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New York City District Council of Carpenters v. Dufour Group

April 19, 2012

NEW YORK CITY DISTRICT COUNCIL OF CARPENTERS, PLAINTIFF,
v.
DUFOUR GROUP INC., DEFENDANT.



The opinion of the court was delivered by: Alison J. Nathan, District Judge

OPINION

The New York City District Council of Carpenters has filed a petition to confirm two related arbitration awards arising out of the discharge of two individuals in violation of a collective bargaining agreement. Dufour Group Inc. ("Dufour Group") opposes the petition and seeks vacatur of the arbitration awards. For the reasons set forth below, the petition to confirm is granted.

I. FACTS AND PROCEDURAL HISTORY

On August 1, 2008, Dufour Group entered into a collective barganing agreement with the District ouncil for New York City and Vicinity, United Brotherhood of Carpenters and Joiners of America, AFL-CIO (the "Union"). (Complaint ¶ 1; Quinn Decl. Ex. 1; Opp. at 1.) Under the agreement, Dufour Group employed several members of the Union for a construction job. (Opp. at 1.)

Grievances were filed against Dufour Group on behalf of two union employees, Wycliffe Frederick and Carlos N. Peralta. (Hilton Decl. Ex. B.) Frederick's grievance alleged that he approached the shop steward, super, and foreman of the jobsite with safety concerns. (Hilton Decl. Ex. B.) As a result, the grievance alleges, at the end of the day Fredrick was "given a paycheck and was informed that [he] was laid-off." (Hilton Decl. Ex. B.) When he sought the reasons for his termination, he was "presented with much hostility and abusive language" and "was accused of inappropriately speaking to a superior." (Hilton Decl. Ex. B.) Peralta's grievance contains similar allegations. (Hilton Decl. Ex. B.) These terminations occurred on the first day of the grievants' jobs. (Opp. at 1; Quinn Decl. Ex. 2.)

An arbitration was held on July 13, 2011, presenting the issue of "[w]hether [Dufour Group] had good cause to terminate the grievants Wycliffe Frederick and Carlos Peralta on 8/5/08? And if not, what shall be the remedy?" (Complaint ¶¶ 8-9; Quinn Decl. Ex. 2 at 2-3; Quinn Reply Ex. 2.) Before the arbitrator rendered a decision, Dufour Group moved to dismiss, arguing that (1) Frederick and Peralta failed to properly assert their rights under the agreement and that (2) the collective bargaining agreement allowed Dufour Group to terminate Frederick and Peralta for any reason. (Hilton Decl. ¶ 12; Opp. at 3; Hilton Ex. C at ¶¶ 4-7.) The arbitrator denied this motion. (Hilton Decl. ¶ 12.)

The arbitrator issued an award to the grievants on October 11, 2011, finding that the facts surrounding the arbitration were essentially the same as those of a previous arbitration regarding the termination of another worker at the site, Robert Makowski. (Quinn Decl. Ex. 2 at 2, 4.) At the Makowski arbitration, the arbitrator concluded that "the termination of three out of eight journeyman carpenters for their unproductivity on their first day of the job strains credulity" and that it was the employer's lack of preparation that led to any productivity issues. (Quinn Decl. Ex. 2 at 4.) The arbitrator noted that, despite being aware of the prior arbitration, counsel for Dufour Group did not present any new evidence or credible testimony to distinguish Frederick and Peralta's termination from that of Makowski. (Quinn Decl. Ex. 2 at 4-7.) Consistent with these determinations, the arbitrator found no good cause to terminate the grievants and awarded lost earnings for the relevant period. (Quinn Decl. Ex. 2 at 6-7.) In a subsequent award, the arbitrator further awarded the grievants compensation for wages lost due to Dufour Group's rescheduling of the hearing on late notice. (Quinn Decl. Ex. 3.)

II.STANDARD OF REVIEW

"Confirmation of an arbitration award is a summary proceeding that merely makes what is already a final arbitration award a judgment of the court, and the court must grant the award unless the award is vacated, modified, or corrected." D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 110 (2d Cir. 2006) (quotation marks and citations omitted). "The arbitrator's rationale for an award need not be explained," and "[o]nly a barely colorable justification for the outcome reached by the arbitrators is necessary to confirm the award." Id. (quotation marks and citations omitted). "A party moving to vacate an arbitration award has the burden of proof, and the showing required to avoid confirmation is very high." Id.

The Federal Arbitration Act provides a limited number of grounds for vacating an arbitration award including, as relevant here, that the arbitrator exhibited "evident partiality" or was "guilty of misconduct in . . . refusing to hear evidence pertinent and material to the controversy." 9 U.S.C. § 10(a). An arbitration award will also be vacated if it was made in "manifest disregard of the law." T.Co Metals, LLC v. Dempsey Pipe & Supply, Inc., 592 F.3d 329, 339 (2d Cir. 2010). Manifest disregard of the law is found only in "those exceedingly rare instances where some egregious impropriety on the part of the arbitrator [ ] is apparent." Id. (quotation marks omitted). To prove manifest disregard of the law, a party must show that (1) the law that was manifestly disregarded was clear and explicitly applicable to the matter before the arbitrator; (2) that the law was improperly applied, leading to an erroneous outcome; and (3) that the arbitrator "knew of the existence of the law and its applicability to the problem before him." Id.

III.DISCUSSION

A.The Arbitrator Did Not Demonstrate Manifest Disregard of the Law

1.Proper Interpretation of the Contract

Dufour Group argues that the arbitration award shows manifest disregard for the law because the arbitrator improperly construed the contract. Under the arbitrator's interpretation of the agreement, Dufour Group was allowed to terminate the ...


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