Justia U.S. 2nd Circuit Court of Appeals Opinion Summaries

The Union represented the workers at the Old Brookville campus. In 2016, LIU contracted out that work to A&A, which became the employer of those workers and assumed an existing collective bargaining agreement, set to expire in August 2017. A&A and the Union entered into a successor CBA, which requires Union membership after 30 days but allows A&A to hire “substitute employees” “to fill in for employees who are out on disability or worker’s compensation or approved extended leaves.” The Union rejected a provision that would have permitted A&A to use non-union “temporary employees” at will for up to 90 days. The agreement has an arbitration provision.Union members noticed new, non-union employees in late 2017. A&A indicated that they were "substitute employees." The Union determined that the number of claimed substitutes exceeded the number of members out on disability, worker’s compensation, and other approved leaves of absence and sent a written grievance. The Union framed the arbitration issue: whether A&A violated the CBA by utilizing temporary employees ... to perform bargaining unit work. A&A argued that the Arbitrator was confined to the issue proposed by the Union in its original grievance, which mentioned only “substitute employees.”The arbitrator held that A&A had violated the CBA and issued an award of $1,702,263.81. The Second Circuit affirmed. The arbitrator did not exceed his authority. While worded differently, the issue that the arbitrator ruled on was substantially identical to the issue in the grievance letter. A party that has previously agreed to arbitrate cannot frustrate the process by refusing to agree on the form of the issue. The arbitrator’s interpretation of the collective bargaining agreement was more than colorable. View "A&A Maintenance Enterprise, Inc. v. Ramnarain" on Justia Law

Dylan filed suit in district court seeking a declaration of its rights and obligations under the terms of a collective bargaining agreement (CBA). The district court converted defendants' motion to dismiss into a motion to compel arbitration and granted the motion, dismissing Dylan's complaint without prejudice.The Second Circuit affirmed the district court's dismissal; clarified that the district court had federal question jurisdiction to decide whether Dylan was entitled to the declaratory relief requested; and held that, because the Funds have adequately initiated arbitration, regardless of timing, Dylan is required to arbitrate by the terms of the CBA. The court also agreed with the district court's analysis that it was proper in this case to compel arbitration and dismiss Dylan's complaint without prejudice. The court considered Dylan's remaining arguments and found them to be without merit. View "Dylan 140 LLC v. Figueroa" on Justia Law

ABM appealed the district court's denial of its motion to confirm an arbitration award and granting in part the union's motion to vacate the award, under Section 301 of the Labor Management Relations Act (LMRA). In this case, the arbitrator issued an opinion and award, concluding that two employees were not entitled to termination pay and directing them to repay certain amounts to ABM. The district court denied the motion to confirm the arbitrator's award, concluding that the award was ultra vires and unenforceable.The Second Circuit held that the arbitrator did not exceed her authority because, under both agency law principles and federal labor law, the union possessed the authority to bind the employees to the arbitration award. The court stated that the district court plainly erred by reasoning that no precedent or authority supported the proposition that a union can bind its members to make payments ordered by an arbitrator under an arbitration agreement to which they were not signatories, following a process in which they did not participate. Rather, the court held that the record is clear that the employees did participate in the arbitration proceeding and the union possessed both agency and statutory authority to appear in the arbitration on their behalf. View "ABM Industry Groups, LLC v. International Union of Operating Engineers" on Justia Law

The Second Circuit affirmed the district court's denial of a petition for discovery pursuant to 28 U.S.C. 1782(a), seeking discovery from four investment banks related to their work as underwriters in the Tencent Music IPO. Petitioner alleged that he intended to use the documents in his pending CIETAC arbitration against the Ocean Entities and its founder.28 U.S.C. 1782(a) authorizes federal courts to compel the production of materials "for use in a proceeding in a foreign or international tribunal" upon "the application of any interested person." In In National Broadcasting Co. v. Bear Stearns & Co., 165 F.3d 184 (2d Cir. 1999) ("NBC"), the court held that the phrase "foreign or international tribunal" does not encompass "arbitral bod[ies] established by private parties."The court held that nothing in the Supreme Court's decision in Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241 (2004), alters its prior conclusion in NBC that section 1782(a) does not extend to private international commercial arbitrations. Furthermore, the arbitration at issue here is a non-covered, private, international commercial arbitration. View "In re: Application and Petition of Hanwei Guo" on Justia Law

Violation of a bankruptcy court discharge order is not an arbitrable dispute. The Second Circuit affirmed the district court's order denying appellants' motions to compel arbitration of a dispute with two debtors who previously held credit card accounts managed by appellants. Appellants argued that debtors were obliged to arbitrate the dispute concerning whether appellants violated the bankruptcy court's discharge orders when they failed to correct the status of debtors' credit card debt on their credit reports.Though the text and history of the Bankruptcy Code are ambiguous as to whether Congress intended to displace the Federal Arbitration Act in this context, the court held that circuit precedent is clear that the two statutes are in inherent conflict on this issue. In Anderson v. Credit One Bank, N.A., 884 F.3d 382 (2d Cir.), cert. denied, 139 S. Ct. 144 (2018), the court refused to enforce the parties' arbitration agreement, finding that Congress did not intend for disputes over the violation of a discharge order to be arbitrable. View "Belton v. GE Capital Retail Bank" on Justia Law

