Opinion
No. 1:02-CV-391-TS.
November 10, 2003
MEMORANDUM AND ORDER
This matter is before the Court on the Defendant's Motion for Summary Judgment [DE 15], filed on August 19, 2003, and the Plaintiffs' Motion for Summary Judgment [DE 11], filed on August 20, 2003.
PROCEDURAL BACKGROUND
The Plaintiffs, United Steel Workers of America, AFL-CIO-CLC and Local Union 715 of the United Steel Workers (collectively, the "Union"), filed a Complaint in this Court on December 4, 2002, for an action arising under Section 301 of the Labor Management Relations Act of 1947, as amended, 29 U.S.C. § 185. The Plaintiffs filed the Complaint seeking to compel the Defendant, Uniroyal Goodrich Tire Manufacturing, a Division of Michelin North America, Inc., to arbitrate a grievance as provided in the governing Collective Bargaining Agreement (CBA). The Defendant filed its Answer on January 8, 2003.
On August 19, 2003, the Defendant filed its Motion for Summary Judgment. On August 20, 2003, the Plaintiffs also filed a Motion for Summary Judgment. On September 5, 2003, the Defendant filed its Response and on September 9, 2003, the Plaintiffs filed their Response.
SUMMARY JUDGMENT STANDARD
The Federal Rules of Civil Procedure mandate that motions for summary judgment be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). Rule 56(c) further requires the entry of summary judgment, after adequate time for discovery, against a party "who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). "[S]ummary judgment is appropriate — in fact, is mandated — where there are no disputed issues of material fact and the movant must prevail as a matter of law. In other words, the record must reveal that no reasonable jury could find for the non-moving party." Dempsey v. Atchison, Topeka, Santa Fe Ry. Co., 16 F.3d 832, 836 (7th Cir. 1994) (citations and quotation marks omitted).
In viewing the facts presented on a motion for summary judgment, a court must construe all facts in a light most favorable to the non-moving party and draw all legitimate inferences in favor of that party. NLFC, Inc. v. Devcom Mid-Am., Inc., 45 F.3d 231, 234 (7th Cir. 1995); Doe v. R.R. Donnelley Sons Co., 42 F.3d 439, 443 (7th Cir. 1994). A court's role is not to evaluate the weight of the evidence, to judge the credibility of witnesses, or to determine the truth of the matter, but instead to determine whether there is a genuine issue of triable fact. Anderson, 477 U.S. at 249-50; Doe, 42 F.3d at 443. The usual Rule 56 standard of review applies to cross-motions for summary judgment. Int'l Brotherhood of Elec. Workers v. Balmoral Racing Club, Inc., 293 F.3d 402, 404 (7th Cir. 2002).
FACTUAL BACKGROUND
The parties do not dispute the following facts.
A. Background
The Defendant operates a plant in Woodburn, Indiana. The Union and the Defendant have been parties to successive CBAs. The hours, wages and other terms of employment of the Defendant's hourly production and maintenance workers are governed by the CBA. Janice Wyatt was an employee in the Union's bargaining unit from July 27, 1992, until her termination on August 10, 2001.
B. Grievance Process Relating to Janice Wyatt's Termination
On August 10, 2001, the Defendant terminated Wyatt's employment after an investigation revealed that she had received Sickness Accident (S A) benefits (1) while also receiving vacation pay, and (2) at a time when she was not authorized to be off work. The Defendant believed that these acts constituted a violation of the Code of Conduct rule regarding dishonesty and warranted termination under the progressive discipline policy that the Defendant followed. On August 27, 2001, the Union filed a grievance on behalf of Wyatt wherein the Union requested that Wyatt be reinstated and made whole. The Defendant acknowledged receipt of the grievance and conducted a meeting on January 31, 2002, in accordance with step two of the grievance procedure as outlined in Article VII of the CBA.
The Defendant denied the grievance, in writing, on February 22, 2002. The letter notes the Defendant's position that numerous documentation supported its action to terminate Wyatt. It also outlined the Union's position that under Article XV, Section 4 b(1)(a) and (b), an employee could receive S A pay while on vacation. The Defendant responded that the cited provisions did not apply to Wyatt's situation because she did not request vacation pay "in lieu" of vacation and that the Defendant considered Wyatt's actions to be a deliberate act of dishonesty.
