Pittsburgh Mailers Union Local v. PG Publishing Co

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
____________
No. 21-1249
____________
PITTSBURGH MAILERS UNION LOCAL 22, a
Subordinate Union of the Communication Workers of
America AFL-CIO; PITTSBURGH TYPOGRAPHICAL
UNION NO. 7, a Subordinate Union of the Communication
Workers of America AFL-CIO;
PRESSMEN/PAPERHANDLER LOCAL UNION 24M/9N,
a Subordinate Union of the Graphic Communication
Conference/International Brotherhood of Teamsters
(GCC/IBT); THE NEWSPAPER, NEWSPRINT,
MAGAZINE AND FILM DELIVERY DRIVERS,
HELPERS, AND HANDLERS, INTERNATIONAL
BROTHERHOOD OF TEAMSTERS LOCAL NO. 211,
Appellants
v.
PG PUBLISHING CO. INC., d/b/a Pittsburgh Post Gazette
Appeal from the United States District Court
for the Western District of Pennsylvania
(D.C. Civil Action No. 2-20-cv-00222)
District Judge: Honorable J. Nicholas Ranjan
Argued on September 24, 2021
Before: McKEE, RESTREPO, and ROTH, Circuit Judges
(Opinion filed: March 30, 2022)
Patrick K. Lemon (ARGUED)
Joseph J. Pass
JUBELIRER, PASS & INTRIERI
219 Fort Pitt Boulevard
1st Floor
Pittsburgh, PA 15222
Counsel for Appellants
Brian M. Hentosz (ARGUED)
Terrence H. Murphy
LITTLER MENDELSON
625 Liberty Avenue
EQT Plaza, 26th Floor
Pittsburgh, PA 15222
Counsel for Appellee
2
___________
OPINION OF THE COURT
ROTH, Circuit Judge:
In this appeal we are asked to determine whether an
arbitration provision in a collective bargaining agreement
(CBA) survives the expiration of the CBA and remains
effective for an extended period during which the parties are
attempting to negotiate a new CBA.
Pittsburgh Mailers Union Local 22, Pittsburgh
Typographical Union No. 7, and Pressman/Paperhandler Local
Union 29M/9N exclusively represent certain employees of PG
Publishing, which prints the Pittsburgh Post-Gazette. Each
union had its own CBA with PG Publishing. Among other
provisions, the CBAs required PG Publishing to provide health
insurance to the unions’ employees.
In addition, a separate provision in each CBA governed
dispute resolution. When a dispute arose under the CBAs,
those agreements contemplated a particular grievance
procedure. The final step in that grievance procedure involved
the union and PG Publishing participating in binding
arbitration. The CBAs had durational clauses, but the
arbitration provisions had no durational clauses of their own.
All three CBAs expired in March 2017. Two months
before their expiration, PG Publishing sent letters to the unions.
In all the letters, PG Publishing included these statements:
3
The current Agreement expires on March
31, 2017. At that time, all contractual
obligations of the current agreement shall
expire.
[PG Publishing] will continue to observe
all established wages, hours and terms
and conditions of employment as required
by law, except those recognized by law as
strictly contractual, after the Agreement
expires. With respect to arbitration, the
Company will decide its obligation to
arbitrate grievances on a case-by-case
basis. 1
While the parties continued to negotiate new CBAs,
they operated under certain terms of the now-expired
agreements. The unions claim that, during that negotiation
period in 2019, PG Publishing violated the expired CBAs by
failing to provide certain health-insurance benefits. The unions
filed grievances under the dispute-resolution provisions
contained in the now-expired agreements. PG Publishing
refused to arbitrate these grievances. Instead, PG Publishing
sent letters to the unions saying that it “has expressly
disavowed any obligation to arbitrate post-expiration
grievances.” 2 In these letters, PG Publishing noted the
Supreme Court’s decision in Litton Financial Printing
Division v. NLRB, 3 explaining that:
1
S. App. 38–39, 42, 44, 46, 65, 68, 70.
2
App. 191, 196–99.
