566 F. App'x 9
1st Cir.2014Background
- IBEW Local 103 and related benefit Funds sued employer Ada Alfonso (and Old Goat) for delinquent contributions required by a collective bargaining agreement (CBA).
- While the Funds litigated in federal court, the Union invoked the CBA grievance procedure and a joint Labor-Management Committee (three union and three employer representatives) issued an arbitration award for the Funds.
- Alfonso moved in district court to vacate the award, arguing the Committee was biased because several members were trustees of the Funds; the district court initially vacated but later, on reconsideration, confirmed the award after finding Alfonso had constructive notice of the Committee’s composition.
- The First Circuit reviews de novo and affirms confirmation, addressing challenges that the dispute was nonarbitrable, that the Committee’s decision was not final and binding, that the Union waived arbitration, and that the arbitrators were evidently partial.
- The court applied LMRA principles (presumption of arbitrability) and FAA standards for evident partiality, concluding the CBA authorized arbitration of contribution disputes, Committee awards could be final, there was no waiver showing prejudice, and Alfonso consented to the arbitration structure given her notice of Committee composition.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Arbitrability of contribution dispute | CBA grievance clause and Funds provisions embrace contribution claims | Clause limited to interpretive disputes; separate Fund remedy shows collection disputes excluded | Arbitrable: broad "matters relating to this Agreement" and presumption of arbitrability govern; CBA covers contribution disputes |
| Finality of Committee awards | Committee decisions are the parties' chosen final grievance resolution | CBA lacks the words "final and binding" for Committee (only for Council); Committee procedures were cursory | Final: parties intended Committee decisions to resolve grievances definitively; availability of Council does not make Committee rulings nonfinal |
| Waiver of arbitration | Union timely invoked arbitration; Funds’ earlier litigation did not waive Union's right | Funds litigated first, so Union waived arbitration via identity of interest and litigation conduct | No waiver: Funds lacked arbitration right under CBA; record shows no prejudice to Alfonso from sequence |
| Evident partiality of Committee members | Process acceptable because parties agreed to selection method and Alfonso had notice some Committee members were Fund trustees | Trustees owe ERISA fiduciary duties and were therefore biased; arbitration should be vacated | No vacatur: even assuming evident partiality, Alfonso consented to the agreed-upon Committee composition and had notice of trustee membership; she cannot demand greater impartiality than the agreed method afforded |
Key Cases Cited
- United Steelworkers of Am. v. Warrior & Gulf Nav. Co., 363 U.S. 574 (1960) (presumption in favor of arbitrability in LMRA cases)
- AT&T Techs., Inc. v. Commc'ns Workers of Am., 475 U.S. 643 (1986) (presumption of arbitrability and standard for construing arbitration clauses)
- Gen. Drivers, Warehousemen & Helpers, Local No. 89 v. Riss & Co., 372 U.S. 517 (1963) (arbitration clauses need not use magic words to be final)
- Elec. Contractors Ass'n of Greater Bos., Inc. v. Local Union 103, Int'l Bhd. of Elec. Workers, 458 F.2d 590 (1st Cir. 1972) (parties’ intent controls whether grievance procedure is final forum)
- Creative Solutions Grp., Inc. v. Pentzer Corp., 252 F.3d 28 (1st Cir. 2001) (litigation conduct can constitute waiver of arbitration rights; doubts resolved against waiver)
- JCI Commc'ns, Inc. v. Int'l Bhd. of Elec. Workers, Local 103, 324 F.3d 42 (1st Cir. 2003) (evident partiality standard under FAA requires more than appearance of bias)
- Doral Fin. Corp. v. Garcia-Velez, 725 F.3d 27 (1st Cir. 2013) (de novo review of district court confirmation of arbitral awards)
- Ramirez-De-Arellano v. Am. Airlines, Inc., 133 F.3d 89 (1st Cir. 1997) (minimal fairness in arbitration includes a hearing on the evidence)