A P P A L A C H I A N R E G I O N A Lhealthcare, Inc. v. Ky. Nurses Ass’n

The Honorable Arthur J. Tarnow, United States District Judge for the Eastern*
District of Michigan, sitting by designation.
NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 07a0824n.06
Filed: December 4, 2007
No. 06-6470
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
A P P A L A C H I A N R E G I O N A L
HEALTHCARE, INC.,
Plaintiff-Appellant,
v.
KY. NURSES ASS’N, et al.,
Defendants-Appellees.
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ON APPEAL FROM THE
U N I T E D S T A T E S
DISTRICT COURT FOR
THE EASTERN DISTRICT
OF KENTUCKY
BEFORE: MOORE and GRIFFIN, Circuit Judges; and TARNOW, District Judge.*
PER CURIAM. Appalachian Regional Healthcare (“ARH”) appeals a district
court’s decision upholding an arbitration award. The district court concluded that the
deference federal courts must accord an arbitrator’s decision required summary
judgment in favor of the unions, appellees here. Applying Michigan Family

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Resources v. Service Employees Int’l Union, 475 F.3d 746 (6th Cir. 2007) (en banc),
decided since the lower court’s decision, we agree, and therefore affirm.
I.
The background facts are adequately set forth in the District Court’s order and
will not be repeated here. See Appalachian Regional Healthcare, Inc. v. Kentucky
Nurses Ass’n, No. 05-150, 2006 WL 2947893 (E.D.Ky. Oct. 13, 2006). Suffice it to
say that the district court, applying the four-part test found in Cement Divisions, Nat’l
Gypsum Co. v. United Steelworkers, Local 135, determined that the arbitrator was
“arguably construing the contract consistently with accepted methods of contractual
interpretation.” Id. at *3-*4 (citing Cement Divs., 793 F.2d 759, 766 (6th Cir. 1986),
overruled by Mich. Family Res., 475 F.3d at 753).
II.
A.
No special standard governs appellate review of a district court’s decision to
vacate or enforce an arbitration award. Electronic Data Systems Corp. v. Donelson,
473 F.3d 684, 688 (6th Cir. 2007) (Moore, J.) (citing First Options of Chicago, Inc.
v. Kaplan, 514 U.S. 938, 947-48, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995)). Rather,

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such a review “should proceed like review of any other district court decision finding
an agreement between parties, e.g., accepting findings of fact that are not ‘clearly
erroneous’ but deciding questions of law de novo.” Id. (quoting Kaplan, 514 U.S. at
947-48).
B.
An en banc panel of the Sixth Circuit recently overruled the Cement Divisions
four-part test. Mich. Family Res., 475 F.3d at 753. The panel reviewed two Supreme
Court cases decided since the 1986 Cement Divisions decision, United Paperworkers
Int’l Union, AFL-CIO v. Misco, Inc., 484 U.S. 29, 40 n.10, 108 S.Ct. 364, 98 L.Ed.2d
286 (1987), and Major League Baseball Players Ass’n v. Garvey, 532 U.S. 504, 121
S.Ct. 1724, 149 L.Ed.2d 740 (2001)).
The panel determined that “Cement Divisions [gave] federal courts more
latitude to review the merits of an arbitration award than the Supreme Court permits.”
Mich. Family Res., 475 F.3d at 751. Applying Misco and Garvey, the panel narrowed
the reviewing court’s inquiry to “whether the arbitrator is even arguably construing
or applying the contract and acting within the scope of his authority.” Id. at 752-53
(citing Misco, 484 U.S. at 38, 108 S.Ct. 364; Garvey, 532 U.S. at 509; 121 S.Ct.
1724) (quotation marks omitted).

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Michigan Family Resources stated that
judicial consideration of the merits of a dispute is the rare exception, not
the rule. .. . . [I]n most cases, it will suffice to enforce the award that the
arbitrator appeared to be engaged in interpretation, and if there is doubt
we will presume that the arbitrator was doing just that.
Id. at 753 (emphasis added). C.
The Appellant argues that the arbitrator was not construing the contract, and
therefore, that his decision did not “draw its essence” from the collective bargaining
agreement. The district court’s decision applied Cement Divisions’ broader inquiry,
which permitted a court to vacate an award that did not “draw its essence” far more
easily than Michigan Family Resources will now allow. Despite that greater leeway,
that court determined that the arbitrator appropriately relied on past practice, properly
applied context to interpret seemingly explicit language, and therefore construed the
contract.
Under the guidance of Michigan Family Resources, if the arbitrator appeared
to be engaged in interpretation, we must enforce the award. That case summarized
its own analysis by observing that
[t]he arbitrator's ten-page opinion has all the hallmarks of interpretation.
He refers to, quotes from and analyzes the pertinent provisions of the
agreement, and at no point does he say anything indicating that he was

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doing anything other than trying to reach a good-faith interpretation of
the contract.
Mich. Family Res., 475 F.3d at 754.
Here, too, the arbitrator’s decision quotes and applies the pertinent provisions
of the collective bargaining agreements, and performs a good-faith interpretation of
those agreements. The arbitrator was within the bounds of his authority, and his
decision arguably construed the collective bargaining agreement. Therefore, we
AFFIRM.

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