Local 217 v. Sage Hosp.ity Res.

• Decision Date: 04 May 2010
• Docket Number: CA. No. 10-5 S.
• Citation: 722 F.Supp.2d 161
• Parties: UNITE HERE LOCAL 217, Petitioner-Plaintiff, v. SAGE HOSPITALITY RESOURCES, d/b/a Renaissance Providence Hotel, Respondent/Defendant.
• Court: U.S. District Court — District of Rhode Island

722 F.Supp.2d 161

UNITE HERE LOCAL 217, Petitioner-Plaintiff,

v.SAGE HOSPITALITY RESOURCES, d/b/a Renaissance Providence Hotel, Respondent/Defendant.

CA. No. 10-5 S.

United States District Court,D. Rhode Island.

May 4, 2010.

Amato A. DeLuca, Esq., Matthew T. Jerzyk, Esq., DeLuca & Weizenbaum, Ltd., Providence, RI, Michael T. Anderson, Esq., Murphy Anderson PLLC, Boston, MA, for Plaintiff.

William Mark Russo, Esq., Moshe S. Berman, Esq., Ferrucci Russo P.C., Providence, RI, Louis J. Cannon, Jr., Esq., Norman R. Buchsbaum, Esq., Law Offices of Norman R. Buchsbaum, Baltimore, MD, for Defendant.

OPINION AND ORDER

WILLIAM E. SMITH, District Judge.

Plaintiff UNITE HERE Local 217 (the “Union”) filed this Petition to compel Defendant Sage Hospitality Resources, d/b/a Renaissance Providence Hotel (the “Hotel”) to submit to arbitration over whether the Hotel must recognize the Union as the collective bargaining agent for Hotel employees. The Hotel has refused arbitration. It claims it is no longer bound by the arbitration clause in a neutrality agreement between the parties, because the agreement has expired. The Union argues the agreement was still operative when it demanded recognition. The question before the Court is whether the Court or an arbitrator should decide whether the agreement was in effect at the time of the demand, and thus whether the dispute over recognition should go to arbitration.

For the reasons explained below, the Court finds that the question properly belongs to the arbitrator. It therefore grants Plaintiff's request and refers this matter to arbitration.

I. Background

The Union and the Hotel entered the neutrality agreement on June 9, 2003. ( See Memorandum of Agreement, June 9, 2003, Compl. Ex. A. (“Agreement”).) The basic bargain was that the Union would refrain from picketing during the development and opening of the facility, while the Hotel would not oppose Union recruiting activities. The agreement then established a procedure, known as a “card check,” by which the Union could become the collective bargaining agent for employees:

The Union may request recognition as the exclusive collective bargaining agent for [Hotel e]mployees. [An agreed-upon arbitrator] will conduct a review of ... membership information submitted by the Union in support of its claim to represent a majority of such [e]mployees. If that review establishes that a majority of ... [e]mployees has designated the Union as [its] exclusive collective bargaining representative or joined the Union, the [Hotel] will recognize the Union as such representative of such [e]mployees.

(Agreement ¶ 9.) The parties also consented to binding arbitration of disputes arising under the contract:

The parties agree that any dispute over the interpretation or application of this agreement shall be submitted to expedited and binding arbitration pursuant to [the] procedures below.... The parties hereto agree to comply with any order of the arbitrator, which shall be final and binding, and furthermore consent to the entry of any order of the arbitrator as the order or judgment of the United States District Court for the District of Rhode Island without entry of findings of fact and conclusions of law.

( Id. ¶ 15.)

The origin of this controversy is that parties made the effective term of the contract contingent on later events. The agreement provides that “[t]his [a]greement shall be in full force and effect from the date it is fully executed ... until thirty months from the full public opening of the [H]otel.” ( Id. ¶ 16.) At least two happenings present themselves as candidates for the “full public opening.” First, on June 1, 2007, the Hotel held a ceremony to celebrate the “opening of [its] doors,” attended by the Mayor of Providence. Daniel Barbarisi, After 80 Years, a Good Night's Rest, Providence Journal, June 2, 2007. At that time, the Hotel had begun booking rooms, but construction on some facilities, including a restaurant, was still ongoing. Second, several months later, on August 21, 2007, the Hotel hosted a “grand opening” gala, boasting the Governor of Rhode Island. The affair featured a ribbon-cutting ceremony followed by a party for several hundred guests. ( See Affidavit of Jenna Karlin, Jan. 7, 2010 (“Karlin Aff.”), Ex. D.)

