Maryland Cas. Co. v. Realty Advisory Bd. on Labor Relations
| Citation | 107 F.3d 979 |
| Decision Date | 31 January 1997 |
| Docket Number | S,D,B-32,No. 734,734 |
| Parties | 154 L.R.R.M. (BNA) 2407, 133 Lab.Cas. P 11,755, 133 Lab.Cas. P 11,797 MARYLAND CASUALTY COMPANY, Plaintiff-Appellee, v. REALTY ADVISORY BOARD ON LABOR RELATIONS, Defendant-Appellee, Gus Bevona, President, Local 32ervice Employees International Union, Defendant-Appellant. ocket 96-7809. |
| Court | United States Courts of Appeals. United States Court of Appeals (2nd Circuit) |
Ronald A. Goldman, Manning, Raab, Dealy & Sturm, New York City (Ira A. Sturm, Paul Galligan, Manning, Raab, Dealy & Sturm, on the brief), for defendant-appellant.
Richard Granofsky, Lester Schwab Katz & Dwyer, New York City (Dennis M. Rothman, Lester Schwab Katz & Dwyer, on the brief), for plaintiff-appellee.
Before: OAKES and ALTIMARI, * Circuit Judges.
Defendant-appellant Local 32B-32J, Service Employees International Union ("Union" or "Local 32B-32J") appeals from an order of the United States District Court for the Southern District of New York (Cedarbaum, J.) granting a preliminary injunction in favor of plaintiff-appellee Maryland Casualty Co. ("Maryland") enjoining an arbitration proceeding. See 1996 WL 363136 (S.D.N.Y. June 28, 1996). The district court concluded that the issues in dispute, concerning (1) whether certain employees of a cleaning contractor were to be retained to clean a building net-leased by Maryland after the contractor was replaced by another contractor, and (2) whether the cleaning employees were to be compensated at Union rates, were not subject to arbitration under the explicit terms of the collective bargaining agreement in force between the parties. Consequently, the district court enjoined any arbitration of the matter. We agree that the issues in dispute are not arbitrable under the terms of the collective bargaining agreement and, therefore, affirm.
Maryland net-leases an office building located at 59 John Street (the "Building"). Local 32B-32J represents approximately 65,000 commercial and residential building service employees, such as porters, cleaners, and handypersons, in the New York metropolitan area. The defendant-appellee Realty Advisory Board on Labor Relations ("RAB") is a multi-employer association that represents commercial building owners and managing agents in collective bargaining agreements with the Union. RAB negotiates the agreement with the Union, and RAB members are bound by the agreement unless they notify RAB in advance that they do not intend to participate in the agreement.
The collective bargaining agreement at issue in this case (the "Agreement") was originally in force from January 6, 1993 until December 31, 1995, but was extended to continue until December 31, 1998. Article I.1 of the Agreement provides that "[t]his agreement shall apply to all classifications of service employees employed by the Employer, excluding, except as otherwise provided herein, employees employed by cleaning and maintenance contractors." Under Article II.1 of the Agreement, the Employer is obligated not to make any agreement or arrangement "for the performance of work and/or for the categories of work heretofore performed by employees covered by this agreement," except as provided by the remainder of Article II. The remainder of Article II provides, in relevant part, that the Employer shall give advance written notice to the Union of its contracting for services or any change of contractors, and that:
3. The Employer shall require the contractor to retain all bargaining unit employees working at the location at the time the contract was awarded and to maintain the existing wage and benefit structure.... The Employer agrees that employees then engaged in the work which is contracted out shall become employees of the initial contractor or any successor contractor, and agrees to employ or re-employ those employees working for the contractor when the contract is terminated or cancelled....
....
6. This Article is intended to be a work preservation provision for the employees employed in a particular building.
Until the middle of 1980, cleaning employees at the Building were employed by Maryland through its managing agent, Newmark & Company ("Newmark"). At that time, five cleaning employees were employed: three day porters and two night porters. In July of that year, Maryland contracted out the Building's "general cleaning services" to Electra Cleaning Contractors ("Electra"). In 1983, American Building Maintenance ("American") replaced Electra as the Building's cleaning contractor, and in 1991 Partners Cleaning Contractors ("Partners") replaced American. Partners's employees were all members of the Union.
In June of 1996, Maryland hired Helmsley-Spear, Inc. ("Helmsley") to manage the building. Helmsley cancelled the cleaning contract with Partners, and hired Commercial Building Maintenance ("Commercial"), whose employees do not belong to the Union. Commercial did not rehire six employees of Partners working at the Building at the time it replaced Partners as the cleaning contractor. As a result, the Union served a notice of arbitration on Maryland and RAB demanding, pursuant to Article II of the Agreement, that (1) the six Partners's employees be reinstated, and (2) that all of Commercial's employees who worked at the Building be given the same benefits and wages provided to Union members under the Agreement.
Maryland sought a temporary restraining order and preliminary injunction enjoining the arbitration proceeding. According to Maryland, the dispute with the Union is not covered by the Agreement's arbitration clause because it is not an "Employer" within the meaning of the Agreement, and because the six Partners's cleaning employees who worked at the Building are not covered by Article II of the Agreement. After argument and further submission of affidavits, the district court, as explained in more detail below, concluded that the six Partners's cleaning employees at issue were not covered by Article II of the Agreement and granted Maryland's motion for a preliminary injunction. The court did not require Maryland to post security.
