Opinion
Case No. 4:04CV480 CDP.
November 7, 2005
MEMORANDUM AND ORDER
This matter is before me on plaintiff's motion to amend the judgment and motion for attorneys' fees. On September 22, 2005, I granted summary judgment to plaintiff and confirmed the arbitration award at issue in its entirety. The full text of my judgment reads as follows:
In accordance with the Memorandum and Order entered this same date,
IT IS HEREBY ORDERED, ADJUDGED AND DECREED that plaintiff shall have summary judgment against defendant on plaintiff's complaint and defendant's counterclaim, and defendant's counterclaim is hereby dismissed with prejudice. Defendant shall bear all taxable costs of this action.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that the arbitration award issued by Arbitrator Thomas A. Cipolla on April 2, 2004 is confirmed in its entirety.
As discussed in my Memorandum and Order accompanying the Judgment, Arbitrator Cipolla's April 2, 2004 arbitration award provides:
The Medical Center must discharge bargaining unit RNs who are not in compliance with the Union dues and fees obligation under Article 4 at any time after the settlement of the award issued by Arbitrator Robert G. Bailey through the date of this arbitration hearing, December 15, 2003. The Medical Center should also reimburse the Union for those dues and fees, without interest, which would have been paid but for the Medical Center's failure to comply with Article 4 during the same period. Finally, the Medical Center is ordered to comply with all of its Article 4 obligations upon written notice by the Union of fee or Union due deficiencies. No other remedy requested is deemed appropriate.
Plaintiff now seeks an award of prejudgment interest. Defendant has not opposed the request.
In Stroh Container Co. v. Delphi Industries, Inc., 783 F.2d 743 (8th Cir. 1986), the Eighth Circuit Court of Appeals summarized the rule governing prejudgment interest as follows:
As a general rule, prejudgment interest is to be awarded when the amount of the underlying liability is reasonably capable of ascertainment and the relief granted would otherwise fall short of making the claimant whole because he or she has been denied the use of money which was legally due. Awarding prejudgment interest is intended to serve at least two purposes: to compensate prevailing parties for the true costs of money damages incurred, and, where liability and the amount of damages are fairly certain, to promote settlement and deter attempts to benefit unfairly from the inherent delays of litigation. Thus, prejudgment interest should ordinarily be granted unless exceptional or unusual circumstances exist making the award of interest inequitable. Such circumstances may include bad faith or dilatoriness by the claimant, or a claimant's assertion of frivolous claims.Id. at 752 (internal citations omitted). The portion of the arbitration award that would be subject to prejudgment interest is the "dues and fees, without interest, which would have been paid but for the Medical Center's failure to comply with Article 4. . . ."
After considering the relevant factors, I find that an award of prejudgment interest is appropriate. Although the arbitrator did not specify a dollar amount in his award, the amount is reasonably capable of ascertainment. In its supplemental motion for summary judgment, plaintiff calculated the amount of unpaid dues and fees owed by defendant to be $33,855.36. This amount was not disputed by defendant.
Moreover, an award of prejudgment interest is appropriate because plaintiff has been denied the use of the unpaid dues and fees since the award was issued in April of 2004. Merely confirming the award without granting the request for prejudgment interest would fall short of affording plaintiff complete relief.
Finally, I find no exceptional or unusual circumstances that would justify the denial of prejudgment interest. Accordingly, I will grant plaintiff's request for prejudgment interest.
Before entering an Amended Judgment, however, I would like to afford plaintiff the opportunity to file a proposed amended judgment for the Court's consideration. In particular, I would like plaintiff to inform the Court whether my September 22, 2005 Judgment should be amended to include a monetary award in favor of plaintiff for the unpaid dues and fees in the amount of $33,855.36, together with an award of prejudgment interest. Plaintiff's proposal shall also include what prevailing prejudgment interest rate it believes is appropriate for this case, as well as its proposed prejudgment calculation. Plaintiff shall file its proposed amended judgment no later than November 10, 2005. Defendant may file a response to plaintiff's proposal or propose its own alternative form of amended judgment by no later than November 17, 2005.
