E.I. Dupont De Nemours & Co. v. Ampthill Rayon Workers, Inc. , 290 F. App'x 607 ( 2008 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 07-2075
E.I. DUPONT DE NEMOURS & COMPANY,
Plaintiff - Appellant,
v.
AMPTHILL RAYON WORKERS, INCORPORATED,
Defendant – Appellee.
Appeal from the United States District Court for the Eastern
District of Virginia, at Richmond. Henry E. Hudson, District
Judge. (3:07-cv-00052-HEH)
Argued: May 14, 2008 Decided: August 25, 2008
Before TRAXLER, GREGORY, and SHEDD, Circuit Judges.
Affirmed by unpublished opinion. Judge Gregory wrote the
opinion, in which Judge Traxler and Judge Shedd joined.
ARGUED: Thomas Peter Gies, CROWELL & MORING, LLP, Washington,
D.C., for Appellant. Jonathan Gans Axelrod, BEINS & AXELROD,
PC, Washington, D.C., for Appellee. ON BRIEF: Kris D. Meade,
Glenn D. Grant, CROWELL & MORING, LLP, Washington, D.C.; James
P. McElligott, Jr., Regina J. Elbert, MCGUIREWOODS, LLP,
Richmond, Virginia, for Appellant.
Unpublished opinions are not binding precedent in this circuit.
GREGORY, Circuit Judge:
E.I. DuPont de Nemours & Co., (ADuPont@) appeals the
district court=s decision denying its motion for summary judgment
and partially granting Ampthill Rayon Workers Incorporated=s
(AARWI@) cross motion for summary judgment. We affirm.
I.
We adopt the facts as set out by the district court, see
E.I. DuPont de Nemours and Co. v. Ampthill Rayon Workers, Inc.,
516 F.Supp.2d 588 (E.D.Va. 2007), and summarize only the facts
relevant to the parties= dispute.
DuPont offers its employees throughout the country, union
and non-unionized, a number of benefit plans (Aplans@), all of
which are governed by ERISA, 29 U.S.C. ' 1001 et seq., with the
exception of the Vacation Plan.1 In August 2006, DuPont sent out
a memorandum to all of its employees informing them about
amendments to the plans. Some of the amendments decreased the
benefits available to the employees under the plans.
ARWI represents about 1000 DuPont employees who work at
DuPont=s Spruance Fibers Plant in Ampthill, Virginia. These
employees come from the Production and Maintenance Unit and the
Clerical, Technical, and Office Unit. While employees in each
1
The Vacation Plan is not relevant to this case.
2
unit signed separate Collective Bargaining Agreements (ACBAs@)
with DuPont, for purposes of this dispute, the relevant
provisions from each CBA are the same.
As a result of DuPont=s 2006 amendments (Aamendments@) to the
plans, ARWI, following the procedures outlined in the CBAs,
initiated a grievance against DuPont alleging that the
amendments violated the CBAs.2 While DuPont initially agreed to
arbitrate the dispute, it subsequently reversed course and filed
a Complaint in federal district court. Shortly thereafter,
DuPont submitted an Amended Complaint seeking a declaratory
judgment stating, inter alia, that ARWI should resolve its
grievance by utilizing each plan=s internal claim procedure or in
the alternative, by filing a civil suit in federal court under
Section 502(a)(1)(B) of ERISA, 29 U.S.C. ' 1132(a)(1)(B).3 In
addition, DuPont sought injunctive relief barring ARWI from
2
For example, ARWI claims DuPont violated Article VII,
Section 1 of the CBAs which provides that Aany changes in the
[benefit plans], which had the effect of reducing or terminating
benefits will not be made effective until one year (1) after
notice to the Union by the Company of such changes.@ (J.A. 332.)
3
Persons empowered to bring a civil action
A civil action may be brought--
(1) by a participant or beneficiary--
(B) to recover benefits due to him under the terms of his plan,
to enforce his rights under the terms of the plan, or to clarify
his rights to future benefits under the terms of the plan[.]
3
resolving its grievance in arbitration. ARWI filed a
Counterclaim alleging that the amendments violated the CBAs and
seeking a ruling requiring DuPont to litigate ARWI=s grievance in
arbitration.
The parties then filed cross motions for summary judgment.
DuPont argued, inter alia, that since the amendments implicated
the terms, conditions, eligibility and interpretation of the
plans, ARWI=s grievance should be resolved according to each
plan=s internal dispute mechanism. ARWI submitted that Article
XI, Section One of the CBAs (Athe arbitration clause@) mandates
that the grievance proceed to arbitration. The arbitration
clause states, in pertinent part, that A[a]ny question as to the
interpretation of this Agreement, or as to any alleged violation
of the terms of this Agreement, which is not otherwise settled
to the mutual satisfaction of the parties hereto, shall at the
request of either party be submitted to arbitration.@ (J.A. 344,
380.)