The issue of which gathering qualified as the “full public opening” arose on January 5 of this year, when the Union demanded arbitration to verify its majority status at the Hotel. The Hotel balked, declaring that the agreement had expired on December 1, 2009, thirty months after the “opening of its doors” on June 1, 2007. The Union shot back that the agreement was still binding, because it would survive until thirty months after the “grand opening” in August 2007. However, because the Hotel disagreed, the Union issued a second demand for arbitration “over the meaning of the contractual term ‘full public opening.’ ” (Pet. ¶ 18.) The Hotel likewise rejected that demand.

On January 7, 2010, the Union filed a Petition to compel arbitration of both its recognition request and the threshold question of whether the agreement was valid when it made the demand. It now moves for an order compelling arbitration of those two issues.

II. Discussion

Before the Union can secure arbitration to confirm its majority status, it must clear the initial hurdle of demonstrating that the neutrality agreement was in force when it invoked the arbitration clause. It argues that an arbitrator may decide when the “full public opening” occurred. The Hotel, however, says the Court must settle that matter, because it is a threshold issue of arbitrability. Thus, the main question posed goes to the threshold issue of the duration of the agreement, and whether it was in effect at the time the Union demanded the card check. The pre-threshold question is whether the Court or an arbitrator should decide when the contract expired.

After holding a hearing on this matter on March 2, 2010, and considering the issues carefully, the Court concludes that the arbitrator must make the call. The reason, as fully explained below, is that this conflict fits within a line of First Circuit cases holding that disputes over contract termination belong in arbitration.

A. Legal standard

Generally, whether a labor dispute must be arbitrated “is a matter to be determined by the court, and a party cannot be forced to arbitrate the arbitrability question.” Litton Fin. Printing Div. v. N.L.R.B., 501 U.S. 190, 208, 111 S.Ct. 2215, 115 L.Ed.2d 177 (1991) (citation and internal quotation marks omitted); First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944-45, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995) (“Courts should not assume that the parties agreed to arbitrate arbitrability unless there is clear and unmistakable evidence that they did so.”) (internal quotation marks, citation, and alterations omitted).

However, that principle does not apply in all circumstances. If arbitrability involves a dispute over the termination of an agreement, the general rule may yield to a different standard articulated by the First Circuit:

Whether a dispute concerning the termination of [a labor] agreement should be adjudicated by an arbitrator or by a court depends on whether the arbitration clause in the agreement is “broad” or “narrow.” Under a broad arbitration clause, i.e. one covering all types of disputes, all questions, including those regarding termination, will be properly consigned to the arbitrator.

New England Cleaning Servs., Inc. v. SEIU, Local 254 AFL-CIO, 199 F.3d 537, 541 (1st Cir.1999) (internal quotation marks and citation omitted); accord Local Union 1253, Int'l Bhd. of Elec. Workers, AFL-CIO v. S/L Constr., Inc., 217 F.Supp.2d 125, 136 (D.Me.2002) (“When the collective bargaining agreement contains a broad arbitration clause, however, issues of contract termination must be submitted to an arbitrator.”).

In other words, if an agreement contains a “broad” arbitration clause, the arbitrator, not the court, must be the one to settle disputes over the application of contract termination provisions. The First Circuit applied this standard in IBEW, Local 1228, AFL-CIO v. Freedom WLNE-TV, Inc.:

Generally it is up to the court to determine, in the first instance, whether the parties have entered into a contract which imposes the duty to arbitrate, and whether that contract is still binding upon them. Where, however, the determination of whether a contract is still in effect depends solely upon construction of the collective bargaining agreement, the issue of contract termination may appropriately be decided by the arbitrator.

IBEW, Local 1228, AFL-CIO v. Freedom WLNE-TV, Inc., 760 F.2d 8, 10 (1st Cir.1985). In Freedom WLNE-TV, the arbitration clause at issue extended to “any and all disputes,” and hence obligated the parties to arbitrate their disagreement over whether the contract had expired. In contrast, the arbitration clause in New England Cleaning was “narrow,” because it covered “only a limited range of disputes, such as employee grievances.” 199 F.3d at 541. It thus did “not contemplate the arbitration of contract termination issues,” which could properly be addressed by the court. Id. at 542.

B. Application

The Hotel agreed to arbitrate “any dispute over the interpretation or application of this agreement.” (Agreement ¶ 15.) Because the present conflict qualifies as such a dispute, the Hotel must submit to arbitration.

1. The termination dispute is arbitrable

On its face, this conflict lends itself to a straightforward resolution. The preliminary argument concerns whether the Union made a timely demand for recognition, which depends on whether the neutrality agreement had expired. To resolve that question, the Union demands arbitration of “the meaning of the contractual term ‘full public opening.’ ” (Pet. ¶ 18.) Thus, as in Freedom WLNE-TV, resolving this matter requires “construction” of an agreement to determine “whether [the]...