United States Court of Appeals
For the First Circuit
No. 00-2177
THE PROVIDENCE JOURNAL COMPANY,
Plaintiff, Appellant,
v.
PROVIDENCE NEWSPAPER GUILD,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
[Hon. Ernest C. Torres, U.S. District Judge]
[Hon. Robert W. Lovegreen, U.S. Magistrate Judge]
Before
Torruella, Circuit Judge,
Lipez, Circuit Judge,
and Zobel,* District Judge.
Richard A. Perras, with whom Lincoln D. Almond, Edwards & Angell,
LLP, was on brief, for appellant.
John F. McMahon, with whom E. David Wanger, Angoff, Goldman,
Manning, Wanger & Hynes, P.C. and Richard S. Humphrey, was on brief,
for appellee.
* Of the District of Massachusetts, sitting by designation.
November 9, 2001
-2-
TORRUELLA, Circuit Judge. Plaintiff-Appellant Providence
Journal Company (the "Journal") and Defendant-Appellee Providence
Newspaper Guild (the "Guild") were parties to a collective bargaining
agreement. After a dispute arose over the interpretation of a clause
in the agreement, the Guild filed a grievance. The parties submitted
the matter to arbitration, and the arbitrator ruled in favor of the
Guild. The Journal then filed this action in district court seeking to
vacate the arbitrator's decision. Rejecting the Journal's claims, the
district court granted summary judgment for the Guild. The Journal now
appeals the district court's decision. Because we conclude that the
arbitrator's interpretation of the collective bargaining agreement is
plausible, we affirm the district court's decision to grant summary
judgment for the Guild.
BACKGROUND
The Journal and the Guild were parties to a collective
bargaining agreement (the "agreement") that, by its terms, expired on
December 31, 1999, but was later extended through January 31, 2000.
Article XIX, Section 3 of the agreement provides different
classifications of employees with different parking benefits as
follows:
(e) The Publisher shall provide employee parking in the
Company's Fountain Street parking lot on the same basis as
parking at that lot is offered to other employees of the
Company.
-3-
(f) The Company shall provide free parking to employees who
are regularly required to maintain an automobile for use in
the performance of their duties.
(g) Employees who work fewer than five (5) days per week
shall be eligible to purchase per diem parking passes from
the Parkade Parking Garage at not more than four dollars
($4.00) per day. This provision shall remain in effect for
the term of this agreement or until the Company divests
ownership of the aforementioned garage, whichever occurs
sooner.
Prior to February 1998, part-time employees were able to use
their per diem parking passes without difficulty. Beginning in
February 1998, however, per diem pass-holders were consistently denied
access to the Parkade Parking Garage and were forced to park elsewhere
at a per diem cost between $6.00 and $10.00. Nevertheless, members of
the general public who purchased parking passes at a rate of $120 per
month were still granted access to the Parkade Parking Garage.
On March 11, 1998, the Guild filed a grievance with the
Journal. Invoking Article XIX, Section 3(g) of the agreement, the
Guild requested that the Journal provide parking for all per diem pass-
holders and reimburse them for the costs incurred while being forced to
park elsewhere.
On November 3, 1999, the parties submitted the matter to
arbitration. At the arbitration hearing, the parties informally agreed
to bifurcate the issues of liability and damages. On December 27,
1999, the arbitrator found that the Journal had violated the agreement
by not providing parking to all per diem pass-holders. The arbitrator
-4-
ordered the parties to work together to fashion a remedy that would
provide parking to the pass-holders and would reimburse them for the
costs of parking elsewhere. The arbitrator also retained jurisdiction
over the case if the parties could not agree on a remedy.
After a failed meeting to craft a remedy, the Journal filed
this action under 9 U.S.C. § 10 of the Federal Arbitration Act ("FAA").1
The Journal sought to have the arbitration award vacated and to deny
the Guild's grievance. The parties then filed cross motions for
summary judgment. On July 25, 2000, Magistrate Judge Lovegreen issued
a Report and Recommendation, which was subsequently adopted by the
district court, granting summary judgment in favor of the Guild.
DISCUSSION
A.
