Reg'l Local Union No. 846 v. Gulf Coast Rebar, Inc., Case No. 3:11-cv-658-AC
| Decision Date | 13 July 2016 |
| Docket Number | Case No. 3:11-cv-658-AC |
| Citation | 194 F.Supp.3d 1096 |
| Parties | REGIONAL LOCAL UNION NO. 846, International Association of Bridge Structural, Ornamental and Reinforcing Iron Workers, AFL–CIO, by and through Luis Quintana, in his representative capacity as Business Manager; Regional District Council Welfare Plan and Trust, f/k/a Local 846 Rebar Welfare Trust, by and through its Board of Trustees; Regional District Council Retirement Plan and Trust, f/k/a Rebar Retirement Plan and Trust, by and through its Board of Trustees; and Regional District Council Training Trust, f/k/a Local 846 Training Trust, by and through its Board of Trustees; and Regional District Council Vacation Trust Fund, f/k/a Local 846 Vacation Trust, by and through its Board of Trustees, Plaintiffs v. GULF COAST REBAR, INC., a Florida Corporation, f/k/a Gulf Coast Placers, Inc., a Florida Corporation, Defendant. |
| Court | U.S. District Court — District of Oregon |
Jamie L. Reyes–Jones, Michael A. Evans, Hartnett Gladney Hetterman, L.L.C., St. Louis, MO, Paul C. Hays, Paul C. Hays Attorney, Portland, OR, for Plaintiffs.
Robert B. Miller, Candice Rutter Broock, Kilmer Voorhees & Laurick, PC, Portland, OR, Dale J. Morgado, Morgado, P.A., New York, NY, for Defendant.
Plaintiffs Regional Local Union No. 846 of the International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers, AFL–CIO (the "Union"), and the Regional District Council Welfare Trust, the Regional District Council Pension Trust, the Regional District Council Training Trust, and the Regional District Council Vacation Trust (collectively the "Trusts"), filed this action to recover amounts allegedly owed to them by Defendant Gulf Coast Rebar, Inc. ("Gulf Coast"), pursuant to the terms of a collective bargaining agreement (the "Agreement"). On October 22, 2012, this Court granted Gulf Coast's motion to compel arbitration of the Union's claim under the Labor Management Relations Act of 1947, 29 U.S.C. §§ 141 –197, (the "LMRA") and stay the Trusts' claims under the Employee Retirement Income Security Act, 29 U.S.C. §§ 1132(g) and 1145, (the "ERISA"). The arbitrator issued an award in favor of the Union finding that Gulf Coast may have incurred financial obligations to the Union and directing Gulf Coast to submit to an audit. After the Court affirmed the arbitrator's decision, the Union and the Trusts (collectively "Plaintiffs") filed a second amended complaint. Gulf Coast responded with a motion to dismiss or, in the alternative, to stay, compel arbitration, or transfer venue to the United States District Court for the Middle District of Florida. ECF 113.
United States Magistrate Judge John V. Acosta issued Findings and Recommendation in this case on June 6, 2016. ECF 127. Judge Acosta recommended that the Court: (1) grant Gulf Coast's motion to refer the action to arbitration to determine the amounts due Plaintiffs based on an audit initiated in March 2015 and to determine Gulf Coast's liability for sums accrued after March 2015; (2) dismiss the Union's claim under the LMRA without prejudice; (3) stay the Trusts' claim under the ERISA, pending arbitration; (4) deny Gulf Coast's motion to dismiss the Trusts' claim for liquidated damages; and (5) deny Gulf Coast's motion to transfer venue with leave to refile.
Under the Federal Magistrates Act ("Act"), the Court may "accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate." 28 U.S.C. § 636(b)(1). If a party files objections to a magistrate's findings and recommendations, "the court shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made." Id. ; Fed. R. Civ. P. 72(b)(3).
For those portions of a magistrate's findings and recommendations to which neither party has objected, the Act does not prescribe any standard of review. See Thomas v. Arn , 474 U.S. 140, 152, 106 S.Ct. 466, 88 L.Ed.2d 435 (1985) (); United States. v. Reyna–Tapia , 328 F.3d 1114, 1121 (9th Cir.2003) (en banc) (). Although in the absence of objections no review is required, the Act "does not preclude further review by the district judge[ ] sua sponte ... under a de novo or any other standard." Thomas , 474 U.S. at 154, 106 S.Ct. 466. Indeed, the Advisory Committee Notes to Fed. R. Civ. P. 72(b) recommend that "[w]hen no timely objection is filed," the Court review the magistrate's recommendations for "clear error on the face of the record."
