United States District Court, D. Rhode Island
PROSPECT EAST HOLDINGS, INC., and PROSPECT CHARTERCARE, LLC, Plaintiffs,
UNITED NURSES & ALLIED PROFESSIONALS, INC., Defendant.
MEMORANDUM AND ORDER
J. MCCONNELL, JR. UNITED STATES DISTRICT JUDGE.
case involves the Court's review of a labor
arbitrator's decisions arising from a Collective
Bargaining Agreement ("CBA"). Plaintiffs Prospect
East Holdings, Inc. and Prospect CharterCARE, LLC
("Prospect") and Defendant United Nurses &
Allied Professionals ("UNAP") filed cross-motions
for summary judgment. The parties have stipulated that the
issues underlying their dispute are pure questions of law and
thus are right for summary judgment. The Court finds that
Prospect has not established a case for vacatur either under
the Federal Arbitration Act (9 U.S.C. § 10(a)(4))
("FAA") or under the common-law manifest-disregard
owns and operates Our Lady of Fatima Hospital in North
Providence, R.I, Prospect and UNAP entered into a CBA that
remained in force between October 30, 2016 and October 29,
2018. Prospect claims that a Memorandum of Understanding
("MOU") containing contract language material to
this dispute preceded the CBA by several
contains two sections important here. Article VI sets forth
procedural rules for grievances and arbitration for disputes
arising under the CBA. ECF 1-1 at 16-18. Specifically, Part
6.6 authorizes an arbitrator to interpret and apply specific
provisions of the CBA. Id. at 18. Consistent with
