United States Court of Appeals
For the First Circuit
No. 00-1994
KEEBLER COMPANY,
Plaintiff, Appellee,
v.
TRUCK DRIVERS, LOCAL 170,
Defendant, Appellant.
ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Rya W. Zobel, U.S. District Judge]
Before
Boudin, Circuit Judge,
Bownes, Senior Judge,
and Lynch, Circuit Judge.
Scott W. Ellis, with whom Richard J. Rafferty, Jr., and
Eden Tolins & Rafferty were on brief, for appellant.
Kent D.B. Sinclair, with whom Seyfarth Shaw was on brief,
for appellee.
April 23. 2001
LYNCH, Circuit Judge. On April 27, 1999, the Keebler
Company discharged an employee, Michael Menchin, for gross
insubordination and fighting on the job. Menchin and his
union, Truck Drivers, Local 170, took the matter to
arbitration, as they were entitled to do under the Union's
collective bargaining agreement with the company. The
arbitrator found that Keebler did not have just cause to
terminate Menchin, but did have just cause to suspend him, and
ordered his reinstatement without back pay. Keebler filed an
action in federal court to vacate the arbitral award; the
Union counterclaimed for enforcement. The district court
granted Keebler's motion for judgment on the pleadings,
finding that the arbitrator had clearly departed from the
language of the collective bargaining agreement. The Union
appeals. In light of the high degree of judicial deference
owed to arbitral awards, we reverse.
I.
Judicial review of arbitral awards is "extremely
narrow and exceedingly deferential." Bull HN Info. Sys. v.
Hutson, 229 F.3d 321, 330 (1st Cir. 2000) (quoting
Wheelabrator Envirotech Operating Servs. v. Mass. Laborers
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Dist. Council Local 1144, 88 F.3d 40, 43 (1st Cir. 1996)). As
this court recently noted, "disputes that are committed by
contract to the arbitral process almost always are won or lost
before the arbitrator. Successful court challenges are few
and far between." Teamsters Local Union No. 42 v. Supervalu,
Inc., 212 F.3d 59, 61 (1st Cir. 2000).
Where a collective bargaining agreement commits the
parties to arbitration, the arbitrator's interpretation of the
agreement is the one they have "bargained for" and must abide
by. E. Assoc. Coal v. United Mineworkers of Am., Dist. 17,
____ U.S. ____, 121 S. Ct. 462, 466 (2000). The job for a
reviewing court "ordinarily is limited to determining whether
the arbitrator's construction of the collective bargaining
agreement is to any extent plausible." Exxon Corp. v. Esso
Workers' Union, Inc., 118 F.3d 841, 844 (1st Cir. 1997),
abrogated on other grounds by E. Assoc. Coal, supra (citing
United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29,
36-38 (1987)). Even if a court strongly disagrees with the
arbitrator's decision, that is not enough to vacate the
arbitral award "as long as the arbitrator is even arguably
construing or applying the contract." Misco, 484 U.S. at 38.
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The district court found that the arbitrator's
decision did not rest on a plausible construction of the
collective bargaining agreement, but simply reflected "his own
brand of industrial justice." United Steelworkers of Am. v.
Enter. Wheel and Car Corp., 363 U.S. 593, 597 (1960).
Specifically, the court found that the arbitrator exceeded his
contractual authority by: (1) requiring Keebler to meet a
"clear and convincing evidence" standard of proof rather than
the more usual "preponderance of the evidence" standard; (2)
holding that there was no "fighting on the job" because
Keebler had not shown by clear and convincing evidence that
Menchin started the fight in question; and (3) not explicitly
discussing Keebler's claim that Menchin's termination was
warranted due to his "gross insubordination" in addition to
his fighting on the job.
We review the district court's decision de novo.
See Bull HN, 229 F.3d at 330. Because the heart of the legal
analysis turns on the language of the pertinent collective
bargaining agreement provision, we recount it in full.