On March 4, 2002, the Union appealed the grievance to arbitration, the next step of the grievance procedure under Article VII, Section 2(a)(3) of the CBA. The Defendant informed the Union that it would not arbitrate the matter because litigation was pending concerning matters that the grievance addressed. The Union and the Defendant exchanged several letters wherein they detailed their positions regarding the obligation to arbitration the grievance in light of Wyatt's federal litigation. The parties were unable to reach an agreement regarding arbitration and the Union filed the instant action to enforce its position that arbitration was required under the CBA, without regard to Wyatt's federal complaint.
1. Relevant Language of the CBA
Article VII of the CBA is entitled "Adjustment of Grievances [and] Arbitration." Section 1(a) provides that the "Union and employees agree that they will utilize the grievance procedure provided herein as the exclusive means, except as limited by law, of handling employee problems and grievances." Section 2 describes the steps of the grievance process. The final step is arbitration. Section 2(b) states, "Any question concerning the interpretation or application of any provision of this Agreement or the local supplemental agreement or any claim of violation of any provision of this Agreement or the local supplemental agreement may constitute a grievance, unless expressly stated otherwise." Section 7 describes the specific procedures applicable to arbitration.
The parties do not provide the Court with Article XV, Section 4 b(1)(a) and (b) of the CBA.
C. Federal District Court Proceedings Regarding Janice Wyatt's Termination
On October 2, 2001, Wyatt filed a complaint with the Equal Employment Opportunity Commission (EEOC) alleging that she was terminated on the basis of her race and disability in violation of Title VII of the Civil Rights Act of 1964 and the American with Disabilities Act. On April 17, 2002, the EEOC issued a Dismissal and Notice of Right to Sue. On July 12, 2002, Wyatt filed a complaint against the Defendant in federal district court in cause number 1:02-CV-234. The Defendant filed an Answer, participated in a preliminary pretrial conference, conducted discovery, filed a motion for summary judgment, supplemental motion for summary judgment, and response to Wyatt's motion for summary judgment.
On July 17, 2003, the court granted the Defendant's motion for summary judgement on each of Wyatt's claims in cause number 1:02-CV-234. In granting summary judgment for the Defendant, the court found that Wyatt failed to establish the elements of a prima facie claim for discrimination based on race, sex, disability, or religion or for retaliation. Further, the court found that Michelin offered a legitimate nondiscriminatory reason for terminating Wyatt: the court found that "Wyatt ostensibly violated the Code of Conduct when she (1) requested and received both S A benefits and vacation pay on July 11, 2001, (2) requested and received unauthorized S A benefits for nine months, and (3) called in sick on July 17, 2001, but, in actuality, had applied for another job on that day." (Ct.'s 7/17/03 Mem. and Order at 12-13.) The court also held that Wyatt did not establish that the Defendant's reasons for termination were a pretext for unlawful discrimination or retaliation.
At the time of her termination, the Defendant considered Wyatt's conduct of July 12 and July 17 to be dishonest. The Defendant also suspected, but had not yet conclusively determined, that Wyatt was receiving unauthorized S A benefits by falsifying documents. The Defendant indicated to Wyatt that it would continue to investigate this matter even though her other acts of dishonesty independently warranted termination.
DISCUSSION
The Defendant makes the following three arguments in support of summary judgment: (1) the Union's suit to compel arbitration is not ripe or is now moot; (2) Janice Wyatt waived her right to arbitration by filing a lawsuit claiming employment discrimination; and (3) the Union is collaterally estopped from litigating the propriety of the Defendant's termination of Janice Wyatt. The Union responds that a dispute exists between the parties as to the interpretation of a clause in the CBA, which must be arbitrated pursuant to Article VII, Section 2(b). The Union also contends that the Court's July 17, 2003, Memorandum and Order granting summary judgment for the Defendant on Wyatt's employment discrimination claims does not moot the issue regarding interpretation of the CBA. Further, the Union argues that Wyatt did not waive her right to pursue her grievance by filing a civil suit and res judicata does not apply.
