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Service Employees International Union Local 32BJ v. Diversified Services Group Inc.

United States District Court, District Circuit

August 1, 2013



ROBERT L. WILKINS United States District Judge


In this case, Plaintiff Service Employees International Union Local 32BJ (SEIU or the Union) argues that a number of its members were discharged in violation of an agreement the Union had with Defendant Diversified Services Group, Inc. (Diversified). SEIU seeks to have the merits of Diversified's actions discharging the employees heard in arbitration, which it claims is compelled by an agreement between the parties. Diversified responds that there is no such agreement, and accordingly disputes that arbitration is appropriate.

Upon careful consideration of the parties' briefs and related papers, and the arguments presented at a hearing on the cross-motions for summary judgment held on July 30, 2013, for the reasons stated herein the Court finds that Plaintiffs motion is due to be GRANTED and Defendant's motion is DENIED.


A. Background

As of July 2011, contractor East-West, Inc. provided the cleaning and maintenance work at the Nebraska Avenue Complex (NAC). (Dkt. No. 1, 6). East-West employed approximately twenty-three people at NAC for this purpose. (Id.). Those twenty-three people were represented by SEIU, "a labor organization within the meaning of the National Labor Relations Act, 29 U.S.C. § 152(5) ..." (Dkt. No. 1, 2, 6). East-West was a party to a collective bargaining agreement (CBA) with the Union that covered the terms and conditions of employment for its cleaning employees at NAC; as of July 2011, the period of the agreement was October 1, 2008 to September 30, 2011. (Pl.'s 7(h) Statement (Dkt. No. 12, at 38-45), 15). The CBA stated that "the employer shall only discipline or discharge employees for just cause." (Dkt. No. 10-2, at 12 (§ 16.2)). It also provided that "all disputes, complaints or grievances in connection with the interpretation or application of the terms of this Agreement" were to be resolved through a Grievance and Arbitration Procedure. (See Id . At 12 (Article 17 and § 17.1)).

In 2011, the General Services Administration (GSA) solicited bids for the cleaning services contract at NAC. (Pl.'s 7(h) Statement, 3; Brome Supp. Decl. (Dkt. No. 14, at 26), 2). In July 2011, Diversified, a cleaning service contractor, through its agent Marc Banks, "requested a copy of the seniority list [from SEIU] for the incumbent workers employed at that time at NAC." (See Dkt. No. 14, at 19). According to the Union, but denied by Diversified, "[a] seniority list aids a company in pricing the costs for an account and helps it submit a competitive bid." (See Pl.'s 7(h) Statement, 6). Just before 11:30 a.m. on July 27, 2011, the Union responded to Banks by e-mail, stating it would provide the list if Diversified signed a Memorandum of Understanding ("MoU"). (Pl.'s 7(h) Statement, If 5). The MoU lists the following four points:

1. The Employer [i.e., Diversified] intends to submit bids for work in the jurisdiction of the Union, Washington DC, including all DC District and Federal Government buildings, Montgomery County Maryland, Baltimore County Maryland, and Northern Virginia sites where the cleaning and maintenance employees are currently represented by the Union.
2. It is the Employer's intent, if it is awarded such work, to hire the incumbent employees and maintain their current terms and conditions of employment.
3. In the event the Employer is the successful bidder, it agrees that it will assume the collective bargaining agreement in effect at the sites.
4. The Union agrees not to take any action, including leafleting or other public demonstrations, opposing the Employer's bid.

(Dkt. No. 1-2, at 8). Diversified signed and returned the MoU by e-mail twelve minutes later, and then the Union sent the seniority list by e-mail just over an hour after that. (See Id . at 10).

On September 16, 2011, the Union and East-West signed a new CBA that extended from October 1, 2011 through September 30, 2014. (See Id . Ex. E (35-54)). This agreement includes the same language in Articles 16 and 17 as in the previous CBA. According to the Union, the new agreement increased wages "and other benefit funds." (Pl.'s 7(h) Statement, 17). The Union claims this negotiation happened "[w]hile the NAC account was out to bid." (Pl.'s 7(h) Statement, 16). Diversified disagrees, claiming that "[i]n the fall of 2011, GSA cancelled the aforementioned 2011 Solicitation. In early 2012, GSA issued a separate Solicitation, utilizing a completely different procurement approach . . . ." (Brome Decl. (Dkt. No. 10-1, at 11), 5).

Banks informed the Union in May 2012 that Diversified would be taking over the contract from East-West at NAC as of June 1, 2012. (Pl.'s 7(h) Statement, 18). On May 9, the Union sent Diversified a copy of the CBA then in effect between East-West and the Union at NAC, i.e. the CBA signed in September 2011. (Pl.'s 7(h) Statement, 19). In sending the document, the Union stated it "would like to have the same contract as East West (current employer)." (Dkt. No. 12-2, at 53). The document sent by the Union contained essentially two changes from the CBA signed in September 2011: the initial date of the agreement was changed to June 1, 2012, and East-West was replaced with Diversified. (See Dkt. No. 1-2, Ex.D (13-34)). On May 21, 2012, Diversified and the Union met; the contents of that discussion are in dispute. (Pl.'s 7(h) Statement, 21; Dkt. No. 14, at 21).

The parties agree that around June 1, 2012, Diversified replaced East-West at NAC and hired the twenty-three incumbent East-West employees. (Pl.'s 7(h) Statement, ¶ 22). Within the first thirty days of assuming the NAC account, Diversified discharged seventeen of the twenty-three incumbent employees. (Def's Statement of Material Facts (Dkt. No. 10-1, at 1-8), ¶ 30). The Union responded to this in several ways. On June 13, 2012, Union representative Luis Benitez "reached out to Diversified seeking to bargain." (Pl.'s 7(h) Statement, ¶ 26). After "confirming" that Diversified signed the MoU, later that day Benitez "corrected his initial request to bargain, and sent an e-mail to remind Banks that Diversified had assumed the 2011 CBA." (Pl.'s 7(h) Statement, ¶ 27). Then, beginning June 14, 2012 and continuing through July 2, 2012, the Union initiated written grievances on behalf of the discharged employees. (Dkt. No. 1, ¶ 23, 26-30). On July 10, 2012, Teodoro Rodriguez of the Union "consolidated all of the grievances into one omnibus grievance, alleging that Diversified had discharged all of these employees without just cause." (Dkt. No. 12-3, ...

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