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International Association of Machinists and Aerospace v. Hawaiian Airlines

January 25, 2012


The opinion of the court was delivered by: Leslie E. Kobayashi United States District Judge


Before the Court are two motions for summary judgment:

(1) Plaintiff International Association of Machinists and Aerospace Workers, District Lodge 141's ("Plaintiff" or "IAM") Motion for Summary Judgment ("Plaintiff's Motion"), filed October 11, 2011 [dkt. no. 26]; and (2) Defendant Hawaiian Airlines' ("Defendant" or "HAL") Motion for Summary Judgment, filed October 11, 2011 ("Defendant's Motion") [dkt. no. 28]. The parties filed their memoranda in opposition on December 27, 2011 and their replies on January 10, 2012. These matters came on for hearing on January 18, 2011. Appearing on behalf of Plaintiff were Ira L. Gottlieb, Esq., and Stefan M. Reinke, Esq., and appearing on behalf of Defendant was William Ota, Esq. After careful consideration of the motions, supporting and opposing memoranda, and the arguments of counsel, Plaintiff's Motion is HEREBY GRANTED, and Defendant's Motion is HEREBY DENIED for the reasons set forth below.


Plaintiff filed its Complaint to Vacate Clarification of Arbitration Decision ("Complaint") on April 25, 2011, seeking to vacate a March 16, 2011 arbitration award pursuant to the Railway Labor Act, 45 U.S.C. 151, et seq. ("RLA" or "the Act"), and the Fifth Amendment to the United States Constitution. [Complaint at ¶ 1.] Plaintiff and Defendant are parties to a collective bargaining agreement ("CBA"); the arbitration award was rendered pursuant to the grievance and arbitration provision of the CBA. [Id. at ¶ 4.]

On October 9, 2008, the parties participated in an arbitration regarding the termination of IAM member Brad Asuncion, a part-time ramp service employee of Defendant from 2002 to November 2007. The Complaint states that Mr. Asuncion voluntarily reported a substance abuse problem and signed a rehabilitation agreement with Defendant, but, shortly after signing it, Defendant accused Mr. Asuncion of violating the terms of the agreement, and discharged him. Per the parties' agreement, Arbitrator Lou Chang ("the Arbitrator") presided as a single arbitrator in lieu of the System Board of Adjustment provided for in the CBA. The Complaint states that the Arbitrator had jurisdiction to determine the following issues submitted to him by the parties: (1) was the termination discipline imposed upon Mr. Asuncion in accordance with the CBA or applicable agreements between the parties; and (2) if not, what is the appropriate remedy? [Id. at ¶¶ 5-6.]

The Arbitrator issued a decision and award dated January 12, 2009 ("Original Award"), ordering that Mr. Asuncion be "promptly reinstated," and that he must "successfully pass a Return to Duty drug test and sign a Return to Duty Agreement and shall be subject to unannounced follow-up drug testing for up to 60 months from the date of his return duty." [Id. at ¶ 7.] According to Plaintiff, the Original Award did not contain a specific deadline for the reinstatement process or any other precondition. The Original Award stated that the Arbitrator retained jurisdiction "to address issues relating to the interpretation and implementation of this Decision." [Id.]

Plaintiff alleges that Mr. Asuncion passed his return to duty drug test and signed a Return to Duty Agreement, but encountered obstacles in retaining a security clearance due to medical reasons. [Id. at ¶¶ 8-9.] Defendant instructed Mr. Asuncion to contact labor relations by February 27, 2009, otherwise it would determine that he had abandoned his job. Plaintiff alleges that Mr. Asuncion contacted Defendant's management several times during February and March of 2009, informing them of his medical issues and providing a doctor's note clearing him for work by March 20, 2009. Defendant initiated a conference call with the Arbitrator regarding Mr. Asuncion's failure to return to work, in which Defendant's representative and a "member of the Union's negotiating committee who was not involved with the October 9, 2009 arbitration and was not authorized by the Union or the [CBA] to participate in arbitration, were present." [Id. at ¶¶ 10-11.]

