Dist. No. 1, Pac. Coast Dist., Marine Engineers' Beneficial Ass'n, AFL–CIO v. Liberty Mar. Corp., 14–7162.

• Decision Date: 26 February 2016
• Docket Number: No. 14–7162.,14–7162.
• Citation: 815 F.3d 834
• Parties: DISTRICT NO. 1, PACIFIC COAST DISTRICT, MARINE ENGINEERS' BENEFICIAL ASSOCIATION, AFL–CIO, Appellee v. LIBERTY MARITIME CORPORATION, Appellant.
• Court: U.S. Court of Appeals — District of Columbia Circuit

815 F.3d 834

DISTRICT NO. 1, PACIFIC COAST DISTRICT, MARINE ENGINEERS' BENEFICIAL ASSOCIATION, AFL–CIO, Appellee

v.LIBERTY MARITIME CORPORATION, Appellant.

No. 14–7162.

United States Court of Appeals, District of Columbia Circuit.

Argued Oct. 13, 2015.

Decided Feb. 26, 2016.

William G. Miossi argued the cause for the appellant. Mary M. Lenahan was with him on brief.

David M. Glanstein and Michael J. Barta were on brief for the amicus curiae American Maritime Officers in support of the appellant.

Mark J. Murphy argued the cause and was on brief for the appellee.

Before: HENDERSON and TATEL, Circuit Judges, and EDWARDS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge HENDERSON

.

KAREN LECRAFT HENDERSON

, Circuit Judge:

Liberty Maritime Corporation (Liberty) appeals a district court order compelling it to arbitrate its ongoing labor dispute with District No. 1, Pacific Coast District, Marine Engineers' Beneficial Association, AFL–CIO (MEBA or the Union). For years, Liberty and MEBA were parties to successive collective bargaining agreements (CBAs) under which Liberty exclusively employed MEBA members as supervisory personnel on several of its bulk-carrier ships. The parties' relationship eventually soured, leading Liberty to replace its MEBA member-employees with those who belonged to a rival union. MEBA asserts that Liberty violated the parties' CBA in doing so. In response, Liberty claims that the parties' CBA had already expired before it switched unions. The parties' dispute thus boiled down to a principal inquiry: When did their CBA expire?

The district court determined that under the CBA, this question had to be submitted to arbitration; it therefore granted MEBA's request for an order compelling Liberty to arbitrate. See Dist. No. 1, Pac. Coast Dist., Marine Eng'rs' Beneficial Ass'n, AFL–CIO v. Liberty Mar. Corp., 70 F.Supp.3d 327, 350 (D.D.C.2014)

. On appeal, Liberty claims that the court erred in doing so. As a threshold matter, it claims that the court lacked subject matter jurisdiction over MEBA's suit. On the merits, it argues that the contract-duration question is not arbitrable; it maintains that the court, not an arbitrator, must decide when the CBA expired. We believe Liberty is wrong on both counts and, accordingly, affirm the district court.

I.

Liberty is a maritime shipping company with a fleet of vessels engaged in global trade. For over two decades, Liberty had a series of CBAs with MEBA, a union representing, inter alia, officers and engineers working in the United States maritime industry, both at ports and on ocean-going vessels. The most recent was slated to expire in June 2010. Negotiations over a successor CBA stalled and, on August 25, 2010, Liberty and MEBA signed a Memorandum of Understanding (MOU) extending the CBA to September 30, 2011.¹ Specifically, the MOU provided that the then-current CBA, along with the provisions of the MOU itself, constituted a "New Agreement."

Three provisions of the New Agreement are relevant. First, like its predecessors, the New Agreement provided that Liberty could employ only MEBA-represented engineers as supervisory personnel² aboard certain vessels. Second, the New Agreement included a grievance-and-arbitration provision establishing a detailed procedure to address disputes arising between Liberty and MEBA. Specifically, it required that "[a]ll disputes relating to the interpretation or performance of this Agreement shall be determined" by an arbitration board consisting of two MEBA representatives and two Liberty representatives. District No. 1, Pacific Coast District, M.E.B.A., Tanker Agreement § 2, at 10 (1986–1990) (Tanker Agreement) (emphasis added).³ In the event the board could not resolve the grievance by mutual agreement or majority vote, an agreed-upon arbitrator was authorized to render a final, binding decision. Third, and most relevant, the New Agreement included a "Duration of Agreement" provision as follows:

[The New Agreement will] continue in full force and effect until midnight, September 30, 2011 and shall continue from year to year thereafter unless either the Company or the Union shall give written notice to the other of its desire to amend the agreement, which shall be given at least sixty (60) days, but no sooner than ninety (90) days, prior to the expiration date. In the event either the Company or the Union serves notice to amend the Agreement, the terms of the Agreement in effect at that time of the notice to amend shall continue in effect until mutual agreement on the proposed amendments or an impasse has been reached.

