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Laborers' Local Union Nos. 472 and 172 v. Ninsa, LLC

United States District Court, D. New Jersey

January 8, 2020

LABORERS' LOCAL UNION NOS. 472 & 172 AND LABORERS' LOCAL UNION NOS. 472 & 172 WELFARE AND PENSION FUNDS AND SAFETY, EDUCATION AND TRAINING FUNDS; and ZAZZALI, FAGELLA, NOVAK, KLEINBAUM & FRIEDMAN, P.C., Petitioners/Cross-Respondents,
v.
NINSA, LLC, Respondent/Cross-Petitioner.

          EDWARD H. O'HARE ZAZZALI, FAGELLA, NOWAK, KLEINBAUM & FRIEDMAN, PC COUNSEL FOR PETITIONERS/CROSS-RESPONDENTS.

          CHARLES E. WOOLSON, JR. LAW FIRM OF CHARLES E. WOOLSON, JR. LLC COUNSEL FOR RESPONDENT/CROSS-PETITIONER.

          OPINION

          NOEL L. HILLMAN, U.S.D.J.

         This matter comes before the Court on Laborers' Local Union Nos. 472 & 172 and Laborers' Local Union Nos. 472 & 172 Welfare and Pension Funds and Safety, Education and Training Funds; and Zazzali, Fagella, Novak, Kleinbaum & Friedman, P.C.'s (collectively, “Petitioners”) motion to confirm an arbitration award (ECF No. 2) and NINSA, LLC's (“Respondent”) cross-motion to vacate the same arbitration award (ECF No. 7). For the reasons set forth below, Petitioners' motion will be granted, and Respondent's motion will be denied.

         BACKGROUND

         The dispute underlying this action centers around whether Respondent adequately contributed to fringe-benefit funds as required by a relevant collective bargaining agreement (the “CBA”).[1] In relevant part, the CBA requires Respondent to make certain contributions to general welfare, pension, and vacation funds in a manner specified by the agreement. See (ECF No. 1 at 16-17).[2] In order to ensure employers adequately comply with their contribution requirements, the CBA provides that “the Trustees of the Fund shall have the right to require such reports from Employers as are necessary for the fulfillment of the Trustees' duties under the Agreement” and shall “have the right to inspect, at reasonable times and places, the employment, payroll and such other payroll related records of the Employer as are relevant to questions of the accuracy and/or comprehensive-ness of reports submitted by the Employer.” (ECF No. 1 at 16). According to the record, the trustees of the funds directed that an audit of Respondent's books be conducted to determine whether Respondent complied with its contribution obligations. (ECF No. 1 at 21, ¶3). On July 20, 2018, an auditor determined that Respondent's contributions were delinquent and deficient, and that Respondent owed $368, 674.26 to the various funds. (Id.).

         The dispute was then presented for arbitration. On October 25, 2018, the parties appeared before the permanent arbitrator as set by the CBA, J.J. Pierson, Esq. A hearing was held, at which the arbitrator considered evidence and live testimony. Prior to issuing the award, the arbitrator directed the parties to file supplemental briefing on various issues, evincing a thorough consideration of the matter.

         On June 5, 2019, the arbitrator rendered factual findings in a ten (10) page award, ultimately concluding that Respondent was bound by the CBA, the terms of which governed the parties' dispute; Respondent owed the funds $368, 674.26 plus interest in the amount of $113, 060.10; Respondent owed the law firm of Zazzali, Fagella, Nowak, Kleinbaum & Friedman attorneys' fees, as provided for by the CBA, in the amount of $73, 734.85; and Respondent, pursuant to the CBA, was responsible for the arbitrator's fee of $2, 500. (ECF No. 1 at 22). In total, the award commands Respondent to pay Petitioners $557, 969.21. (ECF No. 1 at 22).

         On June 21, 2019, Petitioners filed the present action seeking to confirm the arbitration award (ECF Nos. 1 and 2). Respondent opposed and filed a cross-motion to vacate the arbitration award (ECF No. 7), which Petitioners timely opposed (ECF No. 14). As such, the pending motions are either fully briefed, or the time within which to oppose them has passed, rendering them ripe for adjudication.

         DISCUSSION

         I. Subject Matter Jurisdiction

         The Federal Arbitration Act (“FAA”) does not create any “independent federal-question jurisdiction under 28 U.S.C. § 1331 or otherwise.” Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, n. 32, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983). “However, Section 301 of the LMRA, 29 U.S.C. § 185, ‘grants this Court jurisdiction to confirm or vacate arbitration awards between a labor union and an employer.'” Id. (quoting Indep. Lab. Emples. Union, Inc. v. ExxonMobil Research & Eng'g Co., No. 18-10835, 2019 WL 3416897, at *4 (D.N.J. July 29, 2019)). Here, Petitioners properly brought this action to confirm an arbitration award between a labor union and an employer pursuant to the FAA and allege that the LMRA provides this Court with adequate subject-matter jurisdiction. The Court, therefore, exercises subject matter jurisdiction pursuant to 29 U.S.C. § 185.

         II. Whether Confirmation of the Arbitration Award Is Appropriate

         Respondent argues that the arbitration award should be vacated pursuant to 9 U.S.C. § 10(a)(3) because the arbitrator failed to consider a defense it raised. Specifically, Respondent argues that the arbitrator failed to consider “a letter dated September 1, 2018 from [Respondent] to Petitioner . . . [that was] introduced at the hearing and marked Exhibit F-2” that Respondent alleges evinces the existence of a condition-precedent to its agreement to enter into the CBA, a condition Respondent alleges had not been satisfied. See (ECF No. 7-1 at 2). Respondent concedes that “the letter was referenced ...


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