Gulf Coast timely filed objections (ECF 129), to which Plaintiffs responded (ECF 130). Gulf Coast objects to Judge Acosta's recommendation that the action be referred to the same arbitrator who previously found in the Union's favor and directed Gulf Coast to submit to an audit. According to Gulf Coast, the original arbitrator, William P. Hobgood, issued a final and complete award and did not retain jurisdiction over the case. Therefore, argues Gulf Coast, Arbitrator Hobgood does not have the authority to preside over the second arbitration, which should be conducted by a new arbitrator selected pursuant to the process set forth in the Agreement. Gulf Coast also objects to Judge Acosta's statement that "[t]he Audit revealed Gulf Coast owes Plaintiffs $876,177.41 in contributions, $354,761.21 in dues, $160,925[.]90 in liquidated damages, and $465,859.45 in interest." ECF 127 at 7. Gulf Coast requests that Judge Acosta's statement be revised to read, "[T]he Audit revealed Gulf Coast may owe Plaintiffs amounts up to $876,177.41 in contributions, $354,761.21 in dues, $160,925.90 in liquidated damages, and $465,859.45 in interest." ECF 129 at 2 (emphasis added).
Plaintiffs make no argument concerning the revision of Judge Acosta's findings and recommendation to add the word "may" at page seven. Plaintiffs do, however, oppose any revision that would require the selection of a new arbitrator. According to Plaintiffs, Arbitrator Hobgood, who the parties previously chose pursuant to the Agreement, is the proper arbitrator to determine damages. Plaintiffs offer several arguments for why Arbitrator Hobgood should determine damages. Primarily, and most persuasively, Plaintiffs argue that case law supports a remand to the original arbitrator where, as here, the arbitrator's award is either incomplete or needs clarification.
For those portions of Judge Acosta's Findings and Recommendation to which neither party has objected, this Court follows the recommendation of the Advisory Committee and reviews those matters for clear error on the face of the record. No such error is apparent. For those portions of Judge Acosta's Findings and Recommendation to which Gulf Coast objects, the Court undertakes de novo review of the Findings and Recommendation, as well as the objections, Plaintiffs' response, and the underlying pleadings and briefing.
The parties selected Arbitrator Hobgood according to the procedures set forth in the Agreement. See ECF 125–1 at 5. The parties agreed that Mr. Hobgood would frame the issues to be arbitrated. Ultimately, Mr. Hobgood framed the issues as follows: (1) did Gulf Coast violate the collective bargaining agreement; and (2) if so, what is the appropriate remedy? Mr. Hobgood determined that Gulf Coast had an obligation under the Agreement to submit dues and working assessments to the Union's funds and that Gulf Coast must undergo an audit to determine the amounts owed from August 2009 to the present. Mr. Hobgood did not expressly retain jurisdiction when he issued his decision. On January 26, 2015, the Court issued an opinion confirming Mr. Hobgood's award. ECF 89.
Gulf Coast then submitted to an audit for the time period of January 2010 to March 2015, and Plaintiffs now seek to recover, among other things, the amounts that the audit allegedly found owing.
Judge Acosta correctly notes that courts generally only confirm final, binding arbitration awards. See Sheet Metal Workers' Int'l Ass'n, Local 206 v. R.K. Burner Sheet Metal Inc. , 859 F.2d 758, 760 (9th Cir.1988). The Court confirmed the arbitration award in this case, implicitly finding that the award was final and binding. See ECF 82 (). The traditional common law rule, known as the doctrine of functus officio , is that after an arbitrator issues a final, binding award, the arbitrator's authority ends. See Int'l Bhd. of Teamsters v. Silver State Disposal Serv., Inc. , 109 F.3d 1409, 1411 (9th Cir.1997) ; McClatchy Newspapers v. Cent. Valley Typographical Union No. 46 , 686 F.2d 731, 734 (9th Cir.1982). The doctrine of functus officio , however, is subject to several important exceptions: "It has been recognized in common law arbitration that an arbitrator can correct a mistake which is apparent on the face of his award, complete an arbitration if the award is not complete, and clarify an ambiguity in the award." Id. at 734 n. 1.
In labor relations disputes, courts liberally recognize exceptions to the doctrine of functus officio . For example, in United Steelworkers of America v. Enterprise Wheel & Car Corp. , 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960), the arbitrator awarded back pay to a group of discharged employees but failed to determine the amount of wages that the employees had earned in mitigation of their losses. In upholding resubmittal to the original arbitrator, the Fourth Circuit stated, in a portion of the opinion affirmed by the Supreme Court, that "the rule forbidding the resubmission of a final award, which was developed when the courts looked with disfavor upon arbitration proceedings,...
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