AMERIPRIDE SERVICES, LLC and ARAMARK UNIFORM & CAREER APPAREL, LLC, Plaintiffs, v. TEAMSTERS LOCAL 87 and TEAMSTERS LOCAL 386, Defendants.
Case No. 1:21-cv-00969-JLT-EPG
United States District Court, Eastern District of California
September 6, 2024
Jennifer L. Thurston, United States District Judge
ORDER GRANTING LEAD CASE DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT; ORDER DENYING LEAD CASE PLAINTIFFS’ MOTION FOR SUMMARY JUDGMENT (Docs. 29, 32)
I. Background
AmeriPride Services, LLC and Aramark Uniform & Career Apparel, LLC operate facilities in California and elsewhere for the purpose of “provid[ing] uniform and linen services, including the rental, sale, and maintenance of uniform apparel, linens and other items.” (Doc. 36-1 (Defendants’ Response to Plaintiffs’ Statement of Undisputed Facts) (“PSUF“) #1; Doc. 1 at 4 ¶¶ 8-9; Doc. 32-3 at 2 ¶ 3.) Teamsters Local Union 87 (“Local 87“) is the exclusive representative of employees at one such facility, located in Bakersfield, California. (Doc. 50-4 (Joint Statement of Undisputed Facts (“JSUF“)) #1.) Teamsters Local Union 386 (“Local 386“) is the exclusive representative of employees at another facility, located in Merced, California. (JSUF # 2.) These facilities were owned and/or operated by AmeriPride Services, LLC “[a]t least prior to” January 22, 2018, when Aramark, Inc.2 acquired
Teamsters Locals 87 and 386 (“Teamsters“) are parties to a collective bargaining agreement (the “Master“) with Aramark, effective December 30, 2017 through January 28, 2022. (JSUF # 10; J.A. Exh. 15.)3 Aside from the Master, Locals 87 and 386 are each party to a separate CBA with AmeriPride, which covers the “single-location bargaining unit” of employees at the Bakersfield4 and Merced facilities, respectively.5 (JSUF # 7.) These agreements went into effect in late 2016 to mid-2017. (See JSUF ## 8-9.) Both AmeriPride CBAs were later extended for “additional rolling 30-day periods” by agreement of the parties and, as of at least July 28, 2023, no party had given notice of a desire to sever either the extension agreement or otherwise terminate either AmeriPride CBA. (See id.) The Master has never been applied to the Bakersfield or Merced employees. (See PSUF #10.)
A. Relevant terms of the Master
1. The after-acquired clause
Article 1.01 of the Master provides, in part, that:
The Company recognizes the Union as the bargaining agent for those classifications of employees covered by the Agreement in collective bargaining with the Company and the Local Unions signatory hereto. It is further agreed that should any new or additional depots, routes or plants be established by the Company within the jurisdiction of the Locals signatory to this Agreement within Joint Council 7 shall be covered by this Agreement.
(J.A. Exh. 15, Art. 1.01 [emphasis added].)
2. The arbitration clause
Article 7 of the Master sets forth the following four-step grievance and arbitration procedure: Step 1 requires the parties to first discuss “[a]ny issue concerning the proper application and interpretation of this Agreement” with the General Manager and Union Steward. (J.A. Exh. 15, Art. 7.01.) If no resolution is reached, the parties proceed to Step 2, which provides that ”[a]ll matters pertaining to the proper application and interpretation of any and all of the provisions of this Agreement shall be adjusted by the accredited representative of the Company and the accredited representative of the Union.” (Id., Art. 7.02 [emphasis added].) If the parties “fail to reach a satisfactory adjustment,” they must proceed to Step 3, which states that the matter shall be referred for final adjustment to the Northern California Board of Adjustment wherein a majority decision shall be final and binding.” (Id.)
Finally, if the Board of Adjustment is “unable to adjudicate a case ... due to a ‘deadlock,‘” the parties reach Step 4, which permits either party to “request to move the case to an arbitrator for adjudication.” (Id., Art. 7.03.) This request must be by “written notice and confirmed receipt to the other party.” (Id.) As part of this final step, the parties must select from a list of eleven qualified arbitrators submitted by the Federal Mediation & Conciliation Service. (Id.) The selected arbitrator “may interpret the Agreement and apply it to the particular case presented, but shall not have authority to add to, subtract from, or in any way modify the terms of this Agreement or any agreements made supplementary hereto.” (Id., Art. 7.04 [emphasis added].) The arbitrator‘s decision
B. The grievances
On August 15, 2019, Local 87 filed a grievance on behalf of the former AmeriPride employees at the Bakersfield facility, asserting that Aramark violated Article 1 of the Master by failing to recognize employee drivers6 working at that facility. (J.A. Exh. 12; JSUF #11.) Accordingly, it requests that the drivers be recognized as “Teamsters Local 87 drivers” under the Master and that Aramark “cease and desist, and follow Article 1.01” of the Master. (Id.)
Local 386 followed suit, filing its grievance with respect to the Merced employees on January 2, 2020. (JSUF # 12.) The grievance was filed “under Article 1 and all other articles or sections that may apply of the [Master].” (J.A. Exh. 7.) It alleges that the former AmeriPride facility in Merced must be covered under the Master and thus, that all employees at that facility “are entitled to pay rates and all other benefits” listed in the Master. (Id.) Aramark denied both grievances. (JSUF ## 11-12.)
C. Request for arbitration and the present actions
By letter dated October 27, 2020, Teamsters proceeded to request arbitration under Article 7.03 of the Master. (JSUF # 13.) By letter dated November 13, 2020, Aramark informed Teamsters that their requests “would not be processed.” (JSUF # 14.) The same day,7 Aramark filed a National Labor Relations Board charge against Teamsters, alleging that the grievances violated the National Labor Relations Act by “restraining and coercing employees in the exercise of rights guaranteed in NLRA Section 7 ... and by violating [Teamsters‘] duty to bargain collectively ....” (JSUF # 15.) Aramark
II. Legal Standards
Section 301 of the Labor Management Relations Act provides that “[s]uits for violation of contracts between an employer and a labor organization ... may be brought in any district court of the United States.