Several general principles guide a court in an action seeking to compel arbitration of a labor dispute. The first is that "arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed to submit." AT T Techs., Inc. v. Communications Workers of Am., 475 U.S. 643, 648-50 (1986). The second principle is that whether a collective bargaining agreement creates a duty for the parties to arbitrate a particular grievance is an issue for judicial determination. Id. The third principle requires that a court avoid ruling on the potential merits of any underlying claims when deciding whether parties have agreed to submit a particular grievance to arbitration. Finally, when a contract contains an arbitration clause, a presumption of arbitrability exists such that an "order to arbitrate should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute." Id.
The Defendant acknowledges these principles, but argues that the Union cannot establish that a present dispute exists regarding the meaning of the CBA because the Defendant has not acted, or threatened to act, in a manner that is inconsistent with the CBA. (Def. Summ. J. Br. at 10-12) (citing Chicago Typographical Union No. 16 v. Chicago Sun-Times, Inc., 860 F.2d 1420 (7th Cir. 1988) for the proposition that an arbitrable controversy or disagreement must exist before a court can compel arbitration)). Indeed, in Chicago Sun-Times, the court found that the relevant arbitration clause referred to "controversies" and "disagreements" regarding the interpretation and application of the contract and that no such controversies or disagreements existed because the Chicago Sun-Times had not yet taken any position or action regarding the specific section of the agreement at issue.
Here, the CBA unambiguously provides that "any question concerning the interpretation or application of any provision [of the CBA] or any claim of violation of any provision [of the CBA] may constitute a grievance." The CBA further states that the final step of the grievance process is arbitration. When the Defendant terminated Wyatt for dishonesty for her use of vacation and S A benefits, the Union argued that, under Article XV, Section 4 (b)(1)(a) and (b), Wyatt's acts were not improper because an employee may receive S A pay while on vacation. The Defendant responded that the cited provisions did not apply to Wyatt's situation because she did not request vacation pay in lieu of vacation. The grievance involved a question regarding the interpretation or application of Article XV, Section 4(b)(1) and (b) of the CBA and the Defendant acted in a manner inconsistent with the Union's suggested interpretation of this provision. Thus, a dispute existed regarding the meaning of the CBA when the Defendant terminated Wyatt.
However, the Defendant argues that this dispute was resolved when the district court granted its motion for summary judgment on Wyatt's employment discrimination claims under Case No. 1:02-CV-234. The court, in its order awarding summary judgment, found that Wyatt failed to establish the elements of a prima facie claim for discrimination based on race, sex, disability, or religion or for retaliation. The Court also found that the Defendant offered a legitimate nondiscriminatory reason for terminating Wyatt when it stated that she ostensibly violated the Code of Conduct. The Court further held that Wyatt did not establish that the Defendant's reasons for termination were a pretext for unlawful discrimination or retaliation.
The Union's grievance challenged the Plaintiff's termination, but not on the same grounds alleged by Wyatt in her lawsuit and considered by the district court in Case No. 1:02-CV-234. Wyatt filed the lawsuit to assert her rights under federal employment discrimination legislation. The Union filed the grievance to assert its rights under the CBA. The district court never considered the issue of whether the Defendant's interpretation of Article XV, Section 4(b)(1) and (b) was proper. In considering whether the Defendant proffered a legitimate, nondiscriminatory reasons for terminating Wyatt's employment, and whether Wyatt proved the reasons were a pretext for discrimination, the Court considered whether the Defendant's proffered reasons were a lie, not whether they involved a mistaken interpretation of the CBA. See Koski v. Standex Int'l Corp., 307 F.3d 672, 677 (7th Cir. 2002) (To show that an employer's proffered reason is pretextual, a plaintiff must do more than demonstrate that the employer made a mistake or that the employer's reason was not good enough to support its decision. . . . Specifically, the plaintiff must show that the `nondiscriminatory' reason is not the real reason at all, but is instead nothing but a cover-up for discrimination.")
Whether the Defendant violated or misinterpreted the CBA was not resolved by the Court's determination that the Defendant did not violate Title VII or the ADA when it believed that Wyatt could not receive S A benefits and vacation pay on the same day. Therefore, the dispute between the Union and the Defendant was not resolved by the district court's decision in Case No. 1:02-CV-234.
