Opposition Brief — United Paperworkers International Union v. Briggs & Stratton Corp.

WV fe PILED

No. 94-1562

In The

Supreme Court of the United States

October Term, 1994

.

UNITED PAPERWORKERS INTERNATIONAL UNION,

AFL-CIO AND LOCAL 7232, UNITED PAPERWORKERS

INTERNATIONAL UNION,

Petitioners,

BRIGGS & STRATTON CORPORATION,

Respondent.

+

On Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Seventh Circuit

SJ

RESPONDENT'S BRIEF IN OPPOSITION

*

THomas P. Krukowsk!

(Counsel of Record)

KruKxowsk! & Coste.io, S.C.

7111 West Edgerton Avenue

Milwaukee, WI 53220

(414) 423-1330

Attorney for the Respondent

Briggs & Stratton Corporation

QUESTION PRESENTED BY RESPONDENT

The Respondent, Briggs & Stratton Corporation

(“Briggs & Stratton” or the “Company”) objects to the

form and substance of the “Questions Presented for

Review” in the Petition For A Writ Of Certiorari (the

“Petition”) and believes the question should be posed as

follows:

Whether the Seventh Circuit misinterpreted

Sections 3 and 16 of the United States Arbitra-

tion Act in holding this case was not “referable

to arbitration” under § 3 and no appellate juris-

diction existed under § 16, because the Unions,

defendants -in a federal court damage action

under 29 U.S.C. § 185, did not file a grievance or

otherwise invoke the arbitration process, which

left the district court with no pending arbitra-

tion, to which it could have deferred.

ii

PARTIES

The names of all parties to this case appear, and are

correctly set forth, in the caption of the Petition.

Briggs & Stratton is a Wisconsin Corporation duly

organized and incorporated under the laws of the State of

Wisconsin. It has no subsidiaries, other than those which

are wholly owned; it has no parent company.

The United Paperworkers International Union

(“UPIU”) has also been previously referred to as the

International Union, Allied Industrial Workers (“AIW”),

and Local 7232, United Paperworkers International Union

(“Local 7232”) has also been previously referred to as

AIW, Local 232 and AIW, Local 232A. The UPIU and

Local 7232 will be referred to collectively as the

“Unions.”

iil

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES ............--- esse eeeees iv

STATEMENT OF FACTS........------eeceeeeeeeees 1

SUMMARY OF ARGUMENT.........--.------++5: 2

REASONS WHY THE PETITION SHOULD BE

ak cca ae cw eee sas S48 e Rae nese ees 3

1. The decision of the Court of Appeals does not

raise the questions presented in the Petition.. 3

2. The decision of the Court of Appeals sets forth

a simple procedural rule for obtaining appel-

late review of a denial of the stay of in-court

litigation, pursuant to Section 16 of the Arbitra-

tion Act, that does not conflict with any deci-

gion Of this Court. ......... 0c ccc cce cece cence 6

NE sc wkd pa edccuewwccsnccbecsenvecoens 8

iv

TABLE OF AUTHORITIES

Page

Cases

Allied-Bruce Terminix Companies, Inc. v. Dobson, ___

SF cece RO ce Necks Ee CRE bc des nb eannesensas 3, 4

Briggs & Stratton v. Local 232, 36 F.3d 712 (7th Cir.

SR a is hice kad xe ee hae ei cae y A. ie

Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20

45. | SPO a PPE ee Py enn IP hoa er Sri RD EN 4

Gulfstream Aerospace v. Mayacamas Corp., 485 U.S.

Be Sa 4 eek ae ed on eh ce kh deh eee ensied 4,5

Mastrobuono v. Shearson, Lehman, Hutton, Inc., ___

Sh cs BAe i Re ee Oe tv obs aa eanadois 3, 4

Pietro Scalzitti Co. v. Operating Engineers, 351 F.2d

es Ce a Po Soe en oe cba ee eek eure aweue 5

United Paperworkers Int'l. Union v. Misco, Inc., 484

es ee CE cca kop 44k Cea ees 3

STATUTES

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ge RPE PETE Perr Tere re Terry err et 1

RULES

Saeercee, SOG. Re GO By aki ccc en ccd ae tee 2

STATEMENT OF FACTS

The facts of this case were succinctly set forth in the

decision of the Court of Appeals for the Seventh Circuit

at 36 F.3d 712, 713-14 (7th Cir. 1994) and are recited, in

relevant part, as follows:

Briggs & Stratton Corporation has a collective bar-

gaining agreement with Local 232 of the Paperworkers

Union. The workers promised that during its terms they

would not participate in “any concerted slow down,

strike, work stoppage or other concerted interruptions of

Company operations relative to any dispute amenable to

the arbitration provisions of the labor agreement.” In

August 1993 Briggs & Stratton reorganized its Large

Engine Division. Local 232 and its parent international

(collectively, “the Union[s]”) believed that the changes,

which altered the way in which seniority could be exer-

cised, violated the terms of the collective bargaining

agreement and called on its members to “work to rule” -

that is, to enforce every picayune rule found in the con-

tract and the plant’s operating procedures. It aimed to

place economic pressure on the employer. Local 232

urged its members to reject overtime assignments, and

the faithful shunned and put other social pressure on

workers who displayed a lack of enthusiasm for the job

action. The Unions also filed a grievance and took the

dispute about the new organization to arbitration.

