Case Information
‐ ‐ cv Am. AFL ‐ CIO v. Serv.,
In the
United States Court of Appeals
For the Second Circuit
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A UGUST T ERM No.
A MERICAN P OSTAL W ORKERS U NION AFL CIO, Plaintiff Appellee, U NITED S TATES P OSTAL S ERVICE Defendant Appellant.
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Appeal United States Southern New York. Civ. (KBF) ― Katherine B. Forrest, Judge ________
A RGUED : M AY D ECIDED : J UNE ________
Before: W INTER W ALKER C ABRANES , Circuit Judges
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Defendant United States Postal Service appeals May judgment United States District Court Southern New York (Katherine B. Forrest, Judge ) granting motion plaintiff American Workers Union (“APWU”) vacate arbitral on exceeded his powers under relevant agreement doctrine against APWU.
We hold arbitrator’s ― his interpretation particular provisions arbitration agreement, within arbitrator’s decide agreement ― did exceed would required justify vacating award. we REVERSE judgment REMAND instructions confirm award.
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S ARAH T. K ANTER (Darryl J. Anderson, brief ), O’Donnell, Schwartz & Anderson, P.C., Washington, DC, Plaintiff Appellee American AFL CIO M ICHAEL J. B YARS (Emily E. Daughtry, on brief ), Assistant United States Attorneys, for Preet Bharara, United States Attorney for Southern District of New York, New York, NY, Defendant Appellant United States Postal Service
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J OSÉ A. C ABRANES Circuit Judge :
Defendant United States Service (“USPS”) appeals judgment of United States Southern New York (Katherine B. Forrest, Judge ) granting motion plaintiff American Union (“APWU”) vacate exceeded his powers under relevant agreement doctrine collateral against APWU.
We hold arbitrator’s ― his interpretation particular provisions arbitration agreement, within arbitrator’s decide agreement ― did exceed as would required justify vacating award.
‐ ‐ we reverse judgment and remand with instructions confirm award.
BACKGROUND
Carla LaGreca, a former USPS employee, initially employed Mail Processing Clerk. Around she applied for workers’ compensation benefits carpal tunnel syndrome developed connection with her job. In USPS reassigned LaGreca limited ‐ duty position consistent with her work restrictions. In September USPS concluded no longer work available consistent condition and placed leave without pay/injured duty status. LaGreca then initiated grievance proceedings giving rise case.
A. The Grievance Arbitration Procedures APWU USPS are parties Collective Bargaining Agreement (“CBA”) LaGreca may challenge USPS employment decisions allegedly violate CBA. provides four step process culminating
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As set forth in Postal Reorganization Act, 39 U.S.C. § 1005(c), [2] postal employees like LaGreca also receive workers’ compensation protection Federal Employees’ Compensation Act, 5 U.S.C. §§ 8101 et. seq. Under Act, USPS employees with job related disabilities may seek relief for alleged violations their rights by appealing Merit Systems Protection Board (“MSPB”) for a determination whether USPS acted “arbitrarily [or] capriciously” making its employment decisions (an “MSPB appeal”). 5 C.F.R. § 353.304. [3] MSPB has held USPS employees “have right file both grievance [under CBA] and [an MSPB] appeal concerning same agency action.” Latham Serv., M.S.P.R. 400, ¶ (2012).
On September LaGreca initiated CBA, culminated APWU argued, behalf, elimination position violated CBA, retaliatory and discriminatory motives.
On December 29, 2008, while the grievance process was ongoing, LaGreca filed an MSPB appeal, claiming that the USPS acted arbitrarily capriciously eliminating her position. On August 14, 2009, her MSPB appeal was denied on the conclusion Administrative Law Judge (“ALJ”) that the USPS had properly eliminated LaGreca’s position because LaGreca’s doctor had declared totally disabled as September 2008. LaGreca’s appeal that was dismissed untimely.
