Opinion
21-CV-7543 (VSB)(SN)
12-07-2022
DRYWALL TAPERS AND POINTERS OF GREATER NEW YORK LOCAL UNION 1974, AFFILIATED WITH INTERNATIONAL UNION OF ALLIED PAINTERS AND ALLIED TRADES AFL-CIO, Petitioner, v. TIGER CONTRACTING CORP., Respondent.
REPORT AND RECOMMENDATION
SARAH NETBURN, UNITED STATES MAGISTRATE JUDGE.
Drywall Tapers and Pointers of Greater New York Local Union 1974, Affiliated with International Union of Painters and Allied Trades, AFL-CIO (the “Union”) petitions the Court for an order confirming the Decision and Award of the Joint Trade Board (the “Joint Trade Board”), dated April 19, 2021. The petition is brought pursuant to Section 9 of the Federal Arbitration Act (“FAA”) and Section 301 of the Labor Management Relations Act (“LMRA”), 29 U.S.C. § 185. I recommend that the petition be GRANTED.
BACKGROUND
Respondent is a signatory to a collective bargaining agreement (“CBA”) with the Union. ECF No. 1, Petition to Confirm Arbitration (“Pet.”) ¶ 4. The CBA prohibits Respondent from hiring non-union laborers. Decl. of Lauren Kugielska (“Kugielska Decl.”), ECF No. 3, at Ex. B (the “CBA”), Art. I. The CBA provides fines for any such violations. CBA, Art. XIII, Sec. 6, Violation 6. Such fines “shall be used” to defray Union enforcement costs and otherwise advance the Union's interests and benefit Union members and their families. CBA, Art. XIII, Sec. 4(a). The CBA also establishes the Joint Trade Board and empowers that body to hear and decide through arbitration all grievances and disputes related to the CBA. CBA, Art. XIII, Sec. 1.
The Union alleges that Respondent hired non-Union labor for work covered under the CBA. Pet. ¶ 6. Pursuant to Article XIV of the CBA, the Union filed a Demand for Arbitration with the Joint Trade Board and served the Demand on Respondent. Pet. ¶ 7. The Joint Trade Board held a hearing on April 6, 2021, at which a representative from Respondent appeared. The Joint Trade Board thereafter rendered an Award, finding Respondent guilty of hiring two nonUnion employees for work covered by the CBA. See generally Decision of the Joint Trade Board, dated April 19, 2021, at Kugielska Decl., Ex. A. Consequently, the Joint Trade Board directed the Respondent to pay $20,000 in fines to the Joint Board of the Drywall Taping Industry. Id.
The Union served Respondent with the Award and demand letter. Pet. ¶ 12, 13. Respondent has failed to comply with the Award. Pet. ¶ 14. The Award has not been vacated, modified, or corrected as prescribed in §§ 10 and 11 of the FAA. Pet. ¶ 17. The Union seeks to have it confirmed.
DISCUSSION
“Section 301 of the [LMRA] provides federal courts with jurisdiction over petitions brought to confirm labor arbitration awards.” Local 802, Associated Musicians of Greater N.Y. v. Parker Meridien Hotel, 145 F.3d 85, 88 (2d Cir. 1998) (citation omitted). “Normally, confirmation of an arbitration award is a summary proceeding that merely makes what is already a final arbitration award a judgment of the court, . . . and the court must grant the award unless the award is vacated, modified, or corrected.” D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 110 (2d Cir. 2006) (internal quotation marks and citations omitted).