Washington National petitioned the district court under section 7 of the Federal Arbitration Act to enforce two arbitration summonses requiring two non-parties to the arbitration, respondents, to testify at a hearing and to produce certain documents.The Second Circuit held that the district court had subject matter jurisdiction based on the diversity of citizenship of the parties to the petition. The court also held that the district court was not required to consider respondents' challenges to the petition in the first instance. Accordingly, the court affirmed the district court's denial of both motions on the merits. View "Washington National Insurance Co. v. OBEX Group LLC" on Justia Law

Jasmin appealed the district court's grant of Trina's petition to confirm an arbitration award entered in its favor and denial of Jasmin and JRC's motion to vacate the award. The district court relied on an agency and direct benefits theory of estoppel to find that Jasmin was bound by the arbitration clause.The Second Circuit reversed the district court's judgment as to Jasmin, holding that the district court erred when it determined that Jasmin was bound as a principal to the contract under agency theory. The court was not persuaded that JRC acted as Jasmin's agent in executing the contract or that, in the alternative, Jasmin was bound to the arbitration clause under a direct benefits theory of estoppel. In this case, the commercial contract containing the arbitration clause was governed by New York law and signed by Trina and JRC, not Jasmin. The court explained that Jasmin was not a party to the contract and thus could not enforce any rights or duties under the contract. The court remanded with instructions to enter an amended judgment dismissing the case as to Jasmin. View "Trina Solar US, Inc. v. Jasmin Solar Pty Ltd." on Justia Law

Metz appealed the district court's judgment vacating an arbitration award that held that interest rate assumptions for purposes of withdrawal from a multiemployer pension plan liability are those in effect on the last day of the year preceding the employer's withdrawal. The district court held, however, that section 4213 of the Employee Retirement Income Security Act (ERISA) does not require actuaries to calculate withdrawal liability based on interest rate assumptions used prior to an employer's withdrawal from a plan, and that interest rate assumptions must be affirmatively reached and may not roll over automatically from the preceding plan year.The Second Circuit vacated the district court's judgment, holding that interest rate assumptions for withdrawal liability purposes must be determined as of the last day of the year preceding the employer's withdrawal from a multiemployer pension plan. Furthermore, absent any change to the previous plan year's assumption made by the Measurement Date, the interest rate assumption in place from the previous plan year will roll over automatically. Accordingly, the court remanded with directions to enter judgment for Metz and to remand any remaining issues to the arbitrator. View "The National Retirement Fund v. Metz Culinary Management, Inc." on Justia Law

The Second Circuit affirmed the district court's judgment compelling arbitration of grievances raised by airlines in a dispute with the collective bargaining representatives of their pilots.The court held that the district court properly granted the employers' motion for summary judgment and to compel arbitration. The court held that the management grievances did not involve a major dispute; rejected the Union's argument that the case raised issues of representation that would fall within the exclusive jurisdiction of the National Mediation Board; and held that the district court did not err in exercising jurisdiction over the dispute. The court also held that Atlas's motion to compel arbitration of its management grievance was timely.Finally, the court rejected the Union's three arguments with respect to the arbitrability of the employers' management grievances. In this case, Southern was entitled to file a management grievance with the Southern Board regarding the interpretation of Section 1.B.3 of the collective bargaining agreement (CBA); the district court correctly determined that it lacked authority to decide whether the merger provisions of the Atlas CBA were prompted by the announced operational merger of Atlas and Southern; and nothing in the process of interpreting the provisions of the two collective bargaining agreements purports to bind Atlas or Southern pilots to the terms of another existing CBA. View "Atlas Air, Inc. v. International Brotherhood of Teamsters" on Justia Law

Plaintiffs, a group of current and former retail sales employees of Sterling Jewelers, filed suit alleging that they were paid less than their male counterparts, on account of their gender, in violation of Title VII of the Civil Rights Act of 1964 and the Equal Pay Act. After an arbitrator certified a class of Sterling Jewelers employees that included employees who did not affirmatively opt in to the arbitration proceeding, the district court held that the arbitrator exceeded her authority in purporting to bind those absent class members to class arbitration.The Second Circuit reversed, holding that the arbitrator was within her authority in purporting to bind the absent class members to class proceedings because, by signing the operative arbitration agreement, the absent class members, no less than the parties, bargained for the arbitrator's construction of their agreement with respect to class arbitrability. The court remanded to the district court to consider, in the first instance, the issue of whether the arbitrator exceeded her authority in certifying an opt-out class. View "Jock v. Sterling Jewelers Inc." on Justia Law