JCI Communications, Inc. v. International Brotherhood of Electrical Workers

United States Court of Appeals
For the First Circuit

No. 02-2220

JCI COMMUNICATIONS, INC., d/b/a NETVERSANT-NEW ENGLAND,

Plaintiff, Appellant,

v.

INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS, LOCAL 103,

Defendant, Appellee.

ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS

[Rya W. Zobel, U.S. District Judge]

Before

Lynch, Circuit Judge,
Stahl, Senior Circuit Judge,
and Howard, Circuit Judge.

Andrew C. Pickett, with whom Richard W. Paterniti and
Jackson Lewis LLP were on brief, for appellant.

Indira Talwani, with whom Ira Sills and Segal, Roitman &
Coleman were on brief, for appellee.

March 31, 2003
 LYNCH, Circuit Judge. JCI Communications, Inc., doing

business as NetVersant-New England, is a telecommunications company

specializing in network infrastructures. It signed collective

bargaining agreements at various times with Local 2222 and Local

103, two separate locals of the same international union, the

International Brotherhood of Electrical Workers ("International").

JCI found itself in the cross-fire as to which work assignments

belonged to which local. After JCI assigned certain work to Local

2222, Local 103 referred a grievance to arbitration in January

2002. Local 103 prevailed at arbitration. JCI filed suit to

vacate the arbitral award; Local 103 cross-claimed for confirmation

and sought summary judgment. The district court granted summary

judgment to Local 103 and JCI appealed. We affirm.

JCI raises several arguments. Its two main attacks on

the judgment are (1) a set of arguments going to the role played by

a Jurisdictional Agreement (purportedly between Locals 103 and

2222, the International, and JCI) and (2) a claim that the

arbitrators were biased. As to the first attack, JCI argues that,

despite the arbitral award, it was entitled to a trial, following

discovery, on the issue of whether the Jurisdictional Agreement

governs the relationship between the parties. It also argues that

the arbitrators exceeded the scope of their authority when they

considered the validity and effect of the Jurisdictional Agreement,

and so the district court erred in not vacating the award under 9

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U.S.C. § 10(a)(4) (2000). Second, JCI argues that the industry

arbitrators were biased because they worked for JCI's competitors

and so the award should have been vacated under 9 U.S.C. §

10(a)(2). A common theme runs through all the arguments: that JCI

wishes to present new evidence or argument to the court to

undermine the arbitral award. There are very narrow circumstances

in which such a maneuver is permissible; those circumstances are

absent here.

The arguments relating to the Jurisdictional Agreement

fail for a number of reasons. The district court could not

independently review the role of the Jurisdictional Agreement

because JCI submitted that issue to the arbitral panel and did not

reserve the issue or contest the panel's authority. JCI may not,

then, attempt to get discovery or retry the issue to the court.

The district court properly confined itself to a review of the

panel's award and to the record before the arbitrator; it

succinctly and correctly found no basis for the claim that the

arbitrators exceeded their authority.

As to the bias claim, while a court may, in other

circumstances, take independent evidence on bias, the district

court was correct to reject this claim. Here, JCI was on notice

that the panel would be drawn from members of its own and related

industries and, as a result, that some of JCI's competitors could

be the employer representatives on the panel. Yet JCI neither

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inquired about the backgrounds of the arbitrators nor raised the

question of possible bias before the arbitral panel. Mere

participation by arbitrators from the same industry as a party does

not present a facial claim of "evident partiality" under §

10(a)(2). JCI has not preserved any claim of bias.

I.

JCI has hired members of both Local 103 and Local 2222

since at least 1993, when members of both Locals did electrical

work at the same project site. JCI entered into a succession of

collective bargaining agreements (CBAs) with the Locals between

1993 and 2002, and signed the Jurisdictional Agreement in 1998.

JCI entered into its first CBA with Local 2222 in 1993.

That agreement expired and JCI entered into another CBA with Local

2222 that was in force from January 1, 1998 to December 31, 1999.1

JCI and Local 2222 did not sign another CBA until May 15, 2002,

more than three months after the unfavorable arbitral award.

