Opinion
File No. 18-cv-1960 (ECT/LIB)
2020-04-10
INTERNATIONAL ASSOCIATION OF SHEET METAL, AIR, RAIL, AND TRANSPORTATION LOCAL UNION NO. 10, Plaintiff and Counterclaim Defendant, v. A-1 REFRIGERATION OF HIBBING, INC. d/b/a A-1 Refrigeration Heating and Air Conditioning, Inc., Defendant and Counterclaimant.
Justin D. Cummins, Cummins & Cummins PLLP, Minneapolis, MN, for Plaintiff International Association of Sheet Metal, Air, Rail, and Transportation Local Union No. 10. Joseph J. Roby, Jr. and Susan Waldie, Johnson, Killen & Seiler, P.A., Duluth, MN, for Defendant A-1 Refrigeration of Hibbing, Inc. d/b/a A-1 Refrigeration Heating and Air Conditioning, Inc.
Justin D. Cummins, Cummins & Cummins PLLP, Minneapolis, MN, for Plaintiff International Association of Sheet Metal, Air, Rail, and Transportation Local Union No. 10.
Joseph J. Roby, Jr. and Susan Waldie, Johnson, Killen & Seiler, P.A., Duluth, MN, for Defendant A-1 Refrigeration of Hibbing, Inc. d/b/a A-1 Refrigeration Heating and Air Conditioning, Inc.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
Eric C. Tostrud, United States District Judge
The International Association of Sheet Metal, Air, Rail, and Transportation Local Union No. 10 ("Local 10") seeks enforcement of an arbitration award against A-1 Refrigeration of Hibbing, Inc. The arbitration award was issued pursuant to a collective bargaining agreement (or "CBA") between Local 10 and the Sheet Metal, Air Conditioning & Roofing Contractors Association ("SMARCA") in effect from 2017 to 2020. A bench trial was held to determine whether A-1 was bound by this CBA. Based on the testimony and exhibits introduced at trial and the arguments of counsel, the Court concludes that A-1 was bound to this CBA. Therefore, the arbitration award rendered against A-1 shall be enforced, and judgment shall be entered for Local 10 and against A-1 with respect to all claims asserted in this case. FINDINGS OF FACT
1. Local 10 is an unincorporated labor organization that represents employees in the sheet metal industry in Minnesota, South Dakota, North Dakota, and four northern-Wisconsin counties. Compl. ¶ 4 [ECF No. 1]; Test. of Michael McCauley, Trial Tr. 201–202 [ECF No. 100].
2. A-1 is an employer in the sheet metal industry, among others. Answer and Second Am. Countercl. ¶ 6 [ECF No. 40]; Test. of Richard Lees, Trial Tr. 312–17 [ECF No. 101].
3. A-1 is co-owned by Richard Lees and Ernie Aikey. Lees Test., Trial Tr. 312; Test. of Ernie Aikey, Trial Tr. 355.
4. Since at least 2001, Local 10 bargained for and enforced collective bargaining agreements it negotiated with SMARCA. McCauley Test., Trial Tr. 220; Test. of Dennis Marchetti, Trial Tr. 114–15; Pl.’s Exs. 10–16; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36.
5. From 2001 to 2020 there always has been in effect a CBA negotiated by Local 10 and SMARCA. Pl.’s Exs. 10–16 (CBAs in effect 2001–2004, 2004–2007, 2007–2010, 2010–2011, 2011–2014, 2014–2017, 2017–2020); Def.’s Exs. 1, 9, 16, 21, 29, 32, 36 (same).
6. SMARCA is "a nonprofit organization that represents sheet metal contractors ... all over the state of Minnesota, a few counties in Wisconsin, over the entire state of North Dakota, [and] over the entire state of South Dakota." Test. of James Bigham, Trial Tr. 242.
7. SMARCA's "main function" is to represent employers at the bargaining table in CBA negotiations with Local 10. Id. at 257.
8. During CBA negotiations, a Local 10 representative negotiates the terms of a CBA with a SMARCA representative. Id. at 244, 246–47; Marchetti Test., Trial Tr. 154; McCauley Test., Trial Tr. 220.
9. An employer may apply to be a SMARCA member, and in so doing, assign its bargaining rights to SMARCA. Bigham Test., Trial Tr. 259.