On March CBA was submitted Arbitrator Randall Kelly. USPS argued that the matter was arbitrable because ALJ already resolved issue concluding during MSPB appeal that LaGreca was totally disabled. Over objection APWU, Arbitrator Kelly agreed bifurcate proceeding first address question applicable circumstances presented here.
On subject, Arbitrator Kelly noted “[t]he [CBA] specifically recognizes concept res judicata matter simultaneously before MSPB arbitration; albeit veterans .” Joint App’x (emphasis supplied). Specifically, Article 16.9 provides “employee appeal[ing] Veterans’ Preference Act” waives right invoke process if: (1) “an MSPB settlement reached”; (2) “a hearing merits before has begun”; (3) “the MSPB issues merits appeal.” Id. 101. Arbitrator then recognized Article 16.9 does LaGreca, No. ‐ cv but concluded that this provision, as well as other awards where the doctrine collateral estoppel was applied, supported the conclusion that embraces application preclusion principles. Id. at 26.
In applying collateral estoppel to LeGreca’s claim, Arbitrator Kelly first determined that ALJ’s decision denying her appeal was final decision MPSB, matter not disputed on appeal. He then stated that “undeniable conclusion derived decision” was “[LaGreca] [wa]s totally disabled September 2008.” Id. at 27. “[USPS] could not have been arbitrary capricious terminated Modified Duty Assignment” “the matter . . therefore arbitrable doctrine collateral estoppel.” Id.
The APWU sought vacatur in District Court Arbitrator Kelly’s excess CBA.
B. District Court’s Decision
In addressing cross motions summary judgment, Court stated: “Arbitrator found no explicit support [CBA] case. Instead, he purported find implicit support Section 16.9 Agreement [addressing claimants Veterans’ Preference Act].” Am. AFL CIO Serv. (KBF), WL *3 (S.D.N.Y. 2013). asserted “[t]he [CBA] does make any provision application collateral estoppel general,” only provision that addresses preclusion does not apply to LaGreca. Id. *4. The District Court stated further that, if any inference could drawn from Section 16.9, was that preclusion principles do apply other circumstances. Id.
The Court concluded Arbitrator Kelly improperly “relied free floating principle to use preclude LaGreca recovering [CBA] . . . without any contractual basis.” Id. vacated Arbitrator Kelly’s award remanded case This appeal followed.
DISCUSSION
The question here—whether Arbitrator authority, CBA, claim—is legal one, reviewed de novo appeal. See Scandinavian Reinsurance Co. St. Paul Fire & Marine Ins. Co. F.3d (2d Cir. 2012).
Vacatur appropriate arbitrator’s “exceeded [his] powers” relevant contract. U.S.C. § 10(a)(4). crux excess standard “whether
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9 13 2579 the arbitrator’s award draws its essence the collective bargaining agreement.”
St. Mary Home, Inc. v. Serv. Emps. Int’l Dist. 1199,
[i]t is enough to show that the committed an error—or even serious error. Because parties bargained arbitrator’s construction their agreement, an decision even arguably construing contract must stand, regardless court’s view its (de)merits.
arbitration here was Service Reorganization Act (“PRA”), FAA. Courts, however, have recognized that stringent standard vacating is materially same under FAA, Labor Management Relations Act (“LMRA”), PRA. See Oxford Health Plans LLC v. Sutter , S. Ct. (2013) (relying LMRA case law discussing deference FAA awards); USPS v. APWU F.3d (D.C. Cir. 2009) (applying LMRA standards cases PRA). Although APWU objected bifurcation proceedings, there no indication record disputed applicability arbitrable issue. Moreover, doing so would have been futile light our holding Fire Insurance Co. National Gypsum Co. prior judicial within arbitrator’s agreement. F.3d (2d Cir. 1996). 13 2579 Oxford Health Plans LLC v. Sutter , S. Ct. (2013) (alterations, citations, internal quotation marks omitted). In order vacate, court must find “the arbitrator act[ed] outside scope his contractually delegated authority.” Id. (internal quotation marks omitted).
