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International Longshoremen's Association v. Midwest Terminals of Toledo, International, Inc.

United States Court of Appeals, Sixth Circuit

December 10, 2019

Local 1982, International Longshoremen's Association, Plaintiff-Appellee,
v.
Midwest Terminals of Toledo, International, Inc., Defendant-Appellant.

          Appeal from the United States District Court for the Northern District of Ohio at Toledo. No. 3:17-cv-01688-Jeffrey James Helmick, District Judge.

         ON BRIEF:

          Ronald L. Mason, Aaron T. Tulencik, MASON LAW FIRM CO., L.P.A., Dublin, Ohio, for Appellant.

          Joseph C. Hoffman, Jr., Joseph D. Mando, FAULKNER, HOFFMAN & PHILLIPS, LLC, Cleveland, Ohio, for Appellee.

          Before: ROGERS, STRANCH, and THAPAR, Circuit Judges.

          OPINION

          JANE B. STRANCH, CIRCUIT JUDGE.

         For the third time, we are asked to review this dispute over a labor arbitration award issued in 2012. In short, Local 1982 of the International Longshoremen's Association successfully pursued a grievance against Midwest Terminals to enforce their contract requiring Midwest to establish pension and welfare trust fund plans that comply with the Employee Retirement Income Security Act (ERISA). In 2014, we enforced the Joint Grievance Committee's award in Local 1982 I. When disputes arose about implementing that award, Local 1982 returned to court seeking clarification from the Committee, composed of one employer and one union arbitrator. Midwest argued that no ambiguity existed and by engaging in negotiations it had complied with the award and the grievance was terminated. We ultimately affirmed remand of the award to the arbitrators for clarification, Local 1982 II, but before that could occur, Midwest's CFO was appointed to the Committee as the representative for the employers; a deadlock resulted. Local 1982 sought to follow the next step of the grievance procedure in the contract; Midwest refused, arguing that the deadlock terminated the grievance procedure. The district court ordered the parties to proceed to the next step. We AFFIRM.

         I. BACKGROUND

         Our prior decisions set out the specific facts, which are briefly summarized here. At the time of the initial dispute, Local 1982 and Midwest were parties to a collective bargaining agreement (CBA) that consisted of a Master Agreement, formed between the parties' affiliated regional employer group and the union, and a Local Agreement between the parties. Local 1982, Int'l Longshoremen's Ass'n v. Midwest Terminals of Toledo, Int'l, Inc., 560 Fed.Appx. 529, 530 (6th Cir. 2014) ("Local 1982 I"). Both agreements have provisions that address the benefit, pension, and welfare plans relevant to the underlying dispute. Id. at 531-32.

         In 2011, the union filed a grievance against Midwest for its failure to establish and contribute to such trust plans under Section 5.5A of the Master Agreement. After Midwest responded to the Union that it considered the grievance procedurally invalid, the Union escalated the grievance to Step Two of the Master Agreement grievance procedure-referral to a Joint Grievance Committee comprised of an employer representative and a union representative. Id. at 532.

         Midwest refused to participate and did not respond to the requests of the Joint Grievance Committee for explanation and cooperation; the hearing went forward without Midwest present. Id. at 532-33. The central question at the hearing was whether Midwest established ERISA-compliant funds in accordance with Section 5.5A of the Master Agreement, which sets out "[t]he minimum contribution to affiliated local union and employer ERISA approved benefit, pension, and welfare plans." The Committee determined that Midwest had failed to do so and issued its ruling against Midwest. Id. at 533. Under the Master Agreement, Midwest could appeal the unfavorable award within ten days but did not do so; the award became final and binding, and the union filed suit to enforce it. Id. at 534-35. Finding that any contract ambiguity is an issue for the arbitrator, not the courts, we directed the district court to enter an order enforcing the award. Id. at 537, 540.

         Shortly thereafter, the parties were back in court, this time over ambiguities in the content of the award. The district court found that the award was ambiguous and remanded to the Committee for clarification. We affirmed in Local 1982 II, finding that where an award "leaves doubt whether the submitted grievance has been fully executed, an ambiguity arises which the arbitrator is entitled to clarify." Local 1982, Int'l Longshoremen's Ass'n v. Midwest Terminals of Toledo, Int'l, Inc., 694 Fed.Appx. 985, 987 (6th Cir. 2017) ("Local 1982 II") (internal brackets, citations, and quotation marks omitted). We ruled that the award should be remanded for clarification, rejecting Midwest's argument that it complied with the award by negotiating about terms and conditions of the trust agreement; we reasoned that those actions failed to fulfill "the CBA requirement for the creation of a trust fund" and "[c]ommon sense dictates that the Committee intended something more." Id. at 989.

         After the remand but before clarification of the award, the composition of the two-person Committee changed. Over the opposition of the union, Midwest appointed its Chief Financial Officer, Fred Diechert, to replace the employer representative on the Committee. The new two-person Committee deadlocked in clarifying the award. Local 1982 sought to escalate the grievance to Step 3 of the Master Agreement for review by an expanded grievance committee to resolve the deadlock. Midwest opposed the escalation and argued that Local 1982's earlier efforts to confirm the arbitration award rendered it final, and a deadlock in interpreting the award terminated the procedure. The district court found Midwest's arguments to be unavailing, and Midwest appeals.

         II. ...


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