10. SMARCA represents approximately seventy percent of the total number of employers bound by a given CBA. Id. at 244.
11. When SMARCA and Local 10 agree on a CBA, that CBA binds all SMARCA-member employers. Id. at 260.
12. A-1 has never been a member of SMARCA. Id. at 261; Lees Test., Trial Tr. 318.
13. Nor did anyone representing A-1 sit at the bargaining table to negotiate a CBA with Local 10 on A-1's behalf between 2001 and 2018. Bigham Test., Trial Tr. 258; Lees Test., Trial Tr. 317; McCauley Test., Trial Tr. 220; Test. of Douglas Christy, Trial Tr. 187; Marchetti Test., Trial Tr. 154–55.
14. Non-SMARCA-member employers wishing to be bound by a CBA may sign an "agree-to-be-bound" contract instead of signing the CBA itself. Marchetti Test., Trial Tr. 114; see, e.g. , Pl.’s Ex. 23.
15. In late 2001, Dennis Marchetti, then Local 10's business agent, had two meetings with Lees about A-1 becoming a Local 10 employer. Marchetti Test., Trial Tr. 157–58; Lees Test., Trial Tr. 320.
16. During the first meeting, Lees was threatened that if A-1 did not consider becoming a Local 10 employer, Local 10 would organize and picket a high-profile A-1 job site. Lees Test., Trial Tr. 321.
17. As a result of these meetings, Lees and Marchetti reached an agreement. Id. at 324.
18. Pursuant to that agreement, on December 23, 2001, Lees signed an agree-to-be-bound contract with Local 10 on behalf of A-1. Id. at 326; Dennis Marchetti Test., Trial Tr. 124–25; Pl.’s Ex. 24; Def.’s Ex. 2.
19. The agree-to-be-bound contract signed by Lees stated in full: "I hereby agree to abide by the labor agreement negotiated between Northern Minnesota Division of SMARCA of Minnesota, Inc., and Sheet Metal Workers’ International Association, Local Union Number 10, effective May 1, 2001 with an expiration date of April 30, 2004." Pl.’s Ex. 24; Def.’s Ex. 2.
20. Also pursuant to the agreement with Marchetti, Lees became a dues-paying member of Local 10, and Aikey became a dues-paying member of the Pipefitters Union, Local 589. Lees Test., Trial Tr. 325; Def.’s Exs. 3–4.
21. Only A-1 commercial work was covered by the arrangement, not residential or service work performed by A-1. Lees Test., Trial Tr. 323.
22. Pursuant to the agreement with Marchetti, Lees signed and submitted a New Contractor Form with the Sheet Metal Local #10 Control Board Trust Fund ("the Fund"). Def.’s Ex. 5.
23. A-1 never signed another agree-to-be-bound contract regarding any of the subsequent CBAs after 2004. Marchetti Test., Trial Tr. 164; Christy Test., Trial Tr. 188; McCauley Test., Trial Tr. 222–23, 227; Lees Test., Trial Tr. 327.
24. A-1 never signed any CBA with Local 10. Marchetti Test., Trial Tr. 164; Christy Test., Trial Tr. 188; McCauley Test., Trial Tr. 222–23, 227; Lees Test., Trial Tr. 327.
25. The process of negotiating a new CBA to replace an expiring CBA was described in Article XXVII of each CBA. See Pl.’s Exs. 10–16, at Art. XXVII; Def.’s Exs. 1, 9, 16, 29, 32, 36, at Art. XXVII.
26. Article XXVII provided that "[i]n the event ... notice of reopening [of negotiations] is served [not less than ninety (90) days prior to the expiration date], this Agreement shall continue in force and effect until conferences relating thereto have been terminated by either party." Id.
27. Notices of reopening were sent to employers Local 10 believed to be bound by the in-effect CBA. McCauley Test., Trial Tr. 203.
28. In determining which employers were bound by the CBA and should therefore receive notices of reopening, "one of the biggest things" Local 10 considered was whether an employer paid union organizing dues. Id. at 204.
29. Local 10 also considered whether an employer used Local 10's hiring hall and paid CBA-required membership dues. Id.
30. If appropriate notice of reopening were served, Local 10 would negotiate a new CBA with SMARCA and non-SMARCA-member employers to replace the expiring CBA. See Pl.’s Exs. 10–16, Def.’s Exs. 1, 9, 16, 21, 29, 32, 36.
31. On January 14, 2004, Local 10's business manager and president sent a notice of reopening to A-1. Def.’s Ex. 7.
32. After the January 14, 2004 notice of reopening was sent to A-1, Local 10 and SMARCA negotiated and agreed upon a new CBA, effective May 1, 2004 to April 30, 2007. Pl.’s Ex. 11; Def.’s Ex. 9.