JCI assented in 1998 to a CBA concluded in 1997 between

an employers association and Local 103. In March 1998, the

business manager of Local 103 wrote to the President of JCI

promising to "continue to work with Local 2222 in order to

1
JCI claims in its Petition to Vacate that the January 1,
1998 CBA was "automatically renewed on December 31, 1999."
However, the text of that CBA provides that extensions be in
writing, and signed by duly authorized representatives of the
parties. JCI has not provided any such signed agreement (apart
from the new CBA entered into on May 15, 2002).

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formalize a jurisdictional agreement." On October 1, 1998, JCI and

Local 103 executed a Letter of Assent in which JCI recognized the

Boston Chapter of the National Electrical Contractors Association

("Boston Chapter") as JCI's collective bargaining representative

"for all matters contained in or pertaining to [the] current and

any subsequent approved Telecommunications [L]abor [A]greement

between the Boston Chapter, N.E.C.A. and Local Union 103, IBEW."

(emphasis added). The Letter was to "remain in effect until

terminated by the undersigned employer [JCI]" with adequate written

notice to the Boston Chapter and Local 103. JCI never provided

written notice of termination to Local 103.

The then-current Telecommunications Labor Agreement,

signed on September 1, 1997, expired on February 29, 2000 and was

replaced by a succeeding Telecommunications Labor Agreement, dated

March 1, 2000. Both agreements recognize Local 103 as the

exclusive collective bargaining representative of all employees

performing a broad range of electrical work. Both agreements also

provide that disputes shall be resolved via binding arbitration

before a Joint Conference Committee ("Committee") consisting of

three union representatives and three employer representatives.2

2
The agreements use the same language:
Section 1.04 There shall be a Joint Conference Committee of
three (3) representing the Union and three (3) representing the
Employer. It shall meet regularly at such stated times as it may
decide. However, it shall also meet within forty-eight (48) hours
when notice is given by either party. It shall select its own
Chairman and Secretary.

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These agreements, like the Letter of Assent, were duly signed by

appropriate representatives of the parties.

At the heart of this case is a purported "Jurisdictional

Agreement," dated October 2, 1998. The document, which recognizes

the existence of "jurisdictional issues" between the Locals

"regarding telecommunications projects," was characterized as an

agreement between Local 103, Local 2222, and JCI. There are

signature lines on the agreement for representatives of Local 103,

Local 2222, JCI, and the International. Representatives of Local

103 and Local 2222 never signed the agreement. There are only two

signatures: those of Frank Carroll, the International Vice

President in charge of the New England region, and a JCI executive.

The International Constitution provides that only the International

Section 1.05 All grievances or questions in dispute shall be
adjusted by the duly authorized representatives of each of the
parties to this Agreement. In the event that these two are unable
to adjust any matter within 48 hours, they shall refer the same to
the Joint Conference Committee.
Section 1.06 All matters coming before the Joint Conference
Committee shall be decided by majority vote. Four members of the
Committee, two from each of the parties hereto, shall be a quorum
for the transaction of business, but each party shall have the
right to cast the full vote of its membership and it shall be
counted as though all were present and voting.
Section 1.07 Should the Joint Conference Committee fail to
agree or to adjust any matter, such shall then be referred to the
Council on Industrial Relations for the Electrical Contracting
Industry for adjudication. The Council's decision shall be final
and binding on both parties hereto.
Section 1.08 When any matter in dispute has been referred to
conciliation or arbitration for adjustment, the provisions and
conditions prevailing prior to the time such matters arose shall
not be changed or abrogated until agreement has been reached or a
ruling has been made.

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President, or her duly appointed representative, can enter into a

binding agreement with a company.

After it signed the Letter of Assent and the

Jurisdictional Agreement, JCI assigned work to both Locals. JCI

continued assigning work to Local 2222 after its CBA with Local

2222 expired at the end of 1999. JCI says Local 2222 agreed to

extend this CBA while the parties negotiated a new one.