The Supreme Court has determined that “arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.” United Steelworkers of America v. Warrior & Gulf Nav. Co., 363 U.S. 574, 582 (1960). Thus, “[u]nless the parties clearly and unmistakably provide otherwise,” AT & T Techs., Inc. v. Commc‘ns Workers of Am., 475 U.S. 643, 649 (1986), “the question of arbitrability—whether a collective-bargaining agreement
On the other hand, “congressional policy [is] in favor of settlement of disputes by the parties through the machinery of arbitration.” Warrior & Gulf, 363 U.S. at 582. Thus, there is a presumption of arbitrability in labor disputes involving contracts that contain arbitration clauses, meaning that “an order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage.” AT & T, 475 U.S. at 650 (quoting Warrior & Gulf, 363 U.S. at 582-83). This presumption applies to agreements containing broad arbitration clauses, where “in the absence of any express provision excluding a particular grievance from arbitration, we think only the most forceful evidence of a purpose to exclude the claim from arbitration can prevail.” Id. (quoting Warrior & Gulf, 363 U.S. at 584-85); see also Dennis L. Christensen Gen. Bldg. Contractor, Inc. v. Gen. Bldg. Contractor, Inc., 952 F.2d 1073, 1077 (9th Cir. 1991), as amended on denial of reh‘g (Dec. 18, 1991) (explaining the presumption of arbitrability “is particularly potent if the arbitration clause is broad“).
“[I]n deciding whether the parties have agreed to submit a particular grievance to arbitration, a court is not to rule on the potential merits of the underlying claims.” AT & T, 475 U.S. at 649; see also Warrior & Gulf, 363 U.S. at 582 (“[T]he judicial inquiry under [section] 301 must be strictly confined to the question whether the reluctant party did agree to arbitrate the grievance[.]“); United Steelworkers of America v. American Mfg. Co., 363 U.S. 564, 568 (1960) (“The agreement is to submit all
III. Discussion and Analysis
A. Substantive Arbitrability
There are three types of disputes that arise in cases involving the issue of arbitrability, which the Ninth Circuit illustrated well:
(1) the “Merits Question“—a dispute between the parties regarding the merits of an issue ...; (2) the “Arbitrability Question“—a dispute regarding whether the parties agreed to arbitrate the Merits Question ...; and (3) the “Delegation Question“—a dispute regarding whether an arbitrator or a court is tasked with deciding the Arbitrability Question.
SEIU Loc. 121RN v. Los Robles Reg‘l Med. Ctr., 976 F.3d 849, 852 and n.2 (9th Cir. 2020) (citing ASARCO LLC v. United Steel, Paper & Forestry, Rubber, Mfg., Energy, Allied Indus. & Serv. Workers Int‘l Union, AFL-CIO, CLC, 910 F.3d 485, 496-97 (9th Cir. 2018) (Ikuta, J., dissenting)).
The parties agree10 that the dispute here is one of substantive arbitrability (the Arbitrability Question)11 and that the Court is tasked with deciding this question (the Delegation Question), while resolution of the grievances’ merits (the Merits Question) is reserved for arbitration. (See Doc. 49-1 at 18-19, 22; Doc. 49-2 at 7-8; Doc. 50-2 at 11.)12 They also agree that the merits-related dispute
Aramark acknowledges that the Master‘s arbitration clause grants the arbitrator the authority to interpret and apply the terms of the Master (Doc. 49-1 at 12) and concedes that determining whether Article 1 applies to the AmeriPride employees requires interpretation of a provision of the Master. (See Doc. 49-2 at 7 [“Nor does resolving the parties’ dispute regarding substantive arbitrability turn on the interpretation of Article 1.01 of the [Master] (which states the agreement applies to ‘new or additional depots, routes or plants ... established by the Company within [Teamsters‘] jurisdiction‘).“] [quoting J.A. Exh. 15 at 248].) Aramark goes astray when it conflates its own challenges to arbitrability with the merits of the dispute.
1. The proper inquiry
In determining “whether a collective bargaining agreement creates a duty for the parties to arbitrate the particular grievance,” AT & T, 475 U.S. at 649, the Court must ask “whether a particular merits-related dispute is arbitrable because it is within the scope of a valid arbitration agreement.” First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944-45 (1995) (emphasis omitted); see also Mirage Casino-Hotel, Inc. v. Loc. Joint Exec. Bd. of Las Vegas, 911 F.3d 588, 596 (9th Cir. 2018) (“The substantive arbitrability inquiry ... examines the parties’ arbitration agreement and determines whether a particular dispute is within its scope, and thus ‘arbitrable,’ or outside its scope, and thus ‘non-arbitrable.‘“).
Although Aramark accurately defines substantive arbitrability, (see Doc. 49-1 at 18, 21; Doc.
In defining the inquiry in this manner, Aramark argues that the Court should reject Teamsters’ “conclusory assertion” that the grievances are arbitrable merely because they refer to Article 1.0116
The parties in Berry disagreed whether the underlying dispute—an alleged violation of the agreement‘s subcontracting clause—was jurisdictional and, thus, non-arbitrable, or whether it was contractual and subject to arbitration. See Berry, 984 F.2d at 343. In such circumstances, the Ninth Circuit explained that “[t]he proper inquiry ... is not whether the underlying dispute is arbitrable in and of itself; rather, we must ask whether the overall dispute, which encompasses the disagreement over the nature of the underlying dispute, is arbitrable under the terms of the CBA.” Id. (emphasis in original). Thus, the Court was tasked with determining whether the parties agreed to arbitrate disputes over the alleged violation of a substantive provision and whether they agreed to arbitrate disagreements as to the nature of that dispute—that is, whether they agreed to arbitrate disputes over which substantive provision governed the underlying dispute. the Article VI (arbitration) or Article IV(F) (no arbitration) procedures applied.