33. This process repeated itself prior to the expiration of every CBA from 2001–2017, with A-1 receiving reopening letters from Local 10 prior to Local 10 and SMARCA negotiating a new CBA. Def.’s Exs. 7 (January 14, 2004 Notice of Reopening), 17 (January 12, 2009 Notice of Reopening), 19 (January 4, 2010 Notice of Reopening), 27 (January 7, 2011 Notice of Reopening), 31 (January 13, 2014 Notice of Reopening), 35 (January 4, 2017 Notice of Reopening). 34. A-1 never objected to receiving the reopening letters. McCauley Test., Trial Tr. 203.
35. Every CBA in effect from 2001 to 2020 covered the rates of pay and conditions of employment for employees performing specific types of work ("CBA-covered work"). Pl.’s Exs. 10–16, at Art. I; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36, at Art. I.
36. CBA-covered work under each CBA includes, but is not limited to,
the (a) manufacture, fabrication, assembling, handling, erection, installation, dismantling, conditioning, adjustment, alteration, repairing and servicing of all ferrous or non-ferrous metal work and all other materials used in lieu thereof and of all air-veyor systems and air-handling systems, regardless of material used, including the setting of all equipment and all reinforcements in connection therewith; (b) all lagging over insulation and all duct lining; (c) testing and balancing of all air-handling equipment and duct work; (d) the preparation of all shop and field sketches used in fabrication and erection including those taken from original architectural and engineering drawings or sketches.
Pl.’s Ex. 16, at Art. I; Def.’s Ex. 36, at Art. I; see also Pl.’s Exs. 10–15, at Art. I; Def.’s Exs. 1, 9, 16, 21, 29, 32, at Art. I.
37. A-1 conducted business as it related to CBA-covered work consistently with the CBAs in effect from 2001 to July 2018.
38. Every CBA from 2001 to 2020 required employers to ensure that employees who performed CBA-covered work were dues-paying members of Local 10. Pl.’s Ex. 10–16, at Art. V, sec. 1; Def.’s Ex. 1, 9, 16, 21, 29, 32, 36, at Art. V, sec. 1.
39. From 2001 to July 2018, A-1 ensured that Lees, who performed CBA-covered work, was a dues-paying member of Local 10. McCauley Test., Trial Tr. 216–17; Lees Test., Trial Tr. 293; Pl.’s Ex. 49.
40. From 2010 to July 2018, A-1 ensured that Aikey, who performed CBA-covered work, was a dues-paying member of Local 10. McCauley Test., Trial Tr. 217–18; Lees Test., Trial Tr. 300–301; Pl.’s Ex. 30.
41. In 2014, a Local 10 business representative found a non-union-member working for A-1 at an A-1 job site. Christy Test., Trial Tr. 179–80; Lees Test., Trial Tr. 350–51.
42. The business representative informed the non-union-member that he had to stop working on the project. Id.
43. A-1 did not object to Local 10 pulling that worker off A-1's job site. Id.
44. From 2001 to July 2018, A-1 paid to the Fund, on a monthly basis, Union-organizing-dues contributions at an annually increasing rate for the hours it reported for CBA-covered work performed by A-1 employees, consistent with each CBA in effect during that time period. Test. of Sheila Rice, Trial Tr. 39–41, 44; McCauley Test., Trial Tr. 214; Lees Test., Trial Tr. 297–98; Pl.’s Exs. 10–16, Arts. VIII, XVIII, sec. 4, XX, sec. 2; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36, Arts. VIII, XVIII, sec. 4, XX, sec. 2.
45. From 2001 to July 2018, A-1 paid to the Fund, on a monthly basis, SMARCA industry-fee contributions at an annually increasing rate for the hours it reported for CBA-covered work performed by A-1 employees, consistent with each CBA in effect during that time period. Rice Test., Trial Tr. 39–40, 45–46; Bigham Test., Trial Tr. 250, 253–54; Lees Test., Trial Tr. 298–99; Pl.’s Exs. 10–16 at Arts. VIII, XIX, and XX; Def.’s Ex. 1, 9, 16, 21, 29, 32, 36, Arts. VIII, XIX, and XX.
46. From 2001 to July 2018, A-1 paid to the Fund, on a monthly basis, Trust Fund fringe-benefit contributions at an annually increasing rate for hours reported for CBA-covered work performed by A-1 employees, consistent with each CBA in effect during that time period. Rice Test., Trial Tr. 39–40, 45–46; Lees Test., Trial Tr. 294–296, 299; Pl.’s Exs. 10–16, Arts. VIII, XVI–XVIII, and XXI; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36, Arts. VIII, XVI–XVIII, and XXI.
