# Record and brief — 14 Penn Plaza LLC, et al v. Steven Pyett, et al > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385015_0043%3A0 ## Record - **Collection:** Supreme Court brief - **Document type:** Record and brief - **Published:** January 1, 2009 - **Citation:** 556 U.S. 247 ## Text Jan 292008 Rey yf petitioners |4 Penn Plaza LLC. et al. filed. (Distnbuted) Jan 30 2008 DISTRIBUTED tor Conterence of Feb 19 2008 Petition GRANTED — T t € & Ay to F O$ Bret of petitioners 14 Penn Plaza LLC. et al filed May 12 2008 Bret amicus curiae of Chamber of Commerce ot the United States May 12 2008 Bnet amicus curiae of Equal Employment Advisory Council filed Jul 3 2008 lhe time within which to file respondents’ bnet on the merits 1s further extended to and including July 14. 2008 Jul 32008 Consent to the filing of amicus curiae briefs in support of either party o1 | eitl | party rece ,ed Irom ¢ yunsel for the respe ndents Jul 102 ‘ Bret amicus cunae ot Service En pl vees International Lnion. Loca] 32B] Jul 142 Ss Bnet ot respondents Steven Pvett. et a! filed T Jul 1S 2008 Bnet amicus curiae of National Right to Work Legal Defense Foundatior Jul 18 2008 Bnet amici cunae of American Federation ot Labor and Congress of Motion of the Acting Solicitor General tor leave to participate rgument as amicus curiae and for divided argument GRANTED SET FOR ARGUMENT ON Monday. December |. 2008 CIRCLLATED \rgued For petitioners Paul Sa atore. New York. N.Y. For res} ndents ) i ( Freder ch Washit ul n. DC il d ( UTTIS E G annon. Assistant to the Solicitor General. Department of Justice. Washington. D C_ (for United States. as amicus curia Guy PETITION FOR WRIT OF CERTIORARI G L¥SS O Supreme Court US. "\\ No. 07- 07-581 0CT 30 20? is OFFICE OF THE CLERK N TH Supreme Court of the Wnited States 14 PENN PLAZA LLC and TEMCO SERVICE INDUSTRIES, INC., Petitioners, v STEVEN PYETT, THOMAS O'CONNELL, and MICHAEL PHILLIPS, Respondents. On PETITION FOR A Writ OF CERTIORARI TO THE UNITED StaTeEs Court oF APPEALS FOR THE SECOND CIRCUIT PETITION FOR A WRIT OF CERTIORARI JAMES F: BERG Pau SALVATORE* HowakD ROTHSCHILD Mark D. Harris REALTY ADVISORY BoaRD ON LABOR BRIAN S. RAUCH RELATIONS, INC. TAN C. SCHAEFER 292 Madison Avenue PROSKAUER Rose [LLP New York, NY 10017 1585 Broadway (212) 889-4100 New York, NY 10036 ¢ 9 a Counsel for Petitioner (212) 969-3000 Temco Service Industries, Ine. Counsel for Petitioner 14 Penn Plaza LLC * Counsel of Record 211272 @ “OUNSEL PRESS 800) 274-4321 + (500) 349 6859 a QUESTION PRESENTED Is an arbitration clause contained in a collective bargaining agreement, freely negotiated by a union and an employer, which clearly and unmistakably waives the union members’ right to a judicial forum for their statutory discrimination claims, enforceable? i1 LIST OF PARTIES Pursuant to Rule 14.1(b), the only party appearing before the U.S. Court of Appeals for the Second Circuit whose name does not appear in the caption of the Petition for a Writ of Certiorari is the Pennsylvania Building Company. CORPORATE DISCLOSURE STATEMENT Pursuant to Rule 29.6, Petitioners state as follows: 14 Penn Plaza LLC has no parent corporation and no publicly-held cerporation owns 10% or more of its stock. Temco Services Industries, Inc. is a publicly traded company. It has no parent corporation and no publicly- held corporation owns 10% or more of its stock. til TABLE OF CONTENTS Page EE bc i vo voswadvaseneesheetsws i ET cs. tnnscweed abused awivedewensas ii Corporate Disclosure Statement ............... ii EE ks bv W sec deenkseeeecdatuces iii ded cewadmas eats sae Vv Table of Cited Authorities .................... vi EE 9c ndinnd dened c0bsess ceeneubasle< l Statement of Jurisdiction .................... l Constitutional and Statutory. Provisions ED Sa oddncdipan ckcsckontsseksuneneunes 1 ORIGINS GE CRO CBOE noone ccceecciccsccceescs 2 A. FUCUMG OGMBTOUMG 2. wn cc cc ccc cccceess 2 BD. PUCCRMGIII BGT og cccccvccccccccesss 6 Reasons for Granting the Petition ............. 9 I. There Is A Fundamental Conflict In The Lower Courts Over The Enforceability Of Union-Negotiated Waivers Of A Judicial PE aGsantusenesske. (Nokeace cokes 10 iv Contents Page A. This Court Has Acknowledged An “Obvious[] ... Tension” In Its Jurisprudence And Has Not Resolved Tk -whnseaaeeadeusenedateodeniueviee 1] B. The Lower Federal Courts are in Irreconcilable and Acknowledged SE AS avad eden éannceadehennsee 18 C. State Courts Are In Conflict With oo eer ee 23 Il. Uncertainty About The Enforceability Of Arbitration Agreements Creates Serious og er er ere 25 A. The Adverse Effect on Employers, Unions, and Unionized Employees ... 25 B. The Adverse Effect on Labor- Management Relations. ............ 27 EEE ERE RDI oe Pe OE ee 29 Vv TABLE OF APPENDICES Appendix A — Opinion Of The United States Court Of Appeals For The Second Circuit DOSIGGS BME b, TOUT occ vccccccccsscccecs Appendix B — Memorandum And Order Of The United States District Court For The Southern District Of New York Filed June 1, 2006..... Appendix C — Opinion Of The United States District Court For The Southern District Of New York Filed February 22, 2006 .......... Appendix D — Affidavit Of Larry Engelstein Dated November 21, 2005 .................. Appendix E — Excerpts From The 2005 Contractors Agreement .................... Appendix F —9 U.S.C. §§3 &4 .............. Appendix G — 29 U.S.C. §§ 621, 623(a), DED cc cackveecsedsekden seein ene vi TABLE OF CITED AUTHORITIES Page CASES Air Line Pilots Ass’n, Int'l v. Northwest Airlines, Inc., 211 F.3d 1312 (D.C. Cir.), cert. denied, 121 S. Ct. 565 (2000) ........... 22 Air Line Pilots Ass’n, Int'l v. Northwest Airlines, Inc., 199 F.3d 477 (D.C. Cir. 1999) ............ 22, 27, 28 Albertson’s, Inc. v. United Food & Commercial Workers Union, 157 F.3d 758 (9th Cir. 1998), cert. denied, 528 U.S. 809 (1999) ............ 22, 25 Aleman v. Chugach Support Servs., Inc., 485 F.3d 206 (4th Cir. 2007) ................. 21 Alexander v. Gardner-Denver Co., EE de cudénescceccecéocses se passim Austin v. Owens-Brockway Glass Container, Inc., 78 F.3d 875 (4th Cir.), cert. denied, 519 U.S. 980 (1996) ... 9, 18, 19, 20, 22 Barrentine v. Arkansas-Best Freight Sys., Inc., eke <5 sabe eeReces ee cee 12 vii Cited Authorities Page Bratten v. SST Servs., Inc., 185 F:3d 625 (6th Cir. 1999) ................. 22, 24 Brisentine v. Stone & Webster Eng’g Corp., 117 F.3d 619 (11th Cir. 1997) ............62.. 22 Brotherhood of R.R. Trainmen v. Akron & Barberton Belt R.R. Co., 385 F.2d 581 (D.C. Cir. 1967) ...........c000- 27 Brown v. ABF Freight Sys., Inc., 183 F.3d 319 (4th Cir. 1999) .............0... 21 Carson v. Giant Food, Inc., 175 F.3d 325 (4th Cir. 1999), : cert. denied, 540 U.S. 1074 (2000) ........... 20 Circuit City Stores, Inc. v. Adams, I oc det edinecumkunen 15 Collins v. New York City Transit Auth., - oy Bilt, ie 2 | re 16 E.. Associated Coal Corp. v. Massey, 373 F.3d 530 (4th Cir. 2004) .......... 220008. 20 FEOC v. Waffle House, Inc., gE ree 16 Garcia v. Bellmarc Prop. Mgmt., 745 N.Y.S.2d 13 (App. Div. 2002) ............ 24 viii Cited Authorities Page Gilmer v. Interstate/Johnson Lane Corp., Se EE tia cncnatnseedvandsnene passim Granados v. Harvard Maintenance, Inc. No. 05 Civ. 5489, 2006 U.S. Dist. LEXIS 6918 GRAS ED oc cccccccccscesesecss 1 Harrison v. Eddy Potash, Inc., 112 F.3d 1437 (10th Cir. 1997) ............... 22 J.J. Case Co. v. NLRB, ns oc nein neneeudneecens 27 Lewandowski v. Collins Bldg. Servs., Inc., Docket No. 104657/00 (Sup. Ct. N.Y. Co. Dec. 6, 2000) ............. 24 Marquez v. Screen Actors Guild, EE cad sUbdventsdsceeseunes’s 16 Martin v. Dana Corp., 114 F.3d 421 (3d Cir. 1997) .........0..20008. 22 Martin v. Dana Corp., 135 F.3d 765 (3d Cir. 1997), reported in full at 156 L.R.R.M. (BNA) 3137 Se SO I so cs od ekccececenecevas 23 Matthews v. Rollins Hudig Hail Co., 72 F.3d 50 (7th Cir. 1995) .......... ccc c eee 17 ix Cited Authorities Page McDonald v. West Branch, ee ok cewncdcocnsddonesnceys 12 Metropolitan Edison Co. v. NLRB, SEE Soebbucecusesssccccasecds 17 Minnick v. City of Middleburg Heights, No. 81728, 2003 Ohio App. LEXIS 4569 Ge, BA BA Ts EE Poon vccsectccccesces 24 Moses H. Cone Mem’l Hosp. v. Mercury Constr., | RS Eye ee ree 13 NLRB v. Wooster Div. of Borg-Warner Corp., ED inet beuncdueneeneneases 27 Pryner v. Tractor Supply Co., 109 F:3d 354 (7th Cir.), cert. denied, S22 U.S. (1997) ..... ccc cccces 22 Rodriguez de Quijas v. Shearson/American Express, Inc., KR ne er 12 Rogers v. New York Univ., 220 F.3d 73 (2d Cir.), cert. denied, 531 U.S. 1036 (2000) ....... 7, 8,9, 20 Safrit v. Cone Mills Corp.., 248 F.3d 306 (4th Cir.), cert. denied, 534 U.S. 995 (2001) ............ 21 x Cited Authorities Seus v. John Nuveen & Co., 146 F-3d 175 (8d Cir. 1998) ......... Singletary v. Enersys, Inc., 57 F. Appx. 161 (4th Cir. 2003) ..... Sum v. Tishman Speyer Props., Inc. Docket No. 11079-2005 (Sup. Ct. N.Y. Co. Dec. 2, 2005) .... Vaca v. Sipes, Be EOE COREE! se vccsvccsceses Wilko v. Swan, oe et ee Wright v. Univ. Maritime Serv. Corp., PP RP DP CMEEED ccccccsncsececes Yellow Freight Sys., Inc. v. Donnelly, 494 U.S. 820 (1990) ............... Zavala v. Scott Bros. Datry, Inc., 49 Cal. Rptr. 3d 503 (Ct. App. 2006) Page xi Cited Authorities Page STATUTES AND OTHER AUTHORITIES PEED ahs Cenddesesceevwesesd socesesates 1 ED. Sev chudeenesccdescdestvdsescusnns 7 9 U.S.C. § 4 eat iebeeueeseknusaueusseuses 7 —, & Serer ee l EEE Shnectenckktsntsectssaccannes 1 EE nnws bneccecbsses bevseuceds 17 SPIE wabeebensdcuecenceeencesenees 12 N.Y.C. Admin. Code § 8-107 .................. 7 Fs ED pct veni.c st tb cvnctsessues 7 Civil Rights Act of 1991, Pub. L. 102-166, 105 Stat. 1071 ............. 17 1 OPINIONS BELOW The opinion of the United States Court of Appeals for the Second Circuit is reported at 498 F.3d 88 (2d Cir. 2007). App. lz... The Second Circuit affirmed the decision of the United States District Court for the Southern District of New York, which is reported at 04 Civ. 7536, 2006 U.S. Dist. LEXIS 35952 (S.D.N.Y. June 1, 2006). App. 13a. The District Court explained its reasoning in its prior decision in Granados v. Harvard Maintenance, Inc:, which is reported at No. 05 Civ. 5489 (NRB), 2006 U.S. Dist. LEXIS 6918 (S.D.N.Y. Feb. 22, 2006). App. 23a. STATEMENT OF JURISDICTION The judgment of the Court of Appeals was entered on August 1, 2007. App. la. The jurisdiction of this Court is invoked under 28 U.S.C. § 1254(1). CONSTITUTIONAL AND STATUTORY PROVISIONS INVOLVED This case involves the application of the Federal Arbitration Act (“AA”), 9 U.S.C. § 1, et seq. Respondents filed this action pursuant to the Age Discrimination in Employment Act of 1967 (“ADEA”), 29 U.S.C. §§ 621, et seg. The pertinent provisions of each statute are reproduced at 49a-5la and 52a-66a. 2 STATEMENT OF THE CASE This case presents an issue of exceptional importance to organized labor, management, and union members: whether, to achieve all the mutual benefits that arbitration offers over litigation, a union can agree with an employer to the arbitration of its members’ claims under the ADEA and other statutes. This Court has previously acknowledged that this question is undecided under its precedents. See Wright v. Universal Maritime Serv. Corp., 525 U.S. 70, 82 (1998). In the decision below, the Second Circuit held that no union-negotiated arbitration agreement — no matter how clear and explicit —- is ever enforceable. The Fourth Circuit, how~->r, has long held precisely the opposite, routinely enforcing such clear and unmistakable agreements. This conflict in the circuits — and between state courts and federal courts - necessitates the intervention of this Court to resolve the question. A. Factual Background 1. For many decades, Local 32BJ of the Service Employees International Union (“Local 32BJ” or the “Union”), which represcnts over 85,000 employees nationwide in the building services industry, and the Realty Advisory Board on Labor Relations, Inc. (the “RAB”), the New York City real estate industry’s multi- employer bargaining association, have engaged in industry-wide collective bargaining. Over this period, the parties have agreed to, and continually have revised, their Collective Bargaining Agreement for Contractors (the “CBA”). Among other provisions, the CBA prohibits 3 discrimination in employment — an important goal for labor, management, and employees in the “melting pot” of the New York City labor market. Beginning in 1999, the parties agreed to a CBA provision that expressly requires employees to submit any claims of employment discrimination, including claims of age discrimination arising under federal, state, and city law, to binding arbitration under the CBA’s grievance and dispute resolution procedures. The provision states: There shall be no discrimination against any present or future employee by reason of race, creed, color, age, disability, national origin, sex, union membership, or any characteristic protected by law, including, but not limited to, claims made pursuant to Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the New York State Human Rights Law, the New York City Human Rights Code, ... or any other similar laws, rules or regulations. All such claims shall be subject to the grievance and arbitration procedure (Articles V and V1) as the sole and exclusive remedy for violations. Arbitrators shall apply appropriate law in rendering decisions based upon claims of discrimination. App. 48a.' ' In addition to the CBA, the RAB negotiates and administers several other collective bargaining agreements with Local 32BJ and other unions, covering approximately 65,000 (Cont'd) 4 The bargaining parties specifically crafted this language to track this Court’s requirement, set forth in Wright, that any waiver of rights to adjudicate statutory claims be “clear and unmistakable.” It is undisputed that the CBA’s waiver is clear and unmistakable in its language and intent. App. 6a, 21a, 37a-38a. 2. This arbitration provision was heavily negotiated by Local 32BJ and the RAB. As part of the bargaining leading to this clause, the Union gained sizable wage and benefit enhancements, as well as other favorable provisions. Furthermore, the arbitration provision itself was advantageous to the Union and its members. Without it, many of the Union-represented building service workers would be compelled to become pro se federal court plaintiffs to bring their discrimination claims. This would be a daunting task for any individual, but especially for the large percentage of immigrant building service workers for whom English is their second language. Similarly, those employees with the means to retain an attorney would be required to pay fees or a percentage of any award. In contrast, under the arbitration provision, these same employees receive a skilled attorney from the Union at no cost to them, and are not required to pay any administrative fees (7.e., arbitrator or forum fees), (Cont'd) employees and approximately 4,000 commercial and residential] buildings in the New York City area. Those agreements contain arbitration provisions that are virtually identical to the provision at issue here and similarly require the arbitration of statutory discrimination claims. 