Int'l Union, United Automobile, Aerospace & Agric. Implement Workers of Am. Local Union 1613 v. Energy Mfg. Co.

173 F.Supp.3d 815

International Union, United Automobile, Aerospace and Agricultural Implement Workers of America Local Union 1613, Plaintiff,

v.Energy Manufacturing Company Inc., Defendant.

No. 15-CV-28-LRR

United States District Court, N.D. Iowa, Cedar Rapids Division.

Signed March 26, 2016

Filed March 28, 2016

Thomas David McMillen, McMillen Law Firm, West Des Moines, IA, Matthew J. Petrzelka, Petrzelka & Breitbach, PLC, Cedar Rapids, IA, for Plaintiff.

Chris Mitchell, Maynard, Cooper & Gale, PC, Birmingham, AL, Jim D. Dekoster, Kevin R. Rogers, Swisher & Cohrt, PLC, Waterloo, IA, for Defendant.

ORDER

LINDA R. READE, CHIEF JUDGE, U.S. DISTRICT COURT, NORTHERN DISTRICT OF IOWA

TABLE OF CONTENTS

I. INTRODUCTION ... 818

II. PROCEDURAL HISTORY ... 818

III. SUBJECT MATTER JURISDICTION ... 818

IV. SUMMARY JUDGMENT STANDARD ... 818

V. RELEVANT FACTUAL BACKGROUND ... 819

A. Parties ... 819

B. Overview of the Dispute ... 819

1. Bankruptcy proceedings ... 820

2. 2012 termination and arbitration ... 822

VI. ANALYSIS ... 822

A. Judicial Estoppel ... 822

1. Judicial estoppel of Chapman ... 823

2. Judicial estoppel of UAW ... 825

B. Entitlement to Arbitration ... 826

VII. CONCLUSION ... 828

I. INTRODUCTION

The matter before the court is Defendant Energy Manufacturing Company Inc.'s (“EMC”) “Motion for Summary Judgment” (“Motion”) (docket no. 13).

II. PROCEDURAL HISTORY

On February 23, 2015, Plaintiff International Union, United Automobile, Aerospace and Agricultural Implement Workers of America Local Union 1613 (“UAW”) filed a Petition in the Iowa District Court for Jones County (“Complaint”) (docket no. 3) alleging that EMC breached an agreement between the parties to arbitrate the issue of Grievant Steve Chapman's entitlement to back pay. Complaint ¶ 10. On March 30, 2015, EMC removed the case to this court. See Notice of Removal (docket no. 2). On April 2, 2015, EMC filed an Answer (docket no. 6). On January 13, 2016, EMC filed the Motion. On January 29, 2016, UAW filed a Resistance (docket no. 15). On February 5, 2016, EMC filed a Reply (docket no. 17). The Motion is fully submitted and ready for decision.

III. SUBJECT MATTER JURISDICTION

The court has jurisdiction pursuant to 29 U.S.C. § 185(a), which provides that “[s]uits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter ... may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.” 29 U.S.C. § 185(a).

IV. SUMMARY JUDGMENT STANDARD

Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). “A dispute is genuine if the evidence is such that it could cause a reasonable jury to return a verdict for either party; a fact is material if its resolution affects the outcome of the case.” Amini v. City of Minneapolis , 643 F.3d 1068, 1074 (8th Cir.2011)(citing Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ), cert. denied , ––– U.S. ––––, 132 S.Ct. 1144, 181 L.Ed.2d 1018 (2012). “[S]elf-serving allegations and denials are insufficient to create a genuine issue of material fact.” Anuforo v. Comm'r , 614 F.3d 799, 807 (8th Cir.2010).

“To survive a motion for summary judgment, the nonmoving party must substantiate [its] allegations with sufficient probative evidence [that] would permit a finding in [its] favor based on more than mere speculation, conjecture, or fantasy.” Barber v. C1 Truck Driver Training, LLC , 656 F.3d 782, 801 (8th Cir.2011) (second alteration in original) (quoting Putman v. Unity Health Sys. , 348 F.3d 732, 733–34 (8th Cir.2003) ) (internal quotation marks omitted). The court must view the record in the light most favorable to the non-moving party and afford it all reasonable inferences. See Schmidt v. Des Moines Pub. Sch. , 655 F.3d 811, 819 (8th Cir.2011). The non-moving party “has the obligation to come forward with specific facts showing that there is a genuine issue for trial.” B.M. ex rel. Miller v. S. Callaway R – II Sch. Dist. , 732 F.3d 882, 886 (8th Cir.2013) (quoting Atkinson v. City of Mountain View , 709 F.3d 1201, 1207 (8th Cir.2013) ) (internal quotation marks omitted). “A complete failure by the non-moving party ‘to make a showing sufficient to establish the existence of an element essential to that party's case ... necessarily renders all other facts immaterial.’ ” Id. (quoting Celotex Corp. v. Catrett , 477 U.S. 317, 322–23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ) (alteration in original).