A Boston Chapter contractor filed charges against JCI

alleging that it had violated the Telecommunications Labor

Agreement by giving work reserved for Local 103 members to members

of Local 2222. On January 21, 2002, Local 103 referred a grievance

to the Committee, under the procedure set forth in the

Telecommunications Labor Agreement, asserting that JCI was

assigning work covered by that agreement to members of Local 2222.3

The Committee met on February 4, 2002. Per the terms of

the Telecommunications Labor Agreement, the Committee consisted of

three representatives of Local 103 and three representatives of the

Boston Chapter. As JCI alleged to the court, but not to the

Committee, the Boston Chapter representatives worked for

competitors of JCI that had in the past lost job bids to JCI.

3
Apart from its claim relating to the hiring of members of
Local 2222, Local 103 also claimed that at one project site JCI
improperly subcontracted work covered by the Telecommunications
Labor Agreement to Maverick Construction (which may or may not
employ electricians from one of the two Locals). JCI stipulated at
the hearing that it had violated the Telecommunications Labor
Agreement in this regard.

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Robert Feldman, Executive Vice President of JCI, claims that JCI

did not learn that the Boston Chapter arbitrators were employed by

competitors until after the start of the hearing. In any event,

JCI, represented by different counsel than its appellate counsel,

did not object during the arbitral hearing to the Committee's

composition. There is also no evidence or claim that JCI inquired,

either prior to or during the hearing, as to the employers of the

Committee members.

Both parties presented evidence and arguments and

responded to questions from the Committee. JCI's basic position

was that it had obligations to both Locals, and that the

Jurisdictional Agreement covered the dispute. Local 103 argued

that the Jurisdictional Agreement had never been executed and was

not binding. Local 103 submitted evidence including its

correspondence with JCI, the Letter of Assent, a list of JCI

employees, and payroll records and correspondence of select JCI

employees. Local 103 argued that JCI had hired non-members as

technicians, apprentices, and other types of workers to do

electrical work covered by the Telecommunications Labor Agreement.

In response, JCI submitted only the Jurisdictional Agreement and

Letter of Assent. It contended that it had hired only members of

Locals 103 and 2222, and that its hiring practices were consistent

with the Jurisdictional Agreement. Local 103 addressed the

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viability of the Jurisdictional Agreement in response to the

arguments and evidence presented by JCI.

The Committee found: "[JCI] violated the Collective

Bargaining Agreement by assigning bargaining unit work to non-

bargaining unit members and by contracting out bargaining unit

work." The Committee found that the Jurisdictional Agreement did

not govern (1) because it was not signed by the affected Locals;

(2) because the president of the International did not sign the

Jurisdictional Agreement, as required under the International

Constitution to give legal effect to this sort of agreement; and

(3) because JCI presented no evidence that it had a current,

executed CBA with Local 2222 that would justify assignment of work

to Local 2222 under the Jurisdictional Agreement. Any one of these

three reasons, the Committee held, would be sufficient to rebut

JCI's argument that the Jurisdictional Agreement resolved the

dispute. The Committee ordered JCI to pay damages to Local 103 "in

an amount equal to make whole the Union and its members" for all

past and continuing violations. The Committee also required JCI to

make available payroll and other records to Local 103.

JCI petitioned to vacate the arbitration award pursuant

to 29 U.S.C. § 185 (2000). Local 103 answered the petition and

filed a cross-claim to affirm the award, then moved for summary

judgment. Local 103 argued that JCI's claims -- that the Committee

was biased, that the Committee exceeded its jurisdiction, and that

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the signing of the Letter of Assent was procured by fraud -- were

waived because JCI failed to raise them during the challenged

proceeding. In support of this motion, Local 103 submitted an

affidavit from its business manager, Richard Gambino, and exhibits

including the Letter of Assent, Telecommunications Labor Agreement,

Jurisdictional Agreement, Committee decision, and correspondence

between Local 103, JCI, and the Committee secretary. JCI opposed

the motion for summary judgment and moved under Fed. R. Civ. P.