Article 10 of the agreement provides:
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The Employer shall not discharge nor suspend
any employee without just cause, but in respect to
discharge or suspension shall give at least one (1)
warning notice of the same complaint against such
employee to the employee, in writing, and a copy of
the same to the Union affected, except that no
warning notice need be given to an employee before
he is discharged if the cause of such discharge is
dishonesty, drinking, and/or drunkenness, sale, use,
or possession of illegal drugs during working hours,
willful destruction of Company property, or
recklessness resulting in a serious accident while
on duty, gross insubordination, or the carrying of
unauthorized passengers, and/or fighting on-the-job.
II.
We discuss the three grounds for the district
court's decision seriatim, and in addition discuss a fourth
argument made by Keebler that the district court found
unnecessary to address.
1. Standard of Proof
The arbitrator required Keebler to establish its
case by clear and convincing evidence. Keebler argues that
the arbitrator exceeded his authority in doing so because
nothing in the text of the collective bargaining agreement
provided for a heightened standard of proof, and in the
absence of such provision, the customary civil standard --
"preponderance of the evidence" -- should control. The
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district court agreed, finding no justification for the
arbitrator's departure from the customary standard of proof.
The court rejected the rationale of the arbitrator, who
thought such a departure was warranted because Menchin had
been terminated for "criminal conduct," in that the fight in
question had led to an assault-and-battery charge against
Menchin that was pending at the time.
We share the district court's skepticism about the
merits of the arbitrator's rationale. It is unclear why the
existence of a criminal proceeding should ratchet up the
standard of proof in a related but independent arbitral
proceeding about the termination of employment. Even so, such
skepticism is not enough to vacate the arbitrator's decision.
Arbitration is a creature of contract. Here, the collective
bargaining agreement is entirely silent as to the standard of
proof to be used by the arbitrator. Where an arbitration
agreement is silent, court customs do not stand as binding
default rules. See Slaney v. Int'l Amateur Ath. Fed'n, ---
F.3d ---, 2001 U.S. App. LEXIS 4923, at *24 (7th Cir. Mar. 27,
2001) ("[P]arties that have chosen to remedy their disputes
through arbitration rather than litigation should not expect
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the same procedures they would find in the judicial arena.").
Rather, the arbitrator is free to set his own rules of
procedure so long as he stays within the bounds of fundamental
fairness. Compare Gen. Drivers, etc. v. Sears, Roebuck & Co.,
535 F.2d 1072, 1076 (8th Cir. 1976) (given national policy
favoring arbitration of collective bargaining grievances,
arbitrator's procedural rulings are not subject to judicial
review), with Ramirez-de-Arellano v. Am. Airlines, 133 F.3d
89, 91 (1st Cir. 1997) (arbitration must meet minimal
requirements of fairness). Applying a heightened standard of
proof to terminations resulting from potentially criminal
conduct, while judicially unorthodox, is not fundamentally
unfair. Thus, given the agreement's silence on the issue, the
choice of standard was within the arbitrator's discretion.
See Gen. Drivers, 535 F.2d at 1075-76 (finding nothing
impermissible in arbitrators' choice to use "clear and
convincing evidence" standard in reviewing promotion
decision); Amalgamated Meatcutters v. Neuhoff Bros. Packers,
Inc., 481 F.2d 817, 819-20 (5th Cir. 1973) (finding nothing
impermissible in arbitrator's choice to use "beyond a
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reasonable doubt" standard where employees were terminated for
stealing from the company).
2. Fighting on the Job
Menchin was fired after a physical altercation with
his supervisor. The Union challenged Menchin's termination on
the ground that he had fought in self-defense. The arbitrator
was unable to determine how the incident began, but he
specifically found that Menchin did not "sucker punch" his
supervisor as claimed and could find no other evidence
sufficient to prove that Menchin provoked the altercation.
Thus, the arbitrator declined to find that Menchin had engaged
in "fighting on-the-job" on the ground that Keebler could not
prove by clear and convincing evidence that Menchin started
the fight.
