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Peco Foods Inc. v. Retail, Wholesale, and Department Store Union, Midsouth Council

United States District Court, N.D. Alabama, Western Division

February 15, 2018

PECO FOODS, INC., Plaintiff,


          L. Scott Coogler United States District Judge.

         Before this Cour t is Defendant Retail Wholesale and Department Store Union Mid-South Council's(“RWDSU” or “the Union”) Motion for Attorney's Fees and Costs. (Doc. 26.) RWDSU is the prevailing party in this action brought under Section 301 of the Labor Management Relations Act of 1947, as amended 29 U.S.C. § 185 (the “Act”). Plaintiff Peco Foods, Inc. (“Peco”) filed a timely response in opposition. (Doc. 29.) The Union seeks fees and costs in the amount of $22, 430.50 (attorneys' fees in the amount of $21, 667.50 (96.30 hrs. x $225.00 per hour = $21, 667.50 paralegal fees of $763.00 (10.90 hrs. x $70 = $763.00)). (Doc. 27 at 4, Doc. 27-1 at 9 & 13.) For the reasons stated herein, the Union's motion is due to be GRANTED.

         I. Background

         This action arises out of the termination of Larry Richardson (“Richardson”), a Peco employee, and the subsequent arbitration proceeding. Richardson's supervisor held a safety meeting where employees were reminded that throwing ice was prohibited during work hours. (Doc. 17 at 2.) Richardson responded by saying “I don't throw ice, I throw lead.” (Id.) Recalling a recent workplace shooting at another business, the supervisor reported the statement to his superior. Peco's Complex Human Resources Director launched an investigation, which included questioning Richardson about the statement. Richardson could not provide an explanation for his conduct. The following day, with the approval of Peco's Corporate Human Resource Director, Richardson was terminated.

         Richardson was a member of RWDSU, which had a collective bargaining agreement (“CBA”) with Peco. The parties agreed to an arbitration regarding the matter, and an award was ultimately rendered in the Union's favor on July 15, 2016. Peco filed its Complaint in August of 2016 to vacate the award. (Doc. 1.) RWDSU counterclaimed, seeking enforcement. This court confirmed the arbitration award in its Memorandum of Opinion. (Doc. 24.) As explained therein, each argument Peco made in favor of vacatur required this Court to re-determine the arbitrator's factual findings and merits of the arbitrator's decision. (Doc. 24 at 12-13, 16-18.) The arbitration decree did not provide for attorney's fees, therefore the Union has motioned for them. As grounds for the requested fees and costs, the Union contends Peco brought this action without justification and contrary to settled law regarding the limited nature of judicial review of labor arbitration awards. The Court agrees.

         II. Standard of Review

         Although section 301 of the Act[1] does not provide for attorney's fee for its violation, “[a] district court has authority to award attorney's fees where it determines that a party has without justification refused to abide by the award of an arbitrator.” Int'l Union of Dist. 50, Mine Workers of Am. v. Bowman Transp., Inc., 421 F.2d 934, 935 (5th Cir. 1970)[2] (per curiam) (citations omitted); see also Int'l Ass. of Machinists and Aerospace Workers, District 776 v. Texas Steel Co., 538 F.2d 1116, 1122-23 (5th Cir. 1976). Here, though the arbitration decree did not provide for attorney's fees; this Court has the authority to award attorney's fees and costs using “its equity power if a party violates Section 301(a) of the [LMRA] in bad faith, vexatiously, wantonly or for oppressive reasons.” Varnes v. Local 91, Glass Bottle Blowers Assoc., 674 F.2d 1365, 1369 (11th Cir. 1982); 29 U.S.C.A. § 301(a). “In the context of challenges to awards under the FAA, [the Eleventh Circuit] ha[s] provided “notice” that ‘[it] is exasperated by those who attempt to salvage arbitration losses through litigation that has no sound basis in the law applicable to arbitration awards' and has warned litigants that ‘[it is] ready, willing, and able to consider imposing sanctions in appropriate cases.'” United Steel, Paper & Forestry, Rubber, Mfg., Energy, Allied Indus. & Serv. Workers Int'l Union v. Wise Alloys, LLC, 807 F.3d 1258, 1271 (11th Cir. 2015) (citing B.L. Harbert Int'l, LLC v. Hercules Steel Co., 441 F.3d 905, 913-14 (11th Cir. 2006), abrogated on other grounds by Frazier v. CitiFinancial Corp., LLC, 604 F.3d 1313, 1321 (11th Cir. 2010)). This Circuit has “declined to order sanctions when at least some plausible argument supported the challenge or the challenge raised an argument [] not addressed yet.” Id. at 1271 (citing Gonsalvez v. Celebrity Cruises, Inc., 750 F.3d 1195, 1198 (11th Cir. 2013) (per curiam); Hercules Steel, 441 F.3d at 914. Judicial review of a labor-arbitration decision pursuant to [a collective bargaining] agreement is very limited.” Major League Baseball Players Ass'n v. Garvey, 532 U.S. 504, 509 (2001); see also United Steel, 807 F.3d at 1271 (“[W]e review a labor arbitration award for ‘whether [it] is irrational, whether it fails to draw its essence from the collective bargaining agreement or whether it exceeds the scope of the arbitrator's authority.'” (quoting Osram Sylvania, Inc. v. Teamsters Local Union 528, 87 F.3d 1261, 1263 (11th Cir. 1996))).