A court's “review of an arbitration award under the LMRA is . . . ‘very limited.'” Nat'l Football League Mgmt. Council v. Nat'l Football League Players Ass'n, 820 F.3d 527, 536 (2d Cir. 2016) (quoting Major League Baseball Players Ass'n v. Garvey, 532 U.S. 504, 509 (2001)). A court may not “review the arbitrator's decision on the merits despite allegations that the decision rests on factual errors or misinterprets the parties' agreement, but inquire[s] only as to whether the arbitrator acted within the scope of his authority as defined by the collective bargaining agreement.” Id. The court's “task is simply to ensure that the arbitrator was ‘even arguably construing or applying the contract and acting within the scope of his authority' and did not ‘ignore the plain language of the contract.'” Id. at 537 (quoting United Paperworkers Int'l Union, AFL-CIO v. Misco, Inc., 484 U.S. 29, 38 (1987)). “Accordingly, an arbitration award is to be confirmed if there is even a ‘barely colorable justification' for the decision.” Trustees of New York City Dist. Council of Carpenters Pension Fund, Welfare Fund, Annuity Fund, & Apprenticeship, Journeyman Retraining, Educ. & Indus. Fund v. RSG Constr. Corp., No. 22-cv-2072 (JGK), 2022 WL 4088037, at *2 (S.D.N.Y. Sept. 6, 2022) (quoting U.S. Steel & Carnegie Pension Fund v. Dickinson, 753 F.2d 250, 252 (2d Cir. 1985)).
When a petition to confirm an arbitration award is unopposed, courts treat the petition and accompanying record as an unopposed motion for summary judgment; unless the undisputed facts fail to show that the moving party is entitled to judgment as a matter of law, the petition must be confirmed. D.H. Blair & Co., 462 F.3d at 109-10. If, however, “the evidence submitted in support of the summary judgment motion does not meet the movant's burden of production, then summary judgment must be denied even if no opposing evidentiary matter is presented. ” Id. at 110 (internal quotation marks and citations omitted) (emphasis in original).
I. Fine Assessment
When a collective bargaining agreement is ambiguous or silent on a matter, an arbitrator may look for guidance from many sources, including “the practices of the particular industry.” United Steelworkers of Am. v. Warrior & Gulf Navigation Co., 363 U.S. 574, 580-82 (1960). The “bargaining history, past practices, rights established under earlier agreements, and other rudimentary sources of contract construction” are all appropriate sources to guide an arbitrator's interpretation of a CBA. Radio & Television Broad. Engineers Union, Loc. 1212 v. WPIX, Inc., 716 F.Supp. 777, 781 (S.D.N.Y 1989) (quoting Western Electric Co, Inc. v. Communications Workers of America, AFL-CIO, 450 F.Supp. 876, 882 (E.D.N.Y. 1978)). Thus, an arbiters' “reference and ultimate reliance on industry practice are not inherently improper and are insufficient grounds, in and of themselves, for vacatur.” Matter of New York Hotel & Motel Trades Council, AFL-CIO v. Hotel Ass'n of New York City, Inc., No. 93-cv-2708 (SS), 1993 WL 485560, at *7 (S.D.N.Y. Nov. 24, 1993).
Article XIII Section 6 Violation 6 of the CBA provides that a first offense for hiring a non-union laborer will result in a fine of $2,000 for each non-union laborer, plus $1,000 in liquidated damages; a second offense may result in a fine of $5,000 for each non-union laborer, plus $1,500 in liquidated damages. The CBA is silent as to the fine amount for a third offense.
The Joint Trade Board found that Respondent had violated the CBA by hiring two nonunion laborers and fined the Respondent $20,000. The Joint Trade Board was silent on whether Respondent was a repeat offender or how the Board determined the fine. Because the CBA only establishes a fine of $2,000 per first offense and $5,000 per second offence, the Court requested additional information from counsel. See ECF No. 14. Petitioner responded with the Declaration of John Drew, President of District Council 9, International Union of Painters and Allied Trades. Declaration of John Drew, at ECF No. 17 (“Drew Decl.”). He stated that “[i]t is the practice of the JTB to double the amount of the fines set forth for a second offense ($5,000 for each nonUnion worker) as a third offense assessment ....” Drew Decl., ¶ 7. Drew further stated that the Joint Trade Board previously found Respondent to be twice in violation of the CBA by hiring non-union laborers and attached a copy of that prior decision. Drew Decl., ¶ 10.
Thereafter, the Court requested briefing on the Joint Trade Board's legal and factual authority to award a fine that is not expressly provided by the CBA. See ECF No. 19. In response, Petitioner argued that an award must be upheld so long as it “draws its essence” from the CBA. ECF No. 22. And, where the CBA is ambiguous (such as where the CBA does not provide a penalty schedule beyond second offenses), the arbitrator may fashion an award that is consistent with the purpose and intent of the CBA.
