United States District Court, D. New Mexico
CHRISTUS ST. VINCENT REGIONAL MEDICAL CENTER, Plaintiff,
DISTRICT 1199NM, NATIONAL UNION OF HOSPITAL AND HEALTHCARE EMPLOYEES, AFSCME, AFL-CIO, Defendant.
Hari-Amrit Khalsa Hinkle Shanor LLP Albuquerque, New Mexico
--and-- Ellen S. Casey Jaclyn M. McLean Hinkle Shanor LLP
Santa Fe, New Mexico --and-- Charles Birenbaum Jamie Adams
Greenberg Traurig San Francisco, California Attorneys for the
A. Montalbano Stephen Curtice Shane C. Youtz Youtz &
Valdez, PC Albuquerque, New Mexico, Attorneys for the
MEMORANDUM OPINION AND ORDER
MATTER comes before the Court on: (i) the Plaintiff
Christus St. Vincent Regional Medical Center's Petition
to Vacate Arbitration Award, filed April 13, 2017 (Doc. 1)
(“Petition”); and (ii) the Defendant's Motion
to Enforce Arbitration Award, filed April 27, 2017 (Doc.
9)(“Motion”). The Court held a hearing on January
19, 2018. The primary issues are: (i) whether the arbitration
provisions in the Nurse Agreement between Christus St.
Vincent Regional Medical Center & District 1199 NM
National Union of Hospital and Healthcare Employees AFSCME,
AFL-CIO, October 15, 2014 to August 31, 2017 (Doc. 1-3)
(“CBA”) -- which state that an arbitration award
may be set aside under certain conditions -- change the
standard of review for arbitration awards, which the Supreme
Court of the United States articulated in the
Steelworkers Trilogy; (ii) whether the arbitrator,
Michael S. Hill,  exceeded his authority by ordering a fired
employee reinstated; (iii) whether the arbitration award
violates public policy by not disciplining an employee who
allegedly violated the Health Insurance Portability and
Accountability Act of 1996, Pub. L. 104-191, 110 Stat. 1936
(“HIPAA”); and (iv) whether Plaintiff Christus
St. Vincent Regional Medical Center's (“St.
Vincent”) claims were frivolous and brought in bad
faith such that the Court should award attorneys' fees
and costs. The Court concludes: (i) the CBA does not change
the Court's standard of review, because the CBA's
arbitration provisions restate traditional standard of review
principles; (ii) the arbitrator did not exceed his authority,
because the award draws from the CBA's essence; (iii) the
award does not violate public policy, because there is no
evidence that the employee violated HIPAA; and (iv) the Court
will not award fees or costs, because St. Vincent did not
pursue frivolous arguments or act in bad faith. Accordingly,
the Court denies the Petition, and grants the Motion in part
and denies it in part.
Vincent is a hospital in Santa Fe, New Mexico. See
Petition ¶ 1, at 1. Defendant District 1199NM, National
Union of Hospital and Healthcare Employees, AFSCME, AFL-CIO
(“Hospital Union”) is a labor union based in
Santa Fe. See Petition ¶ 2, at 1. St. Vincent
and the Hospital Union entered into the CBA. See CBA
at 1. The CBA states that St. Vincent has the
“exclusive discretion” to execute certain
actions, including “[d]ecisions concerning the hiring,
termination, assignment, transfer, demotion and promotion of
associates, ” CBA § 7.1.12, at 7-8, and
“[d]ecisions concerning the counseling, reprimanding,
discipline and discharge of associates for just cause with
the specific understanding that any discipline must be for
just cause and that the Union may grieve and arbitrate any
such decisions, ” CBA § 7.1.16., at 8. The CBA
establishes a progressive disciplinary process:
The four (4) basic steps listed below will be followed for
disciplinary action. These steps will generally be taken in
the order listed, although some steps may be omitted when
serious offences have been committed.
(1) Documented Verbal Counseling
(2) Written Warning
(3) Final Warning or Suspension
CBA § 12.12.10., at 15.
has several provisions relating to arbitration:
30.19.5. The Arbitrator shall have the authority to determine
if there was just cause for any disciplinary action. However,
in no case shall the Arbitrator have the power to add to, nor
subtract from, or modify this Agreement nor shall the
Arbitrator substitute their [sic] discretion for that of the
employer where such discretion has been retained by the
employer, nor shall the Arbitrator exercise any
responsibility or function of the employer, including but not
limited to, the ability to set standards of patient care.