Keebler argues, and the district court agreed, that
the term "fighting on-the-job" unambiguously encompasses any
physical fighting at work, whether offensive or defensive, so
that the arbitrator's narrower construction of the term was
implausible. Keebler's argument is without merit; the
arbitrator's construction of the term was patently plausible.
Courts themselves are no strangers to the ambiguity latent in
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facially absolute prohibitions against acts of violence.
Crimes of murder, assault, and the like are routinely
construed to contain exceptions for acts taken in self-defense
or upon provocation. The arbitrator acted well within his
bounds in interpreting the contractual prohibition against
"fighting on-the-job" in analogous fashion.
3. Gross Insubordination
Before Menchin's physical altercation with his
supervisor, the two had an aggravated verbal exchange.
Keebler argues, and the district court agreed, that the
arbitrator erred by failing to discuss whether Menchin's
conduct in the exchange constituted gross insubordination,
which the collective bargaining agreement lists as a possible
ground for immediate discharge. Consequently, Keebler
concludes, the arbitrator's decision cannot be fairly said to
draw its essence from the collective bargaining agreement.
For support, Keebler cites a Fourth Circuit case for the
proposition that "where . . . the arbitrator fails to discuss
critical contract terminology, which terminology might
reasonably require an opposite result, the award cannot be
considered to draw its essence from the contract."
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Clinchfield Coal Co. v. District 28, United Mine Workers of
Am., 720 F.2d 1365, 1369 (4th Cir. 1983), cited in Champion
Int'l Corp. v. United Paperworkers Int'l Union, 168 F.3d 725,
731 (4th Cir. 1999).
The result in Clinchfield was justified but the
proposition Keebler quotes is something of an overstatement.
Arbitrators ordinarily are under no obligation to explain the
reasons for an award -- even where the contractual basis for
the award is ambiguous. Enter. Wheel, 363 U.S. at 597-98. In
Clinchfield, the underlying problem with the arbitrator's
decision was that the result seemed impossible to square with
certain provisions of the contract; without some discussion of
the provisions by the arbitrator, the court was forced to
conclude that the arbitral award did not draw its essence from
the contract.1
1 Specifically, the arbitrator had reinstated employees
who were laid off allegedly as a result of the company's
decision to license out some of its "coal lands." The
collective bargaining agreement, however, only protected
employees from layoffs resulting from the licensing out of "coal
mining operations;" the agreement explicitly provided that its
protections did not apply to layoffs resulting from the
licensing out of "coal lands." The arbitrator failed to address
this critical difference in terminology. See 720 F.2d at 1368-
69. Likewise, in Champion International, supra, the arbitrator
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By contrast, here the arbitrator's award is not
impossible to square with the provision of the collective
bargaining agreement permitting immediate discharge for gross
insubordination. Indeed, the arbitrator's award can easily be
understood to rest on the view that Menchin did not commit
gross insubordination. While the arbitrator did not use
precisely such terms, he arrived at this conclusion in so many
words upon reviewing Menchin's conduct during the verbal
exchange. The arbitrator concluded: "While I find that
[Menchin's words to his supervisor] indicated unacceptable
disrespect . . . and were worthy of discipline, I do not find
that a dischargeable event [ ] occurred during the argument .
. . ." Similarly, the arbitrator's award states that Keebler
"did not have just cause to terminate Michael Menchin, but it
did have just cause to suspend him."
awarded a type of bonus to the grievant employees when such
bonuses were only available under a policy that was not
applicable to them. See 168 F.3d at 730-31. The reviewing
court found the arbitrator's failure to discuss a certain
provision of the collective bargaining agreement to supply
further evidence that the award did not draw its essence from
the agreement. See id. at 731.
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Thus, in substance, the arbitrator found some degree
of insubordination, but not the sort of gross insubordination
sufficient to constitute just cause for immediate termination.
