James Farris v. Union Pacific Railroad Co. ( 2010 )

Case: 10-50324 Document: 00511245374 Page: 1 Date Filed: 09/27/2010
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
September 27, 2010
No. 10-50324 Lyle W. Cayce
Summary Calendar Clerk
JAMES H. FARRIS; SCOTT P. WATTS; ALLAN R. GASCH; SCOTT A.
ROHAL; MILO V. MARSHALL; WOODIE JOE JESSEE; V.G.
SHAPOVALOV; MATTHEW R. MCCLOSKEY; JEREMY N. ROGERS;
JIMMY ESPINOZA; KIRK A. WOLFE; SAL SOSA; AUTRY P. CLIMER;
ROBERT T. BORDELON,
Plaintiffs - Appellants
v.
UNION PACIFIC RAILROAD COMPANY,
Defendant - Appellee
Appeal from the United States District Court
for the Western District of Texas
USDC No. 5:09-cv-130
Before HIGGINBOTHAM, SMITH, and HAYNES, Circuit Judges.
PER CURIAM:*
The appellants, a group of locomotive engineers employed by Union Pacific
Railroad Co. (“Union Pacific”), appeal from the district court’s denial of their
petition to set aside an arbitration award issued by the National Railroad
*
Pursuant to 5TH CIR . R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR .
R. 47.5.4.
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Adjustment Board (“NRAB”) pursuant to section 3 of the Railway Labor Act
(RLA), 45 U.S.C. § 153 (2006). We find no error in the district court’s application
of its limited power to review NRAB awards to the undisputed facts of this case
and therefore AFFIRM the denial of the petition.
I. Facts & Procedural History
The arbitration award that is the subject of the appellants’ petition was
the outgrowth of a seniority dispute resulting from the merger of Union Pacific
with Southern Pacific Railroad Company (“Southern Pacific”) in 1996. The
underlying facts are not in dispute.
The Surface Transportation Board (“STB”), a federal agency created by the
Interstate Commerce Commission Termination Act of 1995, Pub. L. No. 104-88,
109 Stat. 803, approved Union Pacific’s application to merge with Southern
Pacific on August 12, 1996. As a condition of approving the merger, the STB
required the railroads to abide by the standard labor-union protections first
imposed in New York Dock Railway, 360 I.C.C. 60, aff’d sub nom. New York Dock
Ry. v. United States, 609 F.2d 83 (2d Cir. 1979). Pursuant to the New York Dock
conditions, Union Pacific was required to negotiate separate merger-
implementing agreements (“MIAs”) with the unions that represented its
employees at each geographic hub; until Union Pacific obtained an MIA at a
particular hub, the New York Dock conditions required the two merged
companies to continue to operate as separate railroads with their unionized
employees covered by separate collective bargaining agreements (“CBAs”).
Union Pacific’s MIA for the San Antonio hub, where all the appellants worked,
took effect on June 1, 1999.
The appellants worked as switchmen for Southern Pacific before the
effective date of the San Antonio MIA. They belonged to the United
Transportation Union (“UTU”) and were, until the effective date of the MIA,
subject to UTU’s CBA with Southern Pacific.
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In December of 1997, Union Pacific offered its train and yard service
employees, including its switchmen, the opportunity to become Union Pacific
engineers. Union Pacific did not offer the appellants the opportunity to become
engineers at that time because the MIA was not yet in place and the New York
Dock rules required Union Pacific to treat Southern Pacific as a separate
railroad for labor purposes. Later, in May of 1999, Southern Pacific offered the
appellants the same opportunity to become engineers for Southern Pacific. In
response, the appellants applied and were accepted as engineers.
After the MIA took effect, Union Pacific and Southern Pacific engineers
were merged into a single group with a single set of seniority rules. The
appellants took the position that they should be, under the several CBAs among
Southern Pacific and Union Pacific and the switchmen’s union and the
engineers’ union, granted seniority as against Union Pacific engineers based on
their date of hire as switchmen rather than the date of their becoming engineers.
The appellants reasoned in part that the unequal opportunity between pre-MIA
Union Pacific switchmen and pre-MIA Southern Pacific switchmen to become
engineers required this result. Union Pacific, the surviving post-merger entity,
disagreed.
The appellants exercised their rights under the RLA to seek arbitration
before the NRAB. After briefing and a hearing, the NRAB entered an
arbitration award in favor of Union Pacific on May 23, 2008. The arbitration
award concluded that Union Pacific had properly determined the appellants’
seniority dates under the applicable CBAs and the MIA.
The appellants timely filed a petition to set aside the NRAB arbitration
award in the United States District Court for the Western District of Texas as
permitted by the RLA. See 45 U.S.C. § 153(First)(q) (creating jurisdiction in the
district courts to hear petitions to set aside NRAB award); see also § 153(First)(r)
(setting two-year limitations period for such petitions). The parties filed cross-
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motions for summary judgment on a stipulated record. After carefully reciting
the material facts, the highly deferential standard of review, and the applicable
law, the district court granted summary judgment for Union Pacific and denied
the appellants’ petition to set aside the arbitration award.
After entry of final judgment, the appellants timely appealed to this court.
