Richard Wawock v. Csi Electrical Contractors , 649 F. App'x 556 ( 2016 )

FILED
NOT FOR PUBLICATION
MAY 05 2016
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
RICHARD WAWOCK, an individual, No. 14-56810
Plaintiff - Appellee, D.C. No. 2:14-cv-06012-SVW-
MAN
v.
MEMORANDUM*
CSI ELECTRICAL CONTRACTORS,
INC. a California Corporation,
Defendant - Appellant.
Appeal from the United States District Court
for the Central District of California
Stephen V. Wilson, District Judge, Presiding
Argued and Submitted April 6. 2016
Pasadena, California
Before: FARRIS, TYMKOVICH**, and M. SMITH, Circuit Judges.
Richard Wawock attempted to bring a class action suit against his former
employer in California state court alleging violations of California law. The
dispute resolution committee determined that Wawock’s claims must be submitted
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The Honorable Timothy M. Tymkovich, Chief Judge for the Tenth
Circuit Court of Appeals, sitting by designation.
to arbitration. Wawock appealed to the district court, alleging the committee acted
in manifest disregard of law. The district court granted summary judgment in
favor of Wawock because the collective-bargaining agreement did not clearly and
explicitly waive employees’ right to a judicial forum. We affirm.
I. Background
Union member Richard Wawock worked as an electrician for CSI Electrical
Contractors. His employment was covered by a collective-bargaining agreement.
Under the CBA, the Labor-Management Committee adjusts “all grievances or
questions in dispute.” The Committee determines “whether any particular dispute
is subject to the grievance procedure . . . .”
In February 2013, Wawock filed a class action suit in California Superior
Court against CSI for failing to compensate employees for training expenses.
Wawock’s suit contained seven causes of action—six under California’s Labor
Code and the seventh pursuant to California’s Business and Professions Code.
CSI filed a motion to compel arbitration and the Superior Court stayed
Wawock’s suit. Wawock wrote to the Committee that the CBA did not encompass
his statutory claims because Wright v. Universal Maritime Service Corporation,
525 U.S. 70 (1998), required statutory claims be explicitly referenced to be waived.
2
The Committee disagreed without addressing Wawock’s reasoning. It
determined Wawock’s statutory claims “are essentially claims for unpaid hours
worked and related expenses” and therefore subject to the grievance-arbitration
process under the CBA. The Committee then denied Wawock additional payment.
Wawock challenged the award and the district court vacated the award
pursuant to the Federal Arbitration Act, 9 U.S.C. § 10(a)(4). CSI appeals.
II. Discussion
We review the district court “accepting findings of fact that are not clearly
erroneous but deciding questions of law de novo.” Coutee v. Barington Capital
Grp., L.P., 336 F.3d 1128, 1132 (9th Cir. 2003).
A district court may vacate an award “where the arbitrators exceeded their
powers.” 9 U.S.C. § 10(a)(4). Arbitrators exceed their powers where they act in
“manifest disregard of law.” Kyocera Corp. v. Prudential-Bache Trade Servs.,
Inc., 341 F.3d 987, 997 (9th Cir. 2003) (quoting Todd Shipyards Corp. v. Cunard
Line, Ltd., 943 F.2d 1056, 1059–60 (9th Cir. 1991)). “Manifest disregard of the
law means something more than just an error in the law or a failure on the part of
the arbitrators to understand or apply the law. It must be clear from the record that
the arbitrators recognized the applicable law and then ignored it.” Mich. Mut. Ins.
Co. v. Unigard Sec. Ins. Co., 44 F.3d 826, 832 (9th Cir. 1995) (internal quotation
3
marks and citation omitted). Additionally, the ignored law must be “well defined,
explicit, and clearly applicable.” Collins v. D.R. Horton, Inc., 505 F.3d 874,
879–80 (9th Cir. 2007) (quoting Carter v. Health Net of Cal., Inc., 374 F.3d 830,
838 (9th Cir. 2004)).
