Kendall Healthcare Group, Ltd. v. 1199SEIU, United Healthcare Workers East, Florida Region

• Court: District Court, M.D. Florida
• Decided: February 18, 2025
• Docket: 8:24-cv-00785
• Status: Unknown

Opinion

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA TAMPA DIVISION KENDALL HEALTHCARE GROUP, LTD., et al. Plaintiffs, v. Case No: 8:24-cv-0785-KKM-CPT 1199SEIU, UNITED HEALTHCARE WORKERS EAST, FLORIDA REGION, Defendant. ___________________________________ ORDER

Plaintiff hospitals move for reconsideration of this Court’s order staying Count II of the Complaint pending resolution of a related union-initiated arbitration. Mot. for Recons. (MFR) (Doc. 44); Stay Order (Doc. 42). For the reasons below, that motion is

denied. A district court may reexamine and revise any interlocutory order up until the entry of judgment. FED. R. CIV. P. 54(b). Usually, though, “district courts should hesitate

before revisiting their earlier interlocutory orders; important interests of finality, stability, and predictability underly that justifiable caution.” , 118 F.4th 1367, 1380 (11th Cir. 2024). Resolution of a motion for reconsideration is thus a matter vested in the district court’s discretion. at 1381. A district court should readily grant a motion for reconsideration if that motion meets the higher standards for

relief from judgment laid out in Federal Rules of Civil Procedure 59(e) and 60(b), while it may typically reject a motion “that simply rehash[es] arguments already considered and rejected.”

e hospitals seek relief from the Stay Order for two reasons. First, they argue that that the Order conflicts with the Eleventh Circuit’s precedential decision in , 663 F.3d 1322 (11th Cir. 2011). MFR

at 5–16. Second, they contend that the Stay Order “extinguished their ability to pursue their section 301 claim.” MFR at 17–18 (cleaned up). Neither argument justifies vacatur or revision of the Stay Order.

To start, the Stay Order does not conflict with . In that case, the Eleventh Circuit held that it was error to compel an employer to arbitrate based on aspirational contract language where “the employee[-]oriented grievance machinery in the parties’

contract qualifies and limits the universe of claims and grievances subject to arbitration, and the language negates the intention that the employer’s claim for damages must be submitted to arbitration.” , 663 F.3d at 1328. In the hospitals’ view, if “district

courts cannot compel . . . arbitration [of] an employer’s claim for damages against [a] union,” when the parties’ collective bargaining agreement includes an employee-centric grievance regime, “then litigation brought by a plaintiff-employer cannot be stayed for the

2 [u]nion to seek arbitration on its own claims.” MFR at 2 (emphasis omitted). at

conclusion does not follow. e hospitals fail to attend carefully to the difference between claims and issues. held only that a district court could not compel an employer to arbitrate a claim

that was not arbitrable under the parties’ collective bargaining agreement. 663 F.3d at 1328. e Stay Order dealt with the distinct question of whether a district court must stay an action when a non-arbitrable properly before the court implicates an arbitrable

and the party entitled to arbitrate the issue seeks to do so. Stay Order at 7–10.1 Under those circumstances, the Federal Arbitration Act requires that the district court stay the action pending the arbitration, as its stay provision operates at the level of the issue, not the claim.

9 U.S.C. § 3; , 861 F.3d 1338, 1345 (11th Cir. 2017) (“9 U.S.C. § 3 directs courts to stay their proceedings in any case raising a dispute on an issue referable to arbitration.”); , No. 3:16-CV-439-