56(f) for limited discovery before the court ruled on Local 103's

motion.4 In support of its opposition, JCI submitted affidavits

from Feldman and Andrew Pickett, an attorney for JCI. It also

submitted exhibits including two CBAs between JCI and Local 2222

(one expired, one concluded after the arbitration); an excerpt from

the Constitution of the International; and correspondence between

the Locals and JCI.

The district court granted Local 103's motion for summary

judgment on August 29, 2002. JCI Communications, Inc. v. Int'l

Bhd. of Elec. Workers Union, Local 103, 2002 WL 2005852, slip op.

at 2 (D. Mass. Aug. 29, 2002). The court held that JCI "invited"

the Committee to rule on the Jurisdictional Agreement by relying on

the Agreement as its "primary defense." Id. at 2. The court

rejected JCI's bias argument on the ground that employer

4
As part of its Rule 56(f) request, JCI sought to depose
Carroll, former Local 103 business manager Paul Ward, and other
members of Locals 103 and 2222.

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representatives on the Committee were "necessarily selected" from

JCI's competitors. Id. at 3. In addition, the court held that JCI

had waived its argument that it signed the Letter of Assent based

on fraudulent representations by Local 103. Id. The court also

dismissed evidence of a recent CBA between JCI and Local 2222

because the agreement postdated the arbitral decision. Id. at 2.

II.

This court's review of entry of summary judgment is de

novo. Second Generation Props., L.P. v. Town of Pelham, 313 F.3d

620, 629 (1st Cir. 2003). That standard applies to our review of

a district court's ruling on an arbitral award. Wonderland

Greyhound Park, Inc. v. Autotote Sys., Inc., 274 F.3d 34, 35 (1st

Cir. 2001). There is no material dispute of fact as to what was

submitted to the arbitrators.

In turn, both this court and the district court are bound

by the very narrow and very deferential standard of review of

arbitral decisions. See Keebler Co. v. Truck Drivers, Local 170,

247 F.3d 8, 10 (1st Cir. 2001). In general, a court may vacate an

arbitral award only in rare circumstances, such as when there was

misconduct by the arbitrator, when the arbitrator exceeded the

scope of her authority, or when the award was made in manifest

disregard of the law. Bull HN Info. Sys. Inc. v. Hutson, 229 F.3d

321, 330-31 (1st Cir. 2000). Many of those circumstances are

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codified in the Federal Arbitration Act, 9 U.S.C. §§ 1-16, which

provides, inter alia, that a court may vacate an award:

(2) Where there was evident partiality or corruption
in the arbitrators, or either of them;
. . . .
(4) Where the arbitrators exceeded their powers, or
so imperfectly executed them that a mutual,
final, and definite award upon the subject matter
submitted was not made.

Id. § 10(a). JCI's claims that the arbitrators acted without

jurisdiction and were biased are brought under these sections.

A. Whether the arbitrators exceeded their authority

JCI argues that the arbitrators were limited to

interpreting the Telecommunications Labor Agreement, under which

Local 103 brought its grievance. From this, JCI reasons that the

arbitrators exceeded their authority by: (1) deciding an issue

governed by another agreement (the Jurisdictional Agreement), (2)

invalidating the Jurisdictional Agreement, (3) deciding an issue

involving a non-party to the arbitration (Local 2222), and (4)

reviewing JCI's CBA with and recognition of Local 2222.

For almost forty years it has been clear that arbitrators

can resolve jurisdictional disputes involving an employer and two

local unions, whether the dispute is "(1) a controversy as to

whether certain work should be performed by workers in one

bargaining unit or those in another; or (2) a controversy as to

which union should represent the employees doing particular work."

Carey v. Westinghouse Elec. Corp., 375 U.S. 261, 263 (1964). Carey

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held that the employer must arbitrate a work assignment

jurisdictional dispute on the demand of only one union. Id. at

265-66. Sometimes the second union seeks to intervene in the

arbitration, sometimes not, and this case involves no issue of

arbitral authority to compel the second union's participation. See

Elkouri & Elkouri: How Arbitration Works 350-51 (M.M. Volz & E.P.