5 which are instead shared equally by the RAB and the Union. If, for some reason, the employee would prefer to retain private counsel, the Union permits the employee to pursue the discrimination claims in the arbitral forum with his or her attorney. App. 42a. Arbitration of discrimination disputes is also appealing to both Local 32BJ and New York City’s real estate employers because it minimizes duplication of efforts, and resolves disputes quickly, inexpensively, fairly, and effectively. Most, if not all, discrimination claims arise out of the same facts and circumstances as contractual grievances alleging CBA violations. For example, an employee asserting a claim of a discharge without just cause (a contractua)] claim) can also assert a claim of discriminatory discharge (a statutory claim). Consolidating the process allows one fact finder —- an employment attorney serving as arbitrator — to consider the facts and circumstances that encompass both claims, and make both determinations. The ability to consolidate the actions results in economies of scale for all parties involved, and ensures consistent rulings on the related issues, while providing employees and employers with the full scope of remedies and defenses available under the anti-discrimination laws. 3. Respondents are employees and former employees of Temco Service Industries, Inc. (“Temco”), a building service and cleaning contractor. Prior to August 2003, they worked as night watchmen/porters in 14 Penn Plaza LLC’s (the “Company”) commercial office building located at 225 West 34th Street in New York City. They are all members of Local 32BJ, covered under the CBA with the RAB. 6 In or about August 2003, in an effort to improve building security in response to post-9/11 security concerns, the Company engaged Spartan Security, a unionized security services contractor, to provide trained, licensed security guards to staff the front lobby desk and the rear entrance of the building. As a result, Temco’s services were no longer needed in these locations. In compliance with the CBA, Temco reassigned Respondents to equivalent duties in other locations in the building. Respondents were unhappy with these reassignments and alleged, among other things, that they violated the CBA and were based on age discrimination. B. Proceedings Below Local 32BJ filed a grievance about the reassignments under the CBA’s dispute resolution procedures, raising both contractual and statutory claims. Prior to the arbitration hearing, the portion of the grievance alleging age discrimination was withdrawn. Respondents (accompanied by their private attorney, in addition to Union-provided counsel) did not raise their age discrimination claims at any time during the arbitration proceedings. After a four-day hearing, the arbitrator denied all their contractual claims in a 19- page opinion. Despite the fact that their personal attorney was present for the entire arbitration hearing and could have raised their age discrimination claims before the arbitrator, Respondents instead filed a lawsuit in federal court alleging that their transfers violated federal, state, 7 and city laws prohibiting age discrimination.* The Company moved to dismiss Respondents’ lawsuit or, alternatively, to compel arbitration of their claims pursuant to Sections 3 and 4 of the FAA (9 U.S.C. §§ 3 and 4), based on the clear agreement to arbitrate such claims contained in the CBA. The district court denied the motion to compel arbitration based on its own recent decision in another case, where it recognized that “the Supreme Court has not spoken clearly on this issue,” but held that it was “constrained” to follow the Second Circuit’s precedents and judicially void the arbitration provision. App. 39a n.7. On appeal, the Second Circuit likewise acknowledged that this Court’s precedents left unresolved the central question. Indeed, as it noted, those precedents are themselves in “tension,” and other circuits have reached different conclusions. App. 6a n.3, 10a n.4. But it considered itself bound by its earlier decision in Rogers v. New York Univ., 220 F.3d 73 (2d Cir.) (per curiam), cert. denied, 531 U.S. 1036 (2000), that held such agreements unenforceable. Rogers involved a collective bargaining agreement that — unlike the CBA - did not clearly incorporate statutory claims. The court found that it did not meet Wright’s “clear and unmistakable” test, and was not * Respondents filed these claims under the ADFA, the New York State Human Rights Law, N.Y. Exec. Law § 290, et seq., and the New York City Administrative Code, N.Y.C. Admin. Code § 8-107. In a separate, related action, Respondents also alleged a violation of the duty of fair representation against the Union, inter alia, for failing to arbitrate the age discrimination claims, but subsequently withdrew that action with prejudice. 8 enforceable for that reason. But Rogers went on to hold, as an alternate ground, that even a clear arbitration provision was not “always enforceable.” Jd. at 75. In Alexander v. Gardner-Denver Co., 415 U.S. 36 (1974), another case in which the arbitration clause of the collective bargaining agreement between a company and a union did not cover statutory anti-discrimination claims, this Court held that the clause could not preclude later assertions of such claims in a judicial forum. From Gardner-Denver’s narrow holding (which Rogers recognized was narrowed further in later cases, see 220 F.3d at 75), Rogers inferred that any collective bargaining agreement clause negotiated by a union could not bar the employees’ right to a judicial forum — whether the parties had deliberately negotiated such a waiver or not. Rogers acknowledged, as did the decision below, that this blanket negation of any and all arbitration clauses did not square with later Supreme Court precedents, which “could be taken to suggest that, under certain circumstances, a union negotiated waiver of an employee's statutory right to a judicial forum might be enforceable.” App. 9a-lla (quotations omitted). But neither Second Circuit decision offered any account of what those circumstances might be. Indeed, it is clear that under the Second Circuit’s holdings, there is no situation — however clear the language in the collective bargaining agreement — that would make such an arbitration agreement binding. Nor did either decision take serious account of this Court’s ruling in Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991), which upheld an agreement to arbitrate 9 entered into by an individual employee, and distinguished earlier cases that were not governed by the FAA (as this one is), and where there was no “clear and unmistakable” arbitration provision (as there is here). Rogers noted that the Fourth Circuit had rejected its conclusion — acknowledging the conflict between the circuits. See 220 F.3d at 75 (citing Austin v. Owens- Brockway Glass Container, 78 F.3d 875, 880-86 (4th Cir.), cert. denied, 519 U.S. 980 (1996)). The decision below did the same, see App. 10a n.4, but adhered to its own view that “nothing had changed” in the law since Rogers was decided. /d. at lla. REASONS FOR GRANTING THE PETITION This Conrt has recognized that there is an unresolved conflict in its own jurisprudence concerning the enforceability of union-negotiated arbitration agreements. An older line of precedent beginning with Gardner-Denver viewed arbitration unfavorably and held that an arbitration proceeding cannot preclude the assertion of statutory claims in a judicial forum. A more recent line of precedent, typified by Gilmer, takes a far more positive view of arbitration and holds that arbitration provisions are enforceable so long as their forum selection language is “clear and unmistakable.” This uncertainty has generated a marked conflict in the federal circuits, and between federal and state courts, leading some to hold that union-negotiated arbitration clauses are never enforceable, and others to hold that they are enforceable if the waiver language is clear. That conflict provides a powerful reason for this Court to grant review. 10 The conflict also creates a host of public policy concerns. First, neither employers nor unions are able to know or predict whether their particular provision is valid, making both the bargaining and administration of multi-jurisdictional collective bargaining agreements exceedingly difficult. Second, unionized employees working in jurisdictions that do not enforce union- negotiated arbitration clauses may be induced to sign individual waivers as a condition of continued employment — effectively removing unions from the negotiation of an important term and condition of employment. In sum, for effective employer and union operations, for productive collective bargaining, and to protect the rights of employees who are union members, there must be a consistent rule of law for the entire country — and that rule only can come from this Court. I. THERE IS A FUNDAMENTAL CONFLICT IN THE LOWER COURTS OVER THE ENFORCE- ABILITY OF UNION-NEGOTIATED WAIVERS OF A JUDICIAL FORUM. There is a pressing need for this Court to clarify the circumstances under which a union-negotiated arbitration agreement may be enforced. Until now, Wiis Court has expressly declined to answer that question. As aresult, the lower federal and state courts have been forced to rely on conflicting precedents, resulting in diametrically opposite conclusions. 1] A. This Court Has Acknowledged An “Obvious[ ] ... Tension” In Its Jurisprudence And Has Not Resolved It. The Second Circuit held that union-negotiated arbitration agreements are not enforceable based on this Court’s 1974 decision in Gardner-Denver. The issue, Petitioners respectfully submit, cannot be so rotely resolved — as this Court itself has acknowledged. In Wright, the Court recognized that whether a collective bargaining agreement can waive employees’ statutory rights to a judicial forum calls into question “two lines” of its own cases that are “obviously [in] some tension.” Wright, 525 U.S. at 76. Wright deferred resolution of that question because it found the particular language in the collective bargaining agreement there too vague and unspecific to constitute a waiver of rights. See id. at 77, 80. Since the instant CBA was specifically drafted to track Wright’s “clear and unmistakable” requirement, and the district court found that it was clear and unmistakable, App. 2la, the issue is squarely presented here. According to Wright, the Gardner-Denver line of cases concerns the preclusive effect of prior contractual erbitrations on an employee’s right to litigate certain related statutory claims. In Gardner-Denver, the Court addressed the question of whether an employee whose grievance had been arbitrated pursuant to a general grievance and arbitration provision in a collective bargaining agreement was subsequently barred from instituting a Title VII court action. The Court held that a general contractual grievance arbitration proceeding 12 does not bar a subsequent related Title VII federal court action. In other words, a contract arbitration is not res judicata to a Title VII litigation. The Court applied this principle in later cases to permit similar post-arbitration litigation under other statutes. See Barrentine v. Arkansas-Best Freight Sys., Inc., 450 U.S. 728 (1981) (Fair Labor Standards Act); McDonald v. West Branch, 466 U.S. 284 (1984) (42 U.S.C. § 1983). Gardner-Denver dealt with a purely contractual arbitration process, where the arbitrator sat only as “the proctor of the bargain.” 415 U.S. at 53. The arbitrator was not able to re'y on external law, and thereby was foreclosed from adjudicating statutory employment claims. The Gardner-Denver Court expressed the now- rejected view that the arbitral fact-finding process is not comparable to judicial fact-finding, and that the “informal” nature of arbitrations rendered them inappropriate for the resolution of Title VII claims. Id. at 57-58 (citing Wilko v. Swan, 346 U.S. 427 (1953)). But in the thirty years since, the Court has disavowed this antiquated view of arbitral inferiority. See Rodriguez de Quijas v. Shearson/American Express, Inc., 490 U.S. 477 (1989); Gilmer, 500 U.S. 20 (1991). According to Wright, the other relevant line of cases involves individual agreements to arbitrate employment disputes. In Gilmer, the Court required an individual non-unionized plaintiff to arbitrate his claim under the ADEA because he had signed a securities industry registration agreement consenting to arbitrate any claims arising out of his employment. /d. at 35. The Court emphasized that “questions of arbitrability must be addressed with a healthy regard for the federal policy 13 favoring arbitration.” Jd. at 26 (quoting Moses H. Cone Mem’! Hosp. v. Mercury Constr., 60 U.S. 1 (1983)). It held that arbitration of, and hence waiver of the right to proceed in court with respect to, statutory discrimination claims was not “inconsistent with the statutory framework and purposes of the ADEA.” Gilmer, 500 U.S. at 27. In so doing, it rejected old- fashioned notions that arbitration suffers from tribunal bias, insufficient discovery procedures, and inadequate remedies. Specifically, the Court stated that “[w]e are well past the time when judicial suspicion of the desirability of arbitration and of the competence of arbitral tribunals inhibited the development of arbitration as an alternative means of dispute resolution.” Jd. at 34. In Wright itself, when this Court faced the question whether union-negotiated waivers of employees’ rights to a judicial forum are enforceable, it acknowledged that Gardner-Denver and Gilmer are in tension — for Gilmer allowed waivers of rights under anti-discrimination statutes that Gardner-Denver had stated were unwaivable by anyone. Wright, 525 U.S. at 76-77. Moreover, the Court itself adverted to the change in its own receptivity to arbitration, with Gilmer being a prominent example. Jd. Nonetheless, the Wright Court left this conflict unresolved, and decided the case before it on a different, narrower ground. /d. In the absence of further guidance from this Court, the Second Circuit plainly erred in relying on Gardzer- Denver rather than Gilmer. Gilmer drew three distinctions between itself and the Gardner-Denver l\ine 14 of cases, all of which made it, not Gardner-Denver, controlling here. First and