United States Court of Appeals
For the First Circuit
No. 07-1024
HORVING RAMOS-SANTIAGO,
Plaintiff, Appellant,
v.
UNITED PARCEL SERVICE,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. Camille L. Vélez-Rivé, U.S. Magistrate Judge]
Before
Torruella and Howard, Circuit Judges,
and Smith,* District Judge.
Manuel A. Rodríguez-Banchs, on brief for appellant.
Juan J. Casillas-Ayala, with whom Diana M. Espinosa-Núñez and
Fiddler González & Rodríguez, PSC, on brief for appellee.
April 24, 2008
*
Of the District of Rhode Island, sitting by designation.
TORRUELLA, Circuit Judge. Horving Ramos-Santiago
("Ramos") was a driver with the United Parcel Service ("UPS") when
he failed to deliver thirty-seven packages over the span of two
business days in 2003. For this incident, UPS terminated his
employment and Ramos, through his union representative, filed a
grievance challenging the termination. Pursuant to the controlling
collective-bargaining agreement ("CBA"), Ramos's grievance was
submitted to arbitration. The arbitrator found that under Article
11, § 3 of the CBA, UPS was justified in terminating him. Ramos
now seeks judicial review. Applying the high degree of deference
generally accorded arbitral decisions, we affirm the district
court's grant of summary judgment enforcing the arbitration award.
I. Background
As this is an appeal from a grant of summary judgment, we
recite the facts in the light most favorable to the non-movant,
Ramos, drawing all reasonable inferences in his favor. Franceschi
v. U.S. Dep't of Veterans Affairs, 514 F.3d 81, 84 (1st Cir. 2008).
Petitioner Ramos had been a UPS employee for the past twelve years,
most recently as a driver. He is a member of the International
Brotherhood of Teamsters ("Union"), which, along with UPS, is party
to a CBA; the CBA outlines the procedure to be followed in carrying
out disciplinary actions against union members. On Friday,
January 24, and Monday, January 27, 2003, Ramos failed to deliver
thirty-seven packages to Centro Médico, a medical institution in
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Río Piedras, Puerto Rico.1 As a result, UPS terminated Ramos's
employment pursuant to Article 11, § 3 of the CBA.2 The Union then
filed a grievance challenging Ramos's discharge, arguing that UPS
had failed to follow the disciplinary procedure mandated by the
CBA, which requires the application of progressive discipline
before a final dismissal. The grievance was submitted to
arbitration.
The arbitrator assigned to adjudicate Ramos's grievance
held hearings at the Puerto Rico Department of Labor on
September 29, 2003, and August 13, 2004. At these hearings, Ramos
stated that he had engaged in an "error of judgment" when he "made
the decision" not to deliver the packages to Centro Médico. After
reviewing the evidence, the arbitrator held in favor of UPS,
finding that the failure to deliver the packages was "not about
mere negligence nor failure of procedures," but was instead a
"deliberate action." As such, Ramos had violated Article 11, § 3
of the CBA and UPS had properly terminated his employment.
Thereafter, Ramos filed a complaint in Puerto Rico state
court challenging the arbitrator's decision. UPS promptly removed
1
Ramos failed to deliver fifteen packages on Friday, and those
same fifteen packages plus seven additional ones on Monday.
2
Article 11, § 3 reads: "The Company can suspend or discharge any
delegate or employee who declares an unauthorized strike, work
stoppage, slowdown, walk out or who takes any other action that
paralyzes, obstructs, or interrupts the operations of the Company
without resorting to the grievance procedure."
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the case to the District Court for the District of Puerto Rico
based on jurisdiction granted by § 301 of the Labor Management
Relations Act. 29 U.S.C. § 185(a) (2000). On August 7, 2006, UPS
filed a motion for summary judgment, which Ramos opposed. The
district court granted the motion on October 2, 2006, finding that
the arbitral award was a plausible interpretation of the CBA.
Subsequently, the district court granted UPS's request for costs on
November 2, 2006. Ramos now appeals the district court's decision,
as well as its award of costs.