30.19.6. The Arbitrator's award in disciplinary cases is
limited to back pay and/or reinstatement, or reinstatement to
a similar position at the parties' discretion if
irreconcilable conflicts exist. . . . The arbitrator may not
award attorney's fees, punitive damages, general
compensatory damages, or costs.
30.19.7. The arbitrator's award may be set aside when the
220.127.116.11. Exceeded his/her authority in making the award.
18.104.22.168. Exceeded his/her jurisdiction under the terms of
this Agreement or, 22.214.171.124. The award is contrary to law.
CBA §§ 30.19.5 -.7, at 20.
Argenbright is a Registered Nurse who worked at St. Vincent
for over twenty years. See Response to
Petitioner's Motion to Vacate Arbitration Award at 1,
filed April 27, 2017 (Doc. 8)(“Petition
Response”). Argenbright was an active union member.
See Petition ¶ 7, at 7 (stating that
Argenbright was a “Union Delegate”). On May 16,
2015, Argenbright took a break from her work shift to enter
the Post Anesthesia Care Unit (“PACU”) area of
Surgical Services and look through PACU's log books.
Corrective Action Form at 1 (dated May 28, 2015) at 1, filed
April 13, 2017 (Doc. 1-6)(“Final Warning”).
Argenbright was searching for patient information relating to
a grievance the Hospital Union filed on behalf of a recently
terminated nurse. See Final Warning at 1; Petition
¶ 17, at 6. St. Vincent investigated the incident and
determined that Argenbright's unauthorized entry into a
secured area during her work shift to access confidential
patient records on the Hospital Union's behalf is
“so egregious that it warrants skipping steps in the
progressive disciplinary process and issuing this corrective
action as a Final Warning.” Final Warning at 2. The
Final Warning directs Argenbright to refrain from certain
actions, such as “using her ID security badge to enter
unauthorized or secure areas unless she is assigned to work
in that area, ” “conducing non-work related
business during working hours, ” and “looking at
protected health information unless she has a need to
know.” Final Warning at 2-3. The Final Warning
concludes by stating: “Consequences of further
infractions: Failure to immediately and continually
adhere to the corrective measure described above may result
in further corrective action up to and including termination
for similar or any other hospital policy violation.”
Final Warning at 3.
early 2016, according to St. Vincent, Argenbright “was
involved in a series of incidents that taken separately each
warrant discipline, and taken together, warrant
termination.” Corrective Action Form (dated February
18, 2016) at 1, filed April 13, 2017 (Doc. 1-7)
(“Termination Form”). First, according to St.
Vincent, during a shift on January 11, 2016, Argenbright
“direct[ed] patient care providers to the Clinical
Supervisor at a rate that seemed unnecessary.”
Termination Form at 1. Second, according to St. Vincent,
during an investigative meeting relating to Argenbright's
January 11, 2016, shift, Argenbright “revealed that she
was in possession of documents containing private healthcare
information.” Termination Form at 1. When
“management attempted to investigate the nature of the
documents, Ms. Argenbright refused to cooperate.”
Termination Form at 1. Third, according to St. Vincent, on
January 18, 2016, Argenbright “failed to gain the
confidence of [a] patient, . . . fail[ed] to communicate
properly about a perceived lack of responsiveness to the
patient's pain, was unaware of care requirements for
oxygen, and failed to reassign the patient formally to
another nurse.” Termination Form at 3. Fourth, on
February 2, 2016, Argenbright entered the Surgical
Services' break room to eat lunch, and leave a Union card
and labor contract for an employee named Kathleen Cass.
See Termination Form at 3; Petition ¶ 27, at 9.
According to St. Vincent, she had tried to enter the Surgical
Services area by swiping her badge, but when that approach
did not work, another employee let her in a different door.
See Termination Form at 3. According to St. Vincent,
after lunch, Argenbright returned to her usual workplace in
the hospital and realized that she may have left her
“report sheet” in the Surgical Services area; she
returned to Surgical Services and was once again let into the
area by another employee. See Termination Form at 3.