Notwithstanding the fact that even Aramark‘s proffered definitions of the disputes don‘t align with the rationale in Berry, Aramark does not articulate why the Court should “reject” Teamsters’ assertion that the grievances are arbitrable because they refer to Article 1 of the Master, when Aramark concedes that the underlying dispute is the Master‘s application—by way of Article 1.0117—
Furthermore, if the Court were to accept Aramark‘s inquiry as proper, any “new or additional depots ...” established by Aramark by way of an acquisition would expose the former company‘s employees to the same challenge facing the former AmeriPride employees here. That is, Aramark could raise the argument that any CBAs covering the employees prior to the acquisition automatically preclude a duty to arbitrate under the Master simply because the CBAs exist (or alternatively, as discussed infra, that the mere existence of a separate CBA is always “forceful evidence” of an intent to exclude claims involving those employees from arbitration).
Finally, Aramark‘s characterizations of the inquiry and dispute would have the Court decide whether Aramark has a duty to arbitrate, but not on the basis that it did not form an agreement with Teamsters, that the Master‘s arbitration clause is invalid, or that the particular grievances are not within the scope of the clause.19 Instead, in essence, Aramark is asking the Court to rule on the merits,
To illustrate, Aramark seeks to have the Court determine that there is no duty to arbitrate the issue of Article 1.01‘s application to the former AmeriPride employees by evaluating the AmeriPride CBAs as opposed to examining the subject matter of the grievances and the breadth of the Master‘s arbitration clause. According to Aramark‘s argument, the Court must not only recognize the existence of the AmeriPride CBAs, (see Doc. 49-3 at 8), it must evaluate their impact and effect on the Master‘s application, (see Doc. 49-1 at 22), and ultimately find that the AmeriPride CBAs apply to the employees, rather than the Master. This is indistinguishable from a request that the Court decide whether the Master applies to the AmeriPride employees. (See, e.g., id. at 19 [asserting the former AmeriPride employees are “covered by their own separate and distinct CBAs and not the [Master]“]; id. at 24 [arguing the employees are not covered by the Master]; Doc. 49-3 at 11 [contending the “plainly expressed intent” of the AmeriPride CBAs’ provisions “warrants a conclusion” that the AmeriPride CBAs “and not any other contract or agreement, most pointedly, the [Master]” have applied to the former AmeriPride facilities] [emphasis in original]; Doc. 49-1 at 11 [noting that the AmeriPride CBAs “constitute the entire agreement” and provide for “final and binding” arbitration]; id. at 28 [asserting the AmeriPride CBAs “currently in effect ... govern the wages, hours, benefits, and other employment terms and conditions” concerning the employees]; id. at 30 [arguing the AmeriPride CBAs “govern[] all grievance arbitration obligations“].)
Any potential effect of the acquisition or rebranding on the applicability of Article 1.01 to the former AmeriPride facilities—or any other alleged event or conduct (e.g., contract extensions, continued recognition of the AmeriPride CBAs, etc.) that would implicate Article 1.01, would require interpretation and/or application of a provision of the Master. Likewise, Aramark‘s assertion that Article 1.01 does not constitute an agreement to merge bargaining units fares no better, as this also implicates application and/or interpretation of the Master. (See Doc. 49-3 at 12.) These arguments are therefore rejected.
In sum, Aramark seeks a determination whether the Master applies to the former AmeriPride employees.22 The grievances seek arbitration to resolve whether the AmeriPride locations are subject to the Master CBA. Thus, Aramark expressly addresses the merits of the dispute and not whether the dispute is subject to arbitration. Consequently, Aramark‘s view of the inquiry is improper and its attempts to mask its merits challenge as an arbitrability dispute are unavailing. Furthermore, it is
2. The dispute is within the scope of the Master‘s arbitration clause
Under Article 7 of the Master, the parties agreed to a grievance procedure that includes “final and binding” arbitration of “[a]ll matters pertaining to the proper application and interpretation of any and all of the provisions” of the Master. (J.A. Exh. 15, Art. 7.02, 7.04.) These broad terms are entitled to the presumption of arbitrability. Warrior & Gulf, 363 U.S. at 585; Christensen, 952 F.2d at 1077 (recognizing “potent” presumption where arbitration clause is broad and noting plaintiff‘s concession that clause submitting to arbitration “all disputes concerning the interpretation or application of [the parties’ agreements]” is “very broad“). Where, as here, the arbitration agreement does not contain an “express provision excluding a particular grievance from arbitration,” the issue is “a simple one: is there forceful evidence of a purpose to exclude these grievances from arbitration so that the heavy presumption in favor of arbitration is overcome?” Howmet Corp. v. United Steelworkers of Am., AFL-CIO, 466 F.2d 1249, 1252 (9th Cir. 1972) (quoting Warrior & Gulf, 363 U.S. at 585). Like the Ninth Circuit in Howmet, the Court holds there is not.
Aramark argues that even in the absence of an express provision, the AmeriPride CBAs “constitute ‘forceful evidence’ of the parties’ intent to exclude such claims from arbitration under the [Master].” (Doc. 49-1 at 22, citing Warrior & Gulf, 363 U.S. at 584-85; AT & T, 475 U.S. at 650; see also Doc. 49-2 at 10.) Aramark asserts its position is “supported by Ninth Circuit cases refusing to compel arbitration of grievances that seek to apply the terms of a CBA to employees at a facility that is already governed by a separate CBA.” (See Doc. 49-2 at 10-11.) These cases are distinguishable.
In Howmet, the Court held that where an employer had agreements with different unions, arbitration should not be compelled, because an award in favor of the union would “foster rather than alleviate industrial disharmony by forcing the employer to arbitrate with one union issues which touched the very heart of the employer‘s collective bargaining agreement with another union.” 466 F.2d at 1254; see also Stove, Furnace & Allied Appliance Workers Int‘l Union of N. Am., AFL-CIO, Loc. 123-B v. Gaffers & Sattler, Inc., 470 F.2d 860 (9th Cir. 1972) (following Howmet based on an
Aramark is similarly unsuccessful in attempting to distinguish the remaining three cases by claiming that the Ninth Circuit‘s findings that the grievances were arbitrable in those cases were on the basis that the relevant employees were not covered by separate CBAs. (Doc. 49-2 at 11 [citing Dennis L. Christensen Gen. Bldg. Contractor, Inc. v. Gen. Bldg. Contractor, Inc., 952 F.2d 1073 (9th Cir. 1991), as amended on denial of reh‘g (Dec. 18, 1991); Haig Berberian, Inc. v. Cannery Warehousemen, 535 F.2d 496 (9th Cir. 1976); Int‘l Bhd. of Elec. Workers, Loc. 1547, AFL-CIO v. Alaska Commc‘ns Sys. Holdings, Inc., 2021 WL 5276022 (9th Cir. Nov. 12, 2021)].) The Court finds no indication that any of these decisions turned on the existence of a separate agreement, nor does Aramark point to any.