II. Discussion
A. Arbitration Award
1. Standard of Review
We review a district court's decision to vacate or
confirm an arbitration award de novo. Cytic Corp. v. DEKA Prods.
Ltd. P'ship, 439 F.3d 27, 32 (1st Cir. 2006). A federal court's
review of an arbitrator's decision, however, is "'extremely narrow
and exceedingly deferential.'" Airline Pilots Ass'n, Int'l v. Pan
Am. Airways Corp., 405 F.3d 25, 30 (1st Cir. 2005) (quoting Bull HN
Info. Sys., Inc. v. Hutson, 229 F.3d 321, 330 (1st Cir. 2000));
First State Ins. Co. v. Banco de Seguros del Estado, 254 F.3d 354,
357 (1st Cir. 2001) (quoting Wheelabrator Envirotech Operating
Servs. Inc. v. Mass. Laborers Dist. Council Local 1144, 88 F.3d 40,
43 (1st Cir. 1996)). Indeed, it is "among the narrowest known in
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the law." Maine Cent. R.R. Co. v. Bhd. of Maint. of Way Employees,
873 F.2d 425, 428 (1st Cir. 1989).
When parties include an arbitration clause in their
collective-bargaining agreement, they are choosing to forego a
number of legal options in favor of having their disputes regarding
the construction of that contract settled by an arbitrator. As
this was the bargain the parties struck, they are bound by the
arbitrator's decision. See Keebler Co. v. Truck Drivers, Local
170, 247 F.3d 8, 10 (1st Cir. 2001). In the spirit of freedom of
contract then, we cannot review the merits of the underlying
dispute and are obligated to enforce the arbitral award unless the
decision fails to "draw[] its essence from the collective
bargaining agreement." See United Steelworkers of Am. v. Enter.
Wheel & Car Corp., 363 U.S. 593, 597 (1960); accord Kraft Foods,
Inc. v. Office & Prof. Employees Int'l Union, Local 1295, 203 F.3d
98, 100 (1st Cir. 2000). Though we may be convinced that the
arbitrator committed a serious error, if she is "even arguably
construing or applying the contract and acting within the scope of
his authority," we may not overturn the arbitrator's decision.
United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 38
(1987).
2. Review of the Arbitration Award
This Court has recognized a very limited exception under
which we may vacate an arbitration award when there is evidence
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that the arbitrator acted in "manifest disregard of the law."
Wonderland Greyhound Park, Inc. v. Autotote Sys., Inc., 274 F.3d
34, 35 (1st Cir. 2001). To establish such an exception, the
challenger must show that the arbitration award complained of is:
(1) unfounded in reason and fact; (2) based on reasoning so
palpably faulty that no judge, or group of judges, could ever
conceivably have made such a ruling; or (3) mistakenly based on a
crucial assumption that is concededly a non-fact. McCarthy v.
Citigroup Global Mkts., Inc., 463 F.3d 87, 91 (1st Cir. 2006). To
succeed, there must be "some showing in the record, other than the
result obtained, that the arbitrator[] knew the law and expressly
disregarded it." Advest, Inc. v. McCarthy, 914 F.2d 6, 9 (1st Cir.
1990) (quoting O.R. Secs., Inc. v. Prof'l Planning Assoc., Inc.,
857 F.2d 742, 747 (11th Cir. 1988)).3
Ramos argues that this is the type of extraordinary case
that warrants our vacating the arbitral decision because the
arbitrator who issued it acted in manifest disregard of the law by
knowingly applying the wrong provision of the CBA. Ramos's
3
We acknowledge the Supreme Court's recent holding in Hall Street
Assocs., L.L.C. v. Mattel, Inc., No. 06-989, 2008 WL 762537, at *4-
5 (March 25, 2008), that manifest disregard of the law is not a
valid ground for vacating or modifying an arbitral award in cases
brought under the Federal Arbitration Act ("FAA"). Because the
case at hand is not an FAA case -- neither party has invoked the
FAA's expedited review provisions, and the original complaint was
filed in Puerto Rico state court under a mechanism provided by
state law -- we decline to reach the question of whether Hall
Street precludes a manifest disregard inquiry in this setting.
Whether or not Hall Street applies, Ramos's claim fails.
