United Natural Foods, Inc. v. Teamsters Local 120

Background

United Natural Foods, Inc., and Supervalu, Inc., collectively called UNFI in the opinion, moved for an expedited preliminary injunction against Teamsters Local 120. The dispute arose from the Union’s allegations that UNFI favored temporary, non-union employees over union employees at a wholesale grocery warehouse.

The parties’ collective bargaining agreement (CBA) required them to use an informal grievance process before pursuing arbitration. It also established deadlines for requesting arbitration, selecting an arbitrator, scheduling hearings, and issuing decisions. The CBA stated that grievances noticed for arbitration had to be heard by an arbitrator unless they were settled.

Between June and September 2020, the Union submitted eight grievances concerning the use of temporary, non-union workers. The parties could not resolve the grievances through the Labor-Management Council, so the grievances moved to arbitration. The Union failed to begin selecting arbitrators within the CBA’s 10-day deadlines for two grievances and requested additional arbitrator panels. UNFI reserved its right to challenge those procedural issues in court.

The parties agreed to address the procedural issues first in the arbitrations. After one arbitrator adjourned a hearing, the Union withdrew from arbitrations before three arbitrators, while continuing with two arbitrations before Arbitrator Richard Miller. UNFI alleged that this approach could produce conflicting results and violate the CBA.

Claims and requested relief

UNFI filed four claims: three claims that the Union breached the CBA and one claim seeking a declaration about the CBA’s arbitration requirements and the effect of the Union’s alleged procedural violations. UNFI also asked the court to stay the two arbitrations before Arbitrator Miller until the court resolved UNFI’s claims.

The court had already granted UNFI’s motion at a hearing and issued this opinion explaining its reasoning. The opinion addresses the preliminary-injunction request; it does not report a final decision on the underlying breach-of-contract claims.

Court’s analysis

A preliminary injunction is temporary relief intended to prevent irreparable harm while a case is pending. The court considered four factors: the threat of irreparable harm, the balance of harms, the likelihood of success on the merits, and the public interest.

The court also considered the Norris-LaGuardia Act, which generally limits federal courts’ power to issue injunctions in labor disputes. The court held that the exception recognized in Boys Markets applied. That exception allows an injunction supporting arbitration when the dispute is subject to mandatory arbitration and an injunction is needed to prevent arbitration from becoming meaningless.

The court found that the grievances were subject to mandatory arbitration. It also found that UNFI could suffer harm that no later arbitration award could fully repair if the Miller arbitrations occurred first. Because earlier arbitrations involving the same contract language, parties, and similar facts could bind later arbitrations, an award in the Miller proceedings could affect disputes that should have been decided earlier. The court also stated that the Union’s withdrawal from six arbitrations threatened the arbitration process itself.

The court concluded that the Norris-LaGuardia Act’s requirements were satisfied. It found that the relevant facts were undisputed, that UNFI had made reasonable efforts to resolve the dispute before seeking court relief, and that the Union had not identified a sufficient legal or factual basis for denying relief under the Act.

On the likelihood-of-success factor, the court determined that UNFI had shown a sufficient likelihood of succeeding on its claim that the Union breached the CBA by refusing to arbitrate grievances it had noticed for arbitration. The court described that interpretation of the CBA as plausible and stated that the Union had not refuted it.

The court found that the balance of harms favored UNFI, although not strongly, because UNFI faced possible irreparable harm while the Union identified no harm from delaying the Miller arbitrations. The court also found that the public interest favored preserving the arbitration process established by the parties’ CBA.

Disposition

The court granted UNFI’s motion for a preliminary injunction. The injunction stayed the proceedings before Arbitrator Miller until resolution of the merits of the case. Under Federal Rule of Civil Procedure 65(c), the court required UNFI to provide $10,000 in security for potential damages the Union might suffer if the injunction were later found wrongful.

The order was signed by Nancy E. Brasel, United States District Judge.