foremost, in Gardner-Denver, the union and the company could arbitrate only contractual grievances, as they had no agreement to arbitrate statutory claims. In fact, the arbitrator did not even have the authority to resolve such claims, being only a “proctor of the [collective bargaining agreement)].” Gardner-Denver, 415 U.S. at 53. Thus, the only question presented in that case (and its progeny) was whether arbitration of the employee’s contract-based claims would be held to preclude later statutory discrimination actions arising out of the same facts. See Gilmer, 500 U.S. at 48. Under those circumstances, Gardner-Denver correctly held that there was no preclusion. Here, in stark contrast, there is an agreement that expressly requires arbitration of any and all statutory claims, and the legally-trained arbitrators are empowered (and, indeed, obligated) to decide such claims “applyling] appropriate law.” App. 48a. The question, therefore, is one of enforceability of forum selection clauses, not preclusion. Second, Gilmer emphasized the fact that unlike Gardner-Denver, it was decided under the FAA. See Gilmer, 500 U.S. at 35. The FAA was enacted to place arbitration agreements upon the same footing as other commercial contacts. To that end, it provides for stays of proceedings in federal courts when an issue is referable to arbitration, zd. § 3, and for orders compelling arbitration when one party has failed, neglected, or refused to comply with an arbitration agreement, id. § 4. In finding that the employee’s ADEA claims should be compelled to arbitration, Gilmer cited to a litany of decisions by this Court holding that by agreeing 15 to arbitrate a statutory claim, a party does not forgo any substantive rights afforded by the statute. /d. This Court has since further bolstered support for arbitration of statutory discrimination claims in Circuit City Stores, Inc. v. Adams, 532 U.S. 105 (2001), holding that agreements to arbitrate employment disputes are fully enforceable pursuant to the FAA. After Circuit City, it is clear that clauses like the instant one are best treated under the FAA, as the decision below understood. Finally, as a third distinction between itself and Gardner-Den»ver, Gilmer explained that since the arbitration in Gardner-Denver arose in the context of a collective bargaining agreement, where the claimant was represented by his union, that case presented a “tension between collective representation and individual statutory rights.” Gilmer, 500 U.S. at 35. The decision below echoed the same concern, that if “the Union refused to submit the wrongful transfer claims to arbitration because the Union had agreed to the new contract, the interests of the Union and the interests of [Respondents] are clearly in conflict.” App. lla n.5. But the Second Circuit ignored a critical distinction between the agreement at issue in Gardner-Denver and the CBA: under the CBA, Respondents retained at all times the right to bring their statutory claims to arbitration on their own - without the need for Union consent. App. 42a. Hence, Respondents enjoyed the same access to the arbitration process as the non-union employees in Gilmer, in which arbitration was upheld. Moreover, in the thirty years since Gardner-Denver, other judicial protections of the individual union member 16 have developed. First, an employee who believes the union acted unfairly (in not processing, or improperly handling, a discrimination claim) can bring a duty of fair representation action against it. See Marquez v. Screen Actors Guild, 525 U.S. 33, 44 (1998); Vaca v. Sipes, 386 U.S. 171, 190 (1967).* Similarly, in those relatively rare cases where a union member may wish to challenge the fairness of the arbitration process, courts are empowered to determine whether the process was in fact fair, and whether the decision was rendered by a neutral, unbiased adjudicator. See Collins v. New York City Transit Auth., 305 F.3d 113, 119 (2d Cir. 2002). Finally, under existing law, an agreement to arbitrate statutory discrimination claims by an employee does not waive an employee’s right to file a charge of discrimination with the Equal Employment Opportunity Commission (EEOC), and does not prohibit the EEOC from commencing a lawsuit in response to the charge. See EEOC v. Waffle House, Inc. , 534 U.S. 279 (2002). In addition to disregarding these critical distinctions, placing the instant case closer to Gilmer than to Gardner-Denver, the Second Circuit simply failed to appreciate that Gilmer and its progeny have undermined Gardner-Denver’s precedential weight. One of Gardner- Denver's animating reasons for opposing arbitration agreements was its view that “there can be no prospective waiver of an employee’s rights under Title VII.” /d. at 51. Gilmer flatly rejected this principle, holding that arbitration of (and hence waiver of a judicial forum regarding) statutory discrimination claims was not inconsistent with the framework and purposes of the anti-discrimination laws. See Gilmer, 500 U.S. at 27. * Indeed, Respondents brought such a claim here, but then withdrew it. See note 2 supra. 17 In particular, the ADEA directs the EEOC to pursue “informal methods of conciliation, conference, and persuasion” in its enforcement procedures. 29 U.S.C. § 626(b). Congress’ grant of concurrent jurisdiction over ADEA claims to state and federal courts also evidences an objective of allowing multiple fora for resolving disputes. Gilmer, 500 U.S. at 30. Finally, Congress has never explicitly precluded arbitration of ADEA claims.‘ For all these reasons, arbitration of age discrimination claims is not only permissible, but encouraged. As to union-negotiated waivers in particular, Gardner-Denver stated that a union cannot waive individual employee rights, but only “certain statutory rights related to collective activity,” 415 U.S. at 51. That view was subsequently called into question by the Court’s decision in Metropolitan Edison Co. v. NLRB, 460 U.S. 693, 706-07 (1983), which held that a union can waive an individual employee’s right under the National Labor Relations Act to be free of discrimination based on union activity. The Court decided that as long as the union- negotiated waiver is “clear and unmistakable,” it would be enforced. Not coincidentally, this is the same standard the Wright Court used to evaluate union-negotiated arbitration agreements. ‘ Indeed, in further support of arbitration, Congress passed the Civil Rights Act of 199' which provided that “the use of alternative dispute resolution, including ... arbitration, is encouraged to resolve disputes arising under [Title VII and the ADEA\|.” Pub. L. 102-166, § 118, 105 Stat. 1071, 1081 (reprinted in notes to 42 U.S.C. § 1981). On its face, Section 118 evinces a clear Congressional intent to encourage arbitration of ADEA claims, not to preclude such arbitration. See Seus v. John Nuveen & Co., 146 F.3d 175, 182 (3d Cir. 1998); Matthews v. Rollins Hudig Hall Co., 72 F.3d 50, 54 n.4 (7th Cir. 1995). 18 At a more fundamental level, decisions after Gardner-Denver rejected its idea that the right te a judicial forum was a substantive right. As Gilmer held, “by agreeing to arbitrate a statutory claim, a party does not forgo the substantive rights afforded by the statute; it only submits to their resolution in an arbitral, rather than a judicial forum.” Gilmer, 500 U.S. at 26. For that reason, and the others expressed above, much of the underlying motivation for Gardner-Denver’s hostility to arbitration has simply faded away as the law has evolved over the last thirty years. B. The Lower Federal Courts are in Irreconcilable and Acknowledged Conflict. The decision below directly and irreconcilably conflicts with the Fourth Circuit’s rulings that union- negotiated arbitration agreements are enforceable. The Fourth Circuit has been steadfast in its position, both pre- and post-Wright, applying the rationale of Gilmer rather than Gardner-Denver to collective bargaining agreements. The ;sidance and drafting instructions detailed in its decisions have become a primer for labor- relations practice throughout the country. Even before Wright, the Fourth Circuit definitively ruled that union-negotiated waivers of an individual’s right to proceed in a judicial forum for statutory discrimination claims are enforceable. In Austin v. Owens-Brockway Glass Container, Inc. , 78 F.3d 875 (4th Cir.), cert. denied, 519 U.S. 980 (1996), the Fourth Circuit determined that Gardner-Denver could not survive Gilmer. Reasoning that Gilmer “recognized that 19 arbitration of a statutory claim is not equal to giving up any right under a statute, [but] simply another forum in which to resolve the dispute,” id., the Fourth Circuit held that Gilmer had rejected the principal basis of Gardner- Denver, that “arbitration is an inappropriate forum for the resolution of [anti-discrimination] statutory [rights]. ...” Id. Following Gilmer, Austin noted that there was no evidence of a Congressional intent to prohibit arbitration of these matters, and therefore no reason to block enforcement of such an agreement. Jd. at 880-81. The Fourth Circuit’s decision was grounded in the recognition that the mechanism for resolving employment disputes is a natural and appropriate subject of collective bargaining, and one over which a union — as the exclusive bargaining representative of its membership — has “the right and duty” to negotiate. As the court observed, the right to arbitrate is as much a term and condition of employment as any other protected by statute. Jd. at 885. Waivers of such rights are effective because they rest on the premise of fair representation through the union. Accordingly, the Fourth Circuit drew no distinction between the individual agreement to arbitrate upheld in Gilmer and the union-negotiated arbitration agreement at issue in Austin. The court held: Whether the dispute arises under a contract of employment growing out of securities registration application, a simple employment contract, or a collective bargaining agreement, an agreement has yet been made to arbitrate 20 the dispute. So long as the agreement is voluntary, it is valid, and we are of the opinion it should be enforced. Id. The Fourth Circuit thus rejected the precise grounds on which the Second Circuit rested its decision. To the Second Circuit, the identity of the party negotiating the waiver is determinative of whether the waiver is valid. Rogers, 220 F.3d at 75. To the contrary, Austin announced a uniform policy — so long as the agreement to waive a judicial forum was made voluntarily, in¢cividual agreements and collectively-bargained agreemeuts are equally valid. Austin, 78 F.3d at 885. In later cases, the Fourth Circuit has fortified and elaborated on its Austin holding, articulating the precise circumstances under which union-negotiated arbitration clauses are enforceable. In Carson v. Giant Food, Inc., 175 F.3d 325, 331 (4th Cir. 1999) (Wilkinson, J.), cert. denied, 540 U.S. 1074 (2000), the Fourth Circuit found two ways to meet Wright’s “clear and unmistakable” test: one, by drafting an explicit arbitration clause whereby employees agree to submit to arbitration all federal causes of action arising out of their employment; and the other, by explicitly incorporating statutory anti- discrimination requirements elsewhere in the contract. This explicit drafting advice signals the court’s continuing commitment to the enforcement of such agreements. See, e.g., EF. Associated Coal Corp. v. Massey, 373 F.3d 530, 533 (4th Cir. 2004) (“We have consistently held that a union-negotiated CBA may waive an employee’s statutory right to litigate his employment discrimination claims in a judicial forum.”); Singletary v. Enersys, Inc., 57 F. Appx. 161 (4th Cir. 2003); 21 Brown v. ABF Freight Sys., Inc., 183 F.3d 319, 321 (4th Cir. 1999) (Luttig, J.).° In its most recent decision on point, Aleman v. Chugach Support Servs., Inc., 485 F.3d 206, 215 (4th Cir. 2007) (Wilkinson, J.), the Fourth Circuit went so far as to describe the method of dispute resolution as a “preeminent” term and condition of employment as to which unions were entitled to strike bargains. /d. at 216. It expressly rejected the idea that there was any statutory basis or precedent for inventing a rule that clear and unmistakable waivers require a “meeting of the minds” between the employer and individual union members. Indeed, it commented that to hold that Congress had placed the resolution of civil rights claims beyond the reach of arbitration “would be too much an exercise in judicial implication” — an exercise that would “change the nature of collective bargaining over conditions of employment and ... read judicial exceptions into the National Labor Relations Act.” /d. at 216-217. See also Safrit v. Cone Mills Corp., 248 F.3d 306, 308-09 (4th Cir.), cert. denied, 534 U.S. 995 (2001) (“[A]n agreement to arbitrate statutory claims is part of the natural tradeoff that a union must make in exchange for other benefits. ... To redact one clause from a CBA would in effect alter the agreement reached during the often-difficult collective bargaining process.”). Despite the sea change in this Court’s jurisprudence in the thirty years since Gardner-Denver, and the Fourth Circuit’s insightful and practical holdings, most other * The CBA clause at issue here incorporates both concepts in evincing its clear and unmistakable waiver. App. 43a-48a. 22 circuits that have addressed the issue have aligned themselves with the Second Circuit — albeit while expressing uncertainty about the state of the law. See Air Line Pilots Ass’n, Int'l v. Northwest Airlines, Inc., 211 F.3d 1312 (D.C. Cir.) (en banc) (per curiam), reinstating 199 F.3d 477, 484 (D.C. Cir. 1999) (“Whatever the Supreme Court said — or more precisely, refrained from saying — in Wright, we do not understand the Court in Gilmer to have overruled Gardner-Denver. We therefore leave to the Court itself the prerogative of overruling its own precedent (if it will); we apply the law as it stands.’’), cert. denied, 121 S. Ct. 565 (2000); Pryner v. Tractor Supply Co., 109 F.3d 354, 365 (7th Cir.) (Posner, J.) (acknowledging a “circuit split” and stating that “[o]n balance our case is closer to Alexander; but is enough left of Alexander to compel a decision in favor of plaintiff?”), cert. denied, 522 U.S. (1997); Bratten v. SSI Servs., Inc., 185 F.3d 625 (6th Cir. 1999) (holding, anomalously, that this Court’s decision in Wright “implicitly overruled” the Fourth Circuit’s holding ir Austin); Albertson’s Inc. v. United Food & Commercial Workers Union, 157 F.3d 758 (9th Cir. 1998), cert. denied, 528 U.S. 809 (1999); Harrison v. ¥ddy Potash, Inc., 112 F.3d 1437, 1453-54 (10th Cir. 19$%) (following Gardner- Denver); Brisentine v. Stone & Webster