UNITED STEEL WORKERS, LOCAL 10-00086 v. MERCK & CO., INC.

Filing 15

ORDER THAT UPON CONSIDERATION OF DEFENDANT'S MOTION TO DISMISS AND PLAINTIFF'S RESPONSE THERETO, IT IS ORDERED THAT THE MOTION IS DENIED, ETC. SIGNED BY HONORABLE GERALD A. MCHUGH ON 2/8/16. 2/9/16 ENTERED AND COPIES E-MAILED.(ti, )

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA

UNITED STEEL WORKERS, LOCAL
10-00086,
Plaintiff,
v.
MERCK & CO., INC.,
Defendant.

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CIVIL ACTION
No. 15-5374

MEMORANDUM ORDER
This 8th day of February, 2016, upon consideration of Defendant’s Motion to Dismiss
and Plaintiff’s Response thereto, it is ORDERED that the Motion is DENIED for the following
reasons.
Plaintiff, United Steel Workers, Local 10-00086 (“the Union”), seeks to vacate an
Arbitration Opinion and Award ruling in favor of Defendant, Merck & Co., Inc. (“Merck”). The
Union submits that it “rarely appeals arbitration awards” and brings suit here under exceptional
circumstances. See Plaintiff’s Opposition Brief at 2. Specifically, the Union does not appeal the
Arbitration Award based on mere disagreement with the Arbitrator’s weighing of the evidence or
interpretation of the controlling collective bargaining agreement (“CBA”). Rather, the Union
alleges that the Award “nullifies [certain] bargained-for provisions” of the CBA and “re-writes
Article 15 to permit Merck to subcontract at will.” Id. Accordingly, the Union contends that the
Award should be vacated because: (1) the Arbitrator exceeded the contractually-delegated
authority provided by the CBA; (2) the Award does not “draw its essence from the CBA;” and
(3) the Award is the result of the Arbitrator’s “own brand of industrial justice.” Id.
This Court’s review of an arbitrator’s award in this context is extremely limited.

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In light of the federal policy encouraging arbitration awards, there is a strong
presumption in their favor. However, the Supreme Court has at the same time
made it clear that courts will intervene when the arbitrator's award does not
“draw[ ] its essence from the collective bargaining agreement” and the arbitrator
is dispensing his or her own “brand of industrial justice.” . . . To put it differently,
if the arbitrator's interpretation is in any rational way derived from the collective
bargaining agreement, the arbitration award will not be disturbed. An arbitration
award will not be vacated just because the court believes its interpretation of the
agreement is better than that of the arbitrator. It will be vacated, however, if there
is a “manifest disregard” of the agreement.
Pennsylvania Power Co. v. Local Union No. 272, Int'l Bhd. of Elec. Workers, AFL-CIO, 276
F.3d 174, 178 (3d Cir. 2001) (internal citations omitted).
Relying largely on the “extremely deferential” standard of review articulated above by
the Third Circuit, Merck argues that there is no legal basis to vacate the Arbitrator’s award. See
Defendant’s Motion at 10–12. Specifically, Merck argues that the Arbitrator issued “a lengthy,
well-reasoned decision, which exhaustively cited evidence submitted by both parties,” and
culminated in an “Award that draws its essence from the CBA.” Id. at 12–13.
Defendant makes cogent arguments, and I recognize that Plaintiff faces an uphill battle
moving forward given the restrictive standard of review. However, the controlling pleading
standard is plausibility—not probability. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007)). The Union’s criticism of the Award is
highly precise. If the Union is correct, the Arbitration Award might amount to a rewriting of the
CBA. At this preliminary stage, where I must accept the allegations of the Complaint at face
value, I cannot conclude that the Arbitrator acted within his authority. Thus, construing all facts
and inferences in the Union’s favor, I conclude that the Complaint states a plausible claim for
relief.
/s/ Gerald Austin McHugh
United States District Court Judge

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