Before analyzing the merits of the Journal's appeal, we find
it necessary to address a jurisdictional issue that has received little
attention thus far. Though neither party raises the issue,2 there is
a question as to whether the district court had jurisdiction to review
the arbitrator's decision. Because we believe that the holding in Hart
1 As the district court noted, jurisdiction actually exists under §
301 of the Labor Management Relations Act, 29 U.S.C. § 185.
2 Furthermore, when the parties, at our request, addressed the
jurisdiction issue in supplemental briefing, they both agreed that the
district court's exercise of jurisdiction was proper.
-5-
Surgical, Inc. v. Ultracision, Inc., 244 F.3d 231 (1st Cir. 2001),3
extends to the facts of this case, we conclude that the district court
properly exercised its jurisdiction.
In Hart, this Court held that in an arbitration case that is
bifurcated into liability and damages phases, the arbitral award with
respect to liability is a final award under the Federal Arbitration Act
("FAA"), 9 U.S.C. § 1 et seq., and is therefore subject to review by
courts. 244 F.3d at 235. Our holding, however, was limited to cases
in which the parties, at the arbitration stage, had formally agreed to
bifurcate arbitration into liability and damages phases. Id. Thus,
the instant case presents us with the question that we expressly
declined to decide in Hart - whether a partial arbitration award on
liability is reviewable in the absence of formal bifurcation.
To determine whether the arbitration award in Hart was
"final," and thus subject to judicial review, this Court examined two
factors: (1) whether, and to what extent, both parties had expressed an
intent to bifurcate, and (2) whether the arbitrator and the parties
understood the determination of liability to be a final award. Id.
3 Although Hart involved a commercial arbitration award subject to the
FAA and the present case involves a labor arbitration award enforceable
under the Labor Management Relations Act ("LMRA"), federal courts rely
on FAA cases to inform their LMRA analysis. United Paperworkers Int'l
Union v. Misco, Inc., 484 U.S. 29, 40 n.9 (1987) (noting that federal
courts look to the FAA for guidance in interpreting the LMRA); Derwin
v. General Dynamics Corp., 719 F.2d 484, 487-88 (1st Cir. 1983) (same).
-6-
Applying this framework to the instant case, it is clear that
the partial award on liability should be deemed "final." On November
3, 1999, the parties agreed to divide the arbitration hearing into two
parts: the first phase required the arbitrator to determine whether the
collective bargaining agreement had been violated; and the second phase
required him to fashion a remedy. The arbitrator acknowledged this
stipulation of the parties by noting, "If I find a violation of the
contract, I should retain jurisdiction for purposes of facilitating
compliance with a remedy." (Appellant's Supplemental Brief app. 5).
All evidence related to the issue of liability was then presented to
the arbitrator, and shortly thereafter he issued his decision on
liability. In doing so, the arbitrator, in turn, "conclusively decided
every point required by and included in" the liability phase. Trade &
Transp., Inc. v. Natural Petroleum Charterers Inc., 931 F.2d 191, 195
(2d Cir. 1991); McGregor Van De Moere, Inc. v. Paychex, Inc., 927 F.
Supp. 616, 618 (W.D.N.Y. 1996) (concluding that the parties’ decision
to bifurcate the issue of liability from damages reflects their
agreement that the award on liability will be final).
It is evident from the November arbitration hearing that the
parties intended, though never formally stated, to bifurcate the
proceedings. They divided the arbitration into separate phases and
requested that the arbitrator retain jurisdiction over the remedy
issue. In fact, had the parties not been stipulating to bifurcation,
-7-
there would have been no need for the parties to specifically request
that the arbitrator retain jurisdiction over the remedial phase.
Clearly, then, both the parties and the arbitrator agreed to bifurcate
the arbitral proceeding and understood the determination of liability
to be a final award.
Although our holding in Hart was limited to formal agreements
to bifurcate, see 244 F.3d at 235, we see no reason to fashion a
different rule when the bifurcation has been informally agreed upon.
For that reason, we deem the arbitrator's partial award on liability
"final," and conclude that the district court properly exercised its
jurisdiction over the case.
B.
Turning to the merits, the Journal argues that the
arbitrator's award should be vacated because it fails to draw its
essence from the contract. In particular, the Journal faults the
arbitrator for implying terms into the agreement that were not
negotiated by the parties and for improperly relying on the parties'
past practice.