Mem. of Understanding (MOU) § 1 (emphases added).

In March 2011, the parties began negotiating a successor to the New Agreement. Liberty's primary issue was the Union's pension plan. MEBA operated under a defined-benefit plan but Liberty insisted that the Union shift to a defined-contribution plan—a change MEBA opposed. Several work-rule changes were also on the table. On July 5, 2011, Liberty notified MEBA that it intended to terminate the CBA on September 30, 2011,⁴ and on July 8, MEBA responded by giving Liberty notice to amend, consistent with the Duration of Agreement provision. With MEBA's notice to amend, the New Agreement's expiration at midnight on September 30, 2011 then became contingent on the parties reaching "impasse" before that date.⁵ See MOU § 1.

Whether Liberty and MEBA in fact reached impasse before September 30, 2011 is the underlying dispute in this case; Liberty claims they did and MEBA claims they did not. The dispute arises from a flurry of last-minute negotiations in the four days leading up to September 30. On September 27, MEBA told Liberty it was not able to accept the defined-contribution pension plan Liberty demanded. Liberty expressed its regret that the parties were unable to reach a deal and began taking steps to bring on another union, the American Maritime Officers (AMO), to fill the MEBA positions beginning at 12:01a.m. on October 1. On September 28, however, MEBA reversed course; its president first contacted Liberty's CEO by phone and then confirmed in writing that MEBA would accept the defined-contribution plan Liberty had proposed and invited Liberty back to the negotiating table to work out the remaining issues. On September 29, citing a lack of confidence in MEBA, Liberty rejected the invitation and maintained that the New Agreement was set to expire at midnight the following day, September 30, in accordance with its terms.

Early on September 30, MEBA submitted a formal grievance to Liberty, using the grievance-and-arbitration procedure set out in the New Agreement. The grievance alleged that Liberty had violated the New Agreement in three ways: (1) by "failing and refusing to recognize MEBA as the sole representative of its licensed engineers and deck officers"; (2) by ordering "duly authorized representatives of the MEBA illegally removed from the Company vessels"; and (3) by authorizing "the assignment of the customary work and supervisory jurisdiction of the officers to be performed by other non-vessel and non-union personnel." Ltr. from Bill Van Loo, MEBA Sec'y–Treasurer, to Philip Shapiro, Liberty President & CEO 1–2 (Sept. 30, 2011). In its grievance, MEBA demanded that Liberty cease and desist from these actions. Liberty did not immediately respond; rather, that afternoon, its CEO notified its supervisory personnel that MEBA and Liberty "were unable to agree on terms for a new ... labor agreement." Ltr. from Philip Shapiro, Liberty President & CEO, to Liberty Officers 1–2 (Sept. 30, 2011). At 12:01 a.m. on October 1, 2011, MEBA members left Liberty's vessels and AMO members came on board.

MEBA subsequently filed additional grievances related to the New Agreement, which grievances Liberty refused to arbitrate; MEBA then filed this action to compel Liberty to do so. The district court granted MEBA's motion for summary judgment, holding, first, that it had jurisdiction to hear the suit, and second, that the question of impasse was arbitrable under the New Agreement's broad arbitration provision. See Liberty Mar., 70 F.Supp.3d at 350

("This Court concludes that it properly may exercise subject matter jurisdiction over MEBA's claims because they arise under section 301 of the LMRA. Moreover, whether the parties' CBA was still in place at the time of all of the alleged violations is a question that arises under the durational provision of the contract, and is therefore a question for the arbitrator to decide."). Liberty timely appealed.

II.

"We review a grant of summary judgment de novo. " Hairston v. Vance–Cooks, 773 F.3d 266, 271 (D.C.Cir.2014)

. "Summary judgment will be granted when ‘there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.’ " Id. (quoting FED. R. CIV. P. 56(a) ). On appeal, Liberty contends that MEBA was not entitled to judgment as a matter of law on the issue of arbitrability. Before reaching that issue, however, we must address Liberty's challenge to the district court's jurisdiction to compel arbitration in the first place.

A. Subject Matter Jurisdiction

The National Labor Relations Act of 1935 (NLRA), 29 U.S.C. §§ 151

–169, establishes a federal regime for managing labor relations and generally authorizes the National Labor Relations Board (NLRB) to resolve disputes between labor organizations and employers. See generally Vaca v. Sipes, 386 U.S. 171, 178–79, 87 S.Ct. 903, 17 L.Ed.2d 842 (1967). The United States Supreme Court has held that the NLRB's jurisdiction is in general exclusive; that is, if a claim falls within the purview of the NLRB, state and federal courts are preempted from hearing it. See San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 245, 79 S.Ct. 773, 3 L.Ed.2d 775 (1959). As the Court put it, "[w]hen an activity is arguably subject to § 7 or § 8 of the [NLRA], the States as well as the federal courts must defer to the exclusive competence of the [NLRB]." Id. This...