18-624
International Brotherhood of Electrical Workers v. Charter Communications, Inc.

                                 UNITED STATES COURT OF APPEALS
                                    FOR THE SECOND CIRCUIT

                                               SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT.
CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS
PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A
SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST
CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH
THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER
MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

        At a stated term of the United States Court of Appeals for the Second Circuit, held at the
Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the
11th day of October, two thousand nineteen.

PRESENT:           DENNIS JACOBS
                   ROBERT D. SACK
                   PETER W. HALL

----------------------------------------------------------------------

INTERNATIONAL BROTHERHOOD OF
ELECTRICAL WORKERS, AFL-CIO, LOCAL UNION
NO. 3,
               Petitioner-Appellant,

                            v.                                                          No. 18-624

CHARTER COMMUNICATIONS, INC., SUCCESSOR
TO TIME WARNER CABLE OF NEW YORK CITY
LLC,
               Respondent-Appellee.

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FOR APPELLANT:                                                     JOHN H. BYINGTON III, Archer, Byington,
                                                                   Glennon & Levine LLP, Melville, NY.

FOR APPELLEE:                                                      DANIEL S. KIRSCHBAUM (Kenneth A. Margolis,
                                                                   on the brief), Kauff McGuire & Margolis LLP,
                                                                   New York, NY.

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       Appeal from a judgment of the United States District Court for the Eastern District of

New York (Weinstein, J.).

       UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED,

AND DECREED that the judgment of the District Court is AFFIRMED.

       International Brotherhood of Electrical Workers, AFL-CIO, Local Union No. 3

(“Local 3”) appeals from a memorandum and order of the United States District Court for the

Eastern District of New York (Weinstein, J.), entered on February 16, 2018, granting

summary judgment in favor of Charter Communications, Inc. (“Charter”) and ordering the

parties to proceed to arbitration. We assume the parties’ familiarity with the facts, record of

prior proceedings, and arguments on appeal, which we reference only as necessary to explain

our decision to affirm.

                                                I.

       The following facts are undisputed.

   A. The Collective Bargaining Agreement

       Local 3 and Charter were parties to a collective bargaining agreement (“CBA”) from

April 1, 2009 through March 31, 2013. That CBA contained a no-strike clause providing that

“[t]here shall be no cessation or stoppage of work, service or employment, on the part of, or

at the instance of either party, during the term of this Agreement.” J. App. 372. The CBA

also included a dispute resolution provision defining the term “grievance” and providing for

the use of final binding arbitration to resolve grievances. Id. at 369. Additionally, the CBA

included location-specific “riders” addressing how various locations would handle issues such

as standby procedures and sick days. Id. at 139. That CBA expired on March 31, 2013.

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       On March 28, 2013, the parties signed a Memorandum of Agreement (“MOA”),

agreeing to extend the CBA, with some modifications, through March 31, 2017.1 None of the

changes provided for in the MOA applied to the no-strike provision or the grievance and

arbitration provisions. A week later, Local 3 members unanimously ratified the MOA.

       While drafting the successor CBA, however, Local 3 and Charter disagreed over

whether the new agreement would include the riders and the electrical engineering degree

bonus clause of the prior CBA. Between July 2013 and March 2014, Local 3 and Charter

negotiated over those terms.2 Because they failed to reach agreement on those terms, Local 3

ultimately refused to sign a successor CBA.

    B. Acceptance of the Successor CBA

       Meanwhile, following ratification of the MOA in April 2013, Charter implemented all

of the increased wages and benefits laid out in the MOA, deducting and transmitting union

dues to Local 3 pursuant to the CBA. Additionally, Local 3 continued to use the grievance

and arbitration procedures laid out in the CBA, demanding fifteen arbitration proceedings

between March 7, 2014 and March 10, 2015. On each occasion, Local 3 served a “Notice of

Intent To Arbitrate” on Charter, seeking arbitration “under the terms of an agreement

between the parties” and “pursuant to a collective bargaining agreement existing between

[Charter] and Local 3.” Id. at 399–413. About half of these notices framed the issue to be


1
  The MOA stated that the parties “agree that the changes which are summarized below were agreed
upon relative to the Collective Bargaining Agreement . . . which will expire on March 31, 2013 and
that the full text of the applicable changes will be incorporated in a new Collective Bargaining
Agreement which shall become effective, upon ratification by the Union membership, scheduled for
April 4, 2013.” J. App. 391.
2
  Neither the no-strike clause nor the grievance and arbitration provisions were discussed during those
negotiations.
                                                  3
arbitrated as “[w]hether the Employer violated the CBA . . . .” Id. at 407, 408, 412; see also id.

at 399, 401, 409, 411, 413. In arbitration decisions awarded between January and April 2015,

arbitrators cited and relied on the grievance and arbitration section of the CBA in concluding

that the disputes were properly before them for arbitration.