Petitioner contends that the Joint Trade Board double the fine of a second offense to establish a fine for a third offense in accordance with its past practice, but provides no factual support for this alleged practice. But notwithstanding that Petitioner has failed to establish that the Award was consistent with any past practice, an award must be confirmed so long as it is “even arguably” construing the CBA. Nat'l Football League Mgmt. Council, 820 F.3d at 537. Given the ambiguity of the CBA, the decision to double the second offense fine for a third offense is at least a “barely colorable justification,” Dickinson, 753 F.2d at 252, and draws from the “essence” of the CBA, United Steelworkers of Am. v. Enter. Wheel & Car Corp., 363 U.S. 593, 597 (1960). Id. (recognizing deference to arbitrator's informed judgment “especially . . . when it comes to formulating remedies”).
Accordingly, the Union's motion should be granted, and the Award should be confirmed.
II. Attorney's Fees and Costs
In addition, the Union seeks attorney's fees and costs. While attorneys' fees and costs are not available under the LMRA and are generally not recoverable from an opposing party, courts have used their inherent powers to award them in successful petitions to confirm arbitration awards “when a challenger refuses to abide by an arbitrator's decision without justification ....” Trustees of the New York City Dist. Council of Carpenters Pension Fund v. Coastal Env't Grp., Inc., No. 16-cv-6004 (GHW), 2016 WL 7335672, at *3 (S.D.N.Y. Dec. 16, 2016) (quoting Int'l Chem. Workers Union, Local No. 227 v. BASF Wyandotte Corp., 774 F.2d 43, 47 (2d Cir. 1985)) (internal quotation marks omitted). An award of reasonable fees and costs is justified because the Respondent failed to appear in this Court and has not paid the Award. In addition, the CBA provides that attorney's fees and costs may be sought in a legal action to enforce an award by the Joint Trade Committee. CBA, Art. XV.
The Union seeks 8.4 hours of attorney's fees at the hourly rate of $300. Kugielska Second Aff., ECF No. 10. These fees are reasonable and justified under the circumstances. The Union also seeks reimbursement of costs for the filing fee in this Court ($400) and the statutory service fee payable to the New York State Secretary of State ($117). Id. These costs are reasonable and customary. Accordingly, the Court should award the Union $2,520 in fees and $517 in reimbursable costs.
Finally, “[t]he award of post-judgment interest is mandatory on awards in civil cases as of the date judgment is entered.” Lewis v. Whelan, 99 F.3d 542, 545 (2d. Cir. 1996) (citing 28 U.S.C. § 1961(a)). Accordingly, if the Court accepts my recommendation to confirm the Union's Award and enters judgment in its favor, post-judgment interest at the statutory rate should be awarded as well.
CONCLUSION
I recommend that the Union's unopposed motion to confirm the Award be GRANTED, and that the Union be awarded $20,000 based on the Arbitration Award, $2,520 in fees, and $517 in costs, for a total judgment amount of $23,037.00, plus post-judgment interest.
* * *
NOTICE OF PROCEDURE FOR FILING OBJECTIONS TO THIS REPORT AND RECOMMENDATION
The parties shall have fourteen days from the service of this Report and Recommendation to file written objections pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure. See also Fed.R.Civ.P. 6(a), (d) (adding three additional days when service is made under Fed.R.Civ.P. 5(b)(2)(C), (D), or (F)). A party may respond to another party's objections within fourteen days after being served with a copy. Fed.R.Civ.P. 72(b)(2). Such objections shall be filed with the Clerk of the Court, with courtesy copies delivered to the chambers of the Honorable Vernon S. Broderick at the United States Courthouse, 40 Foley Square, New York, New York 10007, and to any opposing parties. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(d), 72(b). Any requests for an extension of time for filing objections must be addressed to Judge Broderick. The failure to file these timely objections will result in a waiver of those objections for purposes of appeal. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(d), 72(b); Thomas v. Arn, 474 U.S. 140 (1985).