According to St. Vincent, during this visit, Argenbright
entered a patient care area to speak with Cass. See
Termination Form at 3-4. Based on these four incidents, it
fired Argenbright. See Termination Form at 1.
requested arbitration. See Arbitrator's Decision
and Award at 1 (dated January 13, 2016), filed April 13, 2017
(Doc. 1-2)(“Award”). According to Hill, the
question is “whether the Grievant was discharged for
just cause and if not, what is the remedy?” Award at 3.
See Reply in Support of Defendant's Motion to
Enforce Arbitration Award, filed June 14, 2017 (Doc.
20)(“Reply”)(stating that the question for the
Arbitrator was whether grievant was disciplined for just
cause, and, if not, what is the appropriate remedy).
held a hearing on October 18-19, 2017, and November 16, 2017.
See Award at 1. Hill issued the Award on January 13,
2016. See Award at 1. In the Award, Hill provides a
basic factual background, see Award at 3, summarizes
relevant documents and the parties' positions,
see Award at 3-4, and provides a lengthy summary of
the evidence and testimony, see Award at 4-32.
Hill's “Discussion and Decision” section runs
four pages in which he briefly addresses each of the four
reasons given for Argenbright's discharge. See
Award at 33-37. First, Hill concludes that Argenbright's
frequent requests for a supervisor's assistance were not
an appropriate basis for termination. See Award at
33-34. Second, Hill states that Argenbright's
“handling of the difficult patient on January 18, 2016
is not found by the Arbitrator as cause for
termination.” Award at 35. Third, Hill states:
While testimony indicated reason for suspicion that Ms.
Argenbright might have hospital documents in her possession,
a collective bargaining agreement provision states that notes
are not subject to disclosure. Therefore, no violation of the
collective bargaining agreement was found in the refusal to
disclose notes in the possession of Ms. Argenbright.
Consequently, no evidence was provided at the hearing of a
HIPAA violation by Ms. Argenbright.
at 36. Fourth, Hill states:
The evidence is clear and convincing that she attempted to
enter the area by using her badge which did not permit her to
enter. When that failed, she entered the area either by being
let in a locked door by someone or following someone who
gained entry by appropriate means. . . . The Grievant had
previously been instructed in 2015 not to enter the Surgical
Services area unless she was assigned duties in that area or
she had permission of a supervisor to be in the area. The
prior instructions were part of a Corrective Action which
included a suspension and a final warning.
at 36-37. Hill concludes that “the bulk of the charges
against [Argenbright] were unsubstantiated.” Award at
37. Hill orders Argenbright reinstated to her job after a
six-month suspension and be awarded back pay. See
Award at 37.
months after Hill issued the Award, St. Vincent asked the
Court to vacate it. See Petition ¶ 8, at 3. St.
Vincent argues that the Award does not draw its essence from
the CBA, because Hill's reduced discipline order deviated
from the CBA's progressive disciplinary process.
See Petition at 14-17. St. Vincent asserts that Hill
ignored the CBA's plain language by reducing
Argenbright's punishment despite determining that there
is clear and convincing evidence that she violated a Final
Warning. See Petition at 17-20. St. Vincent also
argues that Hill exceeds his jurisdiction and violates public
policy by reversing Argenbright's termination despite
finding reason for suspicion that Argenbright violated the
Health Insurance Portability and Accountability Act, 29
U.S.C. § 1181 (“HIPAA”). Petition
¶¶ 10, 13-14, at 4; 13-14. See id. at
The Petition Response.
Petition Response, the Hospital Union contends that St.
Vincent “attempt[s] to re-litigate facts already
determined and which are beyond the scope of this Court's
review.” Petition Response at 5. According to the
Hospital Union, the courts' standard of review of
arbitration awards is so narrow that “courts may not
consider the merits of an arbitration award even if it is
alleged that it rests on errors of fact or misinterpretation
of the contract.” Petition Response at 5 (citing
Eastern Associated Coal Corp. v. Mine Workers, 531
U.S. 57, 62 (2000); United Paperworkers Int'l Union,
AFL-CIO v. Misco, Inc., 484 U.S. 29, 36 (1987);
Titan Tire Corp. of Bryan v. United Steelworkers of Am.
