211 F. Supp. 3d 505
E.D.N.Y2016Background
- Local 252 (union) represents Veolia bus employees under a CBA (effective Jan 1, 2012–Apr 15, 2017) that requires grievances to be decided by an impartial arbitrator and limits arbitrator authority.
- Mary Grasso, a Veolia bus operator, reported an injured-on-duty event on Dec 11, 2012; she also worked a part-time bus aide job that day. Veolia investigated beginning Dec 20, 2012 and later interviewed Grasso in Sept 2013.
- Veolia served Grasso with charges on Sept 23, 2013 alleging she misrepresented her leave status and sought her termination for fraud/misconduct.
- Union demanded arbitration; Arbitrator Jack D. Tillem bifurcated the proceeding to decide timeliness (whether Veolia filed charges within the 30-day CBA limit) before reaching just-cause issues.
- Arbitrator Tillem found Veolia violated the CBA’s 30-day discipline notice provision (began Dec 20, 2012), ordered reinstatement and full back pay (with retained jurisdiction to resolve back-pay disputes). Veolia did not comply and sought vacatur in district court.
- District court granted the Union’s summary judgment to confirm the award, denied Veolia’s summary judgment to vacate, and remanded back-pay calculation to the arbitrator or AAA.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether award should be vacated for evident partiality | Arbitrator’s off-the-record statements and certain rulings showed bias | Off-the-record remarks were opinion/settlement effort; adverse rulings do not prove bias | Denied vacatur; no evident partiality shown |
| Whether arbitrator refused to hear pertinent evidence | Union: arbitrator gave parties adequate opportunity and properly managed relevance | Veolia: arbitrator excluded or delayed evidence (e.g., reinstatement offer, witnesses) | Denied vacatur; arbitrator’s evidentiary and procedural rulings were within discretion |
| Whether arbitrator manifestly disregarded CBA or law (industrial justice) | Award ignored plain CBA text on when 30-day clock started and ignored mitigation rule re: unconditional reinstatement offers | Arbitrator interpreted when company knew facts (Dec 20, 2012) and deferred back-pay rulings pending return; Ford Motor rule inapplicable here | Denied vacatur; arbitrator’s interpretation drew essence from CBA and did not manifestly disregard law |
| Attorneys’ fees for Union for defending confirmation | Union: fees due because Veolia refused to comply with award | Veolia: had colorable defenses (bias, legal errors) | Denied; no clear evidence of bad-faith or frivolous conduct by Veolia |
Key Cases Cited
- D.H. Blair & Co., Inc. v. Gottdiener, 462 F.3d 95 (2d Cir.) (courts must confirm arbitration awards unless vacatur grounds shown)
- Scandinavian Reinsurance Co. Ltd v. Saint Paul Fire and Marine Ins. Co., 668 F.3d 60 (2d Cir.) (standard for evident partiality)
- Tempo Shain Corp. v. Bertek, Inc., 120 F.3d 16 (2d Cir.) (arbitrator must give adequate opportunity to present evidence; limited evidentiary review)
- First Nat’l Supermarkets, Inc. v. Retail, Wholesale & Chain Store Food Emps. Union Local 338, 118 F.3d 892 (2d Cir.) (award survives so long as it draws its essence from the CBA)
- Ford Motor Co. v. Equal Employment Opportunity Comm’n, 458 U.S. 219 (Supreme Court) (unconditional reinstatement offer cuts off back-pay liability in Title VII context)
- Zurich Am. Ins. Co. v. Team Tankers A.S., 811 F.3d 584 (2d Cir.) (standard for manifest disregard of law requires knowing refusal to apply clear, applicable law)