47. As is common among employers, A-1 occasionally fell behind on its payments to the Fund. Rice Test., Trial Tr. 39–40.
48. About once a year from 2001 to 2017, the Fund sent out delinquency notices to A-1, informing A-1 that it was behind on its payments and requesting payment. Id.
49. Each time, A-1 sent the Fund the requested payment. Id.
50. Approximately six times between May 2017 and June 2018, A-1 was informed that it was late in making the CBA-required monthly Union-organizing-dues contributions, SMARCA industry-fee contributions, and Trust Fund fringe-benefit contributions. Id. at 40–41.
51. In response to these six delinquency notices, A-1 took corrective action to come into compliance with the CBA. Id. at 41.
52. Every CBA from 2001 to 2020 permitted employers to use Local 10's hiring hall if the employer needed employees to perform CBA-covered work. Pl.’s Exs. 10–16, at Art. IV; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36, at Art. IV.
53. Prior to 2010, A-1 utilized Local 10's hiring hall to hire union members to perform CBA-covered work. Lees Test., Trial Tr. 300, 328–29.
54. A-1 paid those employees hired through the hiring hall in accordance with the wage schedule established by the then-in-effect CBA. Id. at 301–302; Pl.’s Ex. 17.
55. A-1 paid to the Fund, on a monthly basis, Union-organizing-dues contributions, SMARCA industry-fee contributions, and Trust Fund fringe-benefit contributions for all hours worked by the employees A-1 hired through Local 10's hiring hall, in accordance with the wage and rate schedule established by the then-in-effect CBA. Lees Test., Trial Tr. 297–298; Pl.’s Ex. 17.
56. From 2001 to 2018, the Fund conducted three separate audits of A-1, as permitted by the CBAs and the Fund's Restated Declaration of Trust. Pl.’s Ex. 10–16, at Art. XX, sec. 1; Def.’s Ex. 1, 9, 16, 21, 29, 32, 36, at Art XX, sec. 1; Pl.’s Exs. 18, 25, 26, 28; Rice Test., Trial Tr. 41–43, 56–57, 62–63.
57. A-1 complied fully with each audit, in accordance with the CBAs in effect and the Fund's Restated Declaration of Trust. Rice Test., Trial Tr. 42, 57, 62–63; Lees Test., Trial Tr. 302, 305–06.
58. The first audit was randomly conducted in 2007 and focused on the years 2004 through 2006. Rice Test., Trial Tr. 41.
59. The first audit resulted in a finding that A-1 owed less than $50 to the Fund due to both overreporting and underreporting hours worked for one individual. Id. at 41–42.
60. A-1 made a payment to the Fund in the amount found in the audit to be owing. Id. at 42.
61. The second audit was randomly conducted in 2016 and focused on the years 2012 through 2014. Id. at 56–57.
62. The second audit resulted in a finding that contributions were owed to the Fund on behalf of Lees. Id. at 57; Pl.’s Ex. 26.
63. A-1 took corrective action and "substantially ... fixed the issue[.]" Rice Test., Trial Tr. 58.
64. Although A-1's corrective action did not completely "fix[ ] the issue," neither Local 10 nor the Fund filed a grievance or took legal action against A-1. Id. ; McCauley Test., Trial Tr. 232.
65. Local 10 and the Fund decided not to take legal action at least in part because the amount owing would primarily go to fund Lees's personal pension. Rice Test., Trial Test. 58, McCauley Test., Trial Tr. 232.
66. Local 10 also believed it did not make financial sense to take legal action against A-1 regarding the findings of the second audit. McCauley Test., Trial Tr. 232.
67. In 2017, a third audit was initiated due to concerns Local 10 and SMARCA had regarding an apparent disparity between the number of hours A-1 was reporting for CBA-covered work and the amount of work A-1 was completing. Rice Test., Trial Tr. 87, 89; Lees Test., Trial Tr. 302; Pl.’s Ex. 28.
68. The third audit is what ultimately led to Local 10 filing the grievance underlying the arbitration award at issue here. McCauley Test., Trial Tr. 210.
69. The third audit covered the period of January 1, 2015, to November 6, 2017. Pl.’s Ex. 28; Rice Test., Trial Tr. 63, 87.
70. The audit determined that A-1 owed $74,892.50 due to its "fail[ure] to report [Aikey's] owner[-]member minimum" hours for the purposes of making the CBA-required Fund contributions during the audit period. Pl.’s Ex. 28.
71. Based on the findings of the third audit, on January 30, 2018, Doug Christy, Local 10's business representative, informed A-1 by letter that Local 10 would be filing a grievance against A-1 pursuant to Article X of the 2017–2020 CBA for "non-compliance of the [CBA] between ... Local 10 and A-1[.]" Pl.’s Ex. 36; McCauley Test., Trial Tr. 210.
