Accuride Erie, L.P. v. International Union, Automobile, Aerospace & Agricultural Implement Workers

257 F. App'x 574
CourtCourt of Appeals for the Third Circuit
DecidedDecember 11, 2007
Docket06-4007
StatusUnpublished
Cited by3 cases

This text of 257 F. App'x 574 (Accuride Erie, L.P. v. International Union, Automobile, Aerospace & Agricultural Implement Workers) is published on Counsel Stack Legal Research, covering Court of Appeals for the Third Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Accuride Erie, L.P. v. International Union, Automobile, Aerospace & Agricultural Implement Workers, 257 F. App'x 574 (3d Cir. 2007).

Opinion

OPINION OF THE COURT

McCLURE, District Judge.

Appellant Accuride Erie, L.P. (“Accuride”) filed a complaint against appellee, the International Union, United Automobile, Aerospace & Agricultural Implement Workers of America, Local Union 1186 (“Union”) seeking to vacate a labor arbitration award. After cross motions for summary judgment were filed, the district court denied Aecuride’s motion and granted the Union’s motion, thus confirming the arbitration award. Accuride argues that the district court erred in granting summary judgment in favor of the Union because the arbitrator’s award did not derive its essence from the parties’ collective bargaining agreement. For the reasons provided below, we will affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

In 1997, Accuride acquired a manufacturing plant from Kaiser Aluminum Corporation (“Kaiser”) whose hourly employees were represented by the Union. Pursuant to a transitional agreement, Union members were hired to fill positions at Accuride. Some of these union members were eligible to retire under a benefits plan by Kaiser that included retiree medical benefits. The parties entered into a collective bargaining agreement on May 1, 1997 which gave members of the Union a onetime irrevocable election to receive either the Kaiser retiree medical benefits or coverage under a medical plan for active Accuride employees (“1997 CBA”). In 1998, the parties entered into another CBA extending the 1997 agreement through August of 2003 (“1998 CBA”).

On February 16, 2001, the Union submitted a grievance on behalf of an employee and his spouse who had previously elected Kaiser retiree medical benefits. The spouse had been denied coverage under Kaiser’s retiree medical plan and then had sought coverage under the Accuride medical plan. Accuride denied coverage based on the irrevocable election that had been made by the employee. On September 26, 2003, arbitrator Paul Gerhart ruled that the employee had irrevocably opted out of the Accuride medical plan and that Aecuride’s decision to deny coverage was correct (“Gerhart Award”).

In September of 2003, a new CBA was reached which did not mention anything about the former Kaiser employees who had previously elected the Kaiser retiree medical benefits (2003 CBA). The only mention of medical benefits in the entire CBA is in Article 32 and states that Accuride will provide “eligible employees” with medical benefits. Article 32 also states that “[t]he specific terms of these benefits are set forth in the benefits plan and the insurance contract” and that “[t]he bene *577 fits plan and the insurance contract are the controlling documents.” Article 5 pertains to grievances and requires a grievance to be submitted “within 14 calendar days of the occurrence giving rise to the grievance.” Finally, the Memorandum of Settlement associated with the 2003 CBA contains a zipper clause that states that:

Settlements, side agreements (written or unwritten), memoranda of understanding, letters of understanding, past practices, grievances settlements, and any other like items that existed on or before August 31, 2003 are terminated. To the extent the parties desire to continue any settlements, side agreements (written or unwritten), memoranda of understanding, letters of understanding, past practices, grievances settlements, and any other like items, they have been reduced to writing and included in this Memorandum of Settlement or the [Collective Bargaining Agreement],

In April of 2004, Accuride learned that Kaiser had filed an action in bankruptcy court to terminate its retiree medical benefits program. Accuride notified the Union, who responded by demanding that Accuride provide medical coverage for the former Kaiser employees who had elected to receive Kaiser retiree medical benefits. The parties met on May 13 and 14, 2004 to discuss proposals to provide benefits to the affected employees. At these meetings, Accuride rejected the Union’s request to include the affected employees in the Accuride medical plan.

On May 31, 2004, Kaiser terminated its retiree medical benefits with the approval of the bankruptcy court. On June 8, 2004, the Union submitted a grievance demanding that Accuride provide medical coverage for the affected employees. Accuride denied the grievance at every stage of the grievance process, reasoning that the elections made by the Kaiser retirees were irrevocable. Accuride also determined that the grievance was untimely because it was not filed within fourteen days of the occurrence giving rise to the grievance as required by the 2003 CBA.

The grievance was then heard by arbitrator Robert Creo. Arbitrator Creo ruled that the affected employees’ elections in 1997 did not preclude the receipt of benefits under the 2003 CBA. He reasoned that the 2003 CBA required Accuride to provide benefits to all “eligible employees” and that the irrevocable election was terminated by the 2003 CBA. He also ruled that the grievance was timely because the occurrence giving rise to the grievance was the termination of benefits that occurred on May 31, 2004. Finally, he ruled that the Gerhart award was not binding on the current arbitration because it arose under a previous agreement and under different circumstances.

The district court found that the arbitrator’s award drew its essence from the 2003 CBA and upheld the award. Specifically, the district court found that the arbitrator relied on the language in the 2003 CBA that Accuride would provide benefits to all “eligible employees” and the absence of any language incorporating the elections from the previous CBA in determining that the elections did not survive the 2003 CBA. Similarly, the district court found that the arbitrator relied on the 2003 CBA in determining that the grievance was timely because the arbitrator determined that the date of the occurrence under the 2003 CBA was the date Kaiser actually terminated the benefits. Finally, the district court found that the arbitrator correctly found that he was not bound by the Gerhart award based on his finding that the elections did not survive the 2003 CBA. Therefore, the district court granted the Union’s motion for summary judgment and dismissed the case. This appeal followed.

*578 II. JURISDICTION AND STANDARD OF REVIEW

The district court had jurisdiction pursuant to section 301(a) of the Labor Management Relations Act, 29 U.S.C. § 185. Because the district court entered final judgment against Accuride, we have jurisdiction pursuant to 28 U.S.C. § 1291. Our review is plenary, and we apply the same standard as the district court in reviewing the arbitration award. Exxon Shipping Co. v. Exxon Seamen’s Union, 73 F.3d 1287,1291 (3d Cir.1996).

The United States Supreme Court has consistently held that courts exercise a narrow and deferential role in reviewing arbitration awards arising from labor disputes. Pennsylvania Power Co. v. Local Union No. 272, Intern. Broth, of Elec. Workers, AFL-CIO,

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257 F. App'x 574, Counsel Stack Legal Research, https://law.counselstack.com/opinion/accuride-erie-lp-v-international-union-automobile-aerospace-ca3-2007.