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INTERNATIONAL UNION OF OPERATING ENGRS.

April 20, 1989

INTERNATIONAL UNION OF OPERATING ENGINEERS, LOCAL 542, Plaintiff
v.
EVANS ASPHALT COMPANY, INC., Defendant


Edwin M. Kosik, United States District Judge.


The opinion of the court was delivered by: KOSIK

EDWIN M. KOSIK, UNITED STATES DISTRICT JUDGE.

 The plaintiff, International Union of Operating Engineers, Local 542, filed this action on January 26, 1988 in the United States District Court for the Eastern District of Pennsylvania against the defendant, Evans Asphalt Company, Inc., pursuant to § 301(a) of the Labor Management Relations Act ["LMRA"], 29 U.S.C. § 185(a). On February 16, 1988, this action was transferred to the United States District Court for the Middle District of Pennsylvania. On March 25, 1988, the defendant filed its answer to the complaint. The discovery deadline in this case has lapsed.

 On October 11, 1988, the parties submitted cross-motions for summary judgment which contained exhibits. The cross-motions for summary judgment have been briefed and are ripe for disposition.

 The relevant facts of this case are as follows:

 In June of 1986, the plaintiff and Evans Asphalt Company, Inc. ["Evans Asphalt"] executed a collective bargaining agreement ["the Agreement"] which was effective from May 1, 1986 until April 30, 1988. *fn1" Under the terms of the Agreement, disputes between the parties were to be resolved by a grievance committee. If the grievance committee could not resolve the dispute, then the matter would be decided by an arbitrator. The arbitrator's decision was to be final and binding upon the parties. *fn2"

 In late 1986, Evans Asphalt was purchased by Slusser Brothers Trucking & Excavating Company, Inc. Slusser Brothers Trucking & Excavating Company, Inc. was not a party to any collective bargaining agreement with the plaintiff. The plaintiff contends that after the sale to Slusser Brothers Trucking & Excavating Company, Inc., Evans Asphalt continued to do business under the name of Evans Asphalt. The defendant states that Slusser Brothers Trucking & Excavating Company, Inc. assigned its rights to the assets which it obtained from the purchase of Evans Asphalt to Slusser Brothers, a partnership. A new corporation was then formed under the name Evans Asphalt Company, Inc. The defendant maintains that the new Evans Asphalt, which it terms "Evans II", was distinct from the original Evans Asphalt, "Evans I", and did not assume any liability or contracts of Evans I including the collective bargaining agreement executed with the plaintiff.

 In June of 1987, the plaintiff filed a grievance against Evans Asphalt pursuant to the Agreement. In accordance with Article IV of the Agreement, the dispute was referred to an arbitrator by the plaintiff. A hearing was held before an arbitrator on November 17, 1987. However, the hearing was ex parte. Evans Asphalt did not appear at the hearing because it claimed that it was a new corporation and as such was not a party to the Agreement with the plaintiff. Moreover, the defendant did not try to enjoin the arbitration hearing. Nor did the defendant raise any substantive defenses before the arbitrator. The arbitrator ruled that the new Evans Asphalt, Evans II, was in fact the same corporation, under new ownership, which was a party to the Agreement with the plaintiff and that it was therefore bound by the terms of the Agreement. The arbitrator then found that Evans Asphalt violated the Agreement as charged by the plaintiff. Thus, the arbitrator issued an award on November 23, 1987 in favor of the plaintiff and against Evans Asphalt. Evans Asphalt did not seek to vacate or modify the arbitrator's award.

 Evans Asphalt did not comply with the arbitrator's award and has continually refused to do so. Consequently, the plaintiff commenced this action to enforce the award of the arbitrator. Evans Asphalt insists that it is not bound by the arbitrator's award because it is not a party to the Agreement with the plaintiff.

 Summary judgment is appropriate only when there is no genuine issue of material fact to be resolved. Fed. R. Civ. P. 56; Peterson v. Lehigh Valley Dist. Council, 676 F.2d 81, 84 (3d Cir. 1982); Continental Ins. v. Bodie, 682 F.2d 436, 438 (3d Cir. 1982). All doubts as to the existence of a genuine issue of material fact must be resolved against the moving party. The entire record must be examined in light most favorable to the non-moving party. Continental Ins., supra. Additionally, the Supreme Court has recently ruled that Fed. R. Civ. P. 56(c) "mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 106 S. Ct. 2548, 2552-2553, 91 L. Ed. 2d 265 (1986), cert. denied, 484 U.S. 1066, 108 S. Ct. 1028, 98 L. Ed. 2d 992 (1988). The Court further stated that "Rule 56(e) . . . requires the non-moving party to go beyond the pleadings and by [his] own affidavits, or by the 'depositions, answers to interrogatories, and admissions on file,' designate 'specific facts showing that there is a genuine issue for trial.'" Id. at , 106 S. Ct. at 2553.

 At the arbitration hearing, the arbitrator found that Evans II did not cease to be the same entity as Evans I. Specifically, the arbitrator found that Evans Asphalt continued to operate as the same independent corporate entity both before and after Slusser Brothers purchased its assets. The arbitrator based his decision on the undisputed evidence submitted by the plaintiff which demonstrated that Evans I engaged in business operations as Evans Asphalt Company, Inc. even after the change in ownership. *fn3" The plaintiff states that the court should enforce the arbitration award and that the defendant has waived any objection to it by failing to raise any defense before the arbitrator and by failing to file a timely appeal of the award. The plaintiff contends that this court cannot second guess the arbitrator's award and can only overturn the award if it is not rationally derived from the collective bargaining agreement. The defendant argues that the arbitrator's award in this case was meaningless and unenforceable because the arbitrator had no authority to make a decision binding upon a company which was not a party to the agreement to arbitrate. Stated simply, the defendant disputes the existence of a collective bargaining agreement between itself and the plaintiff and the jurisdiction of the arbitrator to issue an award which was binding upon it.

 The defendant clearly had the opportunity to contest the enforceability of the Agreement before the arbitrator. There is no question that the defendant was aware of the date and the time of the arbitration hearing. It is true that prior to the arbitration hearing, the defendant did notify the plaintiff and the American Arbitration Association that it would not submit to the jurisdiction of the arbitrator. However, the defendant chose not to attend the hearing and chose not to raise any objection at the hearing itself. The plaintiff argues that since the defendant raised no defense at the arbitration hearing ...


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