of whether defendants must negotiate a new JCBA. To the Court’s knowledge, no
substantive negotiations on a JCBA have taken place.
13
18
specific issues here are not arbitrable by the relevant adjustment boards. (See
generally Defs.’ Mem. of Law, ECF No. 46.) All three arguments are unavailing.
First, it makes absolutely no difference whether the NMB has “asserted
jurisdiction,” only whether the NMB has properly asserted jurisdiction.14 The RLA
makes clear that the NMB’s exclusive jurisdiction is limited to major disputes and
representation disputes. As described above, this action does not concern a major
dispute under the RLA. Further, since both pilots’ groups are represented by the
same union15, there is no need for the NMB to determine which union should
represent the Atlas and Southern pilots in interest arbitration or JCBA negotiations
under 45 U.S.C. § 152, Ninth. And even if the NMB is called upon at some point to
determine whether the carriers constitute a single transportation system (i.e., a
“single carrier”), nothing about the present dispute “interferes legally or practically
with the [NMB’s] capacity, at any time” to make that determination. See Ass'n of
Flight Attendants, AFL-CIO v. United Airlines, Inc., 71 F.3d 915, 919 (D.C. Cir.
1995). The RLA makes clear that minor disputes should be resolved by the
appropriate adjustment board(s), and this Court has jurisdiction to compel
arbitration in accordance therewith.
The Court notes that defendants’ argument that NMB has “asserted jurisdiction” by docketing the
applications is tenuous at best. Courts routinely “docket” cases as an administrative matter before
determining whether they have jurisdiction or not. In fact, it would be impossible for a court to issue
a decision regarding jurisdiction without docketing the case. The mere fact that NMB has docketed
the relevant applications, therefore, is not indicative of NMB’s view over whether the present action
falls within its exclusive jurisdiction.
15 It is undisputed that Local 1224 is the local collective bargaining agent designated by the IBTAD
to represent both the Atlas and Southern Pilots. (Defs.’ 56.1 Counterstatement ¶ 2.) Defendants
argue that the Atlas and Southern pilots are represented by separate bargaining units (presumably
within Local 1224), but even if true that makes no difference to the Court’s holding here.
14
19
Second, plaintiffs’ motion to compel arbitration is not time-barred.16 It is true
that generally, a party must move to compel arbitration within six months from the
date “a party unequivocally refuses a demand to arbitrate.” C.f. Assoc. Brick Mason
Contractors, Inc. v. Harrington, 820 F.2d 31, 37 (2d Cir. 1987). Defendants argue
that they unequivocally refused plaintiffs’ arbitration demand on April 20, 2016,
when the Union told Atlas that its grievance was “invalid and not arbitrable.” But
defendants’ own proffered evidence proves the opposite. As an initial matter, it is
undisputed that the Union “participated in several meetings to discuss a solution
that would enable the parties to resume their collective bargaining negotiations”
subsequent to April 20, 2016. (Defs.’ Mem. of Law at 32-33.) And on July 14, 2016,
the Union made a counter-proposal that provided for JCBA negotiations and agreed
to “suspend/toll/defer the[] dispute relating to the management grievance” while the
LOA remained in effect. (Carlson Decl. Ex. 7, ECF No. 38-7.)
Defendants argue that the LOA was never executed, and therefore
defendants never deviated from their prior refusal to arbitrate. But that argument
is beside the point—irrespective whether the LOA was executed, it is clear that the
Union was actively negotiating the merits of the Atlas grievance (i.e., means of
negotiating of a JCBA) through January 2017. It would have been nonsensical for
Atlas, in the midst of those live negotiations, to file an action in federal court
The Court notes that defendants’ brief could be construed to argue that the action is time barred
with respect to Atlas and Southern. (Defs.’ Mem. of Law at 33-34 (“Plaintiffs were on notice no later
than April 20, 2016 that the IBTAD had refused to arbitrate the issue of whether the IBTADAtlas/Polar and IBTAD-Southern contracts compelled it to negotiate a [JCBA.]”).) However, since
the Southern Management Grievance was not filed until January 24, 2017, and this action was
commenced on February 7, 2017, this action is unquestionably timely as to the Southern
Management Grievance.
16
20
seeking to compel arbitration. In fact, such action may have violated the RLA,
which requires parties to “exert every reasonable effort to make and maintain
[CBAs], and to settle all disputes . . . in order to avoid any interruption to commerce
or to the operation of any carrier[.]” 45 U.S.C. § 152, First. Because the Union
continued to negotiate the merits of the Atlas Management Grievance into early
2017, plaintiffs’ cause of action did not accrue until negotiations ended and
therefore this action is timely.
Finally, it is clear that the disputes here are arbitrable. The Atlas and
Southern adjustment boards will be called upon to interpret distinct provisions of
the Atlas and Southern CBAs, respectively.17 Defendants’ arguments regarding
whether those provisions actually require JCBA negotiations in this instance go to
the merits of the management grievance, and should be decided by the appropriate
adjustment boards in the first instance. To adopt any of defendants’ arguments in
this regard—e.g. that AAWH is not the “Company” for purposes of the Atlas CBA—
the Court would have to interpret the underlying CBAs. The RLA makes clear that
issues of interpretation and application are to be resolved by the relevant
adjustment board, and therefore defendants’ arguments must be reserved for
arbitration.
Defendants’ argument that the Southern Adjustment Board lacks jurisdiction to consider this
dispute is plainly incorrect. The Southern CBA provides that the Southern Adjustment Board’s
jurisdiction “shall not extend to proposed changes in hours of employment, rates of compensation, or
working conditions.” (Southern CBA § 19.D.2.) But as previously noted, the actual terms of the
JCBA are not at issue here—the sole issue is whether the Union must negotiate. That issue turns on
interpretation of § 1.B.3 of the Southern CBA, and the Southern Adjustment Board unquestionably
has jurisdiction “over disputes growing out of . . . the interpretation or application of any of the
terms” of the Southern CBA. (Id.)
17
21
IV.
CONCLUSION
For the reasons stated above, the Court GRANTS plaintiffs’ motion for
summary judgment and to compel arbitration at ECF No. 35 and DENIES
defendants’ motion for summary judgment at ECF No. 41.
The Clerk of Court is directed to terminate all open motions and terminate
this action.
SO ORDERED.
Dated:
New York, New York
March 13, 2018
______________________________________
KATHERINE B. FORREST
United States District Judge
22
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?