   C. NLRB Adjudication of Dispute Over Riders and Engineering Degree Clause

       Charter filed an NLRB charge in March 2014, alleging that Local 3’s refusal to sign the

draft CBA was an unfair labor practice. In April 2015, the ALJ, following a trial, ruled in

favor of Local 3. The NLRB adopted the ALJ’s decision in October 2015.

       The NLRB determined that Local 3 did not commit an unfair labor practice because

there was no meeting of the minds on whether the riders and the electrical engineering clause

would be part of the successor CBA, and the terms of the MOA were “ambiguous as to these

two issues.” Id. at 145; see also id. at 144–45. Further, the NLRB stated that because the

parties had “different understandings and beliefs as to [the riders] issue,” “there was no

meeting of the minds and no contract.” Id. at 146. The NLRB reached that conclusion

despite noting that “[n]either party took the position that no contract was in effect,” and,

indeed, that the parties were then “arbitrating the claims of [Charter] pertaining to the events

complained of, under the arbitration clause of the contract.” Id. at 144. The NLRB

specifically noted Local 3’s position “that a meeting of the minds ha[d] been established that

the successor agreement would include” the two disputed terms. Id. at 147.

   D. March 2017 Strike and District Court Decision Under Review

       Local 3 went on strike from March 28 to March 31, 2017. Charter then made a

demand for arbitration alleging a violation of the no-strike provision of the CBA. In this

                                                 4
action, Local 3 asserts that it is not bound to arbitrate that alleged violation of the no-strike

clause. The District Court disagreed, reasoning that Local 3 members are bound by the no-

strike clause and grievance and arbitration provisions in the successor CBA because “Local 3’s

conduct manifested an intent to be bound” by those provisions. Sp. App. 10.

                                                II.

       “We review de novo the district court’s grant of summary judgment, drawing all factual

inferences in favor of the non-moving party.” Sousa v. Marquez, 702 F.3d 124, 127 (2d Cir.

2012) (internal quotation marks omitted). Summary judgment is appropriate only “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.” Id. (quoting Fed. R. Civ. P. 56(a)).

                                                III.

       On appeal, Local 3 principally argues that the 2015 NLRB decision finding “no

meeting of the minds and no contract” has preclusive effect, foreclosing the District Court’s

determination that the there was an enforceable agreement as to the no-strike and grievance

and arbitration provisions. Local 3 invokes both claim preclusion and issue preclusion. Claim

preclusion applies when a party attempts to “relitigat[e] issues that were or could have been

raised” in a prior action “between the same parties over the same cause of action” that

resulted in a “final judgment on the merits,” “[p]rovided the parties have had a full and fair

opportunity to litigate the matter.” Channer v. Dep’t of Homeland Sec., 527 F.3d 275, 279 (2d Cir.

2008) (internal quotation marks omitted).

       [I]ssue preclusion applies only if: (1) the issues in both proceedings are identical,
       (2) the issue in the prior proceeding was actually litigated and actually decided,
       (3) there was full and fair opportunity to litigate in the prior proceeding, and (4)
       the issue previously litigated was necessary to support a valid and final judgment
                                                  5
       on the merits.

Local 32B-32J Serv. Emps. Int’l Union, AFL-CIO v. NLRB, 982 F.2d 845, 849 (2d Cir. 1993)

(internal quotation marks omitted).

       Neither claim preclusion nor issue preclusion applies here. First, this suit is not an

attempt to litigate “the same cause of action” or issues “identical” to those raised in the

NLRB proceeding. The issue in this case is whether Local 3 must submit to arbitration of the

dispute arising out of the March 2017 strike, whereas the issue in the NLRB proceeding was

whether Local 3 violated the NLRA by refusing to sign the draft of the successor CBA. The

NLRB proceeding turned on facts about the parties’ bargaining history with respect to specific

terms not at issue here, whereas this dispute turns on facts about the parties’ conduct

following the Union’s ratification of the MOA. The March 2017 strike, moreover, could not

have been raised before the NLRB because it occurred after resolution of the NLRB

proceeding. Second, the parties did not have a full and fair opportunity to litigate the contract

formation issue before the NLRB because neither party argued that there was no contract in

that proceeding. Instead, both parties assumed there was an enforceable successor agreement

and urged the ALJ to adopt their respective interpretations of it. Further, when Charter

moved to reopen the record to admit evidence that Local 3, by its conduct, “admitted the

existence” of a successor CBA, the NLRB denied that motion, reasoning that Local 3’s

conduct did not bear on the question of whether the parties reached a meeting of the minds

on all material terms. J. App. 129 n.1 (internal quotation marks omitted).