72. Specifically, the letter noted that the 2017–2020 CBA required remittance of "required fringes on all hour[s] worked and performed by an owner-member," and that "[t]here have been no fringes paid to the Local 10 on behalf of owner[-]member Ernie Aikey III." Id.
73. Further, Local 10 believed that "there [was] an inconsistency in hours worked and the amount of hours remitted[.]" Id.
74. The grievance was based at least in part on Article XXV, Section 2 of the 2017–2020 CBA, which required "[a]ll owner/members (Union members) [to] pay the minimum of 145 hours of fringe benefit contributions per month for the hours of work." Pl.’s Ex. 16, at Art. XXV, sec. 2; Def.’s Ex. 36, at Art. XXV, sec. 2; Rice Test., Trial Tr. 53; McCauley Test., Trial Tr. 212.
75. Pursuant to Article X, Section 2 of the 2017–2020 CBA, Local 10's grievance was heard by the Local Joint Adjustment Board (or "the arbitration panel") on February 23, 2018. Pl.’s Ex. 41.
76. A-1 hired counsel and participated in the hearing before the arbitration panel, maintaining throughout that it was not bound by the CBA. Id. at 2–3.
77. This was the first time either Local 10 or the Fund learned that A-1 believed it was not bound by a CBA with Local 10. Pl.’s Ex. 46; Rice Test., Trial Tr. 66; Marchetti Test., Trial Tr. 143; Christy Test., Trial Tr. 186; McCauley Test., Trial Tr. 214; Bigham Test., Trial Tr. 255.
78. On February 28, 2018, the arbitration panel issued a written ruling that A-1 "violated Article XXV, Section 2 of the [CBA] by failing to remit fringe benefits on all hours worked and/or the minimum of 145 hours per month for owner-member Ernie Aikey for the time periods of all 2015, 2016, and 2017." Pl.’s Ex. 42.
79. The arbitration panel directed A-1 to pay the required fringe fund benefits it had not paid on behalf of Aikey. Id.
80. A-1 has not complied with the arbitration award. Answer & Second Am. Countercl. ¶ 14. 81. On July 13, 2018, Local 10 filed a one-count Complaint seeking enforcement of the arbitration award. Compl. [ECF No. 1].
82. A-1 filed an Answer and Amended Counterclaim denying it was bound by the 2017–2020 CBA, and seeking a declaratory judgment that the arbitration award is void ab initio for lack of any valid written arbitration agreement (Count I), alleging breach of an alleged verbal contract between Local 10 and A-1 (Count II), and alleging business defamation (Count III). Answer & Second Am. Countercl. [ECF No. 40].
83. On December 14, 2018, A-1's business defamation counterclaim was dismissed. ECF No. 43.
84. On March 25, 2019, A-1's breach of contract counterclaim was dismissed pursuant to the Parties’ stipulation. ECF No. 50.
CONCLUSIONS OF LAW
1. Subject-matter jurisdiction exists under § 301 of the Labor Management Relations Act of 1947, 29 U.S.C. § 185(a).
2. Personal jurisdiction exists over the Parties. Fed. R. Civ. P. 4 ; Summons [ECF No. 3].
3. Venue is proper in this District because A-1's principal place of business is in Hibbing, Minnesota. 28 U.S.C. § 1391(b)(1) ; Answer & Second Am. Countercl. ¶ 7.
4. "[A]rbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit." AT & T Techs., Inc. v. Commc'ns Workers of Am. , 475 U.S. 643, 648, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986) (quoting United Steelworkers of Am. v. Warrior & Gulf Navigation Co. , 363 U.S. 574, 582, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960) ).
5. "[W]hether or not [A-1] was bound to arbitrate ... is a matter to be determined by the Court on the basis of the contract entered into by the parties." Id. at 649, 106 S.Ct. 1415 (citations omitted).
6. The arbitration award was rendered pursuant to Article X of the 2017–2020 CBA. Pl.’s Exs. 41, 42; Def.’s Exs. 39, 42, 43; Christy Test., Trial Tr. 189–94; McCauley Test., Trial Tr. 228–29, 231.
7. Therefore, whether A-1 was bound to arbitrate Local 10's grievance depends on whether they were bound by the 2017–2020 CBA. See AT & T Techs., Inc. , 475 U.S. at 648–49, 106 S.Ct. 1415.
8. "Federal labor law governs a CBA's validity, and we are not bound by technical rules of contract." Miner v. Local 373 , 513 F.3d 854, 861 (8th Cir. 2008).