Goggin eds., 5th ed. 1997). Thus, there was nothing wrong in

principle with the arbitrators reviewing the agreement with one

local although a different local had some interests at stake. Of

necessity, Carey means arbitrators may have to review the

intersections of different labor agreements in the course of

applying one of them.

JCI's argument that a problem arises because Local 2222,

a non-party, is bound by the agreement is simply wrong. The

arbitral order does not purport to be binding on Local 2222 and no

relief is ordered as to that Local. It is true that, until and

unless JCI withdraws from the Telecommunications Labor Agreement,

JCI will have to pay Local 103 for the privilege of using Local

2222 members to do work the Committee found to be within the scope

of the Telecommunications Labor Agreement. That may deter JCI from

using Local 2222 workers, and Local 2222 may feel its contract is

violated and grieve as a result. But that is a problem of the

company's own making.

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 The argument that the arbitrators exceeded their

authority by considering the Jurisdictional Agreement is also

unavailing. JCI did not assert at the arbitration hearing that the

Jurisdictional Agreement deprived the arbitrators of jurisdiction;

nor did it reserve the issue of the meaning of the Jurisdictional

Agreement during the arbitration hearing; nor did it refuse

arbitration for any reason, much less on the ground that the

arbitrators had no authority over the Jurisdictional Agreement.

Once the submission to the arbitrators was made without such a

reservation, it was for the arbitrators to determine the scope of

their own authority. See Dorado Beach Hotel Corp. v. Unión de

Trabajadores de la Industria Gastronómica de P.R. Local 610, 959

F.2d 2, 4-5 (1st Cir. 1992) ("[W]e normally will defer to an

arbitrator's interpretation of the arbitral authority conferred by

the CBA and the parties' submissions.").

Also, it was JCI which asked the arbitrators to consider

the Jurisdictional Agreement when JCI relied on that Agreement in

its defense to the grievance. JCI argued that the construction of

the Telecommunications Labor Agreement must be undertaken in light

of the Jurisdictional Agreement, and having raised the issue

itself, JCI cannot complain that the arbitrators reached it. See,

e.g., Rock-Tenn Co. v. United Paperworkers Int'l Union, 184 F.3d

330, 334 (4th Cir. 1999) ("[U]nconditional submission of an issue

to arbitration, without any objection to the arbitrator's authority

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to decide that issue, cedes authority to the arbitrator, or

represents consent to arbitration of that issue.") (internal

quotations omitted); Franklin Elec. Co. v. Int'l Union, United

Auto. Aerospace & Agric. Workers, 886 F.2d 188, 191-92 (8th Cir.

1989) (a party cannot argue, after an arbitral award, that the

arbitrator lacked authority to decide a jurisdictional or

arbitrability issue the party itself submitted); Jones Dairy Farm

v. Local No. P-1236, United Food & Commercial Workers Union Int'l,

760 F.2d 173, 175-76 (7th Cir. 1985) ("if a party voluntarily and

unreservedly submits" a jurisdictional issue to arbitration, then

the party "cannot later argue that the arbitrator had no authority

to resolve it"); see also Nghiem v. NEC Elec., Inc., 25 F.3d 1437,

1440 (9th Cir. 1994) ("[W]e have long recognized a rule that a

party may not submit a claim to arbitration and then challenge the

authority of the arbitrator to act after receiving an unfavorable

result.") (quotation omitted); Dorado Beach, 959 F.2d at 4 ("[A]n

arbitrator's authority under the CBA may be supplemented by the

parties' submissions."). See generally Moses H. Cone Mem'l Hosp.

v. Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983) ("[A]ny doubts

concerning the scope of arbitrable issues should be resolved in

favor of arbitration.").