In assessing the Journal's claims, we note that judicial
review of an arbitration decision is extremely narrow and
extraordinarily deferential. See Maine Cent. R.R. Co. v. Bhd. of
Maintenance of Way Employees, 873 F.2d 425, 428 (1st Cir. 1989) (noting
that judicial review of arbitration decisions "is among the narrowest
-8-
known in the law"). A court cannot vacate an arbitral award as long as
the arbitrator is even arguably construing the contract and acting
within the scope of his authority. United Paperworkers Int'l Union v.
Misco, Inc., 484 U.S. 29, 38 (1987). In the end, the court's task "is
limited to determining if the arbitrator's interpretation of the
contract is in any way plausible." Labor Relations Div. of Constr.
Indus. v. Int'l Bhd. Teamsters, Local No. 379, 29 F.3d 742, 745 (1st
Cir. 1994).
The Journal claims that the arbitrator failed to base his
decision on the plain language of the contract. More specifically, the
Journal notes that the express language of Article XIX, Section 3(g)
provides only that covered part-time employees "are eligible to
purchase per diem parking passes." Thus, the agreement does not
guarantee employees the right to park, but only the right to purchase
discount parking passes. The Journal, then, faults the arbitrator for
implying a term into the agreement that was not negotiated by the
parties.
To bolster its argument, the Journal points to the plain
language of the two paragraphs that precede Section 3(g). In
particular, Sections 3(e) and (f) require that the Journal provide
"parking" to certain employees. Appellant argues that had the Guild
sought this more generous level of parking benefit for the part-time
-9-
employees, it could have done so through negotiation of the same
parking language into Section 3(g).
We are unpersuaded by the Journal's argument, however,
because we find the arbitrator's decision to be a plausible, common
sense interpretation of the agreement’s plain language. As noted,
Section 3(g) provides employees with the right to purchase discount
parking passes. However, the agreement is silent on what benefits
accrue to the holder of a parking pass. Plain language would seem to
dictate that a parking pass entitles one to actually park. Otherwise,
the right to purchase a discounted parking pass would be completely
meaningless. It makes little sense that the parties bargained for
parking passes that did not provide parking. Since it is a basic
principle of contract law that constructions which render contract
terms meaningless should be avoided, see, e.g., Systemized of New
England, Inc. v. SCM, Inc., 732 F.2d 1030, 1034 (1st Cir. 1984)
(applying the "familiar principle" that every part of a contract should
be given "meaning and effect"), we find the arbitrator's interpretation
consistent with the plain language of the agreement.
The arbitrator's conclusion is further supported by the
parties' past practice. For four years prior to February 1998,
employees purchased discount parking passes and were able to park
regularly at the Parkade Garage. The arbitrator relied on this past
practice as corroborating evidence for his interpretation of the terms
-10-
in Section 3(g). Because this Court allows arbitrators to use past
practice as an interpretive device or as relevant evidence, we find no
error here. See United Steelworkers of Am. v. Warrior & Gulf
Navigation Co., 363 U.S. 574, 581-82 (1960) ("The labor arbitrator's
source of law is not confined to the express provisions of the
contract, as the industrial custom - the practices of the industry and
the shop - is equally a part of the collective bargaining agreement
although not expressed in it."); Strathmore Paper Co. v. United
Paperworkers Int'l Union, Local 197, 900 F.2d 423, 427-28 (1st Cir.
1990) (noting that an arbitrator may factor past practice into his
decision when the contract does not expressly prohibit it).
The Journal argues, however, that the arbitrator improperly
relied on its past practice of honoring the parking passes. More
specifically, the Journal claims that the arbitrator erroneously
elevated the parties' past practice to a term of the contract. The
Journal offers no support for its bald assertion that the arbitrator
substituted past practice for contractual terms. Instead, the record
shows that the arbitrator interpreted the plain language of Section
3(g) to include the right to park and, only then, used past practice to
reinforce his conclusion. We find no error in this sound mode of
analysis.
CONCLUSION
-11-
Because we find the arbitrator's decision to be a plausible,
if not reasonable, interpretation of the collective bargaining
agreement, we affirm the district court's decision granting summary
judgment for the Guild.
Affirmed.
-12-