On April 2, 2009, the Arbitrator issued a Supplemental Arbitrator's Decision, which altered the Original Award by stating that Defendant was no longer obligated to reinstate Mr. Asuncion, because he had not returned to work or diligently pursued reinstatement ("Supplemental Decision"). Plaintiff challenged the Supplemental Decision in this district court (Civil No. 09-00275 DAE-BMK), and United States District Judge David Alan Ezra vacated the award by written order issued on November 9, 2010 ("11/9/10 Order")*fn1 . The 11/9/10 Order remanded to the Arbitrator for clarification and interpretation of the Original Award, and stated that, thereafter, Defendant could take any new employment action it deemed appropriate, and Plaintiff and Mr. Asuncion could institute a new grievance. Defendant appealed the 11/9/10 Order to the Ninth Circuit. [Id. at ¶¶ 13-15.]

In a March 16, 2011 "Clarification Decision," the Arbitrator added new language to the decision portion of the Original Award regarding whether Mr. Asuncion was "promptly reinstated" and implemented a retroactive 21-day deadline for his compliance. Plaintiff alleges that the Clarification Decision is contrary to law and should be vacated. [Id. at ¶¶ 19-20.] Defendant filed a Counterclaim to Confirm Clarification of Arbitration Decision on May 26, 2001.

I. Plaintiffs' Motion

Plaintiff seeks summary judgment to vacate the Clarification Decision on the grounds that the Arbitrator: (1) did not draw the retroactive 21-day deadline for return from the CBA, the parties' submissions, past practice or agreements, or the arbitral record, but instead dispensed his "own brand of industrial justice"; and (2) exceeded his authority under the CBA in clarifying the Original Award by "changing the rules of the game mid-play," and violating due process. [Mem. in Supp. of Plntf.'s Mot. at 26.] It asks the Court to reinstate Mr. Asuncion, or alternatively, to remand the matter to a different arbitrator. [Id. at 34.]

Plaintiff first argues that the Arbitrator overstepped his authority because the retroactive 21-day deadline had no basis in the CBA, the arbitral record, or the parties' past practice. It claims he invented the remedy out of whole cloth, and, because the award does not draw its essence from the CBA, this Court must vacate the Clarification Decision. [Id. at 27-28.] Here, the CBA limits the Arbitrator's authority as follows: The jurisdiction of the Board shall not extend to proposed changes in rules, basic rates of compensation or working conditions covered by this Agreement or any amendments thereto. This Board shall not have jurisdiction or power to add to or subtract from this Agreement or any amendments thereto or any agreement between the parties. [Id. at 29 (quoting JE*fn2 at 540).] Plaintiff argues that the Arbitrator added a new condition of employment applicable to the grievant, Mr. Asuncion. Further, it argues that the retroactive deadline was harsh, illogical, and absurd; it is unfair to demand that the parties should be held to a specific deadline known to no one at that time. Plaintiff argues that the Arbitrator, therefore, meted out his own brand of industrial justice, and the Clarification Decision must be vacated. [Id. at 30-31.]

Next, Plaintiff argues that the Arbitrator deprived it of due process by changing the rules in the middle of the game. That is, more than two years after the initial arbitration hearing, the Arbitrator inserted the new rule that Mr. Asuncion had to have figured out how to finish the reinstatement process within 21 days of the award. Plaintiff contends that courts have held that an arbitration award may be overturned where "procedural irregularities" result in fundamental unfairness. [Id. (citing cases).]

A. Defendant's Memorandum in Opposition

Defendant argues in its opposition that the Clarification Decision should stand, and that Plaintiff is asking the Court to set aside the Clarification Decision of the Arbitrator's Original Award, and to interject the Court's own judgment into a dispute governed by the RLA. It argues that the Clarification Decision is entitled to the same considerable deference afforded all labor arbitration awards, and urges the Court not to "judicialize" the arbitration process. [Mem. in Opp. to Pltf.'s Mot. at 1-2.]

