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SSA TERMINALS v. MACHINISTS AUTO. TRADES DIST.

February 12, 2003

SSA TERMINALS, Petitioner
v.
MACHINISTS AUTOMOTIVE TRADES DISTRICT LODGE NO. 190 — AUTOMOTIVE MACHINISTS LODGE NO. 1414 OF THE INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE OF WORKERS, Respondent.



The opinion of the court was delivered by: CONTI, District Judge

ORDER DENYING PETITIONER'S MOTION TO VACATE ARBITRATION AWARD
I. INTRODUCTION

On October 31, 2002, Petitioner SSA Terminals (SSAT) filed, pursuant to 9 U.S.C. § 10(a)(4), a motion to vacate the arbitration Decision and Award of August 2, 2002 (Award), that directs Petitioner to reinstate James Huey to his former position as a refrigeration mechanic and to pay him full back pay and benefits. For the reasons set forth below, this Court denies Petitioner' s motion, and directs Petitioner immediately to comply with the Award.

 II. BACKGROUND

  James Huey has worked for Petitioner and its predecessor at the same location for approximately 23 years, most recently as a refrigeration mechanic. His employment is governed by a Collective Bargaining Agreement (CBA). On September 1, 2000, Huey reported an on-the-job accident that injured his lower back. Huey received treatment for his injury from two board-certified physicians: Dr. Julie Nefkens, an internist, and Dr. Jeffrey Meter, an orthopedic surgeon. Based on her opinion and that of Dr. Meter, Dr. Nefkens completed several work restriction slips that Huey submitted to Petitioner. These slips indicated that Huey should not bend, lift, or climb at all. Following his doctors' orders, Huey did not return to work.

  Petitioner was suspicious of Huey's claimed disability, and communicated this suspicion to its workers' compensation insurance carrier, who then investigated Huey's claim. The insurance carrier arranged to videotape Huey surreptitiously during the time that he was, according to his doctors, unable to return to work. Petitioner contends that the videotapes show Huey engaging in numerous physical activities that involve bending, lifting, and climbing. According to Petitioner, these activities include using a hedge trimmer, a leaf blower strapped to his back, and a lawn mower, as well as jumping up and down to compact the debris in a trash container, and lifting a garbage container over his head.

[244 F. Supp.2d 1033]

     

  In December, 2000, the insurance carrier deposed Huey. At no time before or during the deposition did Petitioner or the insurance carrier provide Huey an opportunity to view the videotape, nor did they notify Huey that the videotape existed. Petitioner contends that Huey perjured himself at the deposition by falsely stating that he complied with all the physical restrictions imposed by his doctors.

  On January 8, 2001, Petitioner terminated Huey's employment. The letter of termination explains that Petitioner terminated Huey essentially because Huey allegedly "intentionally misrepresented [his] physical limitations and subjective complaints to [his] doctors and to the employer/compensation carrier for the purpose of obtaining Workers' Compensation benefits." (Pet'r's Ex. J)

  Huey filed a grievance challenging his termination, and the dispute went to arbitration. Gerald R. McKay (Arbitrator) conducted the arbitration, and held hearings on May 13, May 21, and May 22, 2002. On August 2, 2002, the Arbitrator issued the Award which concluded that Petitioner did not have just cause to terminate Huey and directed Petitioner to reinstate Huey with full back cay and benefits.

  Now pending before this Court is Petitioner's mat tan to vacate the Arbitrator's Award on the ground that the Award exceeds the Arbitrator's power under 9 U.S.C. § 10(a)(4). Huey, on the other hand, asks this Court to deny Petitioner's motion, to confirm the Arbitrator's award, and to order Petitioner to pay Huey's attorneys' fees in this proceeding.

 III. LEGAL STANDARD

  In general, courts reviewing the decision of a labor arbitrator are required to accord an arbitrator's decision a "nearly unparalleled degree of deference," Stead Motors of Walnut Creek, v. Automotive Machinists Lodge Number 1173. International Association of Machinists and Aerospace Workers, 886 F.2d 1200, 1205 (9th Cir. 1989) (citations omitted). "When reviewing the award of arbitrator chosen by the parties to a collective bargaining agreement, we are bound - under all except the most limited circumstances — to defer to the decision of another even if we believe that the decision finds the facts and states the law erroneously." Id., 886 F.2d at 1204.

  The reason for this unusually high degree of deference is that the arbitrator's decision is deemed to be part of the parties' agreement.

 
Unlike the commercial contract, which is designed to be a comprehensive distillation of the parties' bargain, the collective bargaining agreement is a skeletal, interstitial document. The labor arbitrator is the person the parties designate to fill in the gaps; for the vast array of circumstances they have not considered or reduced to writing, the arbitrator will state the parties' bargain. He is "the parties' is officially designated `reader' of the contract . . . their joint alter ego for the purpose of striking whatever supplementary bargain is necessary" to handle matters omitted from the agreement . . .
Since the labor arbitrator is designed to function in essence as the parties' surrogate, he cannot "misinterpret" a collective bargaining agreement. As Professor St. Antoine observes, "[i]n the absence of fraud or an overreaching of authority on the part of the arbitrator, he is speaking for the parties, and his award is their contract." Thus, what courts do when they review an arbitrator's award is more akin to the review of a contract than of the decision of an inferior tribunal: the award, just as a contract, is the expression of the parties' will and must be enforced as expressed unless illegal or otherwise void.
 

[244 F. Supp.2d 1034]

      Stead Motors, 886 F.2d at 120-06 (citations omitted) Furthermore, and consistent with the arbitrator's role as filler of the gaps in a CBA, it is well established that an arbitrator can look beyond the four corners of the CBA when interpreting the CBA.

 
As to the bases for an arbitrator's award, commentators and courts have long recognized that the arbitrator is entitled, and is even expected, to range afield of the actual text of the collective bargaining agreement he interprets: "The labor arbitrator's source of law is not confined to the expressed provisions of the contract, as the industrial common law - the practices of the industry and the shop - is equally part of the collective bargaining agreement although not expressed in it.
Stead Motors, 886 F.2d at 1206-07, citing United Steelworkers of Am. v. Warrior & Gulf Navigation Company, 363 U.S. 574, 581-82 (1960). In fact, courts are not competent to second-guess an arbitrator's judgment because courts are unfamiliar with "the practices of the industry and the shop." Stead Motors, 886 F.2d at 1207.

  There are, of course, exceptions to the general rule that courts must defer to the judgment of an arbitrator. However, these exceptions are extremely narrow.

 
While we accord an arbitrator's decision a "nearly unparalleled degree of deference," Stead Motors, 886 F.2d at 1205, we have identified narrow exceptions to the general rule. Vacatur of an arbitration award under section 301 of the LMRA [Labor Management Relations Act] is warranted: (1) when the award does not draw its essence from the collective bargaining agreement and the arbitrator is dispensing his own brand of industrial justice; (2) where the arbitrator exceeds the boundaries of the issues submitted to him; (3) when the award is contrary to public policy; or (4) when the award is procured by fraud.
Southern California Gas Company v. Utility Workers Union of America, 265 F.3d 787, 792-93 (9th Cir. 2001). Two of these exceptions are relevant in this case: the essence of the contract exception, and the public policy exception. The Ninth Circuit has clearly stated that both exceptions are extremely narrow:
We believe that courts must apply the "his own brand" or "draw its essence" exceptions to judicial deference in the same way in which we have held that they ...

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