         III. Discussion

         A. Jurisdiction

         While jurisdiction is not disputed by the parties, it is incumbent upon the Court to determine whether ruling on the pending motion is within its power. RWDSU timely made their Motion for Attorney's Fees within the 14 -day time period required by Federal Rule of Civil Procedure 54(d)(2)(B). A month after the Court granted summary judgment in favor of RWDSU (doc. 24), Peco filed its Notice of Appeal. (Doc. 30.) It is well-settled that “[t]he filing of a notice of appeal is an event of jurisdictional significance-it confers jurisdiction on the court of appeals and divests the district court of its control over those aspects of the case involved in the appeal.” Green Leaf Nursery v. E.I. DuPont De Nemours & Co., 341 F.3d 1292, 1309 (11th Cir. 2003) (citation omitted). However, a district court may retain jurisdiction for the purpose of “entertaining motions on matters collateral to those at issue on appeal.” Mahone v. Ray, 326 F.3d 1176 (11th Cir. 2003). This Circuit has held that a district court may consider a motion for attorneys' fees after a notice of appeal has been filed in the underlying case. See Rothenberg v. Sec. Mgmt. Co., Inc., 677 F.2d 64, 65 (11th Cir. 1982); see also Briggs v. Briggs, 260 Fed.Appx. 164, 165 (11th Cir. 2007) (per cuiam) (citing Rothenberg for same proposition). Accordingly, the Court determines it possesses jurisdiction over RWDSU's Motion for Attorney's Fees despite the fact that the underlying case is currently on appeal.

         B. Basis for a Grant of Attorney's Fees

         Given the “very limited” nature of judicial review of labor-arbitration decisions pursuant to CBAs, Peco must have had “at least some plausible argument support[ing] [its] challenge” in order to avoid a grant of attorney's fees in favor of the Union. Garvey, 532 U.S. at 509; United Steel, 807 F.3d at 1271. The Court finds that Peco did not.

         Because the scope of review for a labor arbitration award is so narrow, Peco's only chance for prevailing was for the Court to substitute its judgment for the arbitrator's and to engage in a review of the merits of the decision-something it cannot do. See Drummond Coal Co. v. UMWA, Dist. 20, 748 F.2d 1495, 1497 (11th Cir. 1984) (“[t]he courts are not to engage in a review of the merits of the arbitrator's decision.”). As this Court stated in its Memorandum of Opinion regarding Peco's challenge of jurisdiction, “it is clear that any review this Court would undertake would have to be on the merits of the arbitrator's construction.” (Doc. 24 at 12.)

         The Court ruled that it could not set aside the award based on Peco's challenge of the arbitrator's decision that Peco did not have just cause in firing the employee. (Doc. 24 at 12-13.) Granting such a request would require engaging in a review of the arbitration award's merits. As for Peco's back pay and vagueness challenges, granting vacatur on those grounds also would ...

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