9. Federal labor law has "well established that a collective bargaining agreement is not dependent on the reduction to writing of the parties’ intention to be bound. All that is required is conduct manifesting an intention to abide and be bound by the terms of an agreement." Twin City Pipe Trades Serv. Ass'n v. Frank O'Laughlin Plumbing & Heating Co. , 759 F.3d 881, 885 (8th Cir. 2014) (quotation omitted).
10. The inquiry into whether a party's conduct has manifested an intention to abide and be bound by the terms of an agreement "is a question of fact ... and focuses on the objective intent of the parties—not their subjective beliefs." Miner , 513 F.3d at 861 (internal citation omitted).
11. An employer who has a private, or subjective, intent not to be bound by a CBA may nonetheless be bound if "the signs visible to the union all pointed to [the employer's] acceptance of the collective bargaining agreement." Robbins v. Lynch , 836 F.2d 330, 332 (8th Cir. 1988).
12. The "undisclosed intent" of an employer not to be bound "is not material" to whether the employer was bound by a CBA. Id.
13. A-1's conduct visible to Local 10 manifested an objective intent to abide and be bound by every CBA from 2001 to 2018.
14. In December 2001, Lees signed an agree-to-be-bound contract with Local 10. Lees Test., Trial Tr. 326; Marchetti Test., Trial Tr. 124–25; Pl.’s Ex. 24; Def.’s Ex. 2.
15. From 2001 to July 2018, Lees was a dues-paying member of Local 10, in accordance with Article V, Section 1 of every CBA in effect from 2001–2018. Pl.’s Exs. 10–16, at Art. V, sec. 1, 49; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36, at Art. V, sec. 1; McCauley Test., Trial Tr. 216–18; Lees Test., Trial Tr. 293, 300–01.
16. From 2010 to July 2018, Aikey was a dues-paying member of Local 10, in accordance with Article V, Section 1 of every CBA in effect from 2010–2018. Pl.’s Exs. 13–16, at Art. V, sec. 1, 30; Def.’s Exs. 21, 29, 32, 36, at Art. V, sec. 1; McCauley Test., Trial Tr. 217; Lees Test., Trial Tr. 301; Aikey Test., Trial Tr. 361–62.
17. A-1 did not object when Local 10 pulled A-1's non-union-member worker off a job site in 2014. Christy Test., Trial Tr. 179–80; Lees Test., Trial Tr. 350–51.
18. From 2001 to July 2018, A-1 paid, on a monthly basis, Union-organizing-dues contributions to the Fund at the annually increasing rate for the hours it reported for CBA-covered work, in accordance with Articles VIII, XVIII, and XX of the CBAs. Pl.’s Exs. 10–16, Arts. VIII, XVIII, sec. 4, XX, sec. 2; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36, Arts. VIII, XVIII, sec. 4, XX, sec. 2; Rice Test., Trial Tr. 39–41, McCauley Test., Trial Tr. 214; Lees Test., Trial Tr. 297–98.
19. From 2001 to July 2018, A-1 paid to the Fund, on a monthly basis, SMARCA industry-fee contributions at the annually increasing rate for the hours it reported for CBA-covered work, in accordance with Articles VIII, XIX, and XX of the CBAs. Pl.’s Exs. 10–16 at Arts. VIII, XIX, and XX; Def.’s Ex. 1, 9, 16, 21, 29, 32, 36, Arts. VIII, XIX, and XX; Rice Test., Trial Tr. 39–40, 45–46; Bigham Test., Trial Tr. 250, 253–54; Lees Test., Trial Tr. 298–99.
20. From 2001 to July 2018, A-1 paid to the Fund, on a monthly basis, Trust Fund fringe-benefit contributions at the annually increasing rate for hours reported for CBA-covered work, in accordance with Articles VIII, XVI–XVIII, and XXI of the CBAs. Pl.’s Exs. 10–16, Arts. VIII, XVI–XVIII, and XXI; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36, Arts. VIII, XVI–XVIII, and XXI; Rice Test., Trial Tr. 39–40, 45–46; Lees Test., Trial Tr. 294–296, 299.
21. A-1 fully complied with each audit conducted by the Fund in accordance with Article XX of the CBAs and the Fund's Restated Declaration of Trust. Pl.’s Exs. 10–16, at Art. XX, sec. 1; Pl.’s Exs. 18, 25–28; Rice Test., Trial Tr. 42, 57, 62–63; Lees Test., Trial Tr. 302, 305–06.