Nor is there any merit to the assertion that the manner

in which the arbitrators construed the effect of the Jurisdictional

Agreement exceeded their authority. An arbitrator's award must be

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affirmed so long as the arbitrator is "even arguably construing or

applying the contract." United Paperworkers Int'l Union v. Misco,

Inc., 484 U.S. 29, 38 (1987). Based upon the evidence before the

arbitrators, the Jurisdictional Agreement needed specific

signatures to be executed and those signatures were not on the

document: neither of the two Locals executed it and there was no

evidence that the International President approved the agreement,

as the terms of the International's Constitution required.5 There

was no error in the arbitrator's finding that JCI did not proceed

on the basis of an executed and binding Jurisdictional Agreement.6

Since a court reviews the merits of the arbitral decision

based on the record before the arbitrator under a narrow standard

of review, JCI is not free now, under the guise of judicial review

of an arbitral award, to conduct discovery and obtain a de novo

determination of the meaning and validity of the Jurisdictional

5
JCI argues that when the Vice President of the International
signed the Jurisdictional Agreement he represented that he had the
authority to bind both Local 103 and Local 2222. JCI also argues
that a precondition to its entering into the Telecommunications
Labor Agreement with Local 103 was the execution of the
Jurisdictional Agreement.
6
JCI's claim that the Committee overstepped its authority by
reviewing its CBA with Local 2222 also fails. The Committee did
not interpret such a CBA. It merely observed that the
Jurisdictional Agreement (which JCI submitted) required a current
CBA between JCI and Local 2222 to be effective, and noted that JCI
had presented no evidence of such an agreement. Furthermore, the
Committee's finding that JCI lacked a current CBA with Local 2222
was one of three alternative bases, each independently sufficient,
for the Committee's holding that the Jurisdictional Agreement did
not protect JCI against liability.

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Agreement.7 It long ago waived any such claim through its actions.

The district court was quite correct not to permit this effort by

JCI to evade the normal rules of review.8

B. Whether the arbitrators demonstrated evident partiality

Under the FAA, an arbitral award may be vacated on

grounds of "evident partiality" of the arbitrators. 9 U.S.C. §

10(a)(2). Evident partiality is more than just the appearance of

possible bias. Rather, evident partiality means a situation in

which "a reasonable person would have to conclude that an

arbitrator was partial to one party to an arbitration." Nationwide

Mut. Ins. Co. v. Home Ins. Co., 278 F.3d 621, 626 (6th Cir. 2002)

(internal quotations omitted); accord ANR Coal Co. v. Cogentrix of

N.C., Inc., 173 F.3d 493, 500-501 (4th Cir. 1999); Morelite Constr.

Corp. v. N.Y. City Dist. Council Carpenters Benefit Funds, 748 F.2d

79, 84 (2d Cir. 1984); see also Al Harbi v. Citibank, N.A., 85 F.3d

680, 683 (D.C. Cir. 1996) ("[T]he claimant must establish specific

facts that indicate improper motives on the part of an

7
JCI argues that the district court decided two issues of
material fact on summary judgment: (1) that JCI did not allege to
the Committee that Local 103 made misrepresentations around the
time of the signing of the Letter of Assent; and (2) that the CBA
between JCI and Local 2222 was executed after the Committee's
decision. The record of the Committee hearing shows that JCI did
not allege fraud by Local 103 to the Committee and that JCI
presented no evidence of a current, executed CBA to the Committee.
8
JCI also waived its mitigation of damages argument, which it
raised for the first time in its reply brief. N. Am. Specialty
Ins. Co. v. Lapalme, 258 F.3d 35, 45 (1st Cir. 2001).

