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Liotta v. National Forge Co.

decided: September 10, 1980.

JAMES J. LIOTTA, AN INDIVIDUAL, APPELLANT
v.
NATIONAL FORGE COMPANY, APPELLANT



ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA (D.C. Civ. No. 78-0025)

Before Seitz, Chief Judge and Van Dusen, and Higginbotham, Circuit Judges.

Author: Higginbotham

Opinion OF THE COURT

The appellant, James J. Liotta, formerly President of the Local 1573 of the United Steelworkers of America, AFL-CIO (the Union), was discharged from his employment with the National Forge Company (the Company) on March 16, 1976. This followed his participation in a work stoppage at the Company's Erie, Pennsylvania plant which began on March 3, 1976 and ended on March 11, 1976. Liotta filed a grievance pursuant to the terms of the collective bargaining agreement then in effect. His grievance was denied by an arbitrator on August 3, 1976. On March 16, 1978, he filed this action alleging first that his discharge violated the collective bargaining agreement in violation of Section 301 of the National Labor Relations Act, 29 U.S.C. § 185 and that the arbitrator's contrary decision resulted from the Union's breach of its duty of fair representation. Second, he claimed that the Company discharged him because of his espousal of the rights of the Company's black employees, discriminating against him in violation of 42 U.S.C. § 1981. Liotta appeals from the entry of summary judgment for the Company. The Company cross appeals on the ground that Liotta's complaint is barred by the applicable statutes of limitations. We conclude that his claim under Section 301 is time barred, that his claim under 42 U.S.C. § 1981 is not time barred, and that summary judgment was inappropriate on his Section 1981 claim because of the existence of material issues of fact. We will therefore affirm in part and reverse in part.

I.

The first question we must answer is whether Liotta's Section 301*fn1 cause of action was untimely and therefore whether the Company's motion to dismiss should have been granted. The Company's motion was based on the ground that Liotta's claims were barred by the three-month statute of limitations of the Pennsylvania General Arbitration Act, Pa.Stat.Ann. tit. 5 § 173 (Purdon 1963). The district court held that the six-year limitations period for actions upon a contract applied.

We believe the district court erred. In UAW v. Hoosier Cardinal Corp., 383 U.S. 696, 704-05, 86 S. Ct. 1107, 1113, 16 L. Ed. 2d 192 (1966), the Supreme Court held that "the timeliness of a § 301 suit . . . is to be determined, as a matter of federal law, by reference to the appropriate state statute of limitations." Courts within this circuit have consistently applied the three-month limitations period to suits seeking to vacate an arbitrator's award. Cole v. United Steelworkers, 441 F. Supp. 1346, 1351 (M.D.Pa.1977), aff'd mem., 588 F.2d 819 (3d Cir. 1978); Siskey v. General Teamsters, Chauffeurs, 419 F. Supp. 48, 50 (W.D.Pa.1976); UMWA v. Jones & Laughlin Steel Corp., 378 F. Supp. 1206, 1211-12 (W.D.Pa.1974); International Brotherhood v. Motor Freight Express, 356 F. Supp. 724, 726 (W.D.Pa.1973).

It is important to identify the nature of Liotta's first cause of action since the three-month statute of limitations of Pennsylvania's General Arbitration Act would apply only where one seeks to vacate an arbitrator's award. A fair reading of Liotta's complaint demonstrates that he seeks to vacate the arbitrator's decision. Paragraph 22 of his complaint alleges that he "was unfairly represented before, during and after Arbitration by the" attorney for the International Union. App., at 10. Paragraph 23 alleges that the "Arbitration itself was improper and unfair." App., at 12. Indeed, he sought to litigate before the district court the same claim he presented for arbitration, that of improper discharge.

Moreover, the fact that Liotta alleges that the arbitration award is invalid due to the Union's breach of its duty of fair representation does not change the limitations period because the suit here is against the Company and not the Union. Thus, it is clear that Liotta was dissatisfied with and simply seeks to upset the arbitrator's decision that the Company did not wrongfully discharge him.

The result we reach comports with the general federal policy favoring arbitration as a means of resolving labor disputes, United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 578, 80 S. Ct. 1347, 1350, 4 L. Ed. 2d 1409 (1960), and with the federal labor policy that favors the application of shorter limitations period. In International Union, UAW v. Hoosier Cardinal Corp., 383 U.S. 696, 707, 86 S. Ct. 1107, 16 L. Ed. 2d 192 (1966), the Supreme Court stated:

Relatively rapid disposition of labor disputes is a goal of federal labor law. Since state statutes of limitations governing contracts not exclusively in writing are generally shorter than those applicable to wholly written agreements, their applicability to § 301 actions comports with that goal.

Courts in other jurisdictions have consistently applied the statute of limitations pertaining to appeals from arbitration awards rather than the longer statute of limitations governing actions bottomed on written contracts when such actions seek to vacate arbitration awards. E. g. Barbarino v. Anchor Motor Freight, Inc., 421 F. Supp. 1003 (W.D.N.Y.1976); DeLorto v. United Parcel Service, Inc., 401 F. Supp. 408 (D.Mass.1975); Hill v. Aro Corp., 275 F. Supp. 482 (N.D.Ohio 1967); contra, Smart v. Ellis Trucking Co., 580 F.2d 215 (6th Cir. 1978), cert. denied, 440 U.S. 958, 99 S. Ct. 1497, 59 L. Ed. 2d 770 (1979).

We therefore conclude that Liotta's first cause of action seeking review and vacation of the arbitration award was untimely and that the Company's ...


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