Defendant first argues that the Arbitrator had a sufficient basis to clarify and interpret the Original Award in the manner he did, and that the Clarification Decision is consistent with the residual jurisdiction afforded labor arbitrators under federal law. It argues that, while the common law functus officio doctrine precludes arbitrators from reconsidering final arbitration awards because they lose jurisdiction over a dispute once they have fully and completely decided the submitted dispute, the doctrine is less strictly applied in labor arbitrations than in commercial disputes. [Id. at 19 (citing Glass, Molders, Pottery, Plastics and Allied Workers Int'l Union Local 182 v. Excelsior Foundry Co., 56 F.3d 844 (7th Cir. 1995)).] Further, Defendant argues it is well-accepted that courts may, when presented with an arbitration award that is ambiguous or incomplete, order the matter resubmitted to the arbitrator for interpretation, clarification, or fleshing out, and that this is consistent with the courts' reluctance to second-guess or to substitute their own judgment for that of an arbitrator presiding over a labor grievance. [Id. at 20.] According to Defendant, Mr. Asuncion's failure to promptly avail himself of the opportunity to return to work presented a contingency similar to those outlined in the Excelsior Foundry case, and permitted the Arbitrator to clarify and interpret his decision to address the contingency. Defendant argues that the Clarification Decision is consistent with the residual jurisdiction prescribed by law. [Id. at 22.]

Second, Defendant argues that the Clarification Decision does not exceed the parameters of the residual jurisdiction recognized by Judge Ezra in his 11/9/10 Order. Defendant states that Judge Ezra ruled that the Arbitrator had exceeded his authority by "determin[ing] a post-Decision matter of job abandonment or failure to satisfy conditions for reinstatement." [Id. at 23 (quoting JE at 61).] According to Defendant, the Clarification Decision expressly acknowledges the constraints the 11/9/10 Order imposed on the Arbitrator, and made clear that the Arbitrator did not, in issuing the Clarification Decision, make any determination as to job abandonment or forfeiture, and did not intend or purport to reconsider or reverse the Original Award. [Id. (citing JE at 870).] To the contrary argues Defendant, the Arbitrator simply adhered to the Plaintiff's request that he "elaborate on his instruction to 'promptly reinstate' Mr. Asuncion." [Id. (quoting JE at 722).]

Finally, Defendant argues that the Clarification Decision did not alter the rules of the game mid-play, as suggested by Plaintiff. Nor did it deprive Mr. Asuncion of due process and/or the opportunity to return to work at HAL, where, on several occasions, Defendant expressed to Mr. Asuncion and to the Plaintiff its frustrations regarding Mr. Asuncion's delay in completing the reinstatement process. Defendant argues that neither Plaintiff nor Mr. Asuncion took meaningful action in response to these communications, or to Defendant's invocation of the Arbitrator's residual jurisdiction, or to the Arbitrator's March 2009 invitation to submit supplemental briefing. [Id. at 30.] It maintains that, on remand, Plaintiff had, and exercised, the right to thoroughly brief the clarification of the Original Award. The Arbitrator did not alter any procedural rules, but allowed the parties all of the "process" requested and otherwise due; the fact that the Arbitrator ultimately did not clarify the Decision in a manner favorable to Mr. Asuncion does not mean that the rules were changed mid-play. [Id. at 31.]

B. Plaintiff's Reply

In its reply, Plaintiff argues that the Arbitrator violated principles of functus officio by issuing the Supplemental Decision and Clarification Decision. It argues that there is no legal or logical basis for the 21-day retroactive deadline. Further, it argues that the Original Award became part of the CBA, and had to be honored as such. [Reply to Pltf.'s Mot. at 2-4.] According to Plaintiff, the 21-day deadline, if announced in January 2009, would have been part of the parties' "essential contract," but under the circumstances, the Arbitrator unilaterally declared "a new winner and loser in the case, just as he had in his vacated 'Supplemental Decision.'" [Id. at 5.]

Plaintiff insists setting a retroactive deadline violated due process and the CBA. At the time of the Original Award in January 2009, no party, including Defendant, thought Mr. Asuncion had only 21 days to finish the reinstatement tasks; indeed, no one was aware of any specific deadline by which Mr. Asuncion had to return or else lose his reinstatement rights. Plaintiff argues that ...

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