       Nor is the NLRB’s “no contract” conclusion entitled to preclusive effect as a matter of

deference. As the Supreme Court has explained,

                                                6
       [a]lthough the Board has occasion to interpret collective-bargaining agreements
       in the context of unfair labor practice adjudication, the Board is neither the sole
       nor the primary source of authority in such matters. Arbitrators and courts are
       still the principal sources of contract interpretation. Section 301 of the Labor
       Management Relations Act authorizes federal courts to fashion a body of
       federal law for the enforcement of collective bargaining agreements.

Litton Fin. Printing Div. v. NLRB, 501 U.S. 190, 202–03 (1991) (internal quotation marks and

citations omitted). Local 3’s attempt to distinguish Litton by arguing that the issue here is one

of contract formation, not contract interpretation, is unpersuasive. In deciding whether the

parties intended to continue to be bound by the arbitration and no-strike terms of the CBA,

we are engaged in “fashion[ing] a body of federal law for the enforcement of collective

bargaining agreements.” Id.; cf. Textron Lycoming Reciprocating Engine Div., Avco Corp. v. United

Auto., Aerospace, Agric. Implement Workers of Am., Int’l Union, 523 U.S. 653, 658 (1998)

(explaining that if, “in the course of deciding whether a plaintiff is entitled to relief for the

defendant’s alleged violation of a contract, the defendant interposes the affirmative defense

that the contract was invalid, the court may, consistent with § 301(a), adjudicate that

defense.”).

       Local 3 argues, second, that there was no contract between the parties in March 2017

because a contract is not formed unless there is a meeting of the minds on all material terms,

and the NLRB already found that the riders and the electrical engineering degree term were

material terms. Even assuming those disputed terms are material terms, Local 3’s argument

fails because we apply a more flexible standard than the “all material terms” standard applied

by the NLRB. See Am. Fed’n of Television & Radio Artists, AFL-CIO, N.Y. v. Inner City Broad.

Corp., 748 F.2d 884, 886–87 (2d Cir. 1984) (explaining that in light of national policy

encouraging the formation of collective bargaining agreements, “technical rules of contract do
                                              7
not control the question of whether a collective bargaining agreement has been reached”);

Washington Heights-W. Harlem-Inwood Mental Health Council, Inc. v. Dist. 1199, Nat. Union of Hosp.

& Health Care Emps., RWDSU, AFL-CIO, 748 F.2d 105, 107–08 (2d Cir. 1984); Intermountain

Rural Elec. Ass’n, 309 NLRB 1189, 1192 (1992) (“A collective-bargaining agreement is formed

only after a ‘meeting of the minds’ on all substantive issues and material terms of the

contract.”).

       This case is analogous to Washington Heights. In Washington Heights, a union and an

employer reached agreement on a proposed CBA, signed an MOA, implemented the wage

and benefit terms agreed upon by the parties, participated in arbitration proceedings after

signing the MOA even though the new CBA was not yet signed, and ultimately failed to agree

on a draft of the new CBA. 586 F. Supp. 1251, 1252–53 (S.D.N.Y. 1984), rev’d, 748 F.2d 105

(2d Cir. 1984). The parties litigated an unfair labor practice charge based on refusal to sign the

new CBA, and the NLRB determined that the refusal to sign the new CBA was not an unfair

labor practice due to the parties’ lack of agreement on certain matters. Id. at 1254. Yet it was

undisputed that “labor peace descended in its customarily uncertain fashion, and it was

expected that the formalities of contract formulation and execution would follow.” Id. When

employer refused to participate in an arbitration proceeding, asserting that no agreement to

arbitrate existed, the union sued to enforce the award. Id. at 1253. The district court held for

the employer and vacated the award, reasoning that there was no contract following expiration

of the original CBA because “there had been no formal meeting of the minds.” Id. at 106–07.

       This Court reversed, reasoning that the emphasis should be on “intention rather than

form.” Washington Heights, 748 F.2d at 107 (internal quotation marks omitted). We rejected

                                                 8
the notion that the parties would only be bound by the arbitration provision of an unsigned

successor CBA if there was agreement on all material terms. Id. at 107–08. Noting that there

was no dispute over the arbitration clause, we recognized “the intermediate possibility that the

parties did reach an oral understanding on a successor collective bargaining agreement, even

though there might not have been a meeting of the minds on all the details of that

agreement,” such that “the parties at least agreed to be bound by the grievance and arbitration

provisions of the [former CBA] while they attempted to reduce their successor agreement to

writing.” Id. at 108. Further, we suggested that it would be inequitable to allow the employer

to escape the arbitration provision when it “not only apparently abided by the provisions of

the purported agreement for its entire term, but . . . may have also benefited substantially from

the mutual assumption that there was an agreement.” Id.

