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January 12, 1970

Local 464, American Bakery and Confectionery Workers International Union, AFL-CIO, Plaintiff
Hershey Chocolate Corporation, now, by change of name, Hershey Foods Corporation, Defendant

Sheridan, Ch. J.

The opinion of the court was delivered by: SHERIDAN


In this action plaintiff seeks to compel defendant, Hershey Foods Corporation, *fn1" to arbitrate the question of whether plaintiff should be recognized by defendant as the exclusive bargaining agent of one of defendant's wholly owned subsidiaries. The trial was to the court without a jury.

 Jurisdiction is based on Section 301 of the Labor-Management Relations Act, as amended, 29 U.S.C.A. ยง 185.

 The complaint alleges that: Local 464 and Hershey are parties to a collective bargaining agreement which requires defendant to recognize plaintiff as a collective bargaining agent for all of the employees at defendant's Hershey, Pennsylvania plant; the agreement applies to all operations within its scope; prior to this action, defendant acquired Reese Candy Company as a wholly owned subsidiary; over the past months, Reese's production and shipping operation have been increasingly integrated with defendant's Hershey plant so as to require recognition of plaintiff as the exclusive bargaining agent for Reese employees as well as for defendant's employees; plaintiff made demand for recognition which defendant rejected as well as a demand to arbitrate under the agreement; plaintiff advised defendant that the failure to encompass Reese employees under the collective bargaining agreement is a violation of the agreement, but defendant denies the violation; and, as a result, a dispute exists which falls within the scope of the grievance and arbitration procedure of the agreement, but defendant refuses to honor plaintiff's requests to arbitrate. Plaintiff prays that defendant be directed to proceed to arbitration. A copy of the agreement is attached to the complaint. In its answer defendant denies that the production and shipping operations of Reese have been increasingly integrated and that the integration has resulted in a merger of operations. Defendant also denies that the dispute is within the scope of the grievance and arbitration provisions of the collective bargaining agreement. It admitted all other allegations, except it supplied July 2, 1963, as the date of purchase of the assets of Reese, and it also supplied a copy of a letter of September 26, 1966, in which it rejected plaintiff's demand for arbitration as alleged in paragraph 10 of the complaint, and reviewed plaintiff's prolonged and unsuccessful attempts to organize Reese employees.

 Plaintiff contends the dispute falls within the broad arbitration provisions of Section 9 of the agreement. *fn2" Defendant contends the agreement deals only with disputes concerning the employer-employee relationship and that this dispute, not touching its employees, is outside the agreement.

 Plaintiff previously moved for judgment on the pleadings. In denying the motion, *fn3" Judge Follmer of this court recognized that paragraph 9 of the collective bargaining agreement contained a broadly worded grievance and arbitration procedure under which the parties agreed to discuss "any matters." He decided, however, that the dispute was completely outside the employer-employee relationship and did not come within the classes of arbitrable grievances contemplated by the contract:

"Defendant states, and plaintiff does not deny, that plaintiff has been engaged in a prolonged organizational campaign at the Reese plant, which campaign resulted in an overwhelming defeat by the Reese employees in a representational election held August 19, 1966.
" . . .
" . . . It is perfectly obvious that the phrase 'any matters' is subject to the good faith limitation that the 'matters' in question be related to the employer-employee relationship as that relationship is set forth in the aforementioned bargaining agreement since (1) the clause only refers to the employee and the employer and (2) the conjunctive is used to join 'discuss' and 'adjust,' thus implying that the matter must be within the employer's power to correct. Here, the plaintiff seeks to include within the ambit of the agreement another corporation and another set of employees and have this other corporation and other employees, who, incidentally, within the past year voted not to be represented by this very Union, covered by the Hershey contract. By no stretch of imagination could this be found to contain something that a Hershey employee may in good faith ask the employer to 'discuss and adjust.' It is completely outside of the employer-employee relationship which paragraph 9 was designed to protect.
"The contract does contemplate certain matters only indirectly affecting the employer-employee relationship in paragraph 3, 'No Coercion By Union, and in paragraph 6(b), dispute as to Union membership, in both of which grievance procedure and arbitration are provided for.
"It must be remembered here that Reese was acquired by Hershey nine months prior to the execution of the collective bargaining agreement. Had the parties intended that the relationship between Hershey and Reese was to be the subject of the contractual grievance procedure between Hershey and the Union they would have expressly so stated as they did in the matters above referred to as appearing in paragraphs 3 and 6(b).
"The present Union contention involves a matter wholly beyond the employer-employee relationship and consequently does not come within the classes contemplated by the contract.
"It is well settled that in determining whether or not the parties to a bargaining agreement intended that a particular issue be arbitrable, the Court may consider the past practice of the parties and prior bargaining history. . . . Defendant should not be ...

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