A. The Committee Recognized and Ignored Applicable Law
The applicable law appears in Wright v. Universal Maritime Service
Corporation, 525 U.S. 70 (1998). The CBA in Wright covered “all matters
affecting wages, hours, and other terms and conditions of employment . . . .” Id. at
73. The arbitration clause required “[m]atters under dispute” be submitted to
arbitration. Id. at 72.
The Court held that Wright was entitled to a judicial forum for his ADA
claim because disputes concerning the meaning of a federal statute are not entitled
to a presumption of arbitrability and “any CBA requirement to arbitrate [them]
must be particularly clear.” Id. at 78–79. An employee’s right to a federal judicial
forum is sufficiently important to require a union-negotiated waiver be “clear and
unmistakable.” Id. at 80. The CBA’s broad arbitration clause, requiring arbitration
for “matters in dispute,” was not explicit because it could mean matters in dispute
under the contract. Id.
4
CSI contends the Committee interpreted, rather than ignored, Wright. But
the Committee was alerted to Wright by Wawock and did not mention the case in
its decision or mention Wright’s “clear and unmistakable” standard at all. So, we
agree with the district court’s conclusion that the Committee recognized applicable
law and then ignored it.
B. The Governing Law is Well Defined, Explicit, and Clearly Applicable
CSI next argues Wright is not clearly applicable because it might only apply
to statutory discrimination claims, not statutory labor claims. But every court to
have discussed the issue has recognized Wright’s application to other statutory
claims. See, e.g., Gilbert v. Donahoe, 751 F.3d 303, 307–10 (5th Cir. 2014)
(FMLA); Jonites v. Exelon Corp., 522 F.3d 721, 725 (7th Cir. 2008) (FLSA);
O’Brien v. Town of Agawam, 350 F.3d 279, 284–86 (1st Cir. 2003) (FLSA);
Vasserman v. Henry Mayo Newhall Memorial Hosp., 65 F. Supp. 3d 932, 964–65
(C.D. Cal. 2014) (California wage and hour law claims); Martinez v. J. Fletcher
Creamer & Son, Inc., No. CV 10-0968 PSG (FMOx), 2010 WL 3359372, *3 (C.D.
Cal. Aug. 13, 2010) (FLSA and California statutory claims).
By emphasizing the nature of the statute, CSI mistakes the right at issue. An
agreement to arbitrate statutory claims is not a waiver of the statute’s substantive
5
rights, but rather a waiver of the right “to seek relief from a court in the first
instance.” 14 Penn Plaza LLC v. Pyett, 556 U.S. 247, 265–66 (2009).
C. The CBA Does Not Provide a Clear Waiver
The CBA does not provide that any statutory claim is arbitrable, nor later
incorporate any of the statutes at issue. Making no reference to such claims
necessarily falls short of an explicit statement concerning them. See, e.g., Ibarra v.
UPS, 695 F.3d 354, 356–60 (5th Cir. 2012) (noting circuit agreement that a CBA
must at least “identify the specific statutes the agreement purports to incorporate or
include an arbitration clause that explicitly refers to statutory claims” to provide a
clear and unmistakable waiver).
In light of the lack of reference, CSI argues that the parties’ historical
practice can provide a “clear and unmistakable” waiver. Neither historical practice
nor the parties’ unexpressed intent can fulfill this standard. CBA waivers of the
right to a judicial forum must be “explicitly stated.” Wright, 525 U.S. at 80.
CSI finally argues that because the CBA specifies arbitration for “all
grievances or questions” in dispute, that “all” provides a clear and unmistakable
waiver. Just as in Wright, “grievances or questions” could mean those grievances
or questions under the contract. See Wright, 525 U.S. at 80. “All” does not expand
the meaning of grievances or questions.
6
III. Conclusion
A CBA requirement to arbitrate a statutory claim must be explicitly stated.
The Labor-Management Committee manifestly disregarded law when it ignored
this mandate and subjected Wawock’s statutory claims to arbitration. Affirmed.
7