       Similarly, Local 3 benefited from the parties’ assumption, which was mutual until the

ALJ’s decision in 2015, that there was an agreement. There was no dispute over the no-strike

and grievance and arbitration provisions. And as the District Court correctly noted, neither

the MOA nor the parties’ bargaining history indicates that the successor CBA’s validity was

contingent upon resolution of the disputed terms addressed by the NLRB in 2015. Indeed,

the parties’ conduct indicates otherwise. As discussed above, the parties in this case

participated in arbitration following expiration of the original CBA on the assumption that the

CBA was still in effect.

       Local 3’s effort to distinguish Washington Heights is unavailing. Local 3 argues that

Washington Heights “at best supports only that questions of fact precluded the [district court’s]

award of summary judgment in favor of [Charter],” focusing on the district court’s decision

                                                9
upon this Court’s remand. Appellant Br. 44. Following remand, the district court in

Washington Heights found “an oral understanding on a successor collective bargaining

agreement, even if there was not a meeting of the minds on all the details of that accord,”

such that “[t]he parties had agreed, at least, to be bound by the grievance and arbitration

provisions of the contract while reducing the agreement to writing.” Washington Heights, 608 F.

Supp. 395, 396 (S.D.N.Y. 1985). Local 3 appears to argue that whether there was a

comparable oral understanding here is a fact question. Appellant Br. 44–45. The district

court in Washington Heights based its post-remand “oral understanding” finding on the facts

described above. 608 F. Supp. at 396. As this case presents analogous facts, Washington

Heights does not support Local 3’s argument that further factual development is necessary.3

        Next, Local 3 contends that its conduct did not manifest an intent to be bound. Local

3 asserts that it “conducted itself as though there has been no CBA in effect from the

moment the ALJ Fish Decision [finding ‘no contract’] was issued,” effectively conceding that

it conducted itself, for the first two years following expiration of the original CBA, on the

belief that there was an agreement. Appellant Br. 38; accord id. at 50. That Local 3 expressed

an intent not to be bound by the new CBA following the ALJ’s April 2015 ruling does not

help Local 3. See Powell v. Omnicom, BBDO/PHD, 497 F.3d 124, 129 (2d Cir. 2007) (contract

“remains binding even if a party has a change of heart between the time he agreed to the


3
 Nor does Local 74, Serv. Emps. Int’l Union, AFL-CIO v. Ecclesiastical Maint. Servs., Inc., 55 F.3d 105 (2d
Cir. 1995), preclude granting summary judgment for Charter. In Local 74, the parties submitted
competing affidavits on the issue of whether they orally agreed to maintain the arbitration term of the
expired CBA. Id. at 107. We held that summary judgment for the employer was inappropriate
because “a genuine factual dispute existed on the question of arbitrability.” Id. at 108. Here, Local 3
has presented no evidence to refute the evidence of agreement on the arbitration provision, relying
merely on the NLRB’s legal conclusion that there was “no contract” between the parties.
                                                    10
[contract] and the time those terms are reduced to writing”); Omega Eng’g, Inc. v. Omega, S.A.,

432 F.3d 437, 445 (2d Cir. 2005) (“It is an elementary principle of contract law that a party’s

subsequent change of heart will not unmake a bargain already made.”).

       Finally, Local 3 asserts that “there was no reasoned analysis by the District Court,

indeed no analysis at all, regarding the Court’s determination that somehow, by implication

and surmise, Local 3 and TWC had supposedly agreed to just the grievance and arbitration

provision and the no-strike provision of the expired CBA, and no other CBA terms.”

Appellant Br. 8 (emphasis in original). That argument misunderstands the District Court’s

analysis. The District Court stated, as a matter of judicial restraint, that “[t]he court’s decision

is limited to a finding that the parties were bound by the no-strike, grievance and arbitration

provisions of the new CBA” and “takes no position on the enforceability of the riders or any

other sections of the CBA.” Sp. App. 11. In other words, the District Court determined that

the parties intended to be bound at least by the no-strike and grievance and arbitration

provisions, which were the only terms of the successor CBA that it was required to reach. We

identify no error in the District Court’s reasoning.

                                                IV.

       We have considered all of Local 3’s remaining arguments and have found them to be

without merit. Accordingly, we AFFIRM the judgment of the District Court.

                                             FOR THE COURT:
                                             Catherine O’Hagan Wolfe, Clerk of Court




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