Local 890L, 656 F.3d 368 (6th Cir. 2011); Int.l Bhd.
Of Elec. Workers, Local Union Nos. 12, 111, 113, 969 v.
Prof'l Hole Drilling, Inc., 574 F.2d 497, 503 (10th
Cir. 1978); Vrable IV, Inc. v. SEIU District 1199,
784 F.Supp.2d 846 (S.D. Ohio 2011)). The Hospital Union
contends that Hill appropriately applied the “seven
tests of just cause” standard. Petition Response at
10-11 (citing Healthcare Services Group, 131 Lab.
Arb. 975, 980 (Clark, 2013); Grief Brothers Cooperage
Corp., 42 Lab. Arb. 555 (Daugherty, 1964)).
Specifically, the Hospital Union notes that Hill applied the
seventh test -- whether the discipline was reasonably related
to the seriousness of the offense and the employee's
history. See Petition Response at 11.
Hospital Union also contends that St. Vincent
mischaracterizes Hill's decisions, noting, for instance,
that Hill determined that Argenbright took certain actions
that St. Vincent decided violated a Final Warning; Hill --
according to the Hospital Union -- did not determine that
Argenbright violated the final warning. See Petition
Reply at 13.
the Hospital Union argues that the Award does not violate
public policy by not terminating Argenbright for a HIPAA
violation, because, according to the Hospital Union, Hill did
not find evidence that Argenbright violated HIPAA.
See Petition Reply at 19.
the Hospital Union argues that the Court should grant it
attorneys' fees, because St. Vincent brought its petition
in bad faith or because it was objectively unreasonable.
See Petition Reply at 21-24.
same day it filed its Petition Response, the Hospital Union
filed its Motion, asking the Court to enforce the Award.
See Motion ¶ 1, at 1 (citing 29 U.S.C. §
185(a)). The Hospital Union also requests that its costs
“be taxed against Plaintiff and that as part of these
costs there be included a reasonable attorney's
fee.” Motion at 2-3. The Hospital Union incorporates by
reference its Petition Response. See Motion ¶
6, at 2.
The Motion Response.
Vincent responds. See Christus St. Vincent Regional
Medical Center's Response to Motion to Enforce
Arbitration Award, filed May 22, 2017 (Doc. 14)(“Motion
Response”). St. Vincent begins by asserting: (i) the
Hospital Union fails to state a claim upon which relief can
be granted; (ii) the Court should vacate the Award pursuant
the Labor Management Relations Act, 61 Stat. § 301
(codified at 29 U.S.C. § 185) (“LMRA”),
because Hill “exceeded his powers” and the Award
“does not draw its essence” from the parties'
CBA; (iii) the Court should vacate the Award pursuant to
§ 301 of the LMRA, 29 U.S.C. § 185.2, and 9 U.S.C.
§ 12 for public policy reasons; (iv) there is no basis
for awarding attorneys' fees; (v) there is no basis for
injunctive relief. Motion Response ¶¶ 1-5, at 2-3.
Vincent argues that the Court should vacate the Award,
because Hill exceeded his powers by reducing
Argenbright's discharge. See Motion Response at
4. St. Vincent contends that Hill concluded that Argenbright
committed certain acts that, according to St. Vincent,
constitutes just cause for dismissal under the CBA.
See Motion Response at 4-5. Consequently, St.
Vincent argues, Hill exceeded his jurisdiction by ignoring
St. Vincent's exclusive authority, pursuant to the CBA,
to discipline and discharge employees for just cause.
See Motion Response at 5-6. St. Vincent also argues
that Hill misunderstood the CBA's provisions on producing
records, and, as a consequence, erroneously concluded that
there was no evidence that Argenbright violated HIPAA.
See Motion Response at 10.
St. Vincent contends that the Court should vacate the Award,
because it violates public policy. See Motion
Response at 11. St. Vincent argues that “[a]llowing an
employee to collect and misuse patient information, refuse to
cooperate in an investigation of the matter, and avoid
discipline flies in the face of well-established public
policy involving the privacy of protecting health
information.” Motion Response at 11.
