Jun 05, 2008 Timothy T. Coates
Ninth Circuit reverses judgment against GMSR client based on failure to submit matter to neutral arbitrator

Karcher Firestopping, Inc. v. Local No. 5, International Association of Heat and Frost Insulators and Asbestos Workers (2008) 2008 U.S. App. LEXIS 12236 Ninth Circuit Case Nos. 06-56728 and 07-5520 [unpublished ]. A labor union filed a grievance against GMSR’s client and the client invoked its right under the collective bargaining agreement to have the grievance heard by a neutral arbitrator. The union asserted that the grievance instead had to be submitted to an administrative committee consisting of members of the union and several of the client’s competitors. The client filed a federal declaratory relief action to stay the administrative committee hearing, but the district court denied the stay and the committee then entered a $500,000 award against the client, which was subsequently confirmed in a separate federal action. The district court dismissed the first action. The client appealed from the dismissal and the subsequent judgment. In consolidated appeals, the Ninth Circuit reversed, agreeing with GMSR that the issue of which decision-maker would resolve the grievance – the administrative committee or a neutral arbitrator – was one of law for the court. It further agreed with GMSR that the plain language of the collective bargaining agreement made it clear that GMSR’s client had the right to have the grievance resolved by a neutral arbitrator and not by the administrative committee.