At no point does Aramark assert that—or analyze whether—the particular grievances fall within or without the scope of the Master‘s arbitration clause.23 Aramark makes no reference to the subject of the grievances or the language of the Master‘s arbitration clause in furthering its arguments. It concentrates entirely on the AmeriPride CBAs. (See, e.g., Doc. 49-1 at 21 [arguing the Master does not give an arbitrator authority to interpret the AmeriPride CBAs]; id. at 22 [asserting that “evaluating the impact and effect” of the AmeriPride CBAs “goes beyond the scope” of the Master]; Doc. 49-2 at 9 [claiming that the contractual obligations under the AmeriPride CBAs “establish that the parties’ dispute here is not covered by the [Master‘s] arbitration clause“].) Elsewhere, Aramark argues that the
Aramark argues that Teamsters ”assume the existence of a duty-to-arbitrate,” (Doc. 49-3 at 8, emphasis in original), that the grievances ”purport to be based on Article 1 of the [Master],” (Doc. 49-1 at 20, emphasis added), and that “although [Teamsters] seeks arbitration under Article 7.03 of the [Master],” their claims involve employees who are not covered by the Master. (Id. at 19.) However, whether Teamsters’ reliance on Article 1.01 is baseless remains to be determined by the arbitrator. See Haig Berberian, 535 F.2d at 499 (“The question is whether the claim itself purports to be based on an interpretation of the contract.“); see also American Mfg., 363 U.S. at 568 (courts “have no business weighing the merits of the grievance” or “considering whether there is equity in a particular claim” but are instead “confined to ascertaining whether the party seeking arbitration is making a claim which on its face is governed by the contract“).
The Merits Question asks whether the Master applies to the relevant employees by way of Article 1.01, and in reaching this determination, it may be relevant to consider whether separate CBAs bear on the Master‘s applicability to those employees. In other words, the AmeriPride CBAs may “defeat” the merits of Teamsters’ grievances, but that is undisputedly an issue reserved for arbitration. (See Doc. 49-2 at 9.) Aramark does not acknowledge this important distinction, despite it being raised by Teamsters. Rather, Aramark doubles down in its reply, making another bare assertion that “there is no merit” to Teamsters’ argument that Aramark “is asking the Court to decide the merits of the grievances to conclude that they are not substantively arbitrable.” (Doc. 49-3 at 7; Doc. 50-5 at 7.) The Court finds otherwise, which is illustrated by the fact that Aramark does not dispute that it agreed to be bound by the Master and its arbitration clause.
Teamsters, on the other hand, contend that their “grievances regarding the application of
The Court agrees. Teamsters’ grievances seek to have an arbitrator determine whether the AmeriPride facilities constitute “new or additional depots, routes or plants” under Article 1.01 of the Master, and therefore whether the terms of the Master must be applied to the employees at those facilities. (See JSUF ## 11-12; Doc. 1 ¶ 31 [Member Case]; Doc. 1-3 at 4 [Member Case].) The Master contains no express provision excluding the subject of the grievances from arbitration, and Aramark fails to offer forceful evidence sufficient to overcome the heavy presumption in favor of arbitrability. AT & T, 475 U.S. at 650; Howmet, 466 F.2d at 1256. And although Aramark asserts that resolution of the parties’ dispute regarding substantive arbitrability does not turn on the interpretation of Article 1.01 of the Master (Doc. 49-1 at 22; Doc. 49-2 at 7), it does not challenge that resolution of the grievances does. Accordingly, this is the end of the Court‘s inquiry. See Howmet, 466 F.2d at 1256 (“The district court‘s function in the process is essentially ended once it has found the collective bargaining agreement susceptible of an interpretation which would cover the dispute ....“); see also Mirage, 911 F.3d 588, 596 (9th Cir. 2018) (“[N]or does [the employer] argue that the Union‘s grievance is non-arbitrable as outside the scope of the parties’ arbitration agreement[.] ... Because that is the essence of the substantive arbitrability inquiry ... [the employer] has effectively conceded that the dispute is substantively arbitrable.“). The presumption of arbitrability must prevail.
B. Unlawful objective under the NLRA
Aramark also challenges arbitrability based on the argument that the grievances have an “unlawful objective” under the National Labor Relations Act,
1. Primary jurisdiction
In the context of labor disputes, the primary jurisdiction doctrine recognizes the “congressional intent to have matters of national labor policy decided in the first instance by the National Labor Relations Board.” Glaziers & Glassworkers Loc. Union No. 767 v. Custom Auto Glass Distributors, 689 F.2d 1339, 1342 (9th Cir. 1982). In San Diego Building Trades Council, Millmen‘s Union, Loc. 2020 v. Garmon, 359 U.S. 236 (1959), the Supreme Court held that the doctrine preempted courts from “independently deciding questions of national labor policy” and “emphasized that unfair labor practices should be left in the first instance to the NLRB.” Glaziers, 689 F.2d at 1342 (citing Garmon, 359 U.S. at 244-45); see also Garmon, 359 U.S. at 245 (“When an activity is arguably subject to § 7 or § 8 of the [NLRA], the States as well as the federal courts must defer to the exclusive competence of the [NLRB].“).
Because section 301 also vested jurisdiction in the district courts over violations of labor contracts, the Supreme Court declined to apply the Garmon rule in suits brought in federal court under this section, instead holding that “[t]he authority of the [NLRB] to deal with an unfair labor practice which also violates a collective bargaining contract is not displaced by § 301, but it is not exclusive
The principle of “concurrent jurisdiction” was recognized in United Ass‘n of Journeymen & Apprentices of Plumbing & Pipefitting Indus., Steamfitters & Refrigeration Union, Loc. 342, AFL-CIO v. Valley Engineers, 975 F.2d 611 (9th Cir. 1992), as amended (Oct. 16, 1992). This is the only decision relied upon by Teamsters. (See Doc. 50-5 at 8.) To be clear, however, the relevant issue in Valley Engineers was discrete: whether a court, upon becoming aware that a simultaneous administrative proceeding “implicated a material aspect of the litigation before it,” should stay the suit or enjoin the parties from proceeding in the other forum, which requires courts “to determine which is the more appropriate forum for resolving that aspect of the dispute.” 975 F.2d at 613.