22. When notified by the Fund of delinquent CBA-required Union-organizing-dues, SMARCA industry-fee contributions, and Trust Fund fringe-benefit contributions, A-1 took corrective action to come into compliance with those CBA requirements. Rice Test., Trial Tr. 40–41.
23. A-1 never objected to receiving notices of reopening CBA negotiations. McCauley Test., Trial Tr. 203.
24. A-1 never informed Local 10 or the Funds that it did not believe it was bound by a CBA until the arbitration hearing in 2018. Pl.’s Ex. 46; Rice Test., Trial Tr. 66; Marchetti Test., Trial Tr. 143; Christy Test., Trial Tr. 186; McCauley Test., Trial Tr. 214; Bigham Test., Trial Tr. 255.
25. A-1's objective conduct consistent with the CBAs persisted over nearly two decades. See supra ¶¶ 14–22.
26. That A-1 participated in the arbitration hearing held pursuant to Article X of the 2017–2020 CBA does not manifest an objective intent to be bound by the CBA because A-1's position at the arbitration hearing was that it was not bound by the CBA. Pl.’s Ex. 41.
27. The conduct A-1 points to in support of its position that it did not manifest an objective intent to be bound by the 2017–2020 CBA is immaterial or not inconsistent with any of the CBAs.
28. Lees's credible testimony that he entered into a verbal agreement with Marchetti in 2001 cannot overcome "the [objective] signs visible to the union" which "all pointed to [A-1's] acceptance of the collective bargaining agreement." Robbins , 836 F.2d at 332 ; see Lees Test., Trial Tr. 318–327.
29. Nor can Lees's credible testimony that A-1 was signed up with Local 10 only pursuant to the verbal agreement with Marchetti overcome those objective "signs visible to the union" which "pointed to [A-1's] acceptance of the collective bargaining agreement." Robbins , 836 F.2d at 332 ; Lees Test., Trial Tr. 310.
30. That Lees and Aikey were paid salaries, rather than wages as set forth in Article VIII of each CBA, did not indicate to Local 10 that A-1 did not intend to be bound by any of the CBAs because that was not visible to Local 10. Robbins , 836 F.2d at 332 ; Marchetti Test., Trial Tr. 135; Christy Test., Trial Tr. 185.
31. That neither Local 10 nor the Fund pursued a grievance or legal action based on the two pre-2017 audits does not indicate either that A-1 was not bound by the CBAs or that Local 10 or the Fund did not believe A-1 was bound by the CBAs because neither the CBAs nor the Fund's Restated Declaration of Trust required Local 10 or the Fund to pursue a grievance or legal action as a result of every audit that resulted in a finding that the employer was underpaying, underreporting hours, or otherwise not in compliance with the CBA. See Pl.’s Exs., 10–16, 18; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36.
32. Although Local 10's and the Fund's decision not to pursue a grievance or legal action pursuant to the first two audits may have reinforced A-1's subjective belief that it was not bound by the CBAs, A-1's subjective belief that it was not bound to the CBA is not material. Miner , 513 F.3d at 861 ; Robbins , 836 F.2d at 332.
33. That A-1 paid dues to the Pipefitter Union on behalf of Aikey is not inconsistent with any of the CBAs because the CBAs say nothing about payment of union dues to other unions for non-CBA-covered work. See Pl.’s Exs. 10–16; Def.’s Exs. 1, 9, 16, 21, 29, 32, 36.
34. That A-1 rarely used Local 10's hiring hall is not inconsistent with Local 10 CBAs because the CBAs do not require consistent or ongoing use of the hiring hall. See id.
35. A-1's subjective understanding of why it was conducting business consistently with the CBAs is not relevant to determining whether it was bound by the 2017–2020 CBA because the inquiry into whether an employer is bound to a CBA "focuses on the objective intent of the parties—not their subjective beliefs." Miner , 513 F.3d at 861 (internal citation omitted); see Robbins , 836 F.2d at 332 (stating undisclosed intent not to be bound by a CBA is not material).
36. Because A-1's conduct manifested an objective intent to abide and be bound by the 2017–2020 CBA, "whether or not [A-1] was bound to arbitrate ... is a matter to be determined ... on the basis of the" 2017 to 2020 CBA. AT & T Techs., Inc. , 475 U.S. at 649, 106 S.Ct. 1415 (citations omitted); John Wiley & Sons, Inc. v. Livingston , 376 U.S. 543, 547, 84 S.Ct. 909, 11 L.Ed.2d 898 (1964).