Eng’g Corp., 117 F.3d 519, 526 (11th Cir. 1997) (same). The Third Circuit is a likely exception. In Martin v. Dana Corp., 114 F.3d 421 (3d Cir. 1997), a divided panel agreed with Austin that a union-negotiated arbitration clause could supplant an individual worker’s right to a judicial forum. The en banc court vacated that opinion and referred the case back to the panel to determine whether the plaintiff could arbitrate without the 23 assistance of the union. After determining that the agreement in that case did not grant that right, the original panel reversed its decision, ruling that the collective bargaining agreement did not bar the plaintiff’s suit. See Martin v. Dana Corp., 135 F.3d 765 (3d Cir. 1997), reported in full at 156 L.R.R.M. (BNA) 3137 (3d Cir. Dec. 16, 1997). Because the issue of the claimant’s right to arbitrate without the consent of the union was “the sole issue ... upon which [the] appeal turn[ed],” id. at *2, it appears that the Third Circuit would uphold the CBA here, as Local 32BJ union members have the right to bring their own attorneys into the arbitral forum. App. 42a. In sum, the lower federal courts are in irreconcilable conflict over whether a union-negotiated arbitration clause may be enforceable. In addition to the sharp split between the positions of the Second and Fourth Circuit, other circuits have expressed deep-seated confusion regarding the enforceability of these waivers. Even courts that continue to apply Gardner-Denver do so while questioning its continued viability. This Court’s review is needed to resolve the conflict. C. State Courts Are In Conflict With Federal Courts. The unsettled nature of the law has produced not only a federal circuit split, but also a split between several federal and state courts sitting in the same geographic location. Since state courts have the authority to decide federal discrimination claims, see Gilmer (holding that concurrent jurisdiction exists in state and federal courts to decide ADEA claims); Yellow Freight 24 Sys., Inc. v. Donnelly, 494 U.S. 820 (1990) (same for Title VII claims), this conflict raises the specter that the law could be applied in inconsistent ways — depending on whether the claim was brought in federal or state court. In reliance on this Court’s precedents, New York State courts have held under the FAA that clear and unmistakable union-negotiated agreements to arbitrate statutory discrimination claims are enforceable. See, e.g., Garcia v. Bellmarc Prop. Mgmt., 745 N.Y.S.2d 113 (App. Div. 2002) (enforcing an arbitration agreement drafted by the same parties to this action and containing waiver language identical to the CBA because “Gardner- Denver ... was not decided under the FAA, and does not reflect modern Federal policy favoring arbitration”) (citing Gilmer); Sum v. Tishman Speyer Props., Inc., Docket No. 11079-2005 (Sup. Ct. N.Y. Co. Dec. 2, 2005); Lewandowski v. Collins Bldg. Servs. Inc., Docket No. 104657/00 (Sup. Ct. N.Y. Co. Dec. 6, 2000). These holdings place New York State courts in direct conflict with the Second Circuit. Similarly, the Ohio State courts are in conflict with the Sixth Circuit. Compare Minnick v. City of Middleburg Heights, No. 81728, 2003 Ohio App. LEXIS 4569 (Ohio Ct. App. Sept. 25, 2003) (holding, in accordance with Wright, that clear and unmistakable union-negotiated waivers of statutory claims are enforceable), with Bratten, 185 F.3d 625. In California, the state courts are in conflict with the Ninth Circuit. Compare Zavala v. Scott Bros. Dairy, Inc., 49 Cai. Rptr. 3d 503, 511 n. 9 (Ct. App. 2006) (acknowledging that a union may waive its members’ rights to a judicial forum 25 for employment discrimination claims pursuant to Wright), with Albertson’s, 157 F.3d 758. To have federal and state courts sitting in the same locality apply the same law inconsistently undermines uniformity and raises the specter of forum shopping. These dangers reinforce the need for this Court’s review. II. UNCERTAINTY ABOUT THE ENFORCE- ABILITY OF ARBITRATION AGREEMENTS CREATES SERIOUS POLICY CONCERNS. A. The Adverse Effect on Employers, Unions, and Unionized Employees. Continued conflict regarding the enforceability of union-negotiated arbitration agreements hampers the day-to-day operations of businesses and labor organizations. Many of this country’s industries, such as the real estate and building services industry, operate in more than one federal circuit. In particular, many of the building service companies covered under the CBA operate throughout the country, including in both New York City (Second Circuit) and Virginia (Fourth Circuit). These multi-circuit businesses must adhere to different collective bargaining obligations and employee policies in circuits whose rulings are in conflict. Labor organizations are also compelled to alter bargaining strategies and modify practices to administer collective bargaining agreements across jurisdictions. Following the lead of corporate America, unions are 26 consolidating. For example, New York City-based Local 32BJ now has jurisdiction for building service employees all along the East Coast. Absent this Court establishing a uniform position for all circuits to follow, the prospect of devising a standard dispute resolution procedure for an entire region is exceedingly remote. Further, as many current collective bargaining agreements cover employees located in more than one judicial circuit, an absence of uniformity among the circuits causes confusion within bargaining relationships. For example, the CBA covers employees in New York (Second Circuit) and New Jersey (Third Circuit). Absent this Court’s guidance, the clause presently might be enforceable with respect to employees working in the latter but not the former, even though all these employees are working for the same employer and are represented by the same union. Sound policy should support the ability of business to apply consistent practices across federal judicial circuits; the ability of labor organizations to advance consistent goals across federal judicial circuits; and the ability of labor and management to pursue mature relationships, such as the one between Local 32BJ and the RAB, whereby they can resolve employee disputes without disruption. 27 B. The Adverse Effect on Labor-Management Relations. The Second Circuit’s decision could prove highly detrimental to labor-management relations. In circuits that do not enforce union-negotiated waivers, an employer would seemingly be able to bypass the union as the employees’ bargaining agent. Employers could require unionized employees to sign individual arbitration agreements as a condition of employment — in the same manner that non-unionized employees can be compelled to do under Gilmer and its progeny. In particular, if a union cannot agree to an arbitration clause relating to statutory discrimination claims, it is well-established under labor law that such a term of employment becomes a non-mandatory subject of bargaining. See Air Line Pilots Ass'n, Int'l v. Northwest Airlines, Inc., 199 F.3d 477, 485 (D.C. Cir. 1999) (“[A] proposal to trade that which is not one’s to give cannot be a mandatory subject of bargaining.”) (citing Brotherhood of R.R. Trainmen v. Akron & Barberton Belt R.R. Co., 385 F.2d 581, 603 (D.C. Cir. 1967) (holding proposal to bargain over effects of job terminations, normally a mandatory subject, non-mandatory because union “could not bargain away any part of the rights that accrued to employees under the [arbitral] Award”)); see also NLRB v. Wooster Div. of Berg-Warner Corp., 356 U.S. 342 (1958) (distinguishing between mandatory and non-mandatory subjects of bargaining). As with all non-mandatory subjects of bargaining, an employer would be permitted to present the arbitration agreement directly to its employees — bypassing the union. J.J. Case Co. v. NLRB, 321 U.S. 332 (1944). The employer, 28 therefore, may be able to require its employees to sign the arbitration agreement in exchange for continued employment. Gilmer, 500 U.S. 20. Following the Second Circuit’s rule could strip unionized employees of their leverage that is only available through collective bargaining. An individual agreement to arbitrate clearly would be lawful under Gilmer, and the concept of bypassing the union to implement such an agreement unilaterally already has been approved by the District of Columbia Circuit in the context of the Railway Labor Act. Air Line Pilots Ass’n, Int'l, 199 F.3d at 486. Marginalizing the union would prove highly destabilizing to labor-management relations, and would in no way serve the ultimate ends of the ADEA or other anti-discrimination statutes. 29 CONCLUSION For all the aforementioned reasons, the petition for a writ of certiorari should be granted. Respectfully submitted, JAMES F. BERG PAuL SALVATORE* HowAarRD ROTHSCHILD Mark D. Harris REALTY ADvisORY BOARD ON Brian S. RAUCH Labor RE.ATIons, INC. Tan C. SCHAEFER 292 Madison Avenue PROSKAUER Rose LLP New York, NY 10017 1585 Broadway (212) 889-4100 New York, NY 10036 Counsel for Petitioner (212) 969-3000 Temco Service Industries, Inc. Counsel for Petitioner 14 Penn Plaza LLC * Counsel of Record APPENDIX la APPENDIX A — OPINION OF THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT DECIDED AUGUST 1, 2007 UNITED STATES COURT OF APPEALS SECOND CIRCUIT Docket Nos. 06-3047-CV(L), 06-3106-CV(CON ) Steven PYETT, Thomas O’Connell, and Michael Phillips, Plaintiffs-Appellees, V. PENNSYLVANIA BUILDING COMPANY, 14 Penn Plaza, LLC, and Temco Service Industries, Inc., Defendants-Appellants. Argued: June 27, 2007. Decided: Aug. 1, 2007. Before CABRANES and RAGGI, Circuit Judges, and KORMAN,' District Judge. JOSE A. CABRANES, Circuit Judge. 1. The Ilonorable Edward R. Korman, of the United States District Court for the Eastern District of New York, sitting by designation. 2a Appendix A In this appeal, defendants challenge an order of the United States District Court for the Southern District of New York (Naomi Reice Buchwald, Judge ) denying their motion to compel arbitration of plaintiffs’ age discrimination claims in accordance with the collective bargaining agreement between plaintiffs’ union and their employer. Defendants argue that the District Court, which relied on the Supreme Court’s decision in Alexander v. Gardner-Denver Co., 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974), and our Court’s decision in Rogers v. New York University, 220 F.3d 73 (2d Cir.2000), failed to take into account the Supreme Court’s decisions in Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991), and Wright »v. Universal Maritime Service Corp., 525 U.S. 70, 119 S.Ct. 391, 142 L.Ed.2d 361 (1998). We disagree, and reaffirm our decision in Rogers that mandatory arbitration clauses in collective bargaining agreements are unenforceable to the extent they waive the rights of covered workers to a judicial! forum for federal statutory causes of action. BACKGROUND The following facts are not disputed by the parties. Plaintiffs are employees of Temco Services Industries (“Temco”), a building service and cleaning contractor. Before August 2003, they worked as night watchmen in a commercial office building owned by Pennsylvania Building Company and 14 Penn Plaza LLC (jointly, the “Company”). Since that time, they have been 3a Appendix A working as night porters and light duty cleaners in the same building. Plaintiffs are members of Local 32BJ of the Service Employees International Union (“Union”), and they are covered by the collective bargaining agreement (“CBA”) between the Union and the Realty Advisory Board on Labor Relations, Inc. (“RAB”), the multi-employer bargaining association of the New York City real estate industry. The CBA contains a mandatory arbitration clause for discrimination claims, which provides as follows:* There shall be no discrimination against any present or future employee by reason of race, creed, color, age, disability, national origin, sex, union membership, or any characteristic protected by law, including, but not limited to, claims made pursuant to Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the New York State Human Rights Law, the New York City Human Rights Code, New Jersey Law Against Discrimination, New Jersey Conscientious Employee Protection Act, Connecticut Fair Employer Practices Act, or any other similar laws, rules or regulations. All such claims shall be subject to the grievance and arbitration procedure (Articles 2. From 1999 on, each CBA between the Union and the RAB has included a mandatory arbitration clause for discrimination claims. 4a Appendix A V and VI [of the CBA] ) as the sole and exclusive remedy for violations. Arbitrators shall apply appropriate law in rendering decisions based upon claims of discrimination. In or about August 2003, the Company engaged Spartan Security, a security services contractor and affiliate of Temco, to provide certain security personnel, including night watchmen, for the building. Spartan brought in new employees, and plaintiffs, who had been employed as night watchmen, were reassigned to different locations and less desirable positions as night porters and light duty cleaners within the building. Plaintiffs filed grievances with the Union under the CBA. They claimed that, as the only building employees over the age of 50, they were wrongfully transferred and denied overtime in violation of various provisions of the CBA, including the provision that prohibited discrimination on the basis of age. Plaintiffs’ grievances were submitted to arbitration before the Contract Arbitrator, Ear] Pfeffer, who held hearings on eight occasions between February 2, 2004 and March 7, 2005. Shortly after arbitration began, the Union declined to pursue plaintiffs’ claims of wrongful transfer and age discrimination, electing to pursue only the claims regarding denial of overtime on behalf of all plaintiffs and wrongful denial of promotion on behalf of plaintiff Pyett. According to plaintiffs, the Union’s counsel explained to them that “since the Union had consented to Spartan Security being brought into the building,” the Union could not contest their replacement as night Sa Appendix A watchmen by personnel of Spartan Security. On August 10, 2005, the Contract Arbitrator issued his Opinion and Award, denying plaintiffs’ arbitrated claims in their entirety. On May 26, 2004, while the arbitration was ongoing, but after the Union declined to submit the age discrimination claims, plaintiffs filed charges of discrimination with the Equal Employment Opportunity Commission (“EEOC”). The EEOC issued a Dismissal and Notice of Rights on June 29, 2004 for plaintiffs Phillips and O’Connell and on September 14, 2004 for plaintiff Pyett. In each case, the EEOC determined that its “review of the evidence . . . fail[ed] to indicate that a violation ha[d] occurred,” and notified each plaintiff of his right to sue. On September 23, 2004, plaintiffs commenced this action against the Company and Temco in the District Court, pursuing those claims that the Union did not submit to arbitration. Plaintiffs alleged that they had been transferred from their positions and replaced by younger security officers in violation of the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C. § 621 et seq. , the New York State Human Rights Law, N.Y. Exec. Law § 290 et seg. , and the New York City Administrative code, N.Y.C. Admin. Code § 8-107. Defendants moved for dismissal for failure to state a claim upon which relief can be granted, pursuant to Fed.R.Civ.P. 12(b)(6), and, in the alternative, to compel arbitration, pursuant to 9 U.S.C. §§ 3 and 4. In an order dated May 31, 2006, the District Court denied both 6a Appendix A motions. With respect to defendants’ motion to compel arbitration, the District Court referred to its decision in Granados v. Harvard Maintenance, Inc., No. 05 Civ. 5489, 2006 U.S. Dist. LEXIS 6918 (S.D.N.Y. Feb. 22, 2006), where it “concluded based largely on binding Second Circuit precedent that even a clear and unmistakable union-negotiated waiver of a right to litigate certain federal and state statutory claims in a judicial forum is unenforceable.” Pyett v. Pennsylvania Building Co., 04 Civ. 7536, 2006 U.S. Dist. LEXIS 35952, *11 (S.D.N.Y. June 1, 2006). In Granados, the District Court relied principally on our Court’s opinions in F'ayer v. Town of Middlebury, 258 F.3d 117 (2d Cir.2001), and Rogers.’ The District Court recognized the distinction 3. Gardner-Denver held that a collective bargaining agreement could not waive covered workers’ rights to a judicial forum for causes of action created by Congress-in that case, a cause of action created by Title VII. See Gardner-Denver, 413 U.S. at 49-51. Gilmer held that an individual employee who had agreed individually to waive his right to a federal forum could be compelled to arbitrate a federal age discrimination claim. See Gilmer, 500 U.S. at 33-35. In Wright, the Supreme Court held that a collective bargaining agreement could not waive covered employees’ “rights to a judicial forum for federal claims of employment discrimination” absent a “clear and unmistakable waiver” of those rights. /d. at 82. It declined to resolve the tension between Gardner- Denver and Gilmer, however, instead deciding that it would “not reach the question whether such a [clear and unmistakable] waiver would be enforceable.” /d. In Rogers, we applied Wright to hold that an arbitration provision in a collective bargaining agreement could not waive an employee’s right to assert local, state, and federal statutory (Cont'd) Ta Appendix A our Court has drawn between arbitration clauses in individual contracts, which are governed by a line of Supreme Court cases represented by Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991), and arbitration clauses in CBAs, which are governed by a line of Supreme Court cases represented by Alexander v. Gardner-Denver Co., 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974). See Granados, 2006 U.S. Dist. LEXIS 6918, at *11-14 (citing Fayer, 258 F.3d at 122). The District Court, following Rogers, held that union-negotiated waivers of statutory rights in CBAs were unenforceable and denied defendants’ motion to dismiss. /d. at *15-22. Pursuant to 9 U.S.C. § 16(a)(1)(A) and (B), defendants timely appealed the District Court’s May 31, 2006 order denying their motion to compel arbitration. DISCUSSION Defendants argue that Rogers left open the question of whether an arbitration clause in a CBA that clearly waives a covered worker’s right to a judicial forum with respect to statutory claims is enforceable. They contend that such waivers are enforceable under Gilmer, which, they argue, overturned the holding in Gardner-Denver. (Cont'd) employment discrimination claims in federal court. See 220 F.3d at 75-77. In Fayer, we held that, under Wright, a collective bargaining agreement could not bar a covered employee from pursuing a First Amendment claim in federal court because it did not clearly and unmistakably waive the employee's right to pursue the claim. See 258 F.3d at 123. 8a Appendix A While conceding that in Gilmer the Supreme Court dealt only with contracts signed by individuals and not CBAs, defendants claim, see Appellants’ Br. 12, that in Wright the Supreme Court made clear its abandonment of Gardner-Denver’s rule that a union may only “waive certain statutory rights related to collective activity, such as the right to strike,” Gardner-Denver, 415 US. at 51, 94 S.Ct. 1011. We disagree. Our Court in Rogers squarely decided that a union-negotiated mandatory arbitration agreement purporting to waive a covered worker’s right to a federal forum with respect to statutory rights is unenforceable. We took full account of both Gilmer and Wright and concluded that the Supreme Court’s decision in Gardner-Denver remains good law. Our conclusion in Rogers was an alternative holding, not dicta, and continues to bind our Court. In any event, none of the cases relied upon by defendants persuades us that this holding in Rogers was incorrect. In Rogers, we considered two issues: whether a mandatory arbitration clause in a CBA is enforceable generally, and whether the language of the particular clause at issue was a “clear and unmistakable waiver” under Wright, 525 U.S. at 80, 119 S.Ct. 391. We held first that Gardner-Denver still governed arbitration provisions in CBAs, notwithstanding the Supreme Court’s holding in Gilmer that an employee who agreed to waive his individual right to a federal forum could be compelled to arbitrate an age discrimination claim. See Rogers, 220 F.3d at 75 (discussing Gilmer, 500 U.S. at 23). Second, we held that the language of the waiver at issue in that case was not “clear and unmistakable” 9a Appendix A under Wright. See id. at 77. We explained that Gardner- Denver had not been overruled by Wright. Rogers, 220 F.3d at at 75 (“[W hile Wright may have called Gardner- Denver into question, it did not overrule it.”); see also Wright, 525 U.S. at 82, 119 S.Ct. 391 (“We do not reach the question whether such a waiver [under a CBA] would be enforceable.”). Defendants focus on our comment in Hogers that Wright “could be taken to suggest that, under certain circumstances, a union negotiated waiver of an employee’s statutory right to a judicial forum might be enforceable.” Appellants’ Br. 13 (quoting Rogers, 220 F3d at 75). But they ignore our holding, in reliance on Wright and Gardner- Denver, that arbitration provisions contained in a CBA, which waive employees’ rights to a federal forum with respect to statutory claims, are unenforceable. Defendants argue that our statements regarding the enforceability of arbitration provisions in CBAs were dicta because we also concluded that the clause at issue in Rogers was not “clear and unmistakable.” This argument is without merit. We explicitly stated in Rogers that “the rule in Gardner- Denver was sufficient” to decide the case. Rogers, 220 F.3d at 75. An alternative conclusion in an earlier case that is directly relevant to a later case is not dicta; it is an entirely appropriate basis for a holding in the later case. Our reliance on Gardner-Denver in Rogers was an alternative holding; it was thus not dicta. See MacDonald, Sommer & Frates v. County of Yolo, 477 U.S. 340, 346 n. 4, 106 S.Ct. 2561, 91 L.Ed.2d 285 (1986) (“(S}inece the Superior Court did not rest its holding on 10a Appendix A only one of its two stated reasons, it is appropriate to treat them as alternative bases of decision [rather than dicta].”); United States v. Fulks, 454 F.3d 410, 434-35 (4th Cir.2006) (stating that an alternative conclusion in a prior case that bears directly on a subsequent case cannot be dismissed as dicta). None of the other Supreme Court cases on which defendants rely casts doubt on our holding in Rogers. For example, they draw our attention to Metropolitan Edison Co. v. N.L.R.B., 460 U.S. 693, 103 S.Ct. 1467, 75 L.Ed.2d 387 (1983), and Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 121 S.Ct. 1302, 149 L.Ed.2d 234 (2001). Metropolitan Edison held that union officials may be bound by union-negotiated agreements to enforce no- strike agreements, and thus waive their right, guaranteed by the National Labor Relations Act § 8(a)(3), 29 U.S.C. § 158(a)(3), to be free of anti-union discrimination. Metropolitan Edison, 460 U.S at 708. However, rather than supporting the notion that individual rights may be waived by CBAs, as defendants claim, that holding is in line with the Supreme Court’s observation in Gardner-Denver that unions “may waive certain statutory rights related to collective activity, such as the right to strike.” Gardner-Denver, 415 U.S. at 51 (emphasis added). Circuit City addressed an individual’s employment contract, rather than a CBA, and therefore likewise does not address the issue before us now.’ 4. After Wright, our sister circuits have not stepped much beyond Gardner-Denver's holding with regard to the (Cont'd) lla Appendix A In short, there is nothing that has changed in the nine years since Wright or the seven years since Rogers that compels us to reverse our ruling in Rogers that arbitration provisions contained in a CBA, which purport to waive employees’ rights to a federal forum with respect to statutory claims, are unenforceable.°® (Cont'd) enforceability of arbitration provisions in CBAs. See, e.g., O’Brien v. Town of Agawam, 350 F.3d 279, 285 (1st Cir.2003) (“The Wright Court declined to resolve this tension [between enforceability of mandatory arbitration clauses in individual contracts and those in CBAs], holding that even assuming a CBA can waive an employee’s right to a federal forum, any such waiver must at a minimum be ‘clear and unmistakable.’ ”); Mitchell v. Chapman, 343 F.3d 811, 824 (6th Cir.2003) (“Assuming arguendo, that the CBA mandates binding arbitration, it is well-established that the CBA must contain a ‘clear and unmistakable waiver’ of Mitchell’s [Family and Medical Leave Act] rights to foreclose his entitlement to a judicial forum.”); Tice v. Am. Airlines, Inc., 288 F.3d 313, 317 (7th Cir.2002) (citing Gardner-Denver, but noting the ambiguity in the CBA language); EEOC v. Ind. Bell Tel. Co., 256 F.3d 516, 522 (7th Cir.2001) (holding that “a union cannot surrender employees’ rights under Title VII”). But see E. Associated Coal Corp. v. Massey, 373 F.3d 530, 533 (4th Cir.2004) (“{A] union-negotiated CBA may waive an employee’s statutory right to litigate his employment discrimination claims in a judicial forum.”). 5. The case before us illustrates why the Supreme Court may be reluctant to treat arbitration provisions in CBAs the same as arbitration provisions in individual contracts. If, as plaintiffs allege, the Union refused to submit the wrongful transfer claims to arbitration because the Union had agreed to the new contract, (Cont'd) 12a Appendix A CONCLUSION For the foregoing reasons, the order of the District Court is affirmed. (Cont'd) the interests of the Union and the interests of plaintiffs are clearly in conflict. See Gardner-Denver, 415 U.S. at 58 n. 19, 94 S.Ct. 1011 (“| T]he interests of the individual may be subordinated to the collective interests of all employees in the bargaining unit.”). I3a APPENDIX B — MEMORANDUM AND ORDER OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FILED JUNE 1, 2006 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK No. 04 Civ. 7536 (NRB) STEVEN PYETT, THOMAS O’CONNELL, and MICHAEL PHILLIPS, Plaintiffs, - against - PENNSYLVANIA BUILDING COMPANY, 14 PENN PLAZA LLC, and TEMCO SERVICE INDUSTRIES, INC., Defendants. MEMORANDUM AND ORDER NAOMI REICE BUCHWALD UNITED STATES DISTRIC? JUDGE Steven Pyett, Thomas O’Connell, and Michael Phillips (collectively, “plaintiffs”), all of whom are over 50 years of age, bring this action against Pennsylvania Building Company (“PBC”), 14 Penn Plaza LLC 14a Appendix B (collectively, “the Company”), and Temco Service Industries, Inc. (“Temco”) (collectively, “defendants”) for age discrimination. Defendants now move to dismiss or compel arbitration and for sanctions. For the reasons set forth below, defendants’ motions are denied. BACKGROUND! Plaintiffs are or were longstanding employees in the office building at 14 Penn Plaza, New York, New York (the “building”), who allege that in 2003 they were reassigned to less desirable positions because of their age.” Plaintiffs’ Amended Complaint alleges that defendants engaged in age discrimination, in violation of the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621 et seq. (“ADEA”), the New York State Human Rights Law, N.Y. Exec. Law § 290, et seq. (McKinney 2005), and the New York City Administrative Code, N.Y.C. Admin. Code § 8-107. Employment History Pyett began working at the building in or about 1970, and since then he has been continuously employed there 1. The following facts are drawn from plaintiffs’ complaint and, as is appropriate when considering a motion to dismiss under Fed.R.Civ.P 12(b)(6), are assumed herein to be true. 2. Plaintiffs Pyett and Phillips are still employed at the building, while O’Connell left employment in 2004. First Amended Complaint (“Amended Complaint” or “Am. Compl.”) V9 14, 18, 22. 15a Appendix B in various positions. Until his reassignment to work as a night porter in 2003, he had worked since 1989 as a night watchman. Am. Compl. 17 13, 14. O’Connell began working at the building in or about 1969 and was continuously employed there until he retired in 2004. Id. at 117. O’Connell also worked in numerous positions, and before his reassignment to work as a night porter in 2003, he had been working as a night watchman starting in 1992. /d. at 118. Phillips began working at the building in or about 1995 and had worked as a night starter until he was reassigned in 2003 to work as a light duty cleaner.’ /d. at 1 35. All three plaintiffs were and still are members of Local 32B-32J Service Employees International Union (“Local 32B-J”). Jd. at 19 15, 19, 22. In addition, plaintiffs allege that at all relevant times, PBC and Temco were and are parties to a collective bargaining agreement (“CBA”) with Local 32B-J covering the terms and conditions of plaintiffs’ employment. /d. at 1 27. Plaintiffs allege that in or about 1982 defendant Temco was engaged by defendant PBC to provide maintenance and cleaning services at the building. /d. at 123. At or about the same time, Pyett and O’Connell were transferred from the payroll of PBC to that of Temco. /d. at 1 24. Notwithstanding this payroll change, plaintiffs allege that they continued to receive their work 3. We note that elsewhere, the Amended Complaint states that Phillips is currently employed as a night porter. See id. at 4 22. l6a Appendix B assignments and were still supervised by PBC employees, including the building owner. /d. at 1 25. Plaintiffs assert that in or about August 2008, Spartan Security’ was engaged by PBC to provide security services at the building. /d. at 1 26. Shortly before this date, on or about July 23, 2003, plaintiffs Pyett and O’Connell were informed by PBC and Temco that they were being reassigned as night porters, while Phillips was told he would be reassigned as a light duty cleaner. Jd. at 11 28, 32, 35. Plaintiffs allege that they were reassigned to “substantially less desirable” positions. /d. at 191 29, 36. In addition, Pyett and O’Connell allege that their reassignments led to “a substantial loss of income.” /d. at 1% 30, 33. In all three cases, plaintiffs allege that their former positions were given to Spartan employees who were much younger and had much less seniority at the building than them. /d. at 1% 31, 34, 37. Procedural History In or about August 2003, plaintiffs filed grievances against defendants under the CBA, alleging that: (i) they had been reassigned to less desirable positions in violation of provisions which prohibited age discrimination; (ii) the Company violated seniority 4. Plaintiffs allege that Spartan is a company “engaged in the business of providing building security services at various buildings located in the City of New York, and a subsidiary, department, related or affiliated company of the defendant Temco.” 7d. at 4 11. 17a Appendix B policies when it failed to promote either Pyett or O’Connell to the assistant mechanic position; and (iii) the Company failed equitably to rotate overtime. /d. at 1 38; Def. Mem. at 4. While all these grievances were initially submitted by Local 32B-J to arbitration, the union subsequently withdrew plaintiffs’ age discrimination claim from arbitration by letter dated February 23, 2004, Am. Compl. 1% 39 and 40, and proceeded with the remaining claims. On or about August 21, 2004, plaintiffs filed an action (No. 04 Civ. 6769(N RB)) in this Court against Local 32B- J and defendants, alleging that Local 32B-J had breached its duty of fair representation toward them by withdrawing their age discrimination grievance from arbitration. /d. at 7 41. On or about May 18, 2004, plaintiffs jointly filed a complaint of age discrimination against defendants with the United States Equal Employment Opportunity Commission (“EEOC”). /d. at 1 42. The EEOC subsequently issued right to sue letters to plaintiffs, 2d. at 111 44-46, and on November 1, 2004 plaintiffs filed the Amended Complaint against defendants.° On August 10, 2005, the arbitrator issued an Opinion and Award which denied the remaining grievances of Local 32B-J. See Plaintiffs’ Letter dated September 12, 2005 (“Sept. 12, 2005 Letter”). Following the arbitrator’s decision, plaintiffs discontinued their action (No. 04 Civ. 5. Defendants answered the Amended Complaint in March 2005. 18a Appendix B 6769(NRB)) against Local 32B-J and defendants. However, plaintiffs maintain that their claims in the instant action remain viable notwithstanding the arbitrator’s decision. See Sept. 12, 2005 Letter. Defendants subsequently filed their motion on November 23, 2005. DISCUSSION I. Motion to Dismiss In considering a motion to dismiss,® the Court must accept as true all material factual allegations in the complaint. Levy ex rel. Immunogen Inc. v. Southbrook Int'l Invs., Ltd., 263 F.3d 10, 14 (2d Cir.2001). However, “(cjonclusory allegations or legal conclusions masquerading as factual conclusions will not suffice to prevent a motion to dismiss.” Smith v. Local 819 I.B.T. Pension Plan, 291 F.3d 236, 240 (2d Cir. 2002) (quoting Gebhardt v. Allspect, Inc., 96 F.Supp.2d 331, 333 (S.D.N.Y. 2000)). A motion to dismiss may be granted only where “it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” Still v. DeBuono, 101 F.3d 888, 891 (2d Cir. 1996) (quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). —-——__ asi a —- —_—_—————— - -—— 6. Because we do not rely on any material outside the complaint in ruling on the motion, we decline to convert this motion into one for summary judgment. See Friedl v. City of New York, 210 F.3d 79, 83 (2d Cir. 2000). 19a Appendix B Defendants assert in their papers that we should undertake the three-step burden shifting analysis established in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802-04 (1973), in deciding their motion to dismiss. However, “(t]he prima facie case under McDonnell Douglas ... is an evidentiary standard, not a pleading requirement.” Swierkiewicz v. Sorema N.A., 534 U.S. 506, 510, 122 S.Ct. 992, 997 (2002).’ Accordingly, the Supreme Court has unanimously held that “an employment discrimination complaint need not include {specific facts establishing a prima facie case of discrimination] and instead must contain only ‘a short and plain statement of the claim showing that the pleader is entitled to relief.” ’ Leibowitz v. Cornell University, 445 F.3d 586, 591 (2d Cir.2006) (quoting Swierkiewicz, 534 U.S. at 508) (brackets in original); see also Galvez v. New York Mortgage Co., No. 05 Civ. 2365(DLC), 2005 WL 2124112, at *4 (S.D.N.Y. Sept. 1, 2005) (“[Defendant’s] insistence that [plaintiff] must state a prima facie claim of race discrimination to survive a motion to dismiss must be rejected in light of Swierkiewicz.” ). Therefore, our inquiry at this stage in the litigation is limited to whether the Amended Complaint provides defendants with fair notice of what the plaintiffs’ claims are and the grounds upon which they rest. See Swierkiewicz, 534 U.S. at 512. Under this “simplified standard for pleading, ‘{[a] court may dismiss a complaint only if it is clear that no relief could be granted under 7. Defense counsel subsequentiy acknowledged the applicability of Swierkiewicz during oral argument. 20a Appendix B any set of facts that could be proved consistent with the allegations.’” 7d. at 514 (quoting Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229 (1984)); see Braphman-Bines v. New York City Police Dept., No. 03 Civ. 10207(/KMK), 2005 WL 22843, at *3 (S.D.N.Y. Jan. 3, 2005) (“Under Swierkiewicz, Rule 8 pleading is extremely permissive.”) (quoting Wynder v. McMahon, 360 F.3d 73, 77 (2d Cir.2004)). “This simplified notice pleading standard relies on liberal discovery rules and summary judgment motions to define disputed facts and issues and to dispose of unmeritorious claims.” Swierkiewicz 534 U.S. at 512. We find that plaintiffs have satisfied these lenient standards, as they allege that plaintiffs were over the age of 40, that they were reassigned to positions which led to substantial losses in income,® and that their replacements were both younger and had less seniority at the building. Cf Vallone v. Banca Nazionale del Lavoro, N.Y. Branch, No. 02 Civ. 6064( RCC), 02 Civ. 7102 (RCC), 2004 WL 2912887, at *3 (S.D.N.Y. Dec. 14, 2004). Although plaintiffs clearly will need evidence supporting these allegations to survive summary judgment, we cannot say that they have failed to meet the notice pleading standard required at this stage. Therefore, defendants’ motion to dismiss is denied. 8. In the case of plaintiff Phillips, the Amended Complaint alleges that he was assigned to a “substantially less desirable position.” Am. Compl. 1 36. 2la Appendix B II. Motion to Compel Arbitration Defendants alternatively move to compel arbitration in this matter, arguing that plaintiffs are bound by the terms of the CBA to arbitrate their claims. Plaintiffs assert that they are not bound by these union-negotiated terms and are free to litigate their claims before this Court. We recently addressed this very issue in Granados v. Harvard Maintenance, Inc., No. 05 Civ. 5489(NRB), 2006 WL 435731 (S.D.N-Y. Feb. 22, 2006). There, we concluded based largely on binding Second Circuit precedent that even a clear and unmistakable union-negotiated waiver of a right to litigate certain federal and state statutory claims in a judicial forum is unenforceable. In light of our reasoning in that case, defendants’ motion to compel arbitration is denied. III. Motion for Sanctions In light of these conclusions, imposition of sanctions against plaintiffs would not be appropriate. Therefore, defendants’ motion for sanctions is denied. 22a Appendix B CONCLUSION For the reasons set forth above, defendants’ motion to dismiss or compel arbitration is denied, and their motion for sanctions is denied. IT IS SO ORDERED. Dated: New York, New York May 31, 2006 23a APPENDIX C — OPINION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FILED FEBRUARY 22, 2006 UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK 05 Civ. 5489 (NRB) LUZ GRANADOS, Plaintiff, - against - HARVARD MAINTENANCE, INC., Defendant. February 22, 2006, Decided February 22, 2006, Filed JUDGES: NAOMI REICE BUCHWALD, UNITED STATES DISTRICT JUDGE. OPINION BY: NAOMI REICE BUCHWALD OPINION MEMORANDUM AND ORDER 24a Appendix C NAOMI REICE BUCHWALD UNITED STATES DISTRICT JUDGE Plaintiff Luz Granados (“plaintiff” or “Granados”), an office cleaner, has brought this action against her current employer, Harvard Maintenance, Inc. (“defendant” or “HMI”), which provides cleaning and maintenance services to commercial properties. Plaintiff alleges that defendant subjected her to disparate treatment based on her race, age, national origin, and gender and also retaliated against her in response to her request for leave pursuant to the Family and Medical Leave Act of 1993 (“FMLA”) as well as her complaints of discrimination. Defendant now moves pursuant to Fed.R.Civ.P. 12(b)(1) & (6) to dismiss plaintiff’s complaint. For the reasons set forth herein, defendant’s motion is denied. BACKGROUND’ Plaintiff is a 54 year old Hispanic woman who has been employed as an office cleaner by HMI since 2002. Compl. at 1 6. Plaintiff asserts claims under the FMLA; the New York State Human Rights Law, N.Y. Exec. Law § 290, et seq. (McKinney 2005); and the New York City Administrative Code, N.Y.C. Admin. Code § 8-107. Plaintiff alleges that she has been subjected to a hostile 1. The following facts are drawn from plaintiff’s complaint and, as is appropriate when considering a motion to dismiss under Fed.R.Civ.P 12(b)(6), are assumed herein to be true. 25a Appendix C work environment and has suffered adverse employment actions based on her race, age, national origin, and gender. She also alleges that adverse actions were taken against her for requesting leave pursuant to the FMLA and in retaliation for her complaints of discrimination. Id. at % 7. I. Disparate Treatment and Harassment Plaintiff alleges that since 2003 and continuing to the present day, defendant has taken various actions against her which it did not take against other, similarly situated employees. Jd. at 1 8. Specifically, plaintiff alleges that her male, Albanian supervisor, Al (last name unknown), regularly used derogatory language in her presence. On a monthly basis, Al referred to Hispanics as “Spic.” On a weekly basis, he referred to plaintiff as “dumb Hispanic.” Virtually every day, he referred to plaintiff as an “old, weak woman” and referred to older male employees as “old and weak.” On July 20, 2003, in front of several other employees, Al allegedly called plaintiff an “old Mexican woman” and a “clown” while using plaintiff’s work cart to imitate an old woman. /d. In addition, plaintiff asserts that during weekly inspections, defendant regularly allows three to four Albanian employees to work together to clean sites of comparable size to those which it requires one Hispanic employee to clean alone. Plaintiff and other Hispanic employees allegedly are then reprimanded for failure to do as good a job as the Albanians, even when this is not the case. On July 10, 2003, plaintiff alleges that she 26a Appendix C alone was suspended without pay for failing to properly clean her assigned area despite the fact that two Albanian women were working on the same area with her. Jd. From 2003 until the present, plaintiff alleges that defendant has forced her to vacuum nearly every day, even though Albanian employees were not required to do so. Plaintiff at one point allegedly produced a doctor’s note stating that she should refrain from vacuuming because it was causing damage to her hands. Irregardless, defendant did not assign an Aibanian co- worker assigned to the same work area to vacuum but instead forced plaintiff to continue vacuuming. Jd. Plaintiff alleges that on several occasions she complained both to HMI management and to her union that defendant subjected Hispanic employees to disparate treatment. In response, she alleges that she was told by management to “shut up and mind her own business.” Plaintiff alleges that approximately twice a month thereafter, defendant harassed her and threatened her employment. /d. at 7 9. Il. FMLA Leave Request On August 26, 2003, plaintiff requested two weeks of unpaid leave (which she alleges was the equivalent of FMLA leave), as well as two weeks of accrued vacation time in order to visit her terminally ill father in Colombia. Despite the fact that plaintiff’s union delegate, Paul Romero (“Romero”), had “approved [her] paperwork” 27a Appendix C defendant denied the request. Plaintiff alleges that Romero told her the request was denied because she was Hispanic rather than Albanian. Romero then advised plaintiff to see Murat Mela (“Mela”), an Albanian who was the Assistant Vice President of HMI. /d. at 1 10. Plaintiff alleges that when she went to Mela’s office accompanied by her husband, Mela allegedly told plaintiff that she was a “troublemaker” and that she was “now going to be on [Mela’s] troublemakers list.” He then allegedly stated that he “[got] rid of [troublemakers]” and that plaintiff should not complain to the union about discrimination or FMLA leave because “all problems remain in house and anybody who goes outside is a troublemaker.” /d. at 9111. III. Subsequent Events On October 6, 2003 (presumably after she returned from her visit to her father), Al allegedly told plaintiff that she could not start her shift until she provided a copy of her father’s death certificate to Mela. /d. at 112. Plaintiff produced one the following day, but she was then told that she would not be allowed to return to work until she provided a notarized English translation of the death certificate. Jd. at 4 13. Plaintiff eventually was allowed to return to work but then discovered that an Albanian woman had replaced her while she was away. Plaintiff also learned that the Albanian woman was allowed eight hours to 28a Appendix C complete the same job that plaintiff was required to perform within 7.5 hours.’ /d. at 9 14. In October 2003, during an inspection in which plaintiff and an Albanian woman were both assigned the same work area, Al reprimanded plaintiff because he claimed the area was not clean. Plaintiff alleges that only she was reprimanded, despite the fact that Al saw the Albanian woman sitting in an office instead of working. Plaintiff alleges that when she complained to Al about this, he told the Albanian woman, “(t|his Spanish bitch thinks she’s going to do what she wants. I’m going to make her life miserable and if she says anything else I have oraers from the office to get rid of her. I can get rid of her for anything. She’s an old woman and a troublemaker.” /d. at 4 15. During the same month, Al again complained that plaintiff’s work area was not properly cleaned. Plaintiff allegedly explained to him that her Albanian coworker refused to clean her portion of the assigned area. Although Al saw that the Albanian woman was not working, he told plaintiff to “mind her own business” and said that the Albanian woman could “do whatever she wants.” Al allegedly threatened to issue a written reprimand to plaintiff if the floor was not cleaned when he returned. /d. at 9 16. 2. Defendant allegedly compensates employees on an hourly basis,:d at 714, but it is not clear whether the Albanian woman was paid at the same rate as plaintiff. ~ 29a Appendix C On March 11, 2005, plaintiff was suspended for three days fer poor work performance. She alleges that when giving her the suspension, Al stated to her, “I told you I would get you. We are going to make an example out of you. This is coming from the office. Those were my orders.” Jd. aL 417. During the same month, Al allegedly admitted to plaintiff that he had been ordered to make her life miserable. /d. at 7 18. On Apr* 12, 2005, plaintiff was suspended for one week for failing to properly clean her worksite. However, defendant failed to suspend plaintiff’s “similarly- situated employees who were outside her protected class.” In addition, Al allegedly stated to plaintiff that “[yjou Hispanic people do not know how to clean. My people are perfect.” Al also allegedly stated that if plaintiff went to the union she would be fired. /d. at 1 19. On April 15, 2005, while plaintiff was still serving her suspension, defendant suspended her again. Id. at I 20. On May 5, 2005, Al ordered plaintiff to lift heavy trash bags. When she asked him to assign someone else to assist her, he allegediy refused and threatened to “get your Hispanic ass out of this building.” Fearful of losing her job, plaintiff complied, subsequently injuring her hand and foot as a result. /d. at 9 21. Plaintiff alleges that as a result of her treatment, she has suffered and continues to suffer a loss of monetary and other benefits. She also alleges physical and emotional damages. /d. at "23. 30a Appendix C IV. Collective Bargaining Agreement* Throughout her employment with HMI, plaintiff has been represented for purposes of collective bargaining by Local 32B-32J, Service Employees International Union (“Local 32B-32J” or the “Union”). A collective bargaining agreement (“CBA” or “Agreement”) between IiMI and Local 32B-32J is in place which governs wages, hours, and other terms and conditions. The CBA directly references and requires compliance with the FMLA.‘ In addition, the CBA requires arbitration of disputes “arising between the parties as to interpretation, application or performance of any part of this Agreement and such other issues as the parties are expressly required to arbitrate ... under the terms of this Agreement.” Affidavit of Perry S. Heidecker, Esq. dated August 15, 2005 (“Heidecker Aff.”) Ex. A at 6. The CBA also contains an anti-discrimination clause which states that: There shall be no discrimination against any present or future employee by reason of race, creed, color, age, disability, national 3. The facts in this section, though not included in the complaint, are drawn from the contents of the CBA, of which we appropriately take judicial notice. See Kramer v. Time Warner, Inc., 937 F.2d 767, 773 (2d Cir. 1991). 4. The Agreement states that “[aJny Employer who is required by law to comply with the provisions of the Family Medical and Leave Act (FMLA) shall comply with the requirements of said act.” Heidecker Aff. Ex. A at 36. 3la Appendix C origin, sex, sexual orientation, union membership, or any characteristic protected by law, including, but not limited to, claims made pursuant to Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the New York State Human Rights Law, the New York City Human Rights Code, or any other similar laws, rules or regulations. All such claims shall be subject to the grievance and arbitration procedure (Articles V and VI) as the sole and exclusive remedy for violations. Id. at 41 (emphasis added). Defendant has moved to dismiss the complaint in its entirety. For the reasons set forth below, defendant's motion is denied. DISCUSSION In considering a motion to dismiss, the Court must accept as true all material factual allegations in the complaint. Levy ex rel. Immunogen Inc. v. Southbrook Int'l Invs., Ltd., 263 F.3d 10, 14 (2d Cir. 2001). However, “fejonclusory allegations or legal conclusions masquerading as factual conclusions will not suffice to prevent a motion to dismiss.” Smith v. Local 819 1. B.T: Pension Plan, 291 F.3d 236, 240 (2d Cir. 2002) (quoting Gebhardt v. Allspect, Inc., 96 F.Supp.2d 331, 333 (S.D.N.Y. 2000)). A motion to dismiss may be granted only where “it appears beyond doubt that the plaintiff 32a Appendix C can prove no set of facts in support of his claim which would entitle him to relief.” Still v. DeBuono, 101 F.3d 888, 891 (2d Cir.1996) (quoting Conley v. Gibsor.,, 355 U.S. 41, 45-46 (1957)). I. Waiver of Rights Generally Defendant argues that plaintiff’s complaint should be dismissed because the union-negotiated CBA designates arbitration as the sole and exclusive remedy for any disputes involving the subject matter of plaintiff’s claims. As detailed in numerous cases, see, e.g., Fayer v. Town of Middlebury, 258 F.3d 117, 121-22 (2d Cir.2001), there has been some uncertainty about the enforceability of such provisions in light of two different lines of Supreme Court precedent. For purposes of this discussion, we summarize them briefly below. The first line of cases involves “the preclusive effect of arbitrations conducted under collective bargaining agreements on subsequent litigation arising out of the same underlying facts.” /d. at 121. This line is represented by Alexander v. Gardner-Denver Co., 415 U.S. 36, 49 (1974), in which the Court held that an individual is not barred from bringing a Title VII action even if, pursuant to a nondiscrimination clause of a collective bargaining agreement, he previously arbitrated a grievance involving the same conduct. The second line of cases deals with “the enforceability of individually executed predispute arbitration agreements on federal statutory and 33a Appendix C constitutional claims.” Fayer, 258 F.3d at 122. This line is represented by Gilmer wv. Interstate/Johnson Lane Corp ., 500 U.S. 20, 27 (199!), in which the Court held that a claim under the Age Discrimination in Employment Act of 1967 (ADEA) could be subjected to compulsory arbitration pursuant to an arbitration agreement in a securities registration form, thus waiving the plaintiff’s right to a federal judicial forum. There, the Court stated that “[iJ]t is by now clear that statutory claims may be the subject of an arbitration agreement, enforceable pursuant to the FAA .” Gilmer, at 26. Subsequently, in Wright v. Universal Maritime Svc. Corp 525 U.S. 70, 72 (1998), the Supreme Court considered “whether a general arbitration clause in a{CBA] requires an employee to use the arbitration procedure for an alleged violation of the Americans with Disabilities Act of 1990(ADA).” Although the Court ultimately concluded that the employee was not obliga’ed to use the arbitration procedure, it did not explicitly decide whether or not such a union-negotiated waiver of the employee’s right to a judicia! forum was valid. /d. at 77 (“we find it unnecessary to resolve the question of the validity of a union-negotiated waiver, since it is apparent to us ... that no such waiver has occurred”). Rather, it held that the waiver in question was not sufficiently clear and unmistakable such that, even assuming such waivers were enforceable, it would be valid. Jd. at 80. In reaching its conclusion, the Court acknowledged the tension between the two prior lines of cases but did not resolve it. 34a Appendix C Absent more explicit guidance from the Supreme Court, lower courts, including the Second Circuit, have distinguished these two lines of cases by asserting that the second line of cases “deal[s] not with arbitration clauses in collective bargaining agreements but with employees’ own agreements to arbitrate specified disputes.” Frayer, 258 F.2d at 122; Rogers v. New York University, 220 F.3d 73, 75 (2d Cir. 2000). In addition, the Second Circuit has since considered the enforceability of an arbitration provision in a union- negotiated CBA. The Second Circuit concluded that the provision was not enforceable against the plaintiff’s claims under the ADA, the FMLA, and New York State and City human rights laws. Rogers, 220 F:3d at 75 (“The arbitration provision in the instant case, by which employees purport to waive their right to a federal forum with respect to statutory claims, is contained in a union- negotiated CBA.... [SJuch provisions are not enforceable.”). In reaching this conclusion, the Court stated that “the Gardner-Denver rule is sufficient to decide this case” and noted that “while Wright may have called Gardner-Denver into question, it did not overrule it.” Jd. However, as an alternative rationale, it also affirmed the district court’s conclusion that even if such provisions were enforceable as a general matter, the alleged waiver in that case was not sufficiently clear. /d. at 75-77. In reaching this conclusion, the Court articulated a two- step analysis of whether a waiver of statutorily conferred rights in a CBA is clear and unmistakabie. Specifically, 35a Appendix C it held that a waiver in a CBA will be deemed sufficiently clear and unmistakable if either of two conditions is met. Id. at 76. “First, a waiver is sufficiently explicit if the arbitration clause contains a provision whereby employees specifically agree to submit all federal causes of action arising out of their employment to arbitration.” Id. “Second, a waiver may be sufficiently clear and unmistakable when the CBA contains an explicit incorporation of the statutory anti-discrimination requirements in addition to a broad and general arbitration clause.” /d. Applying the two rationales of Rogers, we find that the arbitration provision at issue here is not enforceable as to any of plaintiff’s statutory claims. A. FMLA Claim Broadly, the Second Circuit has already held that a union-negotiated arbitration clause in a CBA is unenforceable. See Rogers, 220 F.3d at 75; F'ayer, 258 F.3d at 123 n. 2 (“In this Circuit, we have reached the question left open by Wright and held that an arbitration clause in a union collective bargaining agreement is not enforceable against an individual employee’s ADA and Family and Medical Leave Act claims.”); see also Fowler v. Transit Supervisors Org., 96 Civ. 6796 (JGK), 2000 WL 1726687, at *1 (S.D.N.Y. Sept. 6, 2000) (noting that Second Circuit has “expressly held that collective bargaining agreement mandatory arbitration provisions cannot bar union members from bringing federal claims to court”). This binding precedent is sufficient to find 36a Appendix C that the arbitration clause in this case is unenforceable against plaintiff’s FMLA claim. See Rogers, 220 F.3d at 75 (noting that “the Gardner-Denver rule is sufficient to decide this case”); Beljakovic v. Melohn Props., Inc., 04 Civ. 3694(RJH), 2005 WL 2709174, at *1 (S.D.N.Y. Oct. 17, 2005) (finding that language requiring arbitration was “clear and unequivocal” but concluding that because CBA was negotiated between plaintiff’s union and his employer, the arbitration provision was unenforceable). Moreover, even assuming such an arbitration clause were enforceable, the provision in this case is not sufficiently explicit to waive plaintiff’s right to assert her claim under the FMLA in federal court. The provision in relevant part states that it includes claims made pursuant to Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the New York State Human Rights Law, the New York City Human Rights Code, or any other similar laws, rules or regulations. Heidecker Aff. Ex. A at 41 (emphasis added). Although the provision references both federal and state statutory rights, it does not specifically incorporate claims made under the FMLA and also falls short of “a specific agreement to submit all federal claims t~ arbitration.”® Rogers, 220 F.3d at 76 (emphasis addea). 5. We do not consider the reference to “any other similar laws, rules or regulations” to be sufficiently explicit to (Cont'd) 37a Appendix C In addition, while the requirement in the CBA to abide by the FMLA may “creat [e] a contractual right that is coextensive with the federal statutory right,” doing so does not necessarily “mak[{e] compliance with the [federal statute] a contractual commitment that would be subject to the arbitration clause.” Wright, 525 U.S. at 79, 81. In this case, the CBA’s FMLA compliance provision and a separate provision for arbitration of disputes “arising between the parties as to interpretation, application or performance of any part of this Agreement and such other issues as the parties are expressly required to arbitrate ... under the terms of this Agreement,” Heidecker Aff. Ex. A at 6, are insufficient to constitute a clear waiver. See Rogers, 220 F.3d at 76 (noting that although the CBA expressly provided for FMLA compliance and elsewhere contained a general arbitration clause, it did not thereby make compliance with the FMLA a contractual commitment subject to arbitration). In light of the above, we find that the arbitration provision is unenforceable against plaintiff’s F MLA claim, and she is entitled to bring this claim in federal court. Defendant’s motion as to plaintiff’s FMLA claim therefore is denied. B. State Statutory Claims Because the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et seq., applies to this case, federal law (Cont'd) incorporate the FMLA. We also note that in light of the fact that the drafters chose to specify certain federal claims, the exclusion of the FMLA is especially significant. 38a Appendix C controls the analysis of whether the arbitration provision is enforceable against plaintiff’s state statutory claims.