The Defendant next argues that even if there is a present dispute between the parties, "the Union's suit should be dismissed because it can be said with positive assurance that the Collective Bargaining Agreement is not susceptible of an interpretation that covers the asserted dispute." (Def.'s Sum. J. Br. at 14.) In support of this argument, the Defendant states that the right to arbitration arises under two separate provisions of the CBA:
Controversies may arise of a nature so general as directly to affect all or a majority of the employees of a division or plant. It is agreed that issues of this nature need not be subjected to the entire grievance procedure, but may be initiated by either party at any step, prior to arbitration, deemed appropriate by the party bringing the grievance.
Article VII, Section 1(d).
Any question concerning the interpretation or application of any provision of this Agreement or the local supplemental agreement or any claim of violation of any provision of this Agreement of the local supplemental agreement may constitute a grievance, unless expressly stated otherwise.
Article VII, Section 2(b).
Section 1(d) is not applicable here. This provision creates an exception to submission to the entire grievance process for controversies that would have implications for a majority of workers in a division or plant. The Defendant argues that Section 2(b) does not apply because "[a]n employee who chooses to pursue her grievance in another forum has no right under the Collective Bargaining Agreement to also have her grievance arbitrated." (Def.'s Summ. J. Br. at 15.) As the Court discussed infra, Section 2(b) applies because the dispute regarding Wyatt's termination involved the interpretation or application of a provision of the CBA. The Court, having found as a threshold matter that Wyatt's termination is properly the subject of arbitration under the CBA, will next consider whether the Union's right to arbitrate the grievance was waived when Wyatt filed her lawsuit in federal court.
The Defendant argues that election to file a lawsuit to resolve a dispute is a presumptive waiver of the right to arbitrate. The Plaintiff contends that the cases cited by the Defendant are distinguishable. The Defendant cites to Cabintree of Wis., Inc. v. Kraftmaid Cabinetry, Inc., 50 F.3d 388 (7th Cir. 1995), Ernst Young, LLP v. Baker O'Neal Holdings, Inc., 304 F.3d 753 (7th Cir. 2002), St. Mary's Med. Ctr. of Evansville, Ind. v. Disco Aluminum Prod. Co., 969 F.2d 585 (7th Cir. 1992), and Grumhaus v. Comercia Secs., Inc., 223 F.3d 648 (7th Cir. 2000). The waiver issue in these cases was created when one party attempted to exercise an option to arbitrate a contract dispute under the terms of a commercial contract after the party was many months or even years into litigation that was filed to enforce the same contractual rights that would be the subject of arbitration.
In comparison, the Union in this case expressed its desire to arbitrate before Wyatt filed her lawsuit. This is not the case where the party chose a forum and then decided to "change course midstream." Grumhaus, 223 F.3d at 650 (citing Cabintree, 50 F.3d at 390)). This is also not the case where the party is seeking to enforce the same contract rights in federal court that would be the subject of arbitration. Rather, Wyatt filed her lawsuit to enforce federal statutory rights, specifically her rights under Title VII and the ADA. An employee may exercise his right to "pursue fully both his remedy under the grievance-arbitration clause of a collective bargaining agreement and his cause of action under Title VII." Alexander v. Gardner-Denver Co., 415 U.S. 36, 59-60 (1974) "Title VII's purpose and procedures strongly suggest that an individual does not forfeit his private cause of action if he first pursues his grievance to final arbitration under the nondiscrimination clause of a collective bargaining agreement." Id. at 49; See also Pryner v. Tractor Supply Co., 109 F.3d 354, 363 (7th Cir. 1997) (motion to stay federal court proceedings pending arbitration denied because arbitration of a contractual right not to be discriminated against does not preclude enforcement of a statutory right not to be discriminated against). Therefore, even if the Union filed a grievance alleging that the Defendant violated a non-discrimination provision of the CBA, Wyatt would retain her right to enforce her statutory rights in federal court.
The Union appealed the grievance to arbitration on February 22, 2002. Wyatt filed her suit in federal court on July 12, 2002.
Under this case law, the Defendant's argument that "Ms. Wyatt's conduct in pursuing a judicial remedy has imposed undue expense on Michelin, which has undergone the types of litigation expenses arbitration was designed to alleviate," is without merit because even if arbitration had already been completed, this would not act as a bar to Wyatt filing her discrimination claim in federal court. In other words, arbitration would not have necessarily "alleviated" the expense of the federal litigation.