In this narrow context, the Ninth Circuit recognized the blurry jurisdictional line between representational and contractual issues in section 301 cases, holding that the NLRB has primary jurisdiction over the former and shares concurrent jurisdiction with federal courts over the latter. See id. at 613-14. This requires a “close examination” to determine whether “the major issues to be decided ... can be characterized as primarily representational or primarily contractual.” Id. (quoting Bhd. of Teamsters, Loc. No. 70 v. California Consolidators, Inc., 693 F.2d 81, 83 n.4 (9th Cir. 1982)); see also id. (noting the distinction courts have made “between those section 301 cases which turn on our interpretation of the contract and those which, stripped to essentials, are representation cases“) (citing Cappa v. Wiseman, 659 F.2d 957, 958-59 (9th Cir. 1981)). And yet, Teamsters rely on Valley Engineers without acknowledging this distinction or indicating their position on the nature of the issues in this case.27
2. Lawfulness of the provision in dispute
As the first case cited by Aramark—and the only one on point—the Court finds a discussion of United Food & Commercial Workers Union v. Alpha Beta Co., 736 F.2d 1371 (9th Cir. 1984) is warranted. There, the employer argued on appeal that enforcement of the disputed contract provision would “infringe” on employee rights under the
However, the Court distinguished its case from Kaiser Steel in a critical way when it held that “a conflict between an arbitrator‘s decision and federal labor law is necessarily speculative when the
For this reason, the Alpha Beta Court found no merit in the employer‘s speculations that “by seeking to enforce the disputed provision the Local Unions [were] attempting to unlawfully represent the employees,” in violation of the
a. Legal standard under Alpha Beta
Relying on Alpha Beta, Aramark argues that the grievances are not arbitrable because “it is not possible to interpret the [Master], including Article 1, in a way that would avoid conflicting with the NLRA.” (Doc. 49-1 at 23.) According to Aramark, Alpha Beta stands for the proposition that “a dispute is non-arbitrable where there is no possible resolution that would be consistent with federal law.” (Doc. 49-1 at 23.) It quotes the Court‘s actual holding, which is at odds with Aramark‘s theory. (See id. [“[I]f all possible interpretations of the contract provision would result in a conflict between that provision and [the NLRA] . . . arbitration [would] be precluded.“].) Considering that Aramark recognizes the correct standard, it is troubling that it does not acknowledge or attempt to resolve this conflict.31
Aramark makes only one reference to “the contract provision in dispute.” (See Doc. 49-1 at 23 [mentioning Article 1].) Otherwise, it consistently misidentifies the subject of the inquiry by focusing on the grievances, arbitration demands, and the arbitration itself. (See, e.g., id. [“The grievances seek an outcome that is unlawful under the NLRA and are non-arbitrable for this reason as well.“]; id. [asserting that grievances have “unlawful or “illegal objective[s]” and thus, Teamsters’ “arbitration demand itself conflicts with the NLRA“]; id. at 24 [arguing that grievances “constitute an unlawful demand to merge separate and distinct units that an arbitrator has no power to determine“]; id. at 27 [asserting that arbitration demand seeks to merge separate bargaining units, which indicates that “they have an objective that is illegal under federal law and cannot be enforced.“]; id. at 28 [arguing that grievances and arbitration demands conflict with the NLRA]; id. [asserting that grievances seek to “unilaterally apply, through arbitration, the terms” of the [Master] in violation of the NLRA, and thus, “arbitration of [Teamsters‘] grievances would conflict with the NLRA“] [emphasis added].)
Even assuming Aramark challenges the lawfulness of Article 1, it abandons any notion of a “conflict” as quickly as it is raised. Aramark wholly omits from its discussion how Article 1 violates the Aramark puts forth an equally flawed analysis. By misstating the proper standard, Aramark proceeds under three misconceptions: (1) that in determining arbitrability, the Court is authorized and required to decide whether Teamsters’ pursuit of the grievances violates the Aramark proceeds on these assumptions by relying on “longstanding NLRB precedent” to Turning, then, to the Alpha Beta framework, there is little left to discuss. The arbitrator has yet to rule in this case, and as such, Aramark must prove that all possible interpretations of Article 1 are unlawful to preclude arbitration. Alpha Beta, 736 F.2d at 1377; see also United Food & Com. Workers Union, Loc. 135 v. Ralphs Grocery Co., 2019 WL 8221085, at *3 (C.D. Cal. Oct. 9, 2019) (placing burden on challenging party). The conclusory assertion that “it is not possible to interpret the [Master], including Article 1, in a way that would avoid conflicting with the NLRA,” (Doc. 49-1 at 23) is insufficient to meet this burden. Aramark does not identify the employee rights or obligations that would be violated by enforcing Article 1, much less explain “how or in what manner those rights would be affected.” See Alpha Beta, 736 F.2d at 1378 (finding that although the employer properly asserted the disputed provision would interfere with the employees’ self-organization right, it failed to provide its reasoning). It is possible that an arbitrator could interpret Article 1.01 in a manner that would render it Aramark fails to demonstrate arbitration should be precluded on these grounds. Aramark‘s final argument in the context of arbitration is that even if the grievances are deemed arbitrable, the Court should find that Aramark is not obligated “to arbitrate separate grievances involving separate facilities, filed at different times, in a single proceeding before a single arbitrator.” (Doc. 49-1 at 32.) Teamsters contends that the Court need not resolve this issue because “whether to consolidate multiple grievances into a single arbitration is a procedural matter for an arbitrator to decide,” rather than a question of substantive arbitrability for the Court. (Doc. 50-5 at 15.) Once a court determines “that the parties are obligated to submit the subject matter of a dispute to arbitration, ‘procedural’ questions which grow out of the dispute and bear on its final disposition should be left to the arbitrator.” John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 557 (1964); see also Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 84 (2002) (explaining that procedural questions “are presumptively not for the judge, but for an arbitrator, to decide“) (citing John Wiley, 376 U.S. at 557). To support the opposite conclusion, Aramark relies on United Food & Commercial Workers, Local 21 v. MultiCare Health System, 2011 WL 834141, at *3 (W.D. Wash. Mar. 3, 2011). MultiCare involved two disputes: “(1) whether the Court or an arbitrator should determine whether the grievance can be resolved in a single, consolidated arbitration, and (2) if the Court decides the issue, whether it can order consolidated arbitration.” 