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IN RE STAY THE ARBITRATION DEMANDED OF HOTEL GREYS

November 2, 1995

In the Matter of the Petition to Stay the Arbitration Demanded of HOTEL GREYSTONE CORP., Petitioner, -against- NEW YORK HOTEL AND MOTEL TRADES COUNCIL, AFL-CIO, and VITO PITTA, individually and as President of New York Hotel and Motel Trades, Respondents.


The opinion of the court was delivered by: KAPLAN

 LEWIS A. KAPLAN, District Judge.

 This action involves a petition to stay an arbitration brought pursuant to a collective bargaining agreement. On September 13, 1995, this Court denied petitioner's motion to remand to the state court after determining that jurisdiction was proper under Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185 ("LMRA"). At the same time, the Court granted the petitioner's motion for a preliminary stay, pending this resolution of petitioner's motion to stay arbitration permanently and respondent's cross motion to compel arbitration.

 Facts

 Petitioner operates the Hotel Greystone (the "Hotel") in Manhattan. Respondents are the New York Hotel and Motel Trades Council, AFL-CIO (the "Union") and Vito Pitta, the Union's president. The Union is the exclusive bargaining representative of the New York City hotel and restaurant industry. Both the Union and Hotel were parties to an industry-wide collective bargaining agreement (the "Agreement") during the relevant time period.

 The Agreement contained a broad arbitration clause and established a grievance procedure system whereby disputes would be resolved by a rotating panel of arbitrators known as the Office of the Impartial Chairman. The arbitration clause, contained in Article 26 of the Agreement, stated in relevant part:

 
"All complaints, disputes or grievances arising between the parties hereto involving questions or interpretation or application of any clause of this Agreement, or any acts or conduct or relations between the parties, directly or indirectly, which shall not have been adjusted by and between the parties involved shall be referred to a permanent umpire to be known as the Impartial Chairman, and his decision shall be final and binding upon the parties hereto."

 Pursuant to this section of the agreement, Impartial Chairman Ira Drogin arbitrated a dispute, the particulars of which are not relevant to this disposition. In an award dated January 5, Chairman Drogin denied the union's grievance. The union asserts, without contradiction, that it received notice of the award several days later by mail.

 Chairman Drogin's opinion set forth the basis on which he granted the union's request for consideration. He stated, "I find and hold that under Section 26 of the collective bargaining agreement I have the power to grant a request for reconsideration and to grant a reopening of an Award I have issued." Chairman Drogin noted an extensive body of case law by the Office of the Impartial Chairman which interpreted the language in the Agreement to permit reconsideration upon a showing that the previous award was "clearly erroneous" or that there existed newly discovered evidence previously unavailable to the requesting party. However, Chairman Drogin explicitly declined to rest his conclusion on this case law or the past practice of the parties, stating instead that it was based solely on interpretation of Article 26. Chairman Drogin did address and emphatically reject the Hotel's argument that reconsideration was barred under the doctrine of functus officio:

 
"Under this collective bargaining agreement, the arbitrator, after issuance of an Award is not functus officio but has the authority, for good cause, to reopen an Award. Since arbitration is, by its nature, consensual and the parties determine the jurisdiction and authority of the arbitrator, the Hotel can not complain about the scope of the authority granted to the arbitrator, particularly his authority to reopen the award."

 Chairman Drogin granted the Union's request for reconsideration after concluding that confusion had existed about the issue originally submitted for arbitration and that newly discovered evidence may now exist.

 On August 5, 1995, before Chairman Drogin conducted the reconsideration, the Hotel filed a petition for a stay of arbitration in the Supreme Court of the State of New York. The union then removed the action to this Court on August 14, 1995 and on August ...


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