Contending that the [work to rule] campaign was

“concerted slow down” forbidden by the agreement, the

employer filed this suit under § 301 of the Labor-Manage-

ment Relations Act, 29 U.S.C. § 185, seeking [monetary

damages and] an injunction requiring its workers to

resume work as usual. The Unions asked the district

court to dismiss the claim[s] under Fed. R. Civ. P. 12(b)(6)

for failure to arbitrate or, at a minimum, to order the

employer to present its demand to an arbitrator and to

stay proceedings in the interim. The district court denied

both requests on February 15, 1994, ruling that the collec-

tive bargaining agreement “is not susceptible to a con-

struction that the company is bound to arbitrate its claim

for damages against the Unions for breach of the no-

strike clause.” From this decision the Unions [appealed].

The Court of Appeals for the Seventh Circuit noticed the

interlocutory nature of the appeal presented “an obvious

question of appellate jurisdiction” and ruled it had none.

Briggs & Stratton v. Local 232, Intern. Union, 36 F.3d 712,

716 (7th Cir. 1994). The Unions filed a petition for a writ

of certiorari on March 23, 1995.

¢

SUMMARY OF ARGUMENT

The Petition should be denied because the Unions

failed to demonstrate any recognized basis to issue a writ

of certiorari as there is no important question of federal

law raised by the holding of the Court of Appeals for the

Seventh Circuit, which clarified the simple procedural

mechanism for obtaining stay under § 3 of the United

States Arbitration Act, 9 U.S.C. §§ 1-16, and the standard

for conferring appellate jurisdiction under § 16 of the Act.

e

REASONS WHY THE PETITION SHOULD BE DENIED

1. The decision of the Court of Appeals does not

raise the questions presented in the Petition.

There is no important question of federal law in this

case, nor is there a split in the circuits on the applicable

rule of law, that could provide a basis for granting the

petition for a writ of certiorari. The Court of Appeals for

the Seventh Circuit applied the correct legal standard in

this case under the United States Arbitration Act, based

on this Court’s holding in Allied-Bruce Terminix Com-

panies, Inc. v. Dobson, __ U.S. __, 115 S. Ct. 834 (1995).

The Unions cite a split in the circuits over the issue of

whether the Arbitration Act applies to collective bargain-

ing agreements as the primary basis for seeking a writ of

certiorari. That precise issue, however, was never

addressed by the courts below because it was never

raised by the Unions.

There is no controversy involving an important ques-

tion of federal law in this case because Court of Appeals

applied the correct legal analysis under the Arbitration

Act. The recent holdings of this Court in the cases of

Allied-Bruce, and Mastrobuono v. Shearson, Lehman, Hutton,

Inc., __ U.S. __, 115 S. Ct. 1212 (1995), interpreted § 2 of

the Arbitration Act to control arbitration agreements

“involving” commerce, which is limited only by the con-

stitutional constraints of the Commerce Clause, as distin-

guished from the language of § 1 of the Act that refers to

workers actually “engaged in” interstate commerce,

which excludes coverage of the Act. In United Paper-

workers Int'l. Union v. Misco, Inc., 484 U.S. 29, 40 n.9

(1987), this Court recognized the issue of whether the

Arbitration Act applies to collective bargaining agree-

ments; in Gilmer v. Interstate/Johnson Lane Corp., 500 U.S.

20, 25 n.2 (1991), this Court left the issue undecided; but,

in Allied-Bruce and Mastrobuono, the interpretive analysis

of the Court effectively resolved the issue in favor of

coverage. Allied-Bruce, 115 S. Ct. at 841; Mastrobuono, 115

S. Ct. at 1216. These cases implicitly interpreted the § 1 ‘

exclusion’s term “engaged in” commerce narrowly, when

they held that the Arbitration Act governs any agree-

ments “involving” interstate commerce, limited only by

the powers of the Commerce Clause and the exclusion of

§ 1. Allied-Bruce, 115 S. Ct. at 839-841. However, rather

than using the broad terms “involving” or “affecting”

commerce, Congress chose the narrower exclusionary

language “workers engaged in foreign or interstate com-

merce” to define the limits of the § 1 exclusion. The

exclusion, thus, does not apply to goods manufactured at

a fixed site outside the transportation industries (i.e., that

are not goods or services actually “in” interstate com-

merce). Because the exclusion of § 1 does not apply, the

Arbitration Act controls. The Act’s application in this

case was correct because Briggs & Stratton is not an

employer in the transportation industries within the

exclusion of § 1, but rather, a manufacturer of goods at a

fixed site, that eventually involve or affect commerce,

within the meaning of § 2 of the Act.