II. Standard of Review
We review a grant of summary judgment de novo, applying the same
standard as the district court. Mitchell v. Cont’l Airlines, Inc., 481 F.3d 225, 230
(5th Cir. 2007). It is difficult to overstate the level of deference that federal
courts must give to the NRAB’s arbitration award. The statute creating
jurisdiction to entertain the appellant’s petition in the federal courts permits the
judiciary to set aside an NRAB award if, and only if, (1) the NRAB has failed to
comply with the requirements imposed on it by the RLA, (2) the NRAB exceeded
its statutory jurisdiction, (3) a member of the NRAB engaged in fraud or
corruption. 45 U.S.C. § 153(First)(q); see also Union Pac. R.R. Co. v. Sheehan,
439 U.S. 89, 93 (1978).1 In our review on these three points, we are also required
to regard the findings of the NRAB as “conclusive.” § 153(First)(p). In
consequence, “the range of judicial review in [NRAB arbitration] cases is among
the narrowest known to the law.” Diamond v. Terminal Ry. Ala. State Docks,
421 F.2d 228, 233 (5th Cir. 1970).
III. Discussion
The appellants assert that two of these limited grounds for vacatur are
satisfied here: (1) that the NRAB acted outside its jurisdiction because its ruling
bears no rational relationship to the CBAs, and (2) that the award resulted from
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Our precedent also recognizes that a court with jurisdiction to review the award may
set it aside if rendered in violation of a party’s constitutional right to due process of law. See
S. Pac. Co. v. Wilson, 378 F.2d 533, 536–37 (5th Cir. 1967). No due process claim is raised in
this appeal.
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fraud or corruption. The district court concluded, upon careful review of the
record, that the NRAB acted within its jurisdiction and did not engage in fraud
or corruption. We agree.
A. NRAB’s Jurisdiction
The appellants first argue that the NRAB acted outside its jurisdiction in
rendering the award that this the subject of this appeal. We have explained
that,
[i]n the arbitration context, an award ‘without foundation in reason
or fact’ is equated with an award that exceeds the authority or
jurisdiction on the arbitrating body. . . . The arbitrator’s role is to
carry out the aims of the [CBA], and his role defines the scope of his
authority. When he is no longer carrying out the agreement or
when his position cannot be considered in any way rational, he has
exceeded his jurisdiction.
Bhd. of R.R. Trainmen v. Cent. of Ga. Ry. Co., 415 F.2d 403, 411–12 (5th Cir.
1969). We may therefore reject an NRAB award as exceeding the arbitrator’s
jurisdiction if the order is “so unfounded in reason and fact, so unconnected with
the wording and purpose of the [CBA] as to ‘manifest an infidelity to the
obligation of the arbitrator.’” Id. at 415 (quoting United Steelworkers of Am. v.
Enter. Wheel & Car Corp., 363 U.S. 593, 597 (1960)).
As explained in detail by the district court, the appellants’ argument fails
to clear this high hurdle: the arbitrator made a good-faith, reasonable effort to
interpret and apply the CBAs to the facts of this case, and our inquiry
essentially ceases there. While the merits of the arbitrator’s decision are
debatable were we to undertake de novo review, we emphasize once again that
we “do not sit as super arbitration tribunals” and are definitively barred from
“substitut[ing] [our] judgment[] for th[at] of the [NRAB] division[].” Diamond,
421 F.2d at 233.
The argument made by the appellants itself belies their effort to contend
otherwise: they argue only that the arbitrator applied the wrong provision of the
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CBAs at issue in assessing the appellants’ seniority claims. The provision that
the arbitrator did apply is at least arguably controlling. Cf. BNSF Ry. Co. v.
Bhd. of Maint. of Way Emps., 550 F.3d 418, 425 (5th Cir. 2008) (rejecting NRAB
decision where arbitrator’s reading was not “an arguable construction of” the
CBA). We cannot say that the arbitrator’s award is so categorically wrong that
it bears no relationship to the governing CBAs, see Bhd. of R.R. Trainmen, 415
F.2d at 411–12, nor does it “ignore[] an explicit term in a CBA,” see BNSF Ry.,
550 F.3d at 425. The appellants merely disagree with the arbitrator’s reading
of interrelated provisions of the multiple applicable CBAs. Thus, the appelants
have not met their burden of showing that the arbitrator’s ruling bore so little
relationship to the CBAs as to have exceeded the NRAB’s jurisdiction.
B. Fraud or Corruption
The appellants next complain that some of the parties to the arbitration
engaged in fraud. They do not, however, even allege any wrongdoing on the part
of the arbitrator. This omission defeats their claims. Section 153(First)(q)
allows the arbitration award to be aside “for fraud or corruption by a member of
the division [viz., an arbitrator] making the order.” As the plain statutory text
suggests, the appellants were obligated to provide evidence of corruption on the
part of the arbitrator, not on the part of parties to the arbitration. See Trial v.
Atchison, Topeka & Santa Fe Ry. Co., 896 F.2d 120, 125–26 (5th Cir. 1990). We
explained in Trial that a claim does not fall within the judicial review provisions
of § 153 where “the fraud that the appellants allege was allegedly committed by
[the railroad employer], not by an [NRAB] member.” Id.; see also Woodrum v.
S. Ry. Co., 750 F.2d 876, 882 (11th Cir. 1985) (noting that § 153(First)(q) limits
vacatur to “cases of ‘fraud or corruption by a member’” instead of the “more usual
[rule] allow[ing] reopening without such limitation in case of any kind of fraud
generally”). The appellants do not allege fraud on the part of the NRAB
arbitrator, and their claim therefore fails.
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IV. Conclusion
For the foregoing reasons, the well-reasoned opinion of the district court
is AFFIRMED.
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