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arbitrator."). See generally Montez v. Prudential Secs., Inc., 260

F.3d 980, 983 (8th Cir. 2001) (collecting cases on "evident

partiality" standard). The burden is on JCI to establish evident

partiality. See Andersons, Inc. v. Horton Farms, Inc., 166 F.3d

308, 328-29 (6th Cir. 1998); Al Harbi, 85 F.3d at 683; Consolidated

Coal Co. v. Local 1643, United Mine Workers, 48 F.3d 125, 129 (4th

Cir. 1995); Health Servs. Mgmt. Corp. v. Hughes, 975 F.2d 1253,

1258 n.3 (7th Cir. 1992); Sheet Metal Workers Int'l Ass'n, Local

162 v. Jason Mfg., Inc., 900 F.2d 1392, 1398 (9th Cir. 1990);

Middlesex Mut. Ins. Co. v. Levine, 675 F.2d 1197, 1201 (11th Cir.

1982) (per curiam). The purported bias here is that the three

arbitrators from the management side came from JCI's business

competitors.

Absent exceptional circumstances, a court "will not

entertain a claim of personal bias where it could have been raised

at the arbitration proceedings but was not." Fort Hill Builders,

Inc. v. Nat'l Grange Mut. Ins. Co., 866 F.2d 11, 13 (1st Cir. 1989)

(per curiam); see Early v. E. Transfer, 699 F.2d 552, 558 (1st Cir.

1983). It is undisputed that the issue of bias was not raised

before the arbitrators. JCI attempts to excuse this by saying it

did not know the company affiliations of these industry arbitrators

until after the hearing.

JCI did know that the three employer representatives on

the Committee would come from Boston Chapter companies, that is,

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from its industry and related industries, and so potentially from

its competitors. The Telecommunications Labor Agreement quite

reasonably called specifically for arbitrators from relevant

industries, whose expertise would be a considerable benefit. See

Merit Ins. Co. v. Leatherby Ins. Co., 714 F.2d 673, 679 (7th Cir.

1983); In re Andros Compania Maritima, SA, 579 F.2d 691, 701 (2d

Cir. 1978). That the arbitrators came from the same industry does

not in itself approach evident partiality. See Delta Mine Holding

Co. v. AFC Coal Props., Inc., 280 F.3d 815, 821 (8th Cir. 2001)

(partisan arbitrators are generally permissible if that is what the

parties' arbitration clause contemplated); accord ATSA of Cal.,

Inc. v. Cont'l Ins. Co., 754 F.2d 1394, 1395 (9th Cir. 1985)

(order); Nationwide Mut. Ins. Co. v First State Ins. Co., 213 F.

Supp. 2d 10, 17 (D. Mass. 2002). This claim is a far cry from

Commonwealth Coatings Corp. v. Continental Casualty Co., 393 U.S.

145 (1968), where at the time of the arbitration hearing the party

that subsequently challenged the award lacked even an "intimation"

of the source of the alleged bias. Id. at 147-48; see Sheet Metal

Workers Int'l Ass'n Local 420 v. Kinney Air Conditioning Co., 756

F.2d 742, 746 (9th Cir. 1985) (Kennedy, J.) ("cases in which courts

have faulted arbitrators for their failure to disclose potential

sources of bias are inapposite" where the CBA contemplated that

management representatives on an arbitral panel might be a party's

competitors) (citation omitted). The mere fact that the panel

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included business rivals of one party does not rise to the level of

evident partiality. Id.

In practice, that risk of bias could nonetheless

materialize in specific instances. But JCI, which was put on

notice of the risk when it signed the contract, chose not to

inquire about the backgrounds of the Committee members either

before or during the hearing. JCI needed to act before the

Committee rendered its decision. It would undermine the arbitral

process to permit an employer with an industry-represented panel to

await the outcome of an arbitration before deciding to cry bias.

See Early, 699 F.2d at 558 ("[W]e cannot accept that parties have

a right to keep two strings to their bow -- to seek victory before

the tribunal and then, having lost, seek to overturn it for bias

never before claimed."). JCI has waived the claim.9

We affirm entry of summary judgment for Local 103

enforcing the arbitral award. Costs are awarded to Local 103.

9
Having failed to raise the issue of bias with the
arbitrators, JCI was not entitled to any discovery on this point
from the court. See Woods v. Saturn Distrib. Corp., 78 F.3d 424,
430-31 (9th Cir. 1996).

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