37. Article X of the 2017–2020 CBA provides that "[t]he Union and the Employer, whether party to this Agreement independently or as a member of a multi-employer bargaining unit, agree to utilize and be bound by this Article." Pl.’s Ex. 16, at Art. X; Def.’s Ex. 36, at Art. X.
38. Article X provides that grievances that "arise out of interpretation or enforcement" of the 2017–2020 CBA shall be settled by the employer and Local 10, if possible. Pl.’s Ex. 16, at Art. X; Def.’s Ex. 36, at Art. X.
39. If the grieving parties are unable to settle the grievance on their own, the grievance "may be appealed by either party to the Local Joint Adjustment Board." Pl.’s Ex. 16, at Art. X, sec. 2; Def.’s Ex. 36, at Art. X, sec. 2.
40. "Except in the case of a deadlock, a decision of a Local Joint Adjustment Board shall be final and binding." Id.
41. Because A-1's objective conduct manifested an intent to abide and be bound by the 2017–2020 CBA, A-1 was therefore bound by Article X's arbitration clause. See AT & T Techs., Inc. , 475 U.S. at 648, 106 S.Ct. 1415.
42. The Supreme Court "made clear almost [60] years ago that the courts play only a limited role when asked to review the decision of an arbitrator." United Paperworkers Int'l Union v. Misco, Inc. , 484 U.S. 29, 36, 108 S.Ct. 364, 98 L.Ed.2d 286 (1987) (referencing United Steelworkers of Am. v. Enter. Wheel & Car Corp. , 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960) ).
43. "The courts are not authorized to reconsider the merits of an award even though the parties may allege that the award rests on errors of fact or on misinterpretation of the contract." Id.
44. Rather, "[j]udicial review of a final arbitration award is extremely narrow." Bureau of Engraving, Inc. v. Graphic Commc'n Int'l Union, Local 1B , 284 F.3d 821, 824 (8th Cir. 2002).
45. "[A]s long as the arbitrator is even arguably construing or applying the contract and acting within the scope of his authority, that a court is convinced he committed serious error does not suffice to overturn his decision." Misco , 484 U.S. at 38, 108 S.Ct. 364.
46. Article X of the 2017–2020 CBA covers grievances "arising out of interpretation or enforcement of" the 2017–2020 CBA. Pl.’s Ex. 16, at Art. X, sec. 1; Def.’s Ex. 36, at Art. X, sec. 1.
47. Local 10's grievance against A-1 alleged that A-1 was "in violation of Article I, Article II, Section 1, Article V, Article VIII, Article XVI, Article XVII, Article XVIII, Article XX, Article XXI, Article XXV Section2." Pl.’s Ex. 36.
48. Because the grievance arose out of the interpretation or enforcement of the 2017–2020 CBA, the arbitration panel was acting within the scope of their authority to rule on the grievance. Pl.’s Ex. 16, at Art. X; Def.’s Ex. 36, at Art. X.
49. Accordingly, the arbitration award must be enforced "so long as it ‘draws its essence’ from the collective bargaining agreement." Int'l Bhd. of Elec. Workers, Local Union No. 53 v. Sho-Me Power Corp. , 715 F.2d 1322, 1325 (8th Cir. 1983) (quoting Enter. Wheel & Car , 363 U.S. at 596–97, 80 S.Ct. 1358 ). 50. The February 28, 2018 arbitration award draws its essence from the 2017–2020 CBA. See Pl.’s Ex. 42.
51. The arbitration panel determined that the procedural requirements of Article X were met. Id.
52. The arbitration panel determined that Aikey was an owner-member under Article XXV, Section 2 of the 2017–2020 CBA. Id.
53. The arbitration panel determined that A-1 "fail[ed] to remit fringe benefits on all hours worked and/or the minimum of 145 hours per month as required" by Article XXV, Section 2 of the 2017–2020 CBA. Id.
54. That there is some dispute over Article XXV, Section 2's definition of the term owner-member does not suffice to enjoin enforcement of the arbitration award because "courts are not authorized to reconsider the merits of an award even though the parties may allege that the award rests on errors of fact or on misinterpretation of the contract." Misco , 484 U.S. at 36, 108 S.Ct. 364 ; see Marchetti Test., Trial Tr. 144–150.
ORDER
Based on the foregoing, and all of the files, records, and proceedings herein, IT IS ORDERED THAT:
1. The February 28, 2018 arbitration award rendered by the Local Joint Adjustment Board regarding the grievance filed by Local 10 against A-1 is confirmed;
2. A-1 shall pay $140,481.65 to the Fund in accordance with the February 28, 2018, arbitration award;
3. Judgment shall be entered against A-1's Counterclaim with prejudice and on the merits.