°® See Fletcher v. Kidder, Peabody & Co., 81 N.Y.2d 623, 631, 601 N.Y.S.2d 686, 689 (N.Y. 1993) (noting that “where the FAA is applicable, it preempts State law on the subject of the enforceability of arbitration clauses”). In the case of plaintiff’s state statutory claims, the waiver contained in the CBA is sufficiently clear. The prevision explicitly states that “claims made pursuant to... the New York State Human Rights Law/[ |[and] the New York City Human Rights Code ... shall be subject to the grievance and arbitration procedure (Articles V and VI) as the sole and exclusive remedy for violations.” Heidecker Aff. Ex. A at 41. Therefore, we now confront an issue that many courts before us have been able to avoid. That is, in addressing plaintiff's state statutory claims, we must answer the question of whether a clear and unmistakable union-negotiated waiver is enforceable. As discussed above, the Supreme Court has not spoken clearly on this issue. However, we understand Rogers to hold that such 6. Neitler party disputes that the FAA applies to this case. Because plaintiff “is an employee in a service industry which affects commerce, and is not engaged in the transportation industry” we agree. Rogers v. New York University, 98 Civ. 2089(WHP), 1999 WL 710777, at *2 (S.D.N.Y. Sept. 10, 1999), aff'd, 220 F:3d 73 (2d Cir. 2000); see Maryland Cas. Co. v. Realty Advisory Bd. on Labor Relations, 107 F.3d 979, 982 (2d Cir.1997) (“Since collective bargaining agreements are c.; tracts entailing transactions in commerce, the bargaining agreement in the instant case falls within the purview of the [FAA, ’). all 39a Appendix C union-negotiated waivers are unenforceable under the reasoning of Gardner-Denver. Therefore, in the absence of more explicit guidance from the Supreme Court, and in light of the Second Circuit’s holding in Rogers that arbitration provisions contained in a union-negotiated CBA are unenforceable against statutory claims (including New York State and City human rights laws), we apply the reasoning of Gardner-Denver and find that such a waiver is unenforceable.’ See Rogers, 220 F.3d at 75 (“When the arbitration provision has been negotiated by a union in a CBA, these courts have held that Gardner-Denver applies. The Second Circuit is no 7. We decline to adopt the approach set forth in Fletcher, 81 N.Y.2d at 632, 601 N.Y.S.2d at 690 (applying approach of Gilmer in case involving union-negotiated waiver because FAA applied to agreement at issue), which was decided before the Supreme Court’s decision in Wright. Rather, we agree with the majority of courts applying Wright that the basis for the distinction between Gardner-Denver and Gilmer was not so much whether or not the FAA applied but the identity of the party negotiating the waiver. See, e.g., Rogers, 220 F.3d at 75 (noting that “most lower courts have focused on the party negotiating the waiver of rights”). While some state courts have found such provisions to be enforceable against state statutory claims, see, e.g., Garcia v. Bellmarc Property Mgmt., 295 A.D.2d 233, 745 N.Y.S.2d 13 (1st Dep’t 2002); Torres v. Four Seasons Hotel of New York, 277 A.D.2d 23, 715 N.Y.S.2d 28 (1st Dep’t 2000), they did so based on their interpretation of the Supreme Court’s holding in Wright. Until the Supreme Court speaks more clearly on this issue, however, we are constrained to adopt the Second Circuit’s holding in Rogers. 40a Appendix C exception.”); Beljakovic, 2005 WL 2709174, at *3 (“Simply put, there is no compelling authority for the proposition that Gilmer overruled Alexander, and until the Supreme Court clarifies that it has, this Court will apply the law as it stands.” (citations and quotations omitted)); see also Fowler, 2000 WL 1726687, at *1 (“The Court of Appeals for the Second Circuit, however, has expressly held that collective bargaining agreement mandatory arbitration provisions cannot bar union members from bringing federal claims to court”). Defendant’s motion to dismiss plaintiff’s state statutory claims therefore is denied. CONCLUSION For the reasons set forth above, defendant’s motion to dismiss is denied. Counsel are directed to appear for a conference on March 19, 2006 at 2:30pm. SO ORDERED. Dated: New York, New York February 22, 2006 NAOMI REICE BUCHWALD UNITED STATES DISTRICT JUDGE 4la APPENDIX D — AFFIDAVIT OF LARRY ENGELSTEIN DATED NOVEMBER 21, 2005 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK 04 CIV. 07536 (N RB) STEVEN PYETT, THOMAS O’CONNELL AND MICHAEL PHILLIPS, PLAINTIFFS, V. PENNSYLVANIA BUILDING COMPANY, 14 PENN PLAZA LLC, AND TEMCO SERVICE INDUSTRIES, INC. DEFENDANTS. STATE OF NEW YORK _) ) COUNTY OF NEW YORK ) ECF CASE AFFIDAVIT OF LARRY ENGELSTEIN 42a Appendix D LARRY ENGELSTEIN, ESQ., being duly sworn, deposes and says: 1. I am currently employed as General Counsel] of Local 32BJ, Service Employees International Union (the “Union”). As such, I am familiar with the circumstances of the arbitration before Arbitrator Pfeffer in the above identified matter and make this affidavit upon information directly known by me. 2. The Union withdrew any contractual grievance related to Plaintiffs’ age discrimination claim before the arbitration hearing concluded. 3. The Union consents to the use of the Office of the Contract Arbitrator (OCA), created under the Collective Bargaining Agreement between the Realty Advisory Board of Labor Relations, Inc. and the Union, as the forum for Plaintiffs’ private attorney to pursue Plaintiffs’ statutory age discrimination claims, as long as the parties to this lawsuit, and not the Union, pay the costs associated with the arbitration. s/ Larry Engelstein Larry Engelstein, Esq. 43a APPENDIX E — EXCERPTS FROM THE 2005 CONTRACTORS AGREEMENT 2005 Contractors AGREEMENT BETWEEN Service Employees International Union Local 32BJ AFL-CIO AND THE REALTY ADVISORY BOARD ON LABOR RELATIONS INC. EFFECTIVE OCTOBER 1, 2004 TO DECEMBER 31, 2007 * * * ARTICLE VI Arbitration 1. There shall at all times be a Contract Arbitrator to decide all differences arising between the parties as to interpretation, application or performance of any part of this Agreement and such other issues as the parties are expressly required to arbitrate before him under the terms of this Agreement. 44a Appendix E 2. The fee of the Contract Arbitrator and all reasonable expenses involved in his functions shall be borne fifty percent (50%) by tne Employer and fifty percent (50%) by the Union, except that in the event the Employer is in violation of any obligation under the provisions relating to the Health, Pension, Training, Legal and/or SRSF Funds, wages, dues and initiation fees, or any other violations involving damages, then the Employer shall pay the full fee of the Contract Arbitrator and all expenses in connection with the arbitration of the dispute, including, but not limited to, counsel fees, auditor’s fees, arbitration costs and fees and court costs, plus a minimum of fifteen percent (15%) per annum on all monies awarded by the Contract Arbitrator. 3. The Arbitrator shall initially schedule a hearing after either party has served written notice upon the other that the grievance procedure has not resulted in an adjustment. The oath-taking and the period and the requirements for service of notice in the form prescribed by statute are hereby waived. The Arbitrator’s award shall be made within thirty (30) days after the hearing closes. If the Arbitrator shall fail to render his written award within said thirty-day period, either party may serve a written demand upon him that the award must be made within ten (10) days after said demand. The decision shall be rendered within such additional ten (10) day period unless the parties consent to an extension in writing or an illness of the Arbitrator delays such decision. By mutual consent, the time of both the hearing and decision may be extended in a particular case. In the event of a willful default by either party in appearing 45a Appendix E before the Arbitrator, after due written notice shall have been given to him, the Arbitrator is authorized to render his award upon the testimony of the adversary party. Due written notice means mailing, faxing, telegraphing or hand delivery to the address of the employer furnished to the Union by the RAB. 4. The procedure herein outlined in respect to matters over which the Contract Arbitrator has jurisdiction shall be the sole and exclusive method for the determination of all such issues, and said Arbitrator shall have the power to grant any remedy required to correct a violation of this Agreement, including, but not limited to, damages and mandatory orders, and said Arbitrator shall have the further power in cases of willful violations (violations reflective of a deliberate intent to violate this Agreement) to award appropriate remedies, including, but not limited to, damages, all costs and expenses incurred by the Union in the processing of the grievance and arbitration proceedings, and to issue mandatory orders, the award of the Arbitrator being final and binding upon the parties and the employee(s) involved; provided, however, that nothing herein shall be construed to forbid either of the parties from resorting to court for relief from, or to enforce rights under, any arbitration award. 5. If any proceeding to confirm an award, service may be made by registered or certified mail within or without the State of New York as the case may be. 46a Appendix E 6. Should either party fail to abide by an arbitration award within two (2) weeks after such award is sent by registered or certified mail to the parties, either party may, in its sole and absolute discretion, take any action necessary to secure such award, including, but not limited to, suits at law. Should either party bring such Suit, it shall be entitled, if it succeeds, to receive from the other party all expenses for counsel fees and court costs. 7. Grievants attending grievances and arbitrations during their regularly scheduled hours shall be paid during such attendance. If a grievant requires any employee of the building to be a witness at the hearing and the Employer adjourns the hearing, the employee witness shall be paid by the Employer for his regularly scheduled hours during attendance at such hearing. This provision shall] be limited to one employee witness. No more than one adjournment per party shall be granted by the Arbitrator without the consent of the opposing party. All Union claims are brought by the Union alone, and no individual shall have the right to compromise or settle any claim without the written permission of the Union. In the event that the Union appears at an arbitration without the grievant, the Arbitrator shall conduct the hearing provided it is not adjourned. The Arbitrator shall decide the case based upon the evidence adduced at the hearing. 47a Appendix F. There is presently an Office of the Contract Arbitrator-Building Service Industry as contract arbitrator for all disputes. It is agreed by the parties hereto that the arbitrators serving such office shall also serve as contract arbitrators under this Agreemert. The arbitrators currently are: John Anner, Stuart Bauchner, Noel Berman, Nicholas Cooney, John Dorsey, Howard Edelman, Robert Herzog, Theodore Lang, Marilyn Levine, Randi Lowitt, Earl Pfeffer and Bernard Young. Upon thirty (30) days written notice to each other, either the Union or the RAB may terminate the services of any Arbitrator on the panel. Successor or additional Arbitrators shall be appointed by mutual agreement of the Union and the RAB. In the event of the removal, death or resignation of all of the Arbitrators, the successors or temporary substitute shall be chosen by the Union and the RAB. If the parties are unable to agree on asuccessor, then the Chairman of the New York State Employment Relations Board shall appoint a successor after consultation with the parties. The costs of the Office of the Contract Arbitrator shall be shared equally in a manner determined by the Union and the RAB. 48a Appendix E 30. NO DISCRIMINATION There shall be no discrimination against any present or future employee by reason of race, creed, color, age, disability, national origin, sex, union membership, or any characteristic protected by law, including, but not limited to, claims made pursuant to Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the New York State Human Rights Law, the New York City Human Rights Code, New Jersey Law Against Discrimination, New Jersey Conscientious Employee Protection Act, Connecticut Fair Employer Practices Act, or any other similar laws, rules or regulations. All such claims shall be subject to the grievance and arbitration procedure (Articles V and VI) as the sole and exclusive remedy for violations. Arbitrators shall apply appropriate law in rendering decisions based upon claims of discrimination. * * ~ + 49a APPENDIX F — 9 U.S.C. 88 3 & 4 9 U.S.C. § 3 § 3. Stay of proceedings where issue therein referable to arbitration If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement, providing the applicant for the stay is not in default in proceeding with such arbitration. 50a Appendix F 9U.S.C.§ 4 § 4. Failure to arbitrate under agreement; petition to United States court having jurisdiction for order to compel arbitration; notice and service thereof; hearing and determination A party aggrieved by the alieged failure, neglect, or refusal of another to arbitrate under a written agreement for arbitration may petition any United States district court which, save for such agreement, would have jurisdiction under Title 28 [28 USCS §§ 1 et seq.], in a civil action or in admiralty of the subject matter of a suit arising out of the controversy between the parties, for an order directing that such arbitration proceed in the manner provided for in such agreement. Five days’ notice in writing of such application shal] be served upon the party in default. Service thereof shall be made in the manner provided by the Federal Rules of Civil Procedure [USCS Rules of Civil Procedure]. The court shall hear the parties, and upon being satisfied that the making of the agreement for arbitration or the failure to comply therewith is not in issue, the court shall make an order directing the parties to proceed to arbitration in accordance with the terms of the agreement. The hearing and proceedings, under such agreement, shall be within the district in which the petition for an order directing such Sla Appendix F arbitration is filed. If the making of the arbitration agreement or the failure, neglect, or refusal to perform the same be in issue, the court shall proceed summarily to the trial thereof. If no jury trial b [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385015_0043%3A0. Public record. Not legal advice.