Opinion
CIVIL NO. CCB-08-1864.
December 29, 2008
MEMORANDUM
Defendant Steamship Trade Association of Baltimore, Inc. ("STA") and plaintiff International Longshoremen's Association Local 953, AFL-CIO (the "Union") have filed motions for summary judgment regarding enforcement of an arbitration award issued to resolve a dispute arising from a collective bargaining agreement. The issues have been fully briefed and no hearing is necessary. For the reasons stated below, the defendant's motion for summary judgment will be granted and the plaintiff's cross-motion for summary judgment will be denied.
STA filed a motion to dismiss or, alternatively, for summary judgment. Because materials in the form of affidavits and exhibits have been submitted by both sides, the motion will be treated as one for summary judgment under Rule 56 of the Federal Rules of Civil Procedure. See Fed.R.Civ.P. 12(b)(6); 12(c).
BACKGROUND
The Union represents a group of workers at the Port of Baltimore, Maryland. STA, a multi-employer association, represents Port employers in collective bargaining. Two collective bargaining agreements govern the parties' relationship: a master contract, which is negotiated by the International Longshoremen's Association and the United States Marine Alliance, and a local contract negotiated between the Union and STA. Both contracts are effective from October 1, 2004 through September 30, 2010.
The master contract sets the amounts that STA employers contribute for local employee fringe benefits, which are $12 per hour effective October 1, 2004, an increase of $1 per hour over the previous rate; $12.50 per hour effective October 1, 2006; and $13.00 per hour effective October 1, 2008. Union and STA trustees jointly administer several of the fringe benefit funds including the pension, benefits, and severance and annuity ("S A") funds, while STA trustees solely administer the vacation and holiday fund. The local contract specifies how the employer contributions are to be allocated among the funds, and provides in relevant part: "Fringe benefit contributions as set forth in the master contract, for hours worked beginning on October 1, 2004, and until the termination of this Agreement shall be allocated between the Pension Fund and the Benefits Fund in amounts to be determined by agreement of the parties. . . ." (Compl. Ex. 1, Arbitration Decision and Award ("Award") at 4.)
The parties met on various occasions to discuss the allocation of the increased fringe benefit funds in the master contract to no avail. STA consistently proposed allocating some of the increased contributions into the vacation and holiday fund, which the Union steadfastly opposed. Eventually, the matter proceeded to arbitration. On December 6, 2007, the arbitrator, relying on the language in the collective bargaining agreements, concluded that STA "shall either follow the allocation procedure set forth in . . . the local Agreement, or it shall negotiate an agreement with the Union providing for a different allocation among fringe benefit funds." ( Id. at 12.) To date, the parties have not agreed upon an allocation, and the increased contributions continue to be placed into an escrow account pending resolution.
On July 17, 2008, the Union filed a complaint in this court seeking to enforce the arbitration award pursuant to section 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185(a). STA filed a motion to dismiss or, alternatively, for summary judgment on August 19, 2008, claiming both that the Union's claim is barred by the statute of limitations and that the Union is not entitled to the enforcement remedy it seeks. The Union filed a cross-motion for summary judgment on September 4, 2008.
ANALYSIS
Section 301 of the LMRA does not provide a statute of limitations. 29 U.S.C. § 185; see, e.g., Int'l Longshoremen's Assoc. v. Cataneo Inc., 990 F.2d 794, 799 (4th Cir. 1993). Courts usually apply the most analogous state statute of limitations and, in some cases, borrow a more appropriate federal statute of limitations. See DelCostello v. Int'l Bhd. of Teamsters, 462 U.S. 151, 158, 161-171 (1983) (holding that for "hybrid" section 301 and unfair representation actions, the six-month statute of limitations in 29 U.S.C. § 160(b) applies).
STA argues that the Union, despite calling its action one for enforcement, seeks to modify the arbitration award and proposes two possible statutes of limitations that, if applied, would bar the suit. The Union insists, however, that the present action is one for enforcement of the arbitration award and urges the court to apply Maryland's three-year civil action statute of limitations, Md. Code Ann., Cts. Jud. Proc. § 5-101. See, e.g., Int'l Bhd. of Teamsters v. Kansas City Piggy Back, 88 F.3d 659, 661 (8th Cir. 1996) (applying Missouri's five-year statute of limitations for breach of contract actions to section 301 action to enforce arbitration award); Serv. Employee Int'l Union v. City Cleaning Co., 982 F.2d 89, 95-96 (3d Cir. 1992) (applying Pennsylvania's six-year statute of limitations for breach of contract actions). While Maryland's three-year limitations period would likely apply to section 301 actions to enforce arbitration awards, the court need not decide the issue at this time because, as discussed below, the Union is not seeking an enforceable remedy.
STA contends that the court should apply either the 30-day statute of limitations for actions seeking to vacate arbitration awards found in the Maryland Uniform Arbitration Act, Md. Code Ann., Cts. Jud. Proc. § 3-224, or the six-month statute of limitations applied to hybrid section 301 actions in DelCostello.
