Opinion
No. 5063–12.
2013-01-7
In the Matter of the Application of UNITED UNIVERSITY PROFESSIONS and Gerold Feuer, Petitioner, v. STATE of New York, State University of New York, and Upstate Medical University, Respondents.
Richard E. Casagrande, Esq., By Robert T. Reilly, Esq. and Jacquelyn Hadam Esq., Latham, for Petitioners. Eric T. Schneiderman, Attorney General of the State of New York, By Brian J. O'Donnell, Esq., Albany, for Respondents.
Richard E. Casagrande, Esq., By Robert T. Reilly, Esq. and Jacquelyn Hadam Esq., Latham, for Petitioners. Eric T. Schneiderman, Attorney General of the State of New York, By Brian J. O'Donnell, Esq., Albany, for Respondents.
MICHAEL C. LYNCH, J.
The petitioner United University Professions (hereinafter UUP) is a party to a collective bargaining agreement with the State of New York. The petitioner Gerold Feuer (hereinafter, Dr. Feuer) is a member of the petitioner United University Professions (hereinafter UUP), who was employed as an Associate Professor at the State University of New York Upstate Medical University (hereinafter, SUNY Upstate). On December 10, 2010, Dr. Feuer was suspended without pay pending arbitral resolution of certain charges of misconduct.By an Award dated August 20, 2012, an Arbitrator determined that Dr. Feuer was guilty of some, but not all, of the charges asserted against him. Further, the Arbitrator determined that the appropriate penalty for Dr. Feuer's misconduct was not dismissal but suspension and directed SUNY Upstate to reinstate him to his former position with the University. SUNY Upstate has not reinstated Dr. Feuer. The UUP commenced this proceeding pursuant to CPLR Article 75 to obtain an Order confirming the Arbitration Award. Respondents cross move to dismiss the petition and vacate the Award.
Dr. Feuer began working for SUNY Upstate in 1996 in its Department of Microbiology and Immunology as an Associate Professor. Dr. Feuer also served as the director of the Upstate Humanized Severe Combined Immunodeficiency (“SCID”) Mouse Center and the Stem Cell Processing Center. In simple terms, SCID mice are bred to have no immune system. The mice are thereafter “humanized” in the lab with stem cells to mimic the human immune system. In 2008, Dr. Feuer founded HuMurine Technologies, Inc., “to promote the use of humanized SCID mice rather than primates in private venture testing of drugs and bodies, and to contract HuMurine work with his Upstate laboratory to generate financial resources for his research at Upstate” (Arbitrator's Award p. 6).
In December 2010, Dr. Feuer was served with a Notice of Discipline charging him with fifty-three separate specifications of misconduct related to work he allegedly performed on behalf of or in furtherance of HuMurine's interests while employed by SUNY Upstate and while using SUNY Upstate's resources and/or personnel. SUNY Upstate also alleged that Dr. Feuer directed State employees to submit charges for services performed for HuMurine to be paid from a State grant.The UUP filed a grievance to challenge the Notice of Discipline pursuant to the procedure set forth in the Collective Bargaining Agreement. In accordance with that procedure, the parties submitted the following issues to an Arbitrator:
(1) “Was there probable cause for [Dr. Feuer's] immediate suspension [without pay] pursuant to Section 19.7 of the [Collective Bargaining Agreement]. If not, what shall the appropriate remedy be”; (2) “[h]as SUNY Upstate Medial University proven Dr. Feuer's guilt of any of the charges specified in the Notice of Discipline ...”; (3) “[i]f Dr. Feuer is found guilty of any or all of the charges, is there just cause for imposing discipline?”; and, (4) “[i]f just cause for discipline is found, is the penalty of termination appropriate? If not what is the appropriate penalty”
By her August 20, 2012 Award, the Arbitrator determined (1) that SUNY Upstate did have just cause to immediately suspend Dr. Feuer pending resolution of the disciplinary charges; (2) that Dr. Feuer was guilty of thirty of the alleged acts of misconduct; (3) that Dr. Feuer was not guilty of the remaining alleged acts of misconduct; (4) that the penalty of termination was “not appropriate under the totality of circumstances”; and (5) that the appropriate penalty was suspension from the effective date of his termination to the date of the award.
In relevant part, CPLR 7510 provides: “The court shall confirm an [arbitration] award upon application of a party made within one year after its delivery to him [or her], unless the award is vacated or modified upon a ground specified in section 7511”. On a motion to confirm, this Court may not review the legal or factual basis of the award, and, unless a challenging party establishes one of the grounds for modification or vacatur set forth in CPLR 7511, the award must be confirmed (In re Vermilya, 157 A.D.2d 1030 [1990],app. den.75 N.Y.2d 710 [cit. om.] ).