He did not fail to address the issue in his decision; and even
if he had, the award would still be compatible with the above
reading and hence deserving of judicial deference. Cf.
Supervalu, 212 F.3d at 67 (because an arbitrator has no duty
to state the grounds for his award, reviewing court may uphold
the award on grounds not employed by the arbitrator himself).
4. Alteration of Form of Discipline
Finally, in somewhat of a turnaround from the
preceding argument, Keebler argues that in finding Menchin's
conduct during the verbal exchange "worthy of discipline" and
just cause for suspension, the arbitrator effectively found
that Menchin committed gross insubordination. Having found
gross insubordination, the argument continues, the arbitrator
was bound to uphold Menchin's discharge; he had no authority
to alter the form of Menchin's discipline from termination to
suspension. For support, Keebler cites a string of cases for
the proposition that, once an arbitrator finds that an
employee committed some act specifically listed in the
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collective bargaining agreement as providing just cause for
termination, the arbitrator is not free to determine that the
act does not warrant termination but rather warrants some
lesser penalty. See Georgia-Pacific Corp. v. Local 27, United
Paperworkers Int'l Union, 864 F.2d 940, 944-45 (1st Cir.
1988); S.D. Warren Co. v. United Paperworkers Int'l Union, 845
F.2d 3, 8 (1st Cir. 1988); Metro Chevrolet, Inc. v. Union de
Tronquistas de Puerto Rico, 835 F.2d 3, 5 (1st Cir. 1987).
Keebler's argument turns on two assumptions: (1)
that the collective bargaining agreement unambiguously lists
gross insubordination as providing just cause for termination;
and (2) that the arbitrator in effect found gross
insubordination. Both assumptions are unfounded. As to the
first, the agreement merely says that employees may neither be
discharged nor suspended without just cause and the benefit of
a warning, except that no warning need be given before
terminating an employee for, inter alia, gross
insubordination. It does not expressly state that gross
insubordination will always be just cause for termination
(only that when it is, the employee may be terminated without
warning). And indeed, on prior occasions we have held very
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similar language to be ambiguous in this respect. Exxon, 118
F.3d at 845-46; Crafts Precision Indus., Inc. v. Lodge No.
1836, etc., 889 F.2d 1184, 1185-86 (1st Cir. 1989).
As to the second assumption, the arbitrator's
decision need not be read to rest on a finding of gross
insubordination.2 Again, the decision can easily be
understood to rest on a finding that Menchin acted
insubordinately, but that his conduct did not rise to the
level of "gross" insubordination. Cf. Crafts Precision, 889
F.2d at 1185-86 (reading agreement to "suggest that some kinds
of insubordination may warrant 'discharge,' while other, less
serious instances may warrant only 'suspension'").3
2 In the cases Keebler relies upon, the arbitrator
unambiguously found that the grievant had committed conduct
listed in his employment agreement as grounds for termination.
See Georgia-Pacific, 864 F.2d at 944 (arbitrator found that
employee's claim that he was sick when he actually went to play
golf constituted "dishonesty"); S.D. Warren, 845 F.2d at 6-7
(arbitrator found employee had possessed marijuana on employer's
property); Metro Chevrolet, 835 F.2d at 5 (arbitrator found that
employee had been absent without authorization).
3 Indeed, this is an easier case than Crafts Precision.
In that case, the agreement listed simple "insubordination" as
an example of conduct that "may result in suspension, or
immediate discharge, for the first offense." The arbitrator
found this language to permit a distinction between
insubordination to a degree warranting suspension and
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III.
The decision of the district court is reversed and
the case is remanded for entry of judgment enforcing the
award.
insubordination to a degree warranting discharge. See Crafts
Precision, 889 F.2d at 1185. By contrast, here, the collective
bargaining agreement itself explicitly draws such a distinction,
as it specifies not simply "insubordination" but "gross
insubordination" as an example of conduct requiring no warning
before discharge.
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