The Union sought a stay pending appeal, which was withdrawn on consent and the appeal expedited. On appeal, the Union contends that the district court: (1) erred in concluding that the dispute is not arbitrable under the terms of the Agreement; (2) abused its discretion in granting the preliminary injunction without finding the requisite irreparable harm; and (3) abused its discretion in issuing the preliminary injunction without requiring Maryland to post security.
As a preliminary matter, both parties request that the Court rule that it has jurisdiction to hear an appeal of an interlocutory order enjoining an arbitration proceeding. There are two potential bases for such jurisdiction: (1) Section 16(a)(2) of the Federal Arbitration Act ("Act"), 9 U.S.C. § 16(a)(2), which provides for appeals of "an interlocutory order granting ... an injunction against an arbitration that is subject to this title," and (2) 28 U.S.C. § 1292(a)(1), which provides for appeals of interlocutory orders granting injunctions.
Clearly, the Court has appellate jurisdiction under § 16(a)(2) of the Act. Section 2 of the Act makes all contracts entailing transactions in commerce subject to the Act. Although § 1 of the Act excludes coverage for "contracts of employment of seamen, railroad employees, or any other class of employees engaged in foreign or interstate commerce," that exclusion is not applicable in this case because in our Circuit § 1's exclusion is limited to workers involved in the transportation industries. See Erving v. Virginia Squires Basketball Club, 468 F.2d 1064, 1069 (2d Cir.1972). See also Central States, Southeast and Southwest Areas Pension Fund v. Central Cartage Co., 84 F.3d 988, 993 (7th Cir.) (same rule in Seventh Circuit), cert. denied, --- U.S. ----, 117 S.Ct. 276, 136 L.Ed.2d 199 (1996). Since collective bargaining agreements are contracts entailing transactions in commerce, the bargaining agreement in the instant case falls within the purview of the Act, and appellate jurisdiction over the district court's order is conferred under § 16(a)(2).
With respect to jurisdiction under 28 U.S.C. § 1292(a)(1), the parties contend that prior to the enactment of § 16 of the Act in 1988, this Court, in Lummus Co. v. Commonwealth Oil Refining Co., 297 F.2d 80, 85-86 (2d Cir.1961), and its progeny, held that an order staying an arbitration proceeding and denying a stay of the federal action pending arbitration is not an interlocutory injunction appealable under 28 U.S.C. § 1292(a)(1). See also Diematic Mfg. Corp. v. Packaging Indus., 516 F.2d 975, 977 (2d Cir.1975); cf. Gulfstream Aerospace Corp. v. Mayacamas Corp., 485 U.S. 271, 287, 108 S.Ct. 1133, 1142, 99 L.Ed.2d 296 (1988) (). Both parties now urge us to expressly hold that Congress implicitly overruled Lummus and its progeny when it enacted § 16(a)(2) of the Act. We decline to do so at this time; having determined there is jurisdiction in this case under § 16(a)(2), we need not reach the issue of whether there is also appellate jurisdiction under 28 U.S.C. § 1292(a)(1).
The basic principles governing adjudication of arbitrability disputes in the federal courts were established by the Supreme Court in three cases known as the Steelworkers Trilogy. 1 These principles essentially provide: (1) "that arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed to submit," (2) "that the question of arbitrability--whether a collective-bargaining agreement creates a duty for the parties to arbitrate the particular grievance--is undeniably an issue for...
To continue reading
Request your trial
-
Civil Liberties Union v. City Transit Authority, 09 Civ. 3595(RJS).
...no evidentiary hearing is necessary to resolve Plaintiff's motion for a preliminary injunction. See Md. Cas. Co. v. Realty Advisory Bd. on Labor Relations, 107 F.3d 979, 984 (2d Cir.1997) ("Generally, the district court is not required to conduct an evidentiary hearing on a motion for a pre......
-
Morgan Stanley & Co. v. Couch
...whether In re Y & A 's holdings remain good law in the Eighth Circuit is questionable.20 Compare Maryland Cas. Co. v. Realty Advisory Bd. on Labor Relations, 107 F.3d 979, 985 (2d Cir.1997) ("Although an injury that is adequately compensated by a monetary award is not considered ‘irreparabl......
-
New Hope Family Servs., Inc. v. Poole
...or that the court can in no circumstances dispose of the motion on the papers before it." Maryland Cas. Co. v. Realty Advisory Bd. of Labor Relations , 107 F.3d 979, 984 (2d Cir. 1997) (quoting Consolidated Gold Fields PLC v. Minorco, S.A. , 871 F.2d 252, 259 (2d Cir. 1989) ). "Generally, t......
-
Monavie Llc v. Quixtar Inc.
...or where the scope of the arbitration agreement does not encompass the dispute. See, e.g., Maryland Casualty Co. v. Realty Advisory Bd. on Labor Relations, 107 F.3d 979, 985 (2d Cir.1997) (holding that the movant “would be irreparably harmed by being forced to expend time and resources arbi......