Even assuming, without conceding, that the Unions

are correct that the Arbitration Act does not apply to

collective bargaining agreements generally, their argu-

ment nevertheless fails under the holding of Gulfstream

Aerospace v. Mayacamas Corp., 485 U.S. 271 (1988). The

district court’s Order in this case was nothing more than

f}

its decision not to take action and to proceed to judgment

in the ordinary course of litigation. There is no order

enjoining or compelling either party to do anything.

Thus, in the absence of an order having injunctive effect,

this case fails into the broad category of the denial of

stays that was addressed when this Court overruled the

Enelow-Ettelson doctrine in Gulfstream Aerospace, 485 U.S.

at 282-83. Therefore, appellate jurisdiction could not have

existed under 28 U.S.C. § 1292(a)(1) -— even if the Unions

arguments are correct. The insufficiency of the Unions’

reasoning presents an additional basis for denying

review.

The Court of Appeals for the Seventh Circuit framed

the issue, and simultaneously dispensed with the Unions’

arguments in support of the Petition, as follows:

Our circuit is among the minority that has lim-

ited Section 1 [of the Arbitration Act] to the

transportation industries and therefore applies

the Arbitration Act to most collective bargaining

agreements. Pietro Scalzitti Co. v. Operating Engi-

neers, 351 F.2d 576, 579-80 (7th Cir. 1965). Nei-

ther side has asked us to revisit Pietro Scalzitti,

so we turn to Section 16 of the Arbitration Act to

decide whether we have appellate jurisdiction.

Briggs & Stratton v. Local 232, 36 F.3d 712, 715 (7th Cir.

1994). The only question presented to the Court of

Appeals, and thus addressed, was whether this case met

the procedural requirements of §§ 3 or 4 of the Arbitra-

tion Act, which could give rise to appellate jurisdiction

under § 16. The Court of Appeals went on to make one

holding: the procedural prerequisites of § 3 of the Arbi-

tration Act had not been satisfied, thus, no appellate

jurisdiction existed under § 16 of the Act.

2. The decision of the Court of Appeals sets forth

a simple procedural rule for obtaining appellate

review of a denial of the stay of in-court litiga-

tion, pursuant to Section 16 of the Arbitration

Act, that does not conflict with any decision of

this Court

The decision of the Court of Appeals is a simple

reading of § 16 setting forth a procedural rule based on

the text of §§ 3 and 4 of the Act; this case is not a decision

interpreting 28 U.S.C. § 1292(a)(1) or 9 U.S.C. § i. In

addressing the question of appellate jurisdiction under

§ 16, the Court of Appeals looked to § 3 of the Arbitration

Act to determine whether a stay had been properly

requested; if so, the denial of the request would be

appealable under § 16. Section 3, however, refers to a

pending dispute being “referable to arbitration” to pro-

ceed “in accordance with the terms of the agreement” as

if to assume, if not require, a currently pending grievance

or arbitration to which a court could defer when issuing a

stay. In this case, neither side requested arbitration, much

less was the contractual mechanism ever affirmatively

invoked. It naturally followed that, as the appellate panel

learned at oral arguments (and ultimately concluded),

neither party desired arbitration. The Company sought to

prevail in federal court; the Unions wanted the case dis-

missed outright. Accordingly, the appellate panel held, as

a matter of fact, that there was no pending arbitration —

because neither party wanted it — to which the district

court could have deferred. Therefore, the «ase was not

referable to arbitration within the meaning of §§ 3 or 4 of

the Arbitration Act, which resulted in a lack of appellate

jurisdiction under § 16.

The arguments in the Petition demonstrate that the

Unions actually seek a rehearing of their arguments in

support of their Motion to Dismiss, for failure to exhaust

alternative contractual remedies, that was initially pre-

sented to the district court. However, because their argu-

ments failed in the Courts below, the Unions employ a

new legal theory, based on an alleged split between the

circuits over the applicable rule of law. The only rule to

be gleaned from the Court of Appeals’ decision, however,

is that courts will not compel two parties to arbitrate a

dispute when neither party desires arbitration. Briggs &

Stratton v. Local 232, Intern. Union, 36 F.3d 712, 716 (7th

Cir. 1994). No court has ever held that they must.

This case demonstrates that when parties fail to act

affirmatively in litigation, they cannot rely upon the

courts to issue orders interpreting their desires. The

essence of this case was uncovered at oral argument

before the Seventh Circuit when, as the appellate decision

indicates, “both sides treated arbitration as a poor

cousin.” Briggs & Stratton, 36 F.3d at 715. The Court of

Appeals merely decided it had no jurisdiction to review

the question of a stay pending an arbitration that neither

party to the dispute wanted. The decision went on to set

forth a simple procedural rule under § 3 of the Arbitra-

tion Act that provides clear guidance to future disputes

over arbitrability issues in the Seventh Circuit. The argu-

ments of Petitioners miss the point.

o

CONCLUSION

For these reasons, the Petition for a Writ of Certiorari

should be denied.

Respectfully submitted,

THomas P. KruKOwskKI

KruKkowski & CosTELLo, S.C.

7111 West Edgerton Avenue

Milwaukee, WI 53220

(414) 423-1330

Attorney for the Respondent

Briggs & Stratton Corporation