2011 WL 834141, at *1 (emphasis added). After concluding that the issue of consolidation was properly before it under the first issue, it proceeded to the second issue, declining to order consolidated arbitration because the eight relevant CBAs did not “reflect an intent to conduct a single arbitration on behalf of all bargaining units,” where many contained competing arbitration provisions, and none referred to consolidation of grievances. MultiCare, 2011 WL 834141, at *2. Importantly, this rationale hinged on the Supreme Court‘s decision in Stolt-Nielsen S.A. v. AnimalFeeds Int‘l Corp., 559 U.S. 662 (2010), which the Court finds misplaced for a few reasons. First, the court‘s holding in MultiCare relied on the Supreme Court‘s discussion of an entirely distinct issue in Stolt-Nielsen. There, the Court specifically declined to address the first issue identified in MultiCare—whether the court or arbitrator should decide the issue of consolidation—because the parties had already agreed to submit the issue to arbitration. See Stolt-Nielsen, 559 U.S. at 678, 680 (explaining it “need not revisit” the question of “which decision maker (court or arbitrator) should decide whether the contracts in question” permitted class arbitration, because the parties expressly assigned the issue to the arbitration panel). The Court‘s discussion centered on the “standard the appropriate decision maker should apply in determining whether a contract allows class arbitration.” Id. at 678, 680-81 (emphasis added). In other words, MultiCare put the cart before the horse; a court may not apply a standard without first having the authority to do so. Thus, a court must determine who the “appropriate decision maker” is before discussing what standard is to be applied, and certainly prior to applying it. Proper sequence aside, the Court nonetheless struggles to comprehend how a discussion of the proper standard bears on the question of identifying the appropriate decision maker. Second, the holding in Stolt-Nielsen was narrowly confined to class-action arbitration. See 559 U.S. at 663. The Supreme Court recognized that “[i]n certain contexts, it is appropriate to presume that An implicit agreement to authorize class-action arbitration, however, is not a term that the arbitrator may infer solely from the fact of the parties’ agreement to arbitrate. This is so because class-action arbitration changes the nature of arbitration to such a degree that it cannot be presumed the parties consented to it by simply agreeing to submit their disputes to an arbitrator. Id. (emphasis added). The Court then considered “some of the fundamental changes brought about by the shift from bilateral arbitration to class-action arbitration” and concluded that these differences “are too great for arbitrators to presume . . . that the parties’ mere silence on the issue of class-action arbitration constitutes consent to resolve their disputes in class proceedings.” Id. at 686-87. Curiously, MultiCare relies on this holding without considering the differences that the Supreme Court recognized in reaching its conclusion. See id. at 685-86. In the Court‘s view, reliance on this narrow holding necessitates such consideration. Finally, the MultiCare court briefly discussed whether the issue of consolidation is procedural, noting that the Ninth Circuit has not addressed the issue and two other circuits have concluded that it is. 2011 WL 834141, at *3. Nonetheless, it quickly disposed of both holdings in light of Stolt-Nielsen, reliance on which the Court finds inapt. Considering Stolt-Nielsen‘s emphasis on the unique concerns that arise in the context of class actions, and the Court having no occasion to consider an application beyond that, the Court cannot conclude that Stolt-Nielsen intended to extend its holding to consolidated arbitration in labor disputes. Moreover, the Court does not conclude that the holding in Stolt-Nielsen bears on the “first question” at all. Because that is the question facing the Court here—whether a court or an arbitrator is “the appropriate decision maker,” 559 U.S. at 678, the Court respectfully finds Stolt-Nielsen inapplicable and MultiCare unpersuasive, and as a result, Aramark‘s reliance on these two cases unhelpful.36 Turning back to the first question, though no published decision in the Ninth Circuit has directly addressed whether consolidated arbitration is an issue for the arbitrator under Howsam,37 several other circuits have, which, collectively, the Court finds instructive. See e.g., Shaw‘s Supermarkets, Inc. v. United Food & Commercial Workers Union, Loc. 791, AFL-CIO, 321 F.3d 251, 254 (1st Cir. 2003) (leaving the decision whether to consolidate three arbitration proceedings “in the hands of the arbitrator“); Certain Underwriters at Lloyd‘s London v. Westchester Fire Ins. Co., 489 F.3d 580, 585 (3d Cir. 2007) (“Thus, ‘only when there is a question regarding whether the parties should be arbitrating at all’ is a question of arbitrability raised for the court to resolve. ‘In other circumstances, resolution by the arbitrator remains the presumptive rule.