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AECOM Special Missions Services, Inc. v. International Union of Operating Engineers

United States District Court, E.D. Virginia, Alexandria Division

February 21, 2017

AECOM Special Mission Services, Inc., Plaintiff,
International Union of Operating Engineers, Local 99, Defendant.,



         This matter comes before the Court on Plaintiff, AECOM Special Mission Services, Inc.'s ("AECOM"), Motion for Judgment on the Pleadings, Dkt. No. 10; and Defendant, International Union of Operating Engineers, Local No. 99's ("Local No. 99") Cross-motion for Judgment on the Pleadings. Dkt. No. 15. Plaintiff seeks a declaratory judgment that the parties' Collective Bargaining Agreement ("CBA") expired. Defendant counters that the Court lacks authority to enter judgment because the dispute is subject to binding arbitration. In the hearing in this matter on December 21, 2016, the Court found that it did have authority to hear the dispute and noted its intent to GRANT Plaintiffs Motion and DENY Defendant's Motion. This memorandum opinion sets forth the reasons for that decision.

         I. Background

         The following facts are taken from the Complaint, Answer, and attached exhibits which are all considered in addressing a Motion for Judgment on the Pleadings. See Seneca Ins. Co. v. Shipping Boxes I, LLC, 30 F.Supp.3d 506, 510 (E.D. Va. 2014) ("in addressing a Rule 12(c) motion, the Court may consider the Answer and attached exhibits in addition to the Complaint").

         Plaintiff is a Pennsylvania corporation which provides operations and management services, in relevant part, to United States government agencies in Fairfax County, Virginia. Some of the employees working at these facilities are members of Defendant-union. Plaintiff and Defendant entered into a CBA which commenced on June 1, 2012. The CBA was scheduled to run until May 30, 2014 but Article XI of the CBA includes an "evergreen clause" which provides that the CBA renews each year on May 30 unless a party provides written notice of the desire to not renew. The notice must be given more than sixty days prior to May 30. The sixty day renewal notice mirrors the requirement set forth in section 8(d) of the National Labor Relations Act that "no party shall terminate or modify such contract unless the party desiring [to terminate]... serves a written notice upon the other party ... sixty days prior to the expiration date thereof[.]" 29 U.S.C. § 158(d). The CBA renewed on its termination dates in 2014 and 2015 as neither party filed a written notice of expiration.

         The CBA also contains an arbitration provision. Article VI provides that "[i]n the event any grievance or dispute arises as to the interpretation, application, or any claimed violation of this Agreement, the Union and the Employer shall meet in an effort to reach an amicable settlement." Dkt. No. 5, Exh. A at 7. The CBA grievance process consists of three "steps" of party-initiated review. "In the event that the matter remains unresolved after the third step, either party may ... refer the matter to binding arbitration." Id. at 8.

         In 2016, the parties engaged in negotiations for a new CBA. Lester Jordan, AECOM's Director of Employee & Labor Relations was the principal CBA negotiator for AECOM. On March 25, 2016, Mr. Jordan sent a letter to Don Havard, President of Local 99. The subject line of the letter stated: "Subject: Notification of Intent Not to Renew Current CBA." The letter states in its entirety:

This is notification pursuant to Article XI of the Collective Bargaining Agreement (CBA), as well as Section 8(d) of the National Labor Relations Act, of AECOM's intent to discontinue the evergreen clause for the existing CBA between the parties dated June 1, 2012 to and including May 30, 2014 at Langley, VA, on the next anniversary, May 30, 2016. It shall not renew thereafter unless agreed to in writing by the parties. AECOM's desire is to continue bargaining with the IUOE in good faith for a follow on CBA. I am available for negotiations the week of April 4th, and May 2nd. If other dates are more suitable, I may be able to rearrange my schedule. Please let me know your availability.
If you have any questions, feel free to contact me at 757-383-6223 or 301-526-0093.

Dkt. No. 1, Exh.2.

         Defendant received Plaintiffs letter on or before March 28, 2016. Over the ensuing months, Defendant took a number of steps to express its disagreement with the letter. Sometime before April 15, 2016, Mr. Havard wrote to Mr. Jordan that Defendant did not believe that the March 25, 2016 letter constituted a withdrawal from the CBA. Defendant's original response to the letter was not entered into evidence but Defendant contends that "the letter provides notice not of a timely intent to terminate the CBA, but rather, to terminate a specific, unnumbered section of the CBA, identified by AECOM as the "evergreen clause." Dkt. No. 15, Exh. 2 at 9. On April 15, 2016, Mr. Lester replied to Mr. Havard reinforcing Plaintiffs view that the March 28, 2016 letter was a clear intent to terminate pursuant to the CBA. Defendant filed a grievance with Plaintiff on May 3, 2016. On July 12, 2016 Plaintiff sent a "Step 3" response to Defendant's grievance. The Step 3 response reiterated the viewpoint expressed in the April 15, 2016 letter. Defendant filed an arbitration demand on August 31, 2016 with the American Arbitration Association in relation to the earlier grievance. Plaintiff sent a letter to the American Arbitration Association objecting to the arbitration demand.

         Contemporaneous with their dispute over whether the CBA had expired, the parties continued to negotiate over a new CBA. Plaintiff extended a last, best, and final offer in early June 2016. The offer was rejected by Defendant's members. The parties continued to negotiate and a tentative agreement for a new CBA was reached on August 25, 201§. The members rejected this tentative agreement.

         Plaintiff filed a Complaint for Declaratory Judgment pursuant to Section 301 of the Labor Management Relations Act 29 U.S.C. §§ 185, et seq., and Federal Rule of Civil Procedure 57 on October 5, 2016. Dkt. No. 1. Defendant filed an Answer and Counterclaim to compel arbitration on October 26, 2016. Dkt. No. 5. Plaintiff moved for Judgment on the Pleadings on November 21, 2016. Dkt. No. 10. Defendant cross-moved for Judgment on the Pleadings on December 1, 2016. Dkt. No. 15. The matter was fully briefed by the parties. The Court held a hearing on the Motions on December 21, 2016. The ...

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