The opinion of the court was delivered by: THOMAS I. VANASKIE
Jeddo-Highland seeks to vacate or modify the arbitration award on a number of grounds, including that (a) culm is not covered by the work jurisdiction provisions of the 1990 AWA; (b) Morea is not an "affiliate" of Jeddo-Highland; and (c) Morea's "dedication" of the culm in question to Wheelabrator Frackville Energy Company, Inc. ("Wheelabrator") grants to Wheelabrator the right to load and haul the culm in question without being subject to the work jurisdiction provisions of the 1990 AWA. Jeddo-Highland also challenges the award on the ground that it conflicts with a final ruling of the Court of Common Pleas of Schuylkill County, Pennsylvania in Wheelabrator Frackville Energy Company, Inc. v. District 2, United Mine Workers of America, et al., No. S-2213-1992 (Nov. 9, 1992) (hereinafter referred to as the "Schuylkill County Action"). (See Docket Entry 41, Exhibit "I.") Finally, Jeddo-Highland contends that the award is contrary to public policy because it would preclude long-term arrangements for the supply of culm necessary to operate "co-generation" facilities.
Defendants, District 2 United Mine Workers of America, Sub-District 4, and Local Union 1443, United Mine Workers of America (hereinafter collectively referred to as the "UMW"), have asserted a counterclaim, requesting enforcement of the arbitration award. The UMW contends that the 1990 AWA extends to the loading and hauling of culm located on "coal lands" owned by a signatory operator or its affiliate. The UMW further contends that because both Jeddo-Highland and Morea are wholly-owned subsidiaries of Pagnotti Enterprises, Inc. ("Pagnotti"), the loading and hauling of culm owned by Morea is covered by the 1990 AWA. Finally, the UMW asserts that the work jurisdiction requirements of the 1990 AWA could not be defeated by the Wheelabrator transaction.
Both parties have moved for summary judgment. Because it is evident that (a) the work jurisdiction provisions of the 1990 AWA arguably extend to the loading and hauling of culm; (b) the 1990 AWA may be construed to extend to operations on coal lands owned or held by Morea as an affiliate of Jeddo-Highland; (c) the Wheelabrator transaction does not defeat the work jurisdiction provisions of the 1990 AWA; and (d) the decision in question is not inconsistent with either the Schuylkill County Action or public policy, the UMW's summary judgment motion will be granted and Jeddo-Highland's motion will be denied.
The 1990 AWA is "the collective bargaining agreement that governs relations between anthracite-producing companies and UMW-represented workers in the anthracite industry." International Union, UMW v. Racho Trucking Co., 897 F.2d 1248, 1249 (3rd Cir. 1990). The specific work covered by the 1990 AWA is defined as follows:
The production, preparation, processing and cleaning of coal from deep mining operations, strip operations, and refuse banks, and transportation of coal (except transportation of prepared coal), repair and maintenance work normally performed at the mine site or at a central shop of the Employer and maintenance of refuse banks and mine roads, and work customarily related to all of above. . . . Contracting, subcontracting, leasing and subleasing. . . will be conducted in accordance with the provisions of this Article. [1990 AWA, Article 2, § (a) (Docket Entry 41, Ex. "A," emphasis added).]
Disputes arising under the 1990 AWA are subject to a mandatory grievance procedure, culminating in reference of the matter to the "Umpire" appointed by the Anthracite Board of Conciliation. (Id., Article 18.) The Umpire's decision is "final." (Id.)
B. The Umpire's Decision Giving Rise to this Litigation
In April of 1992, the UMW filed a grievance to protest the allegedly improper use of non-union workers on April 14 and 15, 1992 to remove and haul culm from a site known as the "Rosa Breaker," which is operated by Jeddo-Highland. (Docket Entry 41, Ex. "C.") The essence of the UMW's grievance was that the loading and transportation of culm is subject to the "work jurisdiction" provisions of the 1990 AWA.