‘“) (quoting Dockser v. Schwartzberg, 433 F.3d 421, 426 (4th Cir. 2006)); Emps. Ins. Co. of Wausau v. Century Indem. Co., 443 F.3d 573, 577 (7th Cir. 2006) (rejecting argument that agreements made “no mention of consolidation,” which indicated entitlement to separate arbitrations and instead finding that, under Howsam, “the question of whether an arbitration agreement forbids consolidated arbitration is a procedural one, which the arbitrator should resolve“); Avon Prod., Inc. v. Int‘l Union, United Auto Workers of Am., AFL-CIO, Loc. 710, 386 F.2d 651, 658-59 (8th Cir. 1967) (holding that the “arbitrator must determine whether the grievances are to be resolved in a single or in multiple proceedings” and noting that “[t]he numerous decisions on this question by arbitrators adds substance” to the court‘s holding). Guided by the above-cited authority and the facts of this case, the Court concludes no differently. Consolidated arbitration is the type of issue the parties did not expect the Court to decide but rather, a “procedural question which grow[s] out of the dispute and bear[s] on its final In the alternative, Aramark contends that under principles of estoppel, Teamsters should not be permitted to bypass their obligations under the AmeriPride CBAs after accepting benefits under them. (See Doc. 49-2 at 14-16; Doc. 49-3 at 11.)38 Teamsters claims that this argument “relies primarily on a line of cases that has nothing whatsoever to do with the facts here,” and as a result, Aramark fails to demonstrate that Teamsters “have engaged in any conduct that equitably estops them from pursuing” their grievances under the Master. (Doc. 50-6 at 7-8.) The Court agrees. Aramark cites various Ninth Circuit cases it claims have “applied equitable principles in determining substantive arbitrability questions to find that a party is estopped from challenging the validity of an arbitration clause in a contract where the party has accepted benefits under the contract.” (Doc. 49-2 at 14, emphasis added.) However, the substantive arbitrability question here does not involve the AmeriPride CBAs; Teamsters do not challenge the validity of the AmeriPride CBAs’ arbitration clauses and neither party seeks arbitration under those CBAs. Importantly, three of the cases cited by Aramark concern whether a nonsignatory refusing arbitration can be bound by an arbitration agreement under the principle of equitable estoppel. See Comer v. Micor, Inc., 436 F.3d 1098 (9th Cir. 2006); Peck Ormsby Const. Co. v. City of Rigby, 526 F. App‘x 769 (9th Cir. 2013); Loc. 640 Trustees of IBEW & Arizona Chapter NECA Health & Welfare Tr. Fund v. CIGNA Health & Life Ins. Co., 2021 WL 3290534 (D. Ariz. Aug. 2, 2021), aff‘d sub nom. No. 21-16424, 2022 WL 2805111 (9th Cir. July 18, 2022). The error in relying on these cases is twofold: it is undisputed that Teamsters are signatories to the parties’ collective bargaining agreement, and it hardly bears repeating that Teamsters is seeking, rather than refusing, arbitration. Aramark also cites Nghiem v. NEC Elec., Inc., 25 F.3d 1437 (9th Cir. 1994), which is equally distinguishable. There, the appellant sought reversal of an arbitration award on the grounds that it did In sum, Aramark does not explain how this line of cases supports the notion that Aramark has no duty to arbitrate under the Master based on Teamsters’ acceptance of benefits under the AmeriPride CBAs. (See, e.g., Doc. 49-2 at 14-15 [limiting reliance on Comer to the Court‘s definition of equitable estoppel and providing no explanatory parenthetical in citing Nghiem].) Thus, this argument fails. Because the remainder of Aramark‘s arguments flow from this unsupported assertion, the Court finds them similarly unpersuasive. (See id. at 15-16.) Aramark argues also that the “same facts” relied upon in asserting estoppel “warrant [a] finding that [Teamsters] waived any right that might otherwise exist regarding a duty-to-arbitrate under any contracts” other than the AmeriPride CBAs. (Doc. 49-3 at 10-11, emphasis omitted.)39 It argues only that “similar to” Madrid v. Lazer Spot, Inc., 2020 WL 4274218 (E.D. Cal. July 24, 2020), “the elements needed to prove waiver are present, which this Court also held was appropriate for the Court, and not an arbitrator, to resolve . . . .” (Doc. 49-3 at 11.) Teamsters argue that the issue of whether the extensions constitute a waiver of their claims is for the arbitrator, as it goes to the merits of the grievances. (See Doc. 50-5 at 12.) First, contrary to Teamsters’ assertion, this issue is properly before the Court. Although Aramark may take the position that the extensions of the AmeriPride CBAs generally waive Teamsters’ claims, and although Aramark asserts a finding of waiver is warranted based on the fact that the extensions “gave continuing force and effect to” various “mutual obligations and Turning then to Aramark‘s argument, “the test for waiver of the right to compel arbitration consists of two elements: (1) knowledge of an existing right to compel arbitration; and (2) intentional acts inconsistent with that existing right.” Hill v. Xerox Bus. Servs., LLC, 59 F.4th 457, 468 (9th Cir. 2023).40 As to the first element, Aramark contends Teamsters “clearly had ‘knowledge’ that Aramark acquired AmeriPride in January 2018, and also had knowledge of the [Master] (including the arbitration provisions that [Teamsters] now seek to invoke).” (Doc. 49-3 at 11.) Aramark is careful not to assert that Teamsters knew of its right to compel arbitration under the Master, being that such an assertion would directly conflict with Aramark‘s overall position. Nonetheless, it is undisputed Teamsters had knowledge of the right to compel arbitration, and thus, this requirement is satisfied. Next, in determining whether a party took acts inconsistent with a right to arbitration, courts “consider the totality of the parties’ actions” by asking “whether those actions holistically ‘indicate a conscious decision . . . to seek judicial judgment on the merits of the arbitrable claims, which would be inconsistent with a right to arbitrate.‘” Armstrong v. Michaels Stores, Inc., 59 F.4th 1011, 1015 (9th Cir. 2023) (quoting Hill, 59 F.4th at 473 n.19). Under this precedent, “[a] party generally ‘acts inconsistently with exercising the right to arbitrate when it (1) makes an intentional decision not to move to compel arbitration and (2) actively litigates the merits of a case for a prolonged period of time in order to take advantage of being in court.