J-39MCR, 2016 WL 11530541, at *3 (M.D. Fla. Nov. 21, 2016) (“[T]he FAA ‘provides

1 Contra the hospitals, it was thus necessary to determine whether the union’s grievances were arbitrable to adjudicate the union’s motion for a stay. MTS at 3 n.1 (contending that “the Court should not have ruled on whether or not the [u]nion’s grievances were arbitrable”). And the hospitals’ view that I should have considered only their complaint in adjudicating the union’s grievances’ arbitrability would eviscerate § 3. Were that true, a defendant could seek a stay to which he was legally entitled only if he were so fortunate as to have his adversary plead the existence of a separate, possibly conflicting arbitral proceeding. at is not the law. , No. 604CV1464ORL19JGG, 2005 WL 8159917, at *4 (M.D. Fla. Jan. 20, 2005) (denying without prejudice a motion to stay proceedings and compel arbitration in the absence of evidence that the plaintiff had notice of an arbitration program); , 265 F.3d 1186, 1191 (11th Cir. 2001) (per curiam). 3 for stays of proceedings in federal district courts when in the proceeding is referable

to arbitration,’ , ‘any issue referable to arbitration,’ ” not necessarily when all issues are referable to arbitration.” (citations omitted) (first quoting , 500 U.S. 20, 25 (1991), then quoting 9 U.S.C. § 3)),

, No. 3:16-CV-439- J-39MCR, 2017 WL 10651308 (M.D. Fla. Jan. 26, 2017). As explained in the Stay Order, both Count II of the hospitals’ complaint and the

union’s grievances implicate the same core issue—whether the hospitals were entitled to seek first-party indemnification from the union. Stay Order at 8 (“e union filed a grievance that the hospitals ‘wrongfully seek[] indemnification for expenses and attorneys’

fees incurred in defending against the union’s enforcement of dues deductions required under Article 46’ in breach of Article 46, § 5.” (alteration in the original) (quoting (Doc. 16-2) at 1)), (Count II seeks damages because “[t]he Union has refused to

indemnify and hold harmless the Hospitals for their defense of the Union’s agency charges relating to [Article 46] of the CBAs.” (alterations in the original) (quoting Compl. (Doc. 1) ¶ 53.)). Because the hospital’s claim involves a dispute about an issue referrable to

arbitration, a stay pending resolution of the arbitration on that issue was, and remains, proper.

4 As for the hospital’s argument that the Stay Order “has left the [h]ospitals in limbo

and effectively unable to pursue its claims for the [u]nion’s breach of the indemnity provision in any forum,” MFR at 17, that is true enough. Stays often put prosecution of a party’s claims on pause. But the hospitals are free to litigate the issue central to their

claim—whether they are entitled to first-party indemnification under Article 46, § 5—in the arbitration. If the hospitals prevail on that issue, they may move to lift the stay and seek adjudication of any remaining issues in this action. Resp. (Doc. 52) at 8 (conceding that

the hospitals can pursue their claim in this action if they prevail in the arbitration); , No. 8:20-CV-1743-KKM-TGW, 2022 WL 22865423, at *5 (M.D. Fla. Jan. 20, 2022) (“Where an arbitration decision ‘affords basic

elements of adjudicatory procedure, such as an opportunity for presentation of evidence, the determination of issues in an arbitration proceeding should generally be treated as conclusive in subsequent proceedings, just as determinations of a court would be treated’ ”

(quoting , 763 F.2d 1352, 1360 (11th Cir. 1985))). Nothing in the Stay Order prevents the hospitals from having their claim ultimately adjudicated.2

2 ough not relevant to their argument here, the hospitals opine—without citation—that the Stay Order “denied the [u]nion’s substantive motion to dismiss Count II on the merits, recognizing that the [h]ospitals have a valid claim for indemnity against the [u]nion.” MFR at 2. Nothing in the Stay Order implies that the Court concluded that Count II stated a claim for relief. 5 Accordingly, the following is ORDERED:

1. The hospitals’ Motion for Reconsideration (Doc. 44) is DENIED. 2. The hospitals’ Motion for Leave to File Reply (Doc. 55) is DENIED AS MOOT. ORDERED in Tampa, Florida, on February 18, 2025.

pate Gnph Mizelle United States District Judge