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argument is unavailing. UPS terminated Ramos's employment under
Article 11, § 3 of the CBA, which by its text allows for the
summary discharge or suspension of an employee who declares "an
authorized strike, work stoppage, slowdown, walkout or . . . other
action that paralyzes, obstructs or interrupts the operations of
the Company." The arbitrator properly found that Ramos's dismissal
was justified under this provision.
Ramos argues that his actions cannot be characterized as
a strike, work stoppage, slowdown or walkout for the sole reason
that he did not engage in any concerted activity with other
employees. While Ramos is correct that the existence of a strike
requires concerted action, see 29 U.S.C. § 142 (2000), this Court
has stated that concerted action may be carried out by a single
employee under certain circumstances. Five Star Transp. v. NLRB,
No. 07-1316, 2008 WL 839758, at *4 (1st Cir. Mar. 31, 2008)
(holding that the critical inquiry in determining whether action by
a single employee constitutes concerted activity is whether such
action is in furtherance of a group concern). More to the point,
the very text of Article 11, § 3 contemplates actions carried out
by "any employee or delegate," and does not institute a group
action requirement. Thus, though concerted action does not by
itself constitute a strike, the fact that Ramos acted alone does
not render the application of Article 11, § 3 improper.
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Furthermore, the fact that Ramos delivered packages other
than those scheduled for delivery at Centro Médico on the Friday
and Monday in question does not make his discharge under Article
11, § 3 unwarranted. Ramos's decision to not deliver the thirty-
seven packages on the assigned days clearly obstructed and/or
interrupted UPS's operations in contravention of Article 11, § 3.
As developed in arbitration, UPS's regular mode of operation is
that packages be delivered to the recipient on the day they are
sent out from the UPS processing center for delivery. Even if it
is understood that some low number of packages might miss their
delivery date due to extenuating circumstances, that that number
should be as high as thirty-seven is clearly a departure from the
norm.
Based on Ramos's admission during arbitration, the
arbitrator found that this departure from UPS's normal operations
was caused by Ramos's conscious decision to not deliver the thirty-
seven packages to Centro Médico. As such, Ramos's action
obstructed and/or interrupted UPS's operations and the arbitrator's
decision is a plausible construction of Article 11, § 3. It is
also clear that the arbitrator's decision draws its essence from
the CBA. Because the arbitrator did not act in manifest disregard
of the law, and her opinion is supported in reason and fact and is
not based on faulty reasoning or a crucial assumption that is
concededly a non-fact, the arbitral award is allowed to stand.
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B. Bill of Costs
1. Standard of Review
We ordinarily review a district court's award of costs
for abuse of discretion. In re San Juan Dupont Plaza Hotel Fire
Lit., 111 F.3d 220, 228 (1st Cir. 1997); see also García-Goyco v.
Law Envtl. Consultants, Inc., 428 F.3d 14, 18 (1st Cir. 2005). In
doing so, we remember that an award of costs is the type of
discretionary ruling to which appellate courts should give
"'virtually complete'" deference. Dupont Plaza Hotel Fire, 111
F.3d at 228 (quoting Estate of Borst v. O'Brien, 979 F.2d 511, 517
(7th Cir. 1992)).
2. Review of the Award of Costs
Ramos alleges that the district court erred in awarding
UPS litigation costs because it did so before the ten-day period to
file an objection to a bill of costs had run out. See D.P.R. R.
54(b). Specifically, UPS filed its brief in support of its bill of
costs on October 24, 2006, and the district court granted its award
of costs within the ten-day period on November 2, 2006. Yet Ramos
never filed his objection to the bill of costs either before or
after it was awarded. As such, and according to the text of Puerto
Rico Local Rule 54(b), Ramos has waived his objection. Id.
("Unless within ten (10) days after the filing of a bill of costs
the opposing party files a written objection thereto, incorporating
a memorandum of law, the opposing party shall be deemed to have
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waived objection and the Clerk shall tax the costs which appear
properly claimed."
III. Conclusion
For the foregoing reasons, the district court's grant of
summary judgment enforcing the arbitration award is affirmed.
Affirmed.
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