‘” Fox v. Experian Info. Sols., Inc., --- F. Supp. 3d ----, ----, 2024 WL 755804, at *4 (E.D. Cal. Feb. 23, 2024) (quoting Armstrong, 59 F.4th at 1015). As a final matter, Teamsters seek an award of attorney‘s fees and expenses incurred during these proceedings on the ground that Aramark‘s refusal to arbitrate was frivolous and in bad faith. (See Doc. 50-2 at 11-12.) Aramark opposes this request. (Doc. 49-2 at 17.) “Under federal law, attorney‘s fees are available in a Bearing in mind federal policy favors arbitration, the Ninth Circuit has applied “a less demanding—‘without justification‘—standard in cases involving refusals to arbitrate.” United Fed‘n of Agents & Int‘l Representatives v. United Food & Com. Workers Union, Loc. 101, 8 F. App‘x 737, 740 (9th Cir. 2001) (quoting Alpha Beta, 736 F.2d at 1382-83). Evidence of dilatory tactics and inconsistent positions has supported a bad faith finding. See Fed‘n of Agents, 8 F. App‘x at 740-41 (district court did not abuse its discretion in finding union resisted arbitration in bad faith and “without Teamsters lends insufficient support for the argument that Aramark‘s filing of a declaratory judgment action, despite withdrawing its NLRB charge, is sufficient to satisfy this standard. In fact, the Court finds this conduct enlightening. Although Aramark‘s arguments are unavailing, it filed its NLRB charge based on the position that, inter alia, Teamsters’ attempt to arbitrate was an unfair labor practice in violation of the Given the facts of this case as well as the relatively nuanced nature of the issues presented, the Court finds that Aramark‘s refusal to arbitrate was perhaps misguided, but not without justification. Cf. Seven-Up, 2010 WL 5136200, at *8 (finding refusal to arbitrate was “without justification” where employer‘s duty to arbitrate was “straightforward” and it had “not asserted a single justification for its refusal to arbitrate other than procedural issues which are themselves subject to arbitration“). Thus, Teamsters’ request for attorney‘s fees is DENIED. Based upon the foregoing, the Court ORDERS: /// IT IS SO ORDERED. Dated: September 6, 2024 UNITED STATES DISTRICT JUDGEb. Analysis
C. Alternative arguments
1. Consolidated arbitration
2. Estoppel
3. Waiver
IV. Attorney‘s Fees
V. Conclusion and Order
Notes
First, “AmeriPride, Inc.” became “AmeriPride, LLC” in 2019. (See Doc. 1 at 4 ¶ 7; Doc. 32-2 at 2 ¶ 4.) Because this conversion is immaterial to these proceedings, this plaintiff will be referred to by the Court as simply “AmeriPride.”
Second, Lead Case Plaintiffs are subsidiaries of two entities: “Aramark Uniform & Career Apparel Group, Inc.” or “Aramark Group,” and “Aramark, a Delaware corporation,” or “Aramark,” both of which appear to be relevant only insofar as Aramark Inc., “through Aramark Group and/or other affiliates,” acquired AmeriPride in 2018. (See JSUF ## 4, 8; PSUF #1; Doc. 1 at 4 ¶ 7.) Neither entity is a party to this action. Nonetheless, in the event the Court finds it necessary to refer to either entity, “Aramark, a Delaware corporation” will be referred to as “Aramark, Inc.” and “Aramark Uniform & Career Apparel Group, Inc.” will be referred to as “Aramark Group.” As explained below, any reference to “Aramark” made hereinafter will collectively refer to Lead Case Plaintiffs only.
On this topic, another entity named “Aramark Uniform Service” or “Aramark Uniform Services,” is mentioned several times without explanation, including in the parties’ collective bargaining agreement (the “Master“) and in both grievances. (See Doc. 31 at 134, 244, 250-317 (Joint Appendix) (“J.A.“) Exh. 7, 12, 15); see also J.A. Exh. 16, 17, 20); Doc. 32-3 at 2 ¶ 2.) It is unclear what relation this entity has to the parties or this action. (See Doc. 32-3 at 2 ¶¶ 2-3 [distinguishing between Aramark Uniform Services and Plaintiff, Aramark Uniform & Career Apparel, LLC].) As such, it will not be referred to by the Court.
Third, despite being named in the Master and—presumably for this reason—as a respondent in Teamsters’ petition to compel arbitration and grievances, (Doc. 1 [Member Case]; J.A. Exh. 7, 12), “Aramark Uniform &
Finally, AmeriPride and AUCA refer to themselves collectively as “Plaintiffs,” the “Company, “AmeriPride and AUCA,” and “AUCA and AmeriPride.” (See PSUF ## 1-3, 12-13; Doc. 32-1 at 2; Doc. 49-1 at 2.) However, these references are made as to allegations that, as the Court understands the facts, either do not concern one Plaintiff or the other. For instance, their complaint asserts “the Company and Local 386 agreed to extend the Merced CBA ...” with citation to the “Merced CBA Extension Agreement.” (Doc. 1 at 13 ¶ 52 [citing Doc. 1-6, Exh. F] [emphasis added].) However, the parties’ Joint Statement of Undisputed Facts asserts that AmeriPride and Local 386 agreed to this extension, citing to the same exhibit. (See JSUF # 9 [citing Doc. 1-6, Exh. F].) Indeed, the Merced CBA Extension Agreement was made by and between AmeriPride and Local 386 only. (See J.A. Exh. 6.) No reference to AUCA is made. These varying characterizations suggest to the Court that any distinction between “Plaintiffs” and the “Company” are of little importance. Thus, rather than using these terms interchangeably, the Court will refer to AmeriPride and AUCA collectively as “Aramark.” The Court finds this is the easiest reference to follow without altering the parties’ respective positions.
“Route Representatives” engaged in the pickup and/or delivery, or the selling or soliciting of laundry dry cleaning and allied services. It shall cover all truck drivers, driver helpers, inter-plant or relay drivers and such other personnel as may perform any work described in the classifications or applicable definitions herein only. Excluding therefrom, however, all “District Manager, Sales and Service Representatives, Maintenance employees, Office and Clerical employees, Plant Supervisors, Executives, Managers, Supervisors, Professional and Administrative employees and guards in accordance with the Act.”(J.A. Exh. 15, Art. 1.01.)
Likewise, Teamsters indicate they filed their grievances “under the [Master] asserting that pursuant to Article 1.01 Aramark must apply the terms of the [Master] to the [AmeriPride] employees ....” (Doc. 50-2 at 6; see also id. [detailing Local 87 grievance]; id. at 7 [detailing Local 386 grievance]; id. at 9 [specifying that the grievances concern the application of Article 1.01 to the AmeriPride employees]; id. at 10 [asserting that the grievances raise the issue whether Aramark‘s acquisition and operation of former AmeriPride facilities constitutes establishment of “new or additional depots, routes or plants” under Article 1.01 of the Master and, therefore, whether terms of Master must be applied to AmeriPride employees].)