In Cataneo, 990 F.2d at 800, a defendant in a section 301 enforcement action cross-petitioned to vacate the arbitration award, and the Fourth Circuit applied Maryland's 30-day limitations period for vacating arbitration awards, Md. Code Ann., Cts. Jud. Proc. § 3-224. While the same statute creates a cause of action for confirming arbitration awards, it does not provide a limitations period for such actions. See id. § 3-227(a).
Judicial review of arbitration awards in the collective bargaining context is "among the narrowest known to the law." Union Pac. R.R. Co. v. Sheehan, 439 U.S. 89, 91 (1978) (internal quotations omitted). The court is not entitled to decide the merits of the dispute. Rather, "if an arbitrator is even arguably construing or applying the contract and acting within the scope of his authority, the fact that a court is convinced he committed serious error does not suffice to overturn his decision." Major League Baseball Players Ass'n v. Garvey, 532 U.S. 504, 509 (2001) (per curiam) (internal quotations omitted). Nor is the court permitted to second-guess factual determinations. "When an arbitrator resolves disputes regarding the application of a contract, and no dishonesty is alleged, the arbitrator's `improvident, even silly, factfinding' does not provide a basis for a reviewing court to refuse to enforce the award." Id. (quoting United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 39 (1987)). The rationale behind this deference to the arbitrator is that it is the arbitrator's interpretation of the facts and the agreement that the parties bargained for, so it is the arbitrator's ruling that the parties should get, so long as the arbitrator "did his job." See Mountaineer Gas Co. v. Oil, Chem. Atomic Workers Int'l Union, 76 F.3d 606, 608 (4th Cir. 1996).
In this case, the arbitrator directed STA to allocate the escrowed fringe benefit contributions either by following the local contract's allocation procedure or negotiating an agreement with the Union for a different allocation. The Union alleges that STA has failed to abide by the arbitration award "by refusing to allocate the money in question to the S A Fund" and asks the court to enforce the award by "order[ing] STA to allocate the money in escrow and future contributions to the S A fund[.]" (Compl. at 11 ¶ 37.) STA contends that the award calls for an allocation between only the pension and benefits funds, not the S A fund.
It is undisputed that the pension fund and the S A fund are distinct entities. The pension fund was established in 1950 as a defined benefit plan. In 1997, the Union, along with the other local unions at the Port of Baltimore, negotiated with STA to create the S A fund, a defined contribution plan that would supplement the traditional pension plan. The parties created an addendum to the local contract in existence at the time to reflect the new fund and to allocate to it one dollar of employer contributions set out in the master contract. The Union claims that when the S A fund was created, the local contract's reference to "Pension Fund" came to encompass both the traditional defined-benefit pension fund and the new defined-contribution S A fund. Therefore, the plaintiff contends, the arbitrator's directive to comply with the local contract's allocation procedure — calling for an allocation "between the Pension Fund and the Benefits Fund" — included allocating escrowed funds to the S A fund. STA counters that the relevant provisions of the local contract were never amended to include the S A fund, thus the allocation ordered by the arbitrator refers only to the defined-benefit pension fund.
In the arbitration award, the arbitrator referenced the S A fund only once and, in so doing, differentiated that fund from the pension fund: "Members of the Union are eligible to participate in a number of benefit funds: pension, benefits . . ., scholarship, severance and annuity, container royalty, and vacation and holidays [sic]." (Award at 3 (emphasis added).) He further stated that the language in the local contract's allocation provision "is plain and unambiguous" and is unchanged from "earlier Agreements when the allocation of contributions was restricted to the two named funds." ( Id. at 8-9 (emphasis added).) From this language, it is clear that the arbitrator considered the allocation procedure to be limited to the two named funds — pension and benefits. While he never specifically addressed whether the term "Pension Fund" included the S A fund, there is no indication that he considered that to be the case. To the contrary, he noted that the language in the allocation procedure is unchanged from prior contracts, indicating that it has not evolved to include the S A fund, which has only been in existence since 1997. Morever, when the arbitrator did reference the S A fund, he listed it separately from the pension fund. Thus, the clear language of the arbitration award limits the local contract's allocation procedure to the two named funds — pension and benefits — and the court will not and, indeed, cannot go beyond that language to reach a different conclusion.
The arbitrator expressly concluded that STA has two options for allocating the escrowed funds: follow the allocation procedure outlined in the local contract, which mandates an allocation between only the pension and benefit funds — not the S A fund nor the vacation and holiday fund — as agreed to by the parties; or negotiate a different allocation. Both options require that STA and the Union come to a workable agreement, and the court urges the parties to do so.
Because the specific enforcement the plaintiff seeks — allocation of escrowed funds to the S A fund — was not awarded by the arbitrator and cannot be ordered by the court, the defendant's motion for summary judgment will be granted and the plaintiff's cross-motion for summary judgment will be denied. A separate Order follows.