The district court held that the parties= dispute was
arbitrable on account of the arbitration clause=s wide breadth,
the lack of any explicit language in the CBAs excluding ARWI=s
grievance from arbitration, and the absence of Aforceful
4
evidence@ that the parties wished to exclude the disputes from
arbitration. DuPont appeals the district court=s judgment.4
A.
The question posed here is whether ARWI=s grievance,
alleging that the amendments to its employees= plans breached the
parties= CBAs, is arbitrable. We review a district court=s grant
of summary judgment de novo, viewing all of the facts in the
light most favorable to the non-movant. See, e.g., EEOC v. Navy
Fed. Credit Union, 424 F.3d 397, 405 (4th Cir.2005).
Through a series of three cases, known as the ASteelworker=s
Trilogy,@ the Supreme Court set out several principles to aid
lower courts in determining whether an employer-union dispute is
subject to arbitration. See Steelworkers v. Warrior & Gulf
Navigation Co., 363 U.S. 574 (1960), Steelworkers v. American
Mfg. Co., 363 U.S. 564 (1960), and Steelworkers v. Enterprise
Wheel & Car Corp., 363 U.S. 593 (1960).
4
Shortly after the district court=s decision, three other
district courts decided the same issue. Relying on reasoning
similar to that of the district court in this case, the three
district courts held that the unions= claims were subject to
arbitration. See United Steel, Paper and Forestry, Rubber,
Mfg., Energy, Allied Indus. and Serv. Workers Local Union 943 v.
E.I. DuPont de Nemours & Co., Case No. 1:07-cv-1005-00965-RBK-JS
(D.N.J. February 29, 2008); United Steel, Paper and Forestry,
Rubber, Mfg., Energy, Allied Indus. and Serv. Workers Local 4-
5025 v. E.I. DuPont de Nemours & Co., Case No. 07-cv-122s
(W.D.N.Y. March 18, 2008); United Steel, Paper and Forestry,
Rubber, Mfg., Energy, Allied Indus. and Serv. Workers Local 4-
5025 v. E.I. DuPont de Nemours & Co., Case No. 07-cv-126-JJF
(D. Del. April 18, 2008).
5
The Supreme Court first emphasized that Aarbitration is a
matter of contract and a party cannot be required to submit to
arbitration any dispute which he has not agreed so to submit.@
Warrior & Gulf Navigation Co., 363 U.S. at 582. AThe second
rule, which follows inexorably from the first, is that the
question of arbitrability-whether a collective-bargaining
agreement creates a duty for the parties to arbitrate the
particular grievance-is undeniably an issue for judicial
determination.@ AT & T Tech., Inc. v. Commc=ns Workers of Am.,
475 U.S. 643, 649 (1986).
Third, in reviewing whether the parties claims are
arbitrable, Aa court is not to rule on the potential merits of
the underlying claims.@ Id. at 649. This mandate applies Aeven
if [the union=s grievance] appears to the court to be frivolous,@
id. at 649-50, as the court must limit its inquiry to whether
the union=s claims are arbitrable. Finally, Athere is a
presumption of arbitrability in the sense that an order to
arbitrate the particular grievance 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. Doubts should be resolved in favor of
coverage.@ Id. at 650 (emphasis added). This Apresumption is
particularly applicable,@ id., where the arbitration clause is
Abroad.@ Id. Consequently, A>absen[t] [] any express provision
6
excluding a particular grievance from arbitration . . . only the
most forceful evidence of a purpose to exclude the claim from
arbitration=@ will suffice. Id. (quoting Warrior & Gulf, 363
U.S. at 584-85) (emphasis added).
B.
DuPont contends that the district court erred in three
respects: (1) the district court failed to grasp that since
ARWI=s breach of contract grievance is inextricably linked with
benefit eligibility determinations, it should be resolved under
each plan=s dispute resolution procedure; (2) the district court
did not take into account dispositive language from Article VII
of the CBAs limiting what disputes are subject to arbitration;
and (3) the district court Afailed to apply governing ERISA
principles applicable to the resolution of employee benefit
eligibility issues and other plan interpretation issues
implicated by the grievance.@ (Appellant=s Br. 13.)
The cornerstone of DuPont=s argument is that the amendments
concern the eligibility of claimants to receive benefits under
the plans, and as such, they do not implicate the CBAs.
Specifically, DuPont contends that in resolving the parties=
dispute, an arbitrator would be forced to determine whether
individuals affected by the amendments are eligible for
benefits, a decision tasked solely to the plan administrator.