St. Vincent argues that there is no basis for the Court to
award attorneys' fees, because its Petition is reasonable
and made in good faith. See Motion Response at
11-12. Moreover, St. Vincent contends, the Hospital Union
does not meet pleading requirements required for sanctions
under rule 11 of the Federal Rules of Civil Procedure,
because a sanctions motion must be made separately and
describe specific sanctionable conduct. See Motion
Response at 12.
Hospital Union replies. See Reply at 1. The Hospital
Union disputes that Hill exceeded his powers or ignored the
CBA. See Reply at 2-3. The Hospital Union contends
that St. Vincent mischaracterizes some of the evidence, such
as by suggesting that Argenbright entered the restricted area
for non-work-related activities when she entered the area
once during a lunch break and once to retrieve a document
necessary to perform her job. See Reply at 3-4. The
Hospital Union also contends that Hill did not overstep the
CBA by ignoring the Final Warning, because the CBA provides
for additional disciplinary steps. See Reply at 4-5.
The Hospital Union next contends that Arbitrators
“commonly amend the discipline imposed on
employees.” Reply at 5 (citing United Steelworkers
of Am. v. Enter. Wheel & Car Corp., 363 U.S. 593,
598 (1960); Labor Relations Div. of Const. Indus. of
Massachusetts, Inc. v. Int'l Bhd. of Teamsters,
Chauffeurs, Warehousemen & Helpers of Am., Local No.
379, 29 F.3d 742, 747 (1st Cir. 1994); Angelica
Textile Servs., Inc. v. Local Union 170, Int'l Bhd. of
Teamsters, 2013 WL 2251554, at *4 (D. Mass., May 21,
2013)(Hillman, J.)). The Hospital Union contends that the
United States Court of Appeals for the Tenth Circuit permits
arbitrators to adjust punishments in light of the severity of
the grievant's actions. See Reply at 5 (citing
Mistletoe Exp. Serv. v. Motor Expressmen's
Union, 566 F.2d 692, 695 (10th Cir.
1977)(“Mistletoe”); Local No. 7
United Food & Commercial Workers Int'l Union v. King
Soopers, Inc., 222 F.3d 1223, 1229 (10th Cir.
the Hospital Union disputes St. Vincent's contention that
the Award's purported lack of specificity would be
grounds for vacating the Award. See Reply at 8. The
Hospital Union states: “And while the Arbitrator did
not provide a detailed legal analysis of the seven tests of
just cause, it is apparent from his Award that he took those
factors into consideration, and his decision tracks with that
rubric.” Reply at 8-9.
Court held a hearing on January 19, 2018. See Draft
Hearing Transcript (taken January 19, 2018)
(“Tr.”). St. Vincent began by asserting that, in
their CBA, the parties agreed on a standard of review that an
arbitrator's award may be set aside when the arbitrator
exceeds his or her authority. See Tr. at 2:18-3:3
(Birenbaum). St. Vincent contended that the CBA's
specified standard of review distinguishes this case from the
caselaw. See Tr. at 3:4-11 (Birenbaum). St. Vincent
asserted that it skipped some steps in the CBA's
four-step disciplinary process described in the CBA, because
the CBA also allows steps to be skipped for serious
violations, and Argenbright's offense was serious.
See Tr. at 7:5-16 (Birenbaum)(citing CBA at 15).
See also CBA at 19 (“These steps will
generally be taken in the order listed, although some steps
may be omitted when serious offences have been
committed.”). Regarding the Award, St. Vincent argues
that Hill rendered a decision without applying or citing the
CBA's disciplinary procedure. See Tr. at
8:20-9:4 (Birenbaum). St. Vincent argued that this case is
similar to Mistletoe, because St. Vincent's
power to terminate employees is not ambiguous. See
Tr. at 9:31-10:14 (Birenbaum). St. Vincent distinguishes this
case from King Soopers, because, in that case, the
terminated worker was terminated for actions that their CBA
did not expressly prohibit; here, by contrast, St. Vincent
argues, Argenbright violated clear CBA policy. See
Tr. 11:21-12:20 (Birenbaum). The ...