V. RELEVANT FACTUAL BACKGROUND

Viewing the evidence in the light most favorable to UAW and affording it all reasonable inferences, the uncontested material facts are as follows.

A. Parties

UAW is a labor organization that represents employees in an industry affecting commerce. UAW represented the bargaining unit employees of EMC. EMC is “a corporation authorized to do business and doing business in” Monticello, Jones County, Iowa. Complaint ¶ 2.

B. Overview of the Dispute

The relationship between EMC, UAW and the EMC employees is governed by a Labor Agreement. See EMC Appendix (“EMC App'x”) (docket no. 13-3) at 62; see also id. at 59. The Labor Agreement provides for a grievance procedure, “whereby UAW can grieve and ultimately arbitrate disputes with EMC, on the behalf of EMC employees.” EMC Statement of Material Facts (docket no. 13-1) at 1; see also EMC App'x at 76-78. Article 13 of the Labor Agreement provides that “[i]n the event that any grievance cannot be satisfactorily settled under the [grievance] procedure, the Union may submit such grievance to arbitration for final and binding settlement ....” Id. at 77. The Labor Agreement also sets forth deadlines and terms governing arbitration between UAW and EMC. See id. at 76–78.

Chapman is an employee of EMC and a member of UAW. He has worked at EMC for the past twenty-nine years. In 2008, EMC terminated Chapman from his position. UAW grieved the termination on Chapman's behalf under the just cause provision in the Labor Agreement. Following an arbitration hearing, Chapman was reinstated to his position with back pay, but put on a “last chance warning.” See id. at 102, 126. Chapman received his back pay check directly from EMC, and it was made payable to Chapman, with taxes and union dues removed. In May of 2012, EMC terminated Chapman's employment again.

1. Bankruptcy proceeding

In August of 2012, following his termination from EMC, Chapman filed a petition for Chapter 7 bankruptcy in the United States Bankruptcy Court for the Northern District of Iowa. Chapman was represented by counsel in his bankruptcy proceeding. At the time of filing “his bankruptcy petition, Chapman was aware that he had a grievance pending regarding the termination of his employment. Chapman believed at the time that the resolution of the grievance might result in him getting his job back and receiving back pay.” EMC Statement of Material Facts at 2. Chapman's bankruptcy petition did not include the claim against EMC. During the bankruptcy hearing, the Chapman engaged in the following exchange:¹

[Question]: Do you have any claims against anyone, the right to sue anybody for anything?

Chapman: Um, well the union is fighting for my job back, that's the only thing.

[Question]: Okay. But nothing other than that?

Chapman: No.

EMC App'x at 55. At the bankruptcy hearing, Wesley B. Huisinga was appointed as the bankruptcy trustee. Huisinga “certified that the estate had been fully administered and that $118,629.95 in claims were scheduled to be discharged without payment.” EMC Statement of Materials Facts at 3. On November 28, 2012, Chapman's Chapter 7 bankruptcy was discharged.

2. 2012 termination and arbitration

Kevin Visser, a Cedar Rapids attorney, represented EMC in the 2008 and 2012 arbitration proceedings regarding Chapman's employment. Timothy Schnell served as the international representative for UAW from approximately 1999 through May of 2015. Schnell represented EMC's union employees from approximately 2012 though May of 2015. Visser and Schnell represented EMC and UAW, respectively, with respect to the 2012 Chapman arbitration.

Upon UAW's filing of the Chapman grievance, “a dispute arose between EMC and UAW as to the scope of the issue to be arbitrated.” Id. at 4. The dispute concerned whether the arbitration award in 2008 “had the authority to impose a last chance letter that would extend beyond the period when discipline typically dropped off of an employee's record under the Collective Bargaining Agreement.” Id. Visser and Schnell engaged in back and forth communications regarding the scope of the question to be presented to the arbitrator. On March 4, 2013, Visser sent a letter to Schnell regarding Chapman's bankruptcy proceeding and the fact that Chapman did not disclose the claim against EMC to the bankruptcy court. In the letter, “Visser proposed limiting the scope of the arbitration to exclude the back pay issue in order to avoid potentially complicated litigation in which EMC would seek to reopen Chapman's bankruptcy estate ....” Id. at 5. Schnell agreed that the bankruptcy ruling was beyond the scope of the arbitration “and would be a matter for ... Chapman and his attorney to resolve.” Id. Visser agreed to defining the scope of the arbitration to include “[w]hether Chapman was subject to a ‘last chance’ letter and violated that last chance ...” and “[if] he was not subject to the last chance,” whether EMC had just cause for terminating him. EMC App'x at 114. However, Visser then stated that UAW and EMC “must agree that Chapman may not, in any event, recover any remedy other than reinstatement through this limited arbitration. Specifically, we must agree that Chapman has no right to recover backpay in any amount.” Id. On ...