Here, the Union sought to invoke the grievance process to enforce contractual rights unrelated to unlawful discrimination based on race or disability. If arbitration had been completed prior to the commencement of Wyatt's lawsuit, this would not have precluded her from pursuing a remedy in federal court. This Court finds no reason why the converse should not also be true. Wyatt's suit under Title VII and the ADA does not preclude arbitration on the contract issue.
The Court also notes that Title VII and the ADA delineate certain prerequisites that an employee must satisfy before she may institute a lawsuit. An employee must file a charge with the EEOC within 300 days of the discriminatory act. 42 U.S.C. § 2000e-5(e); 42 U.S.C. § 12117(a) (adopting the charge-filing requirements of Title VII). A plaintiff must then file her suit within 90 days from the date she receives notice of her right to sue from the EEOC. 42 U.S.C. § 2000e-5(f); 42 U.S.C. § 12117(a); Houston v. Sidley Austin, 185 F.3d 837, 838-39 (7th Cir. 1999). If Wyatt waited to file her EEOC Charge and lawsuit, her claims would have likely been procedurally barred. See, e.g., Jennings v. Uniroyal Plastics Co., 1989 WL 125601, * 3 (N.D. Ind. Jan. 25, 1989) (holding that statue of limitations under 42 U.S.C. § 1981 was not tolled by the plaintiff's filing grievances with the Union). Accord, Elec. Workers v. Robbins Myers, Inc., 429 U.S. 229 (1976) (pendency of grievance does not toll the running of the statute of limitations). Thus, not only did Wyatt have the right to bring suit when she did, but the statutory prerequisites directed it.
As an alternative, but related, ground to support its argument against arbitration, the Defendant cites the law regarding res judicata and collateral estoppel. The Defendant argues that an issue may not be relitigated when it has already been litigated and determined by a valid and final judgment, the determination is essential to the judgment, and the determination is conclusive in a subsequent action between the parties, whether on the same or a different claim. Sullivan v. Am. Casualty Co. of Reading Penn., 605 N.E.2d 134, 138 (Ind. 1992) (citing Restatement (Second) of Judgments § 27 at 250 (1982)). The Defendant argues, "The exact same evidence that Michelin used to exculpate itself of the discrimination claims brought by Ms. Wyatt is applicable to the instant litigation to prove that there is no present dispute that Ms. Wyatt's termination was justified."
As the Court stated, supra, the issues surrounding summary judgment on employment discrimination claims and the issue of interpretation of the CBA are not the same. Wyatt's discrimination claims failed because she did not establish that the Defendant's proffered legitimate business reasons for terminating her employment — that she ostensibly violated the Defendant's Code of Conduct — were a lie. The Union disputes the Defendant's interpretation of the CBA that led to the Defendant's conclusion that she violated the Code of Conduct. The district court's conclusions did not necessitate an interpretation of Article XV, Section 4 b(1)(a) and (b) of the CBA. In fact, Wyatt's arguments disputing the Defendant's proffered reasons were not even related to contract interpretation. The court notes in its Memorandum and Order granting summary judgment that Wyatt argued that she did not alter the S A forms and that her double-payment on July 11, 2001, was actually caused by the Defendant's mistake regarding the nature of her vacation request. (Ct.'s 7/17/03 Mem. and Order at 14.) These arguments go to whether Wyatt actually engaged in the conduct the Defendant alleged that she did, not whether her conduct was allowed under the CBA.
Res judicata and collateral estoppel do not apply to this case as argued by the Defendant. The Court finds that the grievance challenging Wyatt's termination is subject to arbitration pursuant to the terms of the CBA and that Wyatt's lawsuit and the resulting memorandum and order granting summary judgment in the Defendant's favor do not affect this determination.
CONCLUSION
For the foregoing reasons, the Defendant's Motion for Summary Judgment [DE 15] is DENIED and the Plaintiffs' Motion for Summary Judgment [DE 11] is GRANTED with JUDGMENT being ENTERED in favor of the Plaintiffs and against the Defendant.SO ORDERED.