3
501 U.S. 190 (1991)
4
Having carefully considered the
circumstances of this grievance, [PG
Publishing] has concluded that the
grievance does not fall within any of
Litton’s exceptions. The grievance
involves facts and occurrences that arose
after the contract expired. Under normal
principles of contract interpretation, the
disputed contract right does not survive
the expiration of the contract. Therefore,
the Union’s grievance is not arbitrable. 4
The unions filed this lawsuit in February 2020. They
asserted that, under our decision in Luden’s Inc. v. Local Union
No. 6 of the Bakery, Confectionery & Tobacco Workers
International Union, 5 implied-in-fact contracts had been
formed and, therefore, the unions and PG Publishing needed to
follow the arbitration provisions included in the now-expired
CBAs. 6 After discovery, the unions and PG Publishing moved
for summary judgment. The District Court granted PG
Publishing’s motion for summary judgment, holding that the
court could not compel PG Publishing to arbitrate. 7 The
unions appealed.
4
App. 191, 196–99.
5
28 F.3d 347 (3d Cir. 1994).
6
App. 14.
7
The District Judge based his decision on his finding that no
clear implied-in-fact contract to arbitrate existed after the
expiration of the CBA. However, he added in a note a request
to our Court to provide clarification on whether and under what
circumstances an arbitration provision survived the expiration
5
I.
The District Court had subject-matter jurisdiction under
28 U.S.C. § 1331. We have appellate jurisdiction under 28
U.S.C. § 1291. We apply plenary review to a district court’s
order granting summary judgment. 8 Summary judgment may
be granted only when there is no genuine dispute of material
fact and the moving party is entitled to judgment as a matter of
law. 9
II.
In Luden’s, we held that “an arbitration clause may
survive the expiration or termination of a CBA intact as a term
of a new implied-in-fact CBA unless (i) both parties in fact
intend the term not to survive, or (ii) under the totality of the
circumstances either party to the lapsed CBA objectively
manifests to the other a particularized intent, be it expressed
verbally or non-verbally, to disavow or repudiate that term.” 10
of a CBA. He added that clarification would be helpful not
only to the courts but also to “employers and unions in how
best to act after expiration of a CBA.” Pittsburgh Mailers
Union Local 22, et al. v. PG Publishing Co., No. 2:20-cv-222-
NR, 2021 WL 244632 at 3* (W.D. Pa. Jan. 5, 2021).
8
See, e.g., Olson v. Gen. Elec. Astrospace, 101 F.3d 947, 951
(3d Cir. 1996).
9
See Fed. R. Civ. P. 56(c); see also Coolspring Stone Supply,
Inc. v. Am. States Life Ins., Co., 10 F.3d 144, 148 (3d Cir.
1993).
10
Luden’s, 28 F.3d at 364.
6
Although then-Judge Samuel Alito saw conflict with Litton in
this holding, the Luden’s Majority (of which I was one) did not.
The decision of the Luden’s Majority does not,
however, hold up under further rulings by the Supreme Court
on the issue of the survival of the contractual provisions of a
CBA after its expiration. In 2015, in M & G Polymers USA,
LLC v. Tackett, 11 the Supreme Court was called upon to
determine whether retiree health benefits, created in expired
CBAs, had terminated at the time that the CBAs expired. The
retirees were seeking vested contribution-free lifetime benefits.
The Court held that it interpreted CBAs “according to ordinary
principles of contract law, at least when those principles are not
inconsistent with federal labor policy.” 12 The Sixth Circuit
Court of Appeals had held that the provisions of the CBA
“inferred an intent to vest those retiree benefits for life.” 13 The
Supreme Court concluded, to the contrary, that the benefits in
question did not survive the expiration of the CBA. The Court
turned to Williston on Contracts to support its ruling: “Where
the words of a contract in writing are clear and unambiguous,
its meaning is to be ascertained in accordance with its plainly
expressed intent.” 14 The Court then ruled against the retirees,
holding that the inferences of lifetime benefits were
“inconsistent with ordinary principles of contract law.” 15
11
574 U.S. 427 (2015).
12
Id. at 435.
13
Id. at 436.
14
11 R. Lord, Williston on Contracts § 30:6, p. 108 (4th ed.
2012).
15
Tackett at 574 U.S. at 442.
