SARVEY v. AK STEEL CORPORATION

Filing 21

ORDER granting 8 Motion to Stay Claims Pending Arbitration or Other Resolution of Plaintiff's Contractual Grievance. The parties are to advise the Court of the outcome of the arbitration proceeding immediately upon its conclusion.Signed by Judge Terrence F. McVerry on 06/24/2011. (bsc, )

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
DAVID P. SARVEY

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v.
AK STEEL CORPORATION

2: 11-cv-00314

MEMORANDUM OPINION AND ORDER OF COURT
Presently before the Court for disposition is the MOTION TO STAY LITIGATION OF
ANY REMAINING CLAIMS PENDING ARBITRATION OR OTHER RESOLUTION OF
PLAINTIFF’S CONTRACTUAL GRIEVANCE, with brief in support filed by Defendant, AK
Steel Corporation (Document Nos. 7 and 9), and the BRIEF AND OPPOSITION filed by
Plaintiff, David P. Sarvey (Document Nos. 11 and 12). For the following reasons, the Motion
will be granted.
Background
The following background is taken from the Complaint. Plaintiff, David P. Sarvey, age
forty-seven (47), is an hourly unit employee of AK Steel’s Butler Works located in Butler,
Pennsylvania. On March 9, 2011, Plaintiff filed a two-count Complaint against his employer AK
Steel Corporation in which he alleges violations of the Age Discrimination in Employment Act
(“ADEA”), 29 U.S.C. § 626, et seq. and Pennsylvania common law. By Order of Court filed
contemporaneously herewith, Plaintiff’s Pennsylvania common law claim has been dismissed
with prejudice.
Plaintiff alleges that he was suspended without pay for twenty (20) days in January 2010
because AK Steel deemed him an unsafe worker. Plaintiff further alleges that on or about
October 11, 2010, he was suspended without pay from the Silicon Anneal department and then
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discharged because AK Steel claimed that Plaintiff had created an unsafe work site and worked
unsafely. Plaintiff alleges that “[d]ue to a timely filed grievance” and EEOC charges, he was
reinstated to employment on February 27, 2011. Plaintiff’s Complaint states that although he
was reinstated, AK Steel did not provide him with back pay, return him to his old job, or make
him financially whole.
In his ADEA claim, Plaintiff alleges that he was disciplined due to his age, forty-seven.
The allegations of Plaintiff’s complaint closely track the allegations made in a union grievance
he filed on November 10, 2010. Plaintiff’s grievance, signed by him and his union
representative, contends that Plaintiff’s October, 2010 suspension was “discriminatory and that it
was taken without just cause and due consideration.” The grievance seeks to have Plaintiff’s
suspension revoked and expunged from his record and for Plaintiff “to be made whole in all
respects.”
Significant to the Court’s determination to stay this matter is Section 3 of the Federal
Arbitration Act (“FAA”), which provides as follows:
If any suit or proceeding be brought in any of the courts of the
United States upon any issue referable to arbitration under an
agreement in writing for such arbitration, the court in which such
suit is pending, upon being satisfied that the issue involved in such
suit or proceeding is referable to arbitration under such an
agreement, shall on application of one of the parties stay the trial
of the action until such arbitration has been had in accordance with
the terms of the agreement, providing the applicant for the stay is
not in default in proceeding with such arbitration.
9 U.S.C. § 3. The United States Court of Appeals for the Third Circuit has held that it is
mandatory under Section 3 of the FAA for a court to issue a stay in part because “it relieves the
party entitled to arbitrate of the burden of continuing to litigate the issue while the arbitration
process is on-going . . . .” Lloyd v. Hovensa, LLC, 369 F.3d 263, 270 (3d Cir. 2004).
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Section 1 of the FAA excludes “contracts of employment of seamen, railroad employees,
or any other class of workers engaged in foreign or interstate commerce.” 9 U.S.C. § 1. The
United States Court of Appeals for the Third Circuit has held, however, that the FAA does not
exclude coverage of arbitration under collective bargaining agreements of workers not involved
in the movement of goods in interstate commerce. Tenney Engineering, Inc. v. United Electrical
Radio & Machine Workers of America, 207 F.2d 45, 452-53 (3d Cir. 1953). See generally Great
W. Mortgage Corp. v. Peacock, 110 F.3d 222, 226-72 (3d Cir. 1997) (declaring that Tenney is
still good law).
Plaintiff does not dispute that the provisions of the Collective Bargaining Agreement
(“CBA”) apply to him nor does he dispute that his statutory claim of age discrimination is within
the scope of the arbitration provisions of the CBA. Rather, Plaintiff’s sole argument is that
“only this suit will enable Sarvey to recover legal fees and compensatory damages. The
grievance will only deal with back pay and will never address attorney fees nor compensatory
damages.” Br. in Opp’n at ¶ 6.
As Defendant acknowledges, compensatory damages are not available in the grievancearbitration procedure; however, the ADEA also does not permit a separate recovery of
compensatory damages for pain and suffering or emotional distress either. Comm’r Internal
Revenue v. Schleier, 515 U.S. 323, 326 n.2 (1995); Rogers v. Exxon Research & Engineering
Co., 550 F.2d 834 (3d Cir. 1977). Attorneys fees are also not available in the grievancearbitration procedure; however, Plaintiff will not be responsible for any attorneys fees as the
Union supplies grievants with counsel in arbitration. Nor will Plaintiff be responsible for any
costs of the arbitration as AK Steel and the Union pay the costs, including the arbitrator’s fees.

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Therefore, it appears that a stay pending arbitration of Plaintiff’s grievance is therefore
mandatory pursuant to Section 3 of the FAA, unless “the applicant for the stay is [ ] in default in
proceeding with such arbitration.” Section 3 of the FAA.

Plaintiff makes the unsupported

allegation that “Defendant has intentionally delayed the Arbitration in this case which could have
been bumped forward but was not.” Other than Plaintiff’s bald assertion, there is nothing before
the Court to indicate that Defendant is in “default in proceeding with such arbitration” or any
other persuasive reason why a stay should not issue pursuant to the directives of the FAA.
Accordingly, the Court finds that Section 3 of the FAA mandates a stay pending
arbitration of Plaintiff’s remaining claims. The Motion to Stay Litigation of Any Remaining
Claims Pending Arbitration or Other Resolution of Plaintiff’s Contractual Grievance is hereby
GRANTED. It is further ORDERED that the parties are to advise the Court of the outcome of
the arbitration proceeding immediately upon its conclusion.
So ORDERED this 24th day of June, 2011.

BY THE COURT:
s/ Terrence F. McVerry
United States District Court Judge
cc:

Dirk D. Beuth, Esquire
Law Office of Neal Alan Sanders
Email: [e-mail]
Neal A. Sanders, Esquire
Law Offices of Neal Sanders
Email: [e-mail]
Peter D. Post, Esquire
Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
Email: [e-mail]
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