830 F.3d 358
6th Cir.2016Background
- Funds (multi-employer) created by a CBA between SMACNA and Local 80 sought enforcement of LJAB arbitration awards against five corporate employers for unpaid contributions.
- Employers did not participate in arbitration and denied the CBA’s grievance/arbitration procedures applied to them.
- LJAB issued awards in 2011 finding Employers liable; Employers did not comply.
- Funds sued under § 301 of the LMRA to confirm the arbitration awards; they moved for summary judgment.
- District court denied the motion, concluding there was a genuine factual dispute whether Employers had agreed to the CBA and that state contract law governed formation of the arbitration agreement.
- District court certified an interlocutory question under §1292(b) asking whether state or federal law governs whether Employers are bound/signatory to the CBA; Sixth Circuit accepted appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Choice of law for whether parties agreed to arbitrate under a CBA | Federal labor law governs the question of assent/formation for CBAs | State contract-formation law governs enforcement of arbitration agreements | Federal labor law governs whether parties are bound by a CBA (threshold arbitrability) |
| Whether technical contract rules control formation of a CBA | Cites federal precedent that CBAs are governed by federal labor law and policy | Argues arbitration agreements are ordinary contracts subject to state law | Court held CBAs are not ordinary contracts; technical state contract rules do not control and federal law applies |
| Whether district court properly applied state law and denied summary judgment | Funds argued the district court erred by applying state law and refusing to decide law question | Employers urged state-law analysis; district court found genuine factual dispute and applied state law | Court reversed district court’s law conclusion and remanded for proceedings applying federal labor law for this legal question |
| Scope of appellate review on interlocutory appeal | Funds sought review of law question only | Employers defended district court’s legal ruling | Sixth Circuit reviews legal conclusions de novo but will not decide disputed factual question of whether Employers are in fact bound |
Key Cases Cited
- Granite Rock Co. v. Int’l Bhd. of Teamsters, 561 U.S. 287 (2010) (courts decide whether parties agreed to arbitrate)
- Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002) (procedural questions for arbitrators vs courts)
- John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543 (1964) (labor-contract issues resolved by reference to the contract entered)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (generally apply state-law principles to contract formation in arbitration context)
- Textile Workers Union v. Lincoln Mills of Ala., 353 U.S. 448 (1957) (LMRA authorizes federal common law for enforcement of CBAs)
- Allis-Chalmers Corp. v. Lueck, 471 U.S. 202 (1985) (interpretive uniformity favors federal resolution of labor-contract disputes)
- Hergenreder v. Bickford Senior Living Grp., LLC, 656 F.3d 411 (6th Cir. 2011) (discussing state-law application to arbitration-formation questions)
- Caterpillar Inc. v. Williams, 482 U.S. 386 (1987) (limits on applying federal jurisdiction where claims are not founded on rights created by CBAs)