Such an action would also be inconsistent with the CBAs, and
7
specifically, Article VII, Sections 1 and 3, which states in
relevant part:
Section 1. All existing privileges heretofore enjoyed
by the employees in accordance with the following
Industrial Relations Plans and Practices of the
COMPANY and of the Plant shall continue, subject to
the provisions of such Plans and Practices and to such
rules, regulations and interpretations as existing
prior to the signing of this Agreement, and to such
modifications thereof, as may be hereafter adopted
generally by the Company or by the Plant to govern
such privileges.
Section 3. In addition to receiving benefits pursuant
to the Plans and Practices set forth in Section 1
above, employees shall also receive benefits as
provided by the COMPANY=S Beneflex Flexible Benefits
Plan, subject to all terms and conditions of said
Plan . . . .
(emphasis added). DuPont states that the Asubject to@ language
in Article VII was included in the CBAs in order Ato ensure that
[DuPont] retain[ed] the flexibility to amend these plans without
having to negotiate over subsequent plan amendments at
particular unionized facilities.@ (Appellant=s Br. 7.) By
filing a grievance, DuPont argues that ARWI is attempting an Aend
round@ the plans= dispute resolution procedures and Section
502(a)(1)(B) of ERISA, which provide the exclusive remedies for
employees seeking, enforcing, or clarifying their benefits under
the terms of each plan. Since the terms of each plan grant the
8
plan administrator5, acting as an ERISA fiduciary, the sole right
and discretion to make benefit eligibility determinations, and
the resolution of ARWI=s grievance necessarily involves
eligibility determinations, DuPont concludes that ARWI must
resolve its grievance through each plan=s internal dispute
procedures or in the alternative, through a civil action in
federal court.
ARWI surmises that since its grievance is limited to
Awhether DuPont exceeded the external restraints imposed by the
CBA . . . when it amended the plans@ (Appellee=s Br. 13), the
dispute clearly falls within the broad reach of the arbitration
clause. In addition, parroting the district court=s reasoning,
ARWI states that the plans= internal dispute resolution
mechanisms are designed to handle Aroutine benefit eligibility
determinations@ (Appellee=s Br. 14) not for interpreting the
obligations of each party under the CBAs. Finally, ARWI
contends that arbitration is the only suitable forum to resolve
the merits of its claim as ERISA does not provide employees with
Aa mechanism@ to bring their grievances before a federal court.
Based on the guidance provided by the Supreme Court, there
can be little doubt that ARWI=s claims are arbitrable. Here,
like in AT&T, the CBAs contain a broad Astandard arbitration
5
DuPont is the plan administrator for all plans except the
Pension and Retirement Plan.
9
clause,@ id. at 647, that allows Aany question as to the
interpretation of the [CBA] or as to any alleged violation of
the [CBA]@ to be settled by arbitration. (emphasis added).
Frankly, it is difficult to envision a broader arbitration
clause. It is unfathomable that either of the parties could
assume that the Asubject to@ language in Article VII would
override the overarching arbitration clause in Article XI of the
CBAs. This conclusion is even more convincing in light of the
fact that the parties chose to explicitly exclude arbitration as
a forum for resolving certain types of disputes. For example,
the CBAs preclude an employee disputing his discharge (J.A. 334)
or the denial of a promotion from proceeding to arbitration.
(J.A. 336-337.) Initially, even DuPont felt ARWI=s grievance was
subject to arbitration, and it went so far as to agree on an
arbitrator; yet, DuPont suddenly changed its mind, refusing to
arbitrate and instead initiated this action in federal court.
While it is true that the result of the plans= amendments
will decrease the benefits available to certain DuPont
employees, ARWI=s breach of contract claims are premised on the
fact that such changes violate the terms of the CBAs. As a
result, DuPont=s argument that the amendments affect an employee=s
eligibility to receive benefits under the plans, while true, is
inapposite to the issue of what forum should determine whether
the amendments violated the CBAs.
10
Additionally, DuPont has not provided Aforceful evidence,@
much less Athe most forceful evidence,@ that the parties= intended
to submit an employee=s claims alleging violations of the CBAs
to the plan administrator or to a federal court. The
presumption of arbitrability is particularly strong in this case
due to the wide reaching arbitration clause and the lack of any
explicit language in the CBAs excluding the claims at issue here
from arbitration. Whatever limited doubt exists as to the
parties= intentions must be resolved in favor of arbitration.
Also, sending this grievance to an arbitrator is hardly
inconsistent with ERISA (despite DuPont=s claims to the
contrary), and quite frankly is the only option that conforms to
the mandates of the Supreme Court. Because there is no doubt
that the arbitration clause is susceptible to an interpretation
that covers ARWI=s grievance, arbitration is the proper forum to
resolve this dispute.6
II.
For the reasons above, we affirm the district court=s
decision.
AFFIRMED
6
Our decision is purposely bereft of any analysis as to the
merits of ARWI=s claims, as even frivolous claims are subject to
arbitration. AT&T, 475 U.S. at 654-55.
11