7
Three years later, in CNH Industrial N.V. v. Reese, 16 the
Sixth Circuit Court of Appeals tried again to hold that lifetime
vesting of health care benefits survived the expiration of the
CBA that had created them. Here, the Court of Appeals had
held that the same inferences that had been used to support
vesting, now rendered the provisions of the CBA ambiguous so
that the court could consider extrinsic evidence. The Supreme
Court flatly held that the Court of Appeals’ decision “does not
comply with Tackett’s direction to apply ordinary contract
principles.” 17 The Supreme Court explained that those
principles include the requirement that, if a specific provision
does not have its own durational clause, the general durational
clause of the CBA applies. 18 For that reason, in Reese, the
Court of Appeals’ refusal to apply the general durational clause
“distort[ed] the text of the agreement and conflict[ed] with the
principle of contract law that the written agreement is
presumed to encompass the whole agreement of the parties.” 19
Arbitration provisions are similar to these health benefit
provisions in that they are matters of consent, i.e., unlike
wages, hours and terms and conditions of employment,
arbitration provisions are contractual provisions that are not
required by the NLRA to continue in effect during the
negotiation of a new CBA. 20 The holdings of the Supreme
Court in Tackett and Reese are, for this reason, relevant to our
consideration of the duration of the arbitration provisions in the
CBAs here. It is clear from these Supreme Court precedents
16
138 S. Ct. 761 (2018).
17
Id. at 765.
18
Id. at 763.
19
Id.20
Litton, 501 U.S. at 198-200.
8
that we must apply ordinary contract principles in determining
whether a contractual provision in a CBA survives the
expiration of the CBA. According to these principles, if a
specific provision does not have its own durational clause, the
general durational clause of the CBA applies. 21
The arbitration provisions here are contractual. Thus,
we must follow the Supreme Court’s directive: Since the
arbitration provisions have no durational limit of their own,
their survival is governed by the general durational clauses of
the CBAs. Under this rule, PG Publishing’s obligation to
arbitrate expired with the CBAs in March 2017.
Nor does the unions’ claim of an “implied-in-fact
contract” change our ruling. The arbitration clause had already
expired. The rule does not preclude the parties from coming to
an agreement, after the expiration of a CBA, to arbitrate
disputes in accord with contract law principles. However, such
an agreement must be a complete one, encompassing all
necessary provisions. It cannot be merely “implied.”
The letters, written by PG Publishing in 2017, confirm
that PG Publishing did not wish to be bound by the arbitration
provisions after the expiration of the CBAs. PG Publishing’s
letters, however, were not necessary to reach the conclusion
that we do. Because the arbitration provisions here did not
have their own durational clauses, under the contract law
principle that the writing must encompass the whole agreement
of the parties, 22 PG Publishing’s letters were not necessary.
21
Reese, 138 S. Ct. at 766 (quoting Litton, 501 U.S. at 440).
22
Id. at 763 (quoting Tackett, 574 U.S. at 439).
9
We also note that our decision here is consistent with
the outcome arrived at by our sister circuits in labor cases. 23
Finally, we must explain how we can come to this
conclusion in view of our holding in Luden’s that an arbitration
clause may survive the expiration of a CBA “as a term of a new
implied-in-fact CBA.” 24 As a panel, are we not bound by the
precedential holding in Luden’s? Clearly, however, when we
consider the development of the law in Tackett and Reese, we
must admit that our decision in Luden’s to extend the duration
of the arbitration provision beyond the expiration of the CBA,
without there being any durational clause in the arbitrational
provision, is a violation of “ordinary contract provisions.” 25
Under the reasoning of Tackett and Reese, we are required to
hold that the arbitration provisions here expired with the
CBAs.
Although normally we would not overrule a prior
precedent of our Court without an en banc hearing, we are
permitted to do so when that prior precedent has been
23
See, e.g., Nat’l Lab. Rels. Bd. v. Nexstar Board., Inc., 4 F.4th
801, 811 (9th Cir. 2021) (noting that “the agreement in the
CBA to arbitrate expires with the CBA”); McNealy v.
Caterpillar, Inc., 139 F.3d 1113, 1119 (7th Cir. 1998) (noting
that “an arbitration clause is not effective after a CBA expires,
unless the parties agree to continue the clause”); Des Moines
Mailers Union, Teamsters Local No. 358 v. NLRB, 381 F.3d
767, 770 (8th Cir. 2004) (applying general durational clause of
the CBA).
24
Luden’s, 28 F.3d at 364.
25
Reese, 138 S. Ct. at 765.
10
“undermined by the Supreme Court.” 26 Our review of Tackett
and Reese convinces us that the holdings in those two cases
undermine our opinion in Luden’s. For that reason, we hold
that Luden’s is overruled and that, as a matter of contract law,
the arbitration provisions here, because they do not have their
own durational clauses, expired with the CBAs on the CBAs’
termination date.
For the above reasons, we will affirm the judgment of
the District Court.
26
United States v. Jacobs, 21 F.4th 106, 114 (3d Cir. 2021).
11