Although the UMW originally contended that the culm in question was owned by Jeddo-Highland, it now acknowledges that the culm is instead owned by Morea. Both Morea and Jeddo-Highland are wholly-owned subsidiaries of Pagnotti. (Docket Entry 41, Ex. "G" at 37.)
Effective December 14, 1990, Morea dedicated the culm located at the Rosa Breaker site to Wheelabrator. (See the "Amended and Restated Supply and Disposal Agreement" (the "Amended Supply Agreement") Docket Entry 41, Ex. "I.")
As security for its obligations under the Amended Supply Agreement, Morea pledged its stock to Wheelabrator. The Amended Supply Agreement provided that Morea would not subject any of the "anthracite culm" to any lien, nor make any agreement that would allow any other person "the right to enter upon the Culm Sites and remove the anthracite culm thereon or otherwise take any action with respect to any anthracite culm that would . . . result in any impediment to [Wheelabrator's] removal of the anthracite culm from the Culm Sites." (Docket Entry 41, Ex. "D", at 4.) Jeddo-Highland is not a party to the Amended Supply Agreement.
The question of whether the loading and hauling of culm from the Rosa Breaker site falls with the 1990 AWA was submitted to the Anthracite Board of Conciliation (the "Board"), a joint management/labor dispute resolution committee established under Article 18 of the 1990 AWA. The Board conducted a hearing on September 1, 1992, at which both sides presented testimony that was transcribed. (Docket Entry 41, Ex. "G.")
Because the Board was unable to reach a decision, the UMW referred the grievance to Umpire Clyde W. Summers, who has served as the only neutral arbitrator under the anthracite wage agreements since the mid-1970s. (Summers Dep., Docket Entry 41, at 13.) It appears that he has served with concurrence of management and labor since that time. (Id. at 18.)
Umpire Summers conducted a hearing on December 10, 1992. The record before Umpire Summers included the transcribed testimony from the Board hearing, the record from the Schuylkill County Action, decisions on other grievances under the 1990 AWA, and a number of other pertinent documents, including the Amended Supply Agreement. (See Exhibits 3A through 3AA and 4 to the Summers' Deposition, Docket Entry 42.)
In his opinion, the Umpire rejected Jeddo-Highland's position that the removal from the culm bank was not a coal operation but the removal of waste which is largely stone, explaining:
The culm bank contains coal, and although at one time it was not profitable to extract the coal, it is now economically feasible, and the culm bank is sold for the coal content in the culm. It is ultimately sized and crushed to extract the coal, which is then used as fuel. Indeed, it was described in the agreement between Pagnotti and Wheelabrator as "anthracite culm", indicating that it contained anthracite coal. [Docket Entry 27, Ex. "D" at 3-4.]
Moreover, because the material removed from the culm bank "was reprocessed through the breaker to extract more of the coal," the Umpire concluded that the 1990 AWA "specifically covers this, for Article 2, in describing the jurisdiction includes 'processing and cleaning of coal from . . . refuse banks.'" (Id. at 4.)
The Umpire also rejected Jeddo-Highland's argument that the Amended Supply Agreement was not a "lease of coal lands, but the purchase of the culm." The Umpire explained:
The agreement further provides that, "Pagnotti Coal Company and Owner have granted to Operator and Landholder (Wheelabrator and Morea Cogen) the Disposal Site Easement" and that Pagnotti will "maintain and ensure the peaceful and quiet use and enjoyment by Operator and Landholder of the Culm Site Easements and the Disposal Site Easement." The agreement also permits Wheelabrator "to install screening equipment on the Culm Site and to keep such mobile equipment on the Culm Site as is necessary to facilitate screening and removal of the anthracite culm. [Id.]
Apart from whether this might in technical legal terms be described as a lease, it is quite clear that it comes within the intent and meaning of the word "lease" as used in the Wage Agreement. . . . Signatories to the Agreement were not to avoid the Agreement by leasing, contracting or any other form of transfer ...