In Oxford Health Plans , issue whether arbitrator exceeded by permitting class wide arbitration. Id. In holding vacatur inappropriate Supreme Court noted “focused clause’s text, analyzing (whether correctly not makes no difference) . . . what it sent arbitration.” Id. at 2069. Court distinguished its decision Stolt–Nielsen S.A. v. AnimalFeeds International Corp., (2010), “overturned arbitral decision [to permit class arbitration] because it lacked any contractual ordering class procedures, not because lacked . . ‘sufficient’ one.” Oxford Health Plans S. Ct. 2069. In Stolt–Nielsen parties had expressly stipulated they never reached regarding class Id. arbitral “was not—indeed, could have been—based determination regarding parties’ intent.” Id. (internal quotation marks omitted). Similarly, Harry Hoffman Printing, Inc. Graphic Communications International Local —the case relied upon Court—we vacated arbitral imposing additional due process requirements because panel “creat[ed] 2579 entirely new terms” in the CBA, notwithstanding so called “no modification” clause. F.2d (2d Cir. 1991). Simply put, as in Stolt Nielsen , panel’s in Harry Hoffman lacked any contractual and, indeed, expressly prohibited CBA. See id at 100. situation here is analogous to Oxford Health Plans :
Arbitrator Kelly looked at terms CBA concluded that, in circumstances presented, they supported application collateral estoppel. Nothing in CBA expressly forecloses use preclusion principles respect to MSPB appeals or other proceedings. Moreover, we have held arbitration agreement such as one issue in this case, arbitrators possess prior judicial administrative decisions. See, e.g. , Fire Ins. Co. v. Nat’l Gypsum Co. F.3d (2d Cir. 1996) (“[A]mbiguity issue [of estoppel] within scope resolved in favor arbitrability.”); Nat’l Union Fire Ins. Co. Belco Petroleum Corp. F.3d (2d Cir. 1996) (“Nothing in clause gives any indication anyone other than should decide preclusive effect prior arbitration.”).
In sum, Arbitrator concluded Section 16.9 demonstrated shared intent parties CBA permit decisions inform, some cases, preclude decisions subsequent Nothing expressly foreclosed conclusion. concluded that, “[i]f one were draw any inference [Section 16.9], it would be converse inference that, because [CBA] explains where principles of preclusion do apply, those principles do not elsewhere.” Am. Union WL at *4. That is simply a different interpretation of contract, while arguably a better interpretation CBA, simply a vacatur. Because “arguably construing or contract,” his decisions “must stand, regardless [district] court’s view its (de)merits.” Oxford Health Plans S. Ct. (internal quotation marks omitted).
CONCLUSION To summarize, we hold that:
(1) Under CBA, preclusive effect prior judicial or administrative matter decided by arbitrator. (2) Nothing foreclosed application preclusion principles by arbitrator.
(3) did exceed interpreting terms contract, correctly not, permit use prior administrative decision. we REVERSE judgment REMAND instructions confirm award.
Notes
[1] doctrine estoppel, also known issue preclusion, provides judgment prior action may preclude relitigation issues second action, if those issues were actually litigated necessary outcome first action. Parklane Hosiery Co. Shore n.5 (1979).
[2] U.S.C. § 1005(c) provides: “Officers employees Service shall covered subchapter I chapter title relating compensation for work injuries.”
[3] C.F.R. § 353.304(c) provides: “An individual who partially recovered compensable injury may appeal determination agency acting arbitrarily capriciously denying restoration.” Restoration rights Federal Employees’ Compensation Act include creation limited duty assignments employees temporary permanent compensable injuries. U.S.C. § 8151(b); C.F.R. § 353.301(d).
[4] Federal Arbitration Act (“FAA”) provides district court “may make order vacating [arbitral] award upon application any party . . where arbitrators exceeded their powers, so imperfectly executed them mutual, final, definite upon subject matter submitted made.” U.S.C. § 10(a)(4).
[6] did have guidance Oxford Health Plans deciding vacate case.