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National Association of Government Employees, Inc. v. National Emergency Med. Servs. Ass'n, Inc.

United States District Court, D. Massachusetts

February 4, 2015

NATIONAL ASSOCIATION OF GOVERNMENT EMPLOYEES, INC., Plaintiff-Respondent,
v.
NATIONAL EMERGENCY MEDICAL SERVICES ASSOCIATION, INC., and TORREN K. COLCORD, Defendants-Petitioners

For National Association of Government Employees, Inc., Plaintiff: Andrew D. Roth, LEAD ATTORNEY, PRO HAC VICE, Bredhoff & Kaiser, P.L.L.C., Washington, DC; Charles J. Ogletree, Jr., LEAD ATTORNEY, PRO HAC VICE, Cambridge, MA; Jean E. Zeiler, LEAD ATTORNEY, National Association of Government Employees, Quincy, MA; Joshua B, Shiffrin, Tanaz Moghadam, PRO HAC VICE, Bredhoff & Kaiser, P.L.L.C., Washington, DC; Richard L. Barry, Jr., National Association of Government Employees, Quincy, MA.

For National Emergency Medical Services Association, Torren Colcord, Defendants, Counter Claimants: John P. Connelly, LEAD ATTORNEY, Hinckley, Allen & Snyder LLP, Boston, MA.

For National Association of Government Employees, Inc., Counter Defendant: Jean E. Zeiler, LEAD ATTORNEY, National Association of Government Employees, Quincy, MA; Joshua B, Shiffrin, Bredhoff & Kaiser, P.L.L.C., Washington, DC; Richard L. Barry, Jr., National Association of Government Employees, Quincy, MA.

MEMORANDUM AND ORDER

Patti B. Saris, Chief United States District Judge.

I. INTRODUCTION

The plaintiff, National Association of Government Employees (NAGE), requests a judgment confirming an arbitration award handed down on May 15, 2014, and requiring the defendants, National Emergency Medical Services Association (NEMSA), to pay NAGE $260,064. NEMSA, in its opposition, asks the Court to vacate the arbitration award. After hearing, NAGE's motion to confirm (Docket No. 91) is ALLOWED. NEMSA's motion to vacate (Docket No. 97) and NAGE's motion for attorneys' fees (Docket No. 100) are DENIED.

II. FACTUAL BACKGROUND

The plaintiff, NAGE, is a labor organization representing federal, state, and municipal employees. This case involves the International Association of EMTs and Paramedics (IAEP), a subdivision of NAGE with approximately 10,000 members. The defendant, NEMSA, is a smaller organization that represents approximately 5,000 emergency medical services employees. Torren Colcord, also a defendant, is NEMSA's executive director.

In March, 2012, NAGE and NEMSA agreed to join forces, and signed three contracts that eventually gave rise to the arbitration at issue. The Affiliation Agreement required NEMSA monthly to remit funds to NAGE, amounting to 10% of NEMSA's dues and fees from each bargaining unit, and required NAGE to protect NEMSA's bargaining relationships against challenges from other unions (including NAGE). The Servicing Agreement required NEMSA to pay a monthly fee amounting to 85% of the same dues and fees, in return for which NAGE would provide staff and resources to represent NEMSA's unit members. The Employment Agreement, between NAGE and Colcord only, made Colcord a NAGE employee for ten years. The Affiliation and Servicing Agreements both provided that arbitration or mediation were the " only means" of settling disputes not resolved by good-faith discussion.[1] The results of any such arbitration would be final and binding on the parties.

In the arbitrator's words, " [d]isharmony between the two unions ensued almost immediately after the ink dried on the three contracts." Docket No. 97-1, p. 5. Most relevantly, NEMSA preserved a retainer agreement with Goyette & Associates (Goyette), a California law firm, without NAGE's knowledge. Until early May, 2012, NEMSA paid $45,000 monthly to Goyette; at that point, Colcord diverted those monthly fees to himself. Goyette subsequently filed a lawsuit for over $825,000 in missing fees and obtained a writ of attachment for $270,000. This attachment prevented NEMSA from fulfilling its fee obligations to NAGE, which was still unaware of the Goyette agreement or the subsequent lawsuit. NEMSA made only partial payments in December, 2012, and January, 2013; it made no payments at all in February and March 2013. Further controversy arose over the formula used to calculate NEMSA's payments to NAGE.

In late 2012, the President and Treasurer of NAGE spoke with NEMSA personnel about NAGE's concerns with NEMSA's financial condition. Both organizations discussed terminating Colcord and instituting new leadership, but were advised by consulting attorneys that such a course of action would violate the Employment Agreement. NAGE informed NEMSA in February, 2013, that it planned to issue a notice of default in light of NEMSA's delinquent payments. Further discussions occurred throughout the next few months, but no resolution was reached. On April 5, 2013, NAGE sent a letter terminating all three agreements with NEMSA. NAGE subsequently began to raid NEMSA's membership and challenge NEMSA's representation of several national bargaining units. In April, 2013, NAGE filed suit against NEMSA and Colcord in this Court to recover damages for the alleged contract breaches, over NEMSA's objection that the arbitration provisions in the Agreements forbade such judicial action. At the Court's encouragement, the parties agreed to submit to arbitration pursuant to Section 301 of the Labor Management Relations Act (LMRA), 29 U.S.C. § 185(a) (Section 301), and the proceeding was stayed pending the issuance of an award.

At arbitration, NEMSA raised a plethora of claims against NAGE, only one of which the arbitrator, Robert M. Hirsch, found meritorious.[2] NAGE, as it now concedes, had declined to arbitrate the underlying disputes and instead " ran to court" with its breach of contract claim. Docket No. 97-1, p. 10. Although NAGE argued that it merely sought interim judicial relief, the arbitrator concluded that NAGE had breached the arbitration provisions of the Agreements by virtue of its failure to arbitrate, and that NEMSA was entitled to consequential damages for its efforts to enforce those provisions.

In turn, NAGE sought a declaration that it was legally justified in terminating its three contracts with NEMSA, as well as damages against NEMSA and Colcord jointly and severally. The arbitrator granted both requests. He first concluded that, while the arbitration provisions in the Agreements served as a dispute resolution mechanism, they did not " bar either party from terminating the contracts where a material breach was committed by the other side." Docket No. 97-1, p. 14. NAGE was thus within its rights to cease performance upon NEMSA's failure to pay fees it indisputably owed. The arbitrator further found that NAGE was entitled to damages from NEMSA and Colcord in the amount of $281,380 based on their respective breaches of the Servicing and Affiliation Agreements. Colcord had breached by diverting funds from Goyette to himself, the arbitrator wrote, while NEMSA erred in subsequently defaulting on its payments to NAGE.

Since that point, neither NEMSA nor Colcord has made any of the required payments. NAGE, accordingly, sought confirmation of the arbitration award in ...


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