D.E.I., Inc. v. Ohio & Vicinity Regional Council of Carpenters

155 F. App'x 164
CourtCourt of Appeals for the Sixth Circuit
DecidedSeptember 1, 2005
Docket04-3033
StatusUnpublished
Cited by9 cases

This text of 155 F. App'x 164 (D.E.I., Inc. v. Ohio & Vicinity Regional Council of Carpenters) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
D.E.I., Inc. v. Ohio & Vicinity Regional Council of Carpenters, 155 F. App'x 164 (6th Cir. 2005).

Opinion

ROGERS, Circuit Judge.

Plaintiff D.E.I., Inc., an architectural design/build firm, appeals the district court’s decision granting summary judgment in favor of defendants Ohio and Vicinity Regional Council of Carpenters and Ohio and Vicinity Regional Council of Carpenters, Local 372 (“the Union”) on D.E.I.’s action to vacate an arbitration award. In the project at issue, D.E.I. had been hired by Citizens National Bank as a general contractor on the construction of a new bank in Van Wert, Ohio. D.E.I.’s collective bargaining agreement with the Union prohibited D.E.I. from subcontracting with nonunion contractors; however, the bank specifically wanted D.E.I. to use local nonunion carpenters who were current or potential customers of the bank. Citizens National therefore terminated the general contractor agreement, and one week later retained D.E.I. as a construction manager. Under the terms of the construction manager contract, Citizens National, and not D.E.I., would contract with the carpenters. When the Union determined that in fact non-union carpenters were working on the project, it filed a grievance alleging that D.E.I. had subcontracted with non-union carpenters. An arbitration panel held that D.E.I. had violated the subcontracting provision of its collective bargaining agreement, after which D.E.I. filed its motion to vacate the arbitration award in the district court. The district court granted summary judgment in favor of the Union, and we affirm the judgment of the district court. The arbitration award can be viewed as resting on the theory that D.E.I. in fact acted as a general contractor on the project, and therefore was responsible for the subcontracting of the non-union carpenters. The arbitration panel was therefore “arguably” construing the collective bargaining agreement, and its award cannot be set aside. Similarly, the panel’s apparent holding that the grievance was timely can be explained by the continuing violation theory. Finally, there is no need to remand the award for clarification, as D.E.I. admits that the award itself is clear.

I.

On August 15, 2002, Citizens National and D.E.I. signed the so-called “General-Contractor Contract” for the building of a *166 new Citizens National bank in Van Wert, Ohio (‘Van Wert project”). Under this contract, D.E.I. was required to build the bank. Before construction began on the Van Wert project, however, a dispute arose between the Union and D.E.I. over other projects. In September, 2002, the Union sued D.E.I. in Ohio state court, alleging that D.E.I ., Inc.’s, predecessor, D.E.I. Services, had signed a collective bargaining agreement that bound D.E.I., Inc., and that D.E.I. was violating that agreement in one or more projects unrelated to the Van Wert project. During settlement discussions, D.E.I. allegedly “expressed a willingness to be bound to the [collective bargaining agreement], but only if the [Union] agreed to ‘carve out’ from the coverage of the [agreement] an upcoming project on which DEI was slated to serve as a general contractor on the construction of a Citizens National Bank in Van Wert, Ohio.” Ultimately, the parties settled the lawsuit; D.E.I. agreed to be bound by the collective bargaining agreement without obtaining an exception for the Van Wert project.

D.E.I. had sought to exclude the Van Wert project from the collective bargaining agreement because Citizens National wanted to use its current and potential customers as contractors on the project. Even after the exclusion fell through, however, Citizens National still wanted the non-union bank customers to perform the work on the bank. On November 18, 2002, Citizens National “rescinded” the agreement under which D.E.I. was to act as the general contractor on the project. The letter stated that despite the rescission, “it seems that there might be another role that DEI could play in this project.”

One week later, on November 26, 2002, Citizens National and D.E.I. entered into a “Construction Management Contract,” under which D.E.I. would essentially act as a consultant and overseer to the construction of the bank. The amount of compensation D.E.I. would receive under the construction management contract was $1,804,133.00, the identical amount that D.E.I. was to receive under the rescinded general contractor contract.

On February 19 or 20, 2003, the Union filed a grievance against D .E.I. alleging a violation of the “Sub-Contracting clause.” The grievance was referred to the Joint Labor Relations Board, and a Grievance Hearing before a panel of the Board (“arbitration panel” or “panel”) was held on April 10, 2003. Both sides presented evidence to the panel. The district court described the evidence presented and arguments made by the parties:

The Union contended that the construction agreement was a sham, D.E.I. was de facto serving as a general contractor, and subcontracting work had to be performed by union labor. In support of its contention that D.E.I. was acting as a general contractor, the Union pointed out that construction managers, who are obligated to perform less work and assume lesser responsibilities, are also paid less, in contrast to D.E.I., which was receiving the same compensation despite its putative change in status from general contractor to construction manager.
In addition, the Union also presented evidence that the same contractors who had worked for D.E.I. on other projects for which it was general contractor were working on the Van Wert project. One of those subcontractors admitted to a union representative that its bid had gone to D.E.I., rather than the bank. In addition, the Union submitted evidence that two other subcontractors had been subcontracted directly by D.E.I.. The Union also offered an admission by D.E.I.’s project manager to another con *167 tractor that D.E .1. had “found a way to ‘get around all of that Union stuff ... by call[ing] themselves Construction Managers on the Van Wert Project.”
D.E.I. also argued that the Union’s grievance was not timely. The collective bargaining agreement provides that “No grievance shall be filed or processed on events which have occurred prior to seven (7) calendar days before the grievance is filed.” The Union’s grievance bears two dates, February 19 and February 20, 2003.
D.E.I. presented evidence that the union was aware that non-union labor was doing carpentry work as of February 3, 2003, and that a union agent observed such work on February 5, 2003. The union, in response, stated that the February 3rd observation had not been by a union representative, and that on February 5th, immediately after its agent observed non-union workers at the project, it immediately complained to D.E.I.. Thereafter, rather than filing a grievance, the Union sought to resolve its objections informally. These efforts reached an impasse on February 11th.
The Union also presented evidence to the arbitrators that, notwithstanding the provision in the collective bargaining agreement requiring grievances to be filed within seven days, its grievance was timely because it had been filed within seven business days, as allowed by past practice between the parties.

D.E.I., Inc. v. Ohio and Vicinity Regional, No. 3:03CV7434, slip op. at 3-4 (N.D.Ohio Dec. 8, 2003). On April 22, 2003, the panel gave its finding, which was described by the Secretary of the Board:

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Bluebook (online)
155 F. App'x 164, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dei-inc-v-ohio-vicinity-regional-council-of-carpenters-ca6-2005.