Of course, defendant does not waive its right to appeal my order granting summary judgment if it does not object to the form of the proposed amended judgment or if it proposes an alternative form of amended judgment.
Unlike prejudgment interest, attorneys' fees are ordinarily not recoverable by the prevailing party in federal litigation unless authorized by statute or justified by circumstances in which the losing party has acted in bad faith. Int'l Ass'n of Heat and Frost Insulators and Asbestos Workers, Local Union 34, AFL-CIO v. General Pipe Covering, Inc., 792 F.2d 96, 101 (8th Cir. 1986). Attorneys' fees are not authorized by statute in suits to enforce arbitration awards.Lackawanna Leather Co. v. United Tool Commercial Workers Int'l Union, AFL-CIO CLC, Dist. Union No. 271, 706 F.2d 228, 232 (8th Cir. 1983) (en banc).
Plaintiff contends that a fee award in the amount of $27,236.50 is warranted in this case because defendant refused to comply with the award in bad faith. According to plaintiff, defendant's bad faith is demonstrated by the fact that the parties arbitrated this dispute over the non-payment of union fees and dues twice. Plaintiff also argues that my order granting summary judgment in its favor is evidence of defendant's bad faith because I ultimately found defendant's evidence on the public policy defense unpersuasive. Although "[a]n unjustified refusal to abide by an arbitrator's award may constitute bad faith for the purpose of awarding attorneys' fees," Int'l Union, United Auto., Aerospace Agric. Implement Workers v. United Farm Tools, Inc., Speedy Mfg. Div., 762 F.2d 76, 77 (8th Cir. 1985), I find no evidence of bad faith to justify a fee award in this case.
I am not persuaded that any bad faith on defendant's part is shown simply because the parties arbitrated two disputes over the non-payment of union dues and fees. The parties settled their dispute after the first arbitration award was entered in plaintiff's favor; therefore, it cannot be said that defendant refused to comply with the first award. I do not find defendant's refusal to comply with the second award to constitute bad faith, either. Defendant timely advanced a public policy defense to enforcement of the award before this Court. The court, not the arbitrator, is empowered to decide this issue. See W.R. Grace and Co. v. Local Union 759, Int'l Union of the United Rubber, Cork, Linoleum and Plastic Workers of Am., 461 U.S. 757, 766 (1983) ("The question of public policy is ultimately one for resolution by the courts."). Under these circumstances, then, I cannot conclude that defendant evidenced a bad refusal to comply with the award merely because it was required to obtain a ruling from this Court, rather than the arbitrator, on its public policy defense.
Of course, defendant actually presented its evidence in support of its public policy defense to the arbitrator, who properly concluded that he lacked the authority to consider it in conjunction with his interpretation of the collective bargaining agreement.
Similarly, the fact that defendant was unsuccessful in persuading me to vacate the arbitration award does not mean that its public policy defense was legally frivolous or presented in bad faith. This was a hotly-contested case, and the Court had to carefully evaluate a substantial amount of evidence from both parties to decide this issue. Although I ultimately decided that defendant had not met its burden of proof with respect to the public policy defense, I do not find that defendant advanced its arguments vexatiously or in bad faith to avoid compliance with the arbitration award. For these reasons, I will deny plaintiff's motion for attorneys' fees.
Accordingly,
IT IS HEREBY ORDERED that plaintiff's motion to amend the judgment [#47] is granted. Plaintiff shall file its proposed amended judgment in accordance with the terms of this Order no later than November 10, 2005. Defendant may file a response to plaintiff's proposal or its own alternative proposed amended judgment no later than November 17, 2005. IT IS FURTHER ORDERED that plaintiff's motion for attorneys' fees [#44] is denied.
IT IS FURTHER ORDERED that the Clerk of the Court shall tax costs against defendant as provided in plaintiff's bill of costs [#46].