This Court may vacate an arbitration award only upon one of the grounds set forth in CPLR 7511(b) [1] (NY City Transit Auth. v. Transp. Workers' Union, Local 100, 6 NY3d 332, 336 [2005] ). In support of the instant cross motion, respondents claim that the arbitrator exceeded her power (CPLR 7511(b) [1](iii)).This ground may be invoked “where the arbitrator's award violates a strong public policy, is irrational or clearly exceeds a specifically enumerated limitation on the arbitrator's power” ( NY City Transit Auth., Supra ).
Now, respondents contend that the arbitrator “exceeded [her] power” because her decision to suspend rather than dismiss Dr. Feuer violated a “strong public policy”. “[T]he scope of the public policy exception to an arbitrator's power to resolve disputes is extremely narrow * * * [j]udicial restraint under the public policy exception is particularly appropriate in arbitrations pursuant to public employment collective bargaining agreements' “ (United Fed'n of Teachers, Local 2 v. Bd. of Educ., 1 NY3d 72 [2003] [cit. om.] )
In support of its' claim that the award violates public policy, respondents cite Penal Law Article 155, which sets forth definitions and standards applicable to and the elements of the criminal offense of larceny.Respondents contend that the arbitrator factually determined that Dr. Feuer committed certain acts that “fit the definition” of larceny and “at the dollar level involved ($78,600.00 or $149,994.00) it would constitute Grand Larceny in the 2nd Degree a Class C Felony ...” (Memorandum of Law p. 7).
As set forth above, after consideration of all the evidence and testimony before her, the arbitrator determined that Dr. Feuer was guilty of thirty of the fifty separate acts of misconduct asserted against him. More specifically, the arbitrator determined that petitioner inappropriately used the State's facilities and resources for the benefit of his private entity, assigned State employees to perform services for the private entity, and inappropriately directed employees to charge costs related to the private entity to a State grant contract (Charges 7–22; Exhibit B, p. 33). The arbitrator also found that Dr. Feuer, through his private entity, sold and shipped mice owned by Upstate to other universities and charged the shipping costs to a State grant contract (Charges 23, 24, 25–28; Exhibit B, p. 33). Further, the arbitrator concluded that in the course of arranging such shipments, Dr. Feuer failed to comply with certain material transfer agreements (Charges 32–39; Exhibit B p. 34).
In this Court's view, respondent has not demonstrated that the public policy exception applies here. This exception to the general policy of judicial noninterference
applies only in “cases in which public policy considerations, embodied in statute or decisional law, prohibit, in a absolute sense, particular matters being decided or certain relief being granted by an arbitrator. Stated another way, the courts must be able to examine [the] arbitration agreement or an award on its face without engaging in extended fact-finding or legal analysis and conclude that public policy precludes its enforcement' “
Matter of State of NY, Off. of Children & Family Servs. (Civil Serv. Empls. Assn., Inc.), 79 AD3d 1438, 1439 [2010] [cit. om.], lv. den.17 NY3d 706 [2011] ).
Here, the cited provisions of the penal law support respondent's view that, generally, public policy supports certain punishment for conduct that is adjudged to be criminal larceny as defined in the statute. Dr. Feuer, however, was neither charged criminally nor adjudged to be guilty of any crime. Further, the heightened standard of proof applicable to a criminal proceeding “beyond a reasonable doubt” did not apply at the Arbitration.Respondents do not cite any public policy embodied in statute that requires the dismissal of a public employee charged with acts of misconduct that may be akin to criminal larceny. Because the arbitrator's determination to suspend Dr. Feuer does not violate any express statute, rule or regulation prohibiting reinstatement under similar circumstances, the Court is unable to conclude that the Award is “prohibit[ed], in an absolute sense” (see e.g. Matter of Jandrew v. County of Cortland, 84 AD3d 1616, 1620 [2011] ).
This Court is also unable to conclude that the award, on its face, violates public policy. Notably, it is apparent that before deciding that Dr. Feuer should be returned to work, the arbitrator considered certain mitigating factors, including that Dr. Feuer did not intend to profit personally from his conduct. Rather, the arbitrator concluded that Dr. Feuer believed that his work with the private entity would benefit the University and provide financial support for his work on behalf of the University. Further, the arbitrator noted that Dr. Feuer's conduct was not clandestine and that the administration therefore either knew or should have known that he was engaging in the offensive conduct. The arbitrator also considered the administration's delay in deciding whether Dr. Feuer's work with the private entity conflicted with his position at SUNY Upstate, that Dr. Feuer “constantly and actively” sought guidance from SUNY administrators, that the administration initially supported his plans, that similar billing practices existed with another subcontract, and that once the administration determined a conflict existed with HuMurine, the determination was not immediately communicated to Dr. Feuer. Under the circumstances, and notwithstanding the Arbitrator's ruling that Dr. Feuer engaged in misconduct, the Court is unable to conclude that the Award returning him to work at the laboratory violates an express public policy ( Matter of State of NY, Off. of Children & Family Servs. (Civil Serv. Empls. Assn., Inc.), Supra ).
The respondents also contend that the arbitrator's determination should be vacated because she refused to accept certain evidence purportedly offered “on the issue of intent to steal and to deceive the employer” (Respondent's Memorandum of Law p. 8). Respondents claim that such refusal constitutes “legal misconduct” (CPLR 7511(b)[1](i)).
Misconduct may occur where an arbitrator refuses to hear evidence that is “pertinent and material” to the issues presented (Professional Staff Congress/City University of New York v. Board of Higher Education, 39 N.Y.2d 319 [1976];Matter of Matter of Allstate Ins. Co. v. GEICO (Govt.Empls.Ins.Co.), ––– AD3d ––––, 2012 Slip Op 7994 (2d Dept Nov. 21, 2012). Generally, unless the moving party demonstrates that the evidence was “material and relevant”, “[a]n arbitrator's refusal to receive evidence is not a sufficient basis to vacate an award ...” (Thompson v. S.L.T. Ready–Mix, 245 A.D.2d 911 [1997] ). On this application to vacate the Award, respondents bear the burden of demonstrating, with “clear and convincing proof” that the arbitrator's refusal to consider the requested evidence constituted misconduct pursuant to CPLR 7511(b)[1][i] ). ( Id., citing Matter of Wiener Furniture Co. [Kingston City Schools Consol.], 90 A.D.2d 875;see Allstate, Supra ).
The documents at issue were identified at the Arbitration as State Exhibits 65, 68, 69, 70, and 71. State 65 was an e-mail from HuMurine's counsel to a HuMurine employee (Exhibit 5), State 68 was a lengthy e-mail from Dr. Feuer to his counsel dated June 6, 2010 outlining his predictions with regard to HuMurine's future (Exhibit 6). State 69 was an e-mail from a HuMurine employee to Dr. Feuer dated June 17, 2010 asking him to follow up with counsel on a certain issue (Exhibit 7). State 70 was an e-mail from HuMurine's counsel to Dr. Feuer dated July 6, 2010 (Exhibit 8), State 71 was e-mail, dated earlier the same day, indicating that Dr. Feuer forwarded to HuMurine's counsel an email he received from a SUNY administrator requesting details with regard to a HuMurine contract (Exhibit 9).Respondents contend that the documents “were offered specifically on the issue of intent to steal and to deceive the employer with respect to the actions being taken in the Petitioner's Upstate laboratory on behalf of HuMurine” (Memorandum of Law at p. 8)
The record before the Court indicates that the e-mail was sent and received from Dr. Feuer's personal e-mail account and extracted from a State-owned laptop computer.
Petitioner's counsel argued that the evidence was not admissible because the documents were subject to the attorney-client privilege.After reviewing written submissions from counsel, the Arbitrator issued an interim award dated February 22, 2012 wherein she advised that the documents were, “not sufficiently probative to support their admissibility, based on the representations of counsel as to their contents” (Exhibit I).
In this Court's view, the Respondents have not demonstrated that the requested documents were pertinent and material to the issues presented. It is well settled that “[a]n arbitrator is not bound by principles of substantive law or rules of evidence, and may do justice and apply his or her own sense of law and equity to the facts as he or she finds them to be” (Matter of Perilli v. New York State Dept. of Correctional Servs., 80 AD3d 617 [2011] [cit. om.] ). Petitioners' counsel explains that during the disciplinary hearing that lasted eight days, fifteen witnesses testified and approximately ninety exhibits were received as evidence (Reilly Reply Affidavit ¶ 4). Now, as at the Arbitration, respondents contend that the evidence was necessary to prove Dr. Feuer's intent. The arbitrator, after considering all the evidence, such as counsels' characterizations as to the content of the documents and testimony from the State's witness that his opinion with regard to Dr. Feuer's intent was not based solely on the content of the e-mail (see Tr. pp. 590–594), declined to accept the documents.Respondents have not established any basis to question the Arbitrator's judgment and the record before the Court does not support respondents' view that her determination constituted misconduct.
Accordingly, based on the foregoing, it is
ORDERED AND ADJUDGED that the petition is granted; and it is further
ORDERED AND ADJUDGED that the cross motion is denied; and it is further
ORDERED AND ADJUDGED that the Arbitration Award dated August 20, 2012 is confirmed.
This memorandum constitutes the Decision and Judgment of this Court. This original Decision and Order is being returned to counsel for petitioner. The below referenced original papers are being mailed to the Albany County Clerk. The signing of this Decision and Order shall not constitute entry or filing under CPLR 2220. Counsel is not relieved from the provision of that rule regarding filing, entry, or notice of entry.