Getting Rid of a Bad Decision

Appealing the "All Shook Up" Arbitration AwardLocal 802 Legal Corner

Volume CV, No. 4April, 2005

Harvey Mars

In last month’s column I “admitted” (a rare occurrence for an attorney!) that vacating an arbitration award is probably one of the most difficult tasks that a lawyer can seek to accomplish.

I posed this rhetorical question: under what set of circumstances will a court actually vacate an arbitration award? I also addressed various circumstances where I believed that a court would not hesitate to actually do so.

Obviously, as many have surmised from last month’s president’s report, my article was not entirely written in a vacuum.

Earlier this month, Local 802 filed in the U.S. District Court for the Southern District of New York a verified petition to vacate an arbitration award rendered by Arbitrator Carol Wittenberg, which granted the new Broadway production “All Shook Up” Special Situation status.

The primary ground upon which this petition is premised, not surprisingly, is that Arbitrator Wittenberg overstepped her jurisdiction by conducting a new hearing so that she would ascertain whether “All Shook Up” qualified for a Special Situation exemption.

In so doing, Arbitrator Wittenberg ignored the findings of a panel of known experts and presumptively assumed their role.

Furthermore, she ignored a provision of the Broadway agreement, which specifically granted the Special Situations Committee continuing jurisdiction to consider any appropriate matters that might lead to a reconsideration of its prior determination.

It is hard to fathom that the parties would have agreed to allow an arbitrator with absolutely no experience in this field to second-guess or overrule the determination of a panel of experts.

Nor is it reasonable to believe that the parties would have put so much effort into formulating a revamped procedure for the Special Situations Committee to follow, only to have it cast aside through an arbitration procedure.

Nonetheless, inexplicably, the arbitrator concluded that she, not the committee, was now authorized to make the final determination of whether “All Shook Up” was entitled to a Special Situation exemption.

She came to this conclusion primarily based upon the arbitration clause in the Broadway agreement’s Special Situations section. She found that the arbitration language in the MOA (Special Situations article) does not place any restrictions on the arbitrator.

In arriving at this conclusion, the arbitrator totally ignored the last paragraph of the Special Situation article, which permitted the committee to retain jurisdiction to reconsider its prior determination.

While it may be true that the arbitration clause does not contain any specific restrictions, the arbitrator cannot ignore pertinent or controlling sections of the collective bargaining agreement when formulating a determination.

She was duty-bound to issue a decision that was consistent with the continuing jurisdiction of the committee. This she did not do.

I noted in my previous article that even though vacating a labor arbitration award is an extremely difficult and arduous task, it is not an insurmountable one.

We believe that the petition to vacate the “All Shook Up” award stands a fair chance of presenting itself as one of the exceptions to the general rule of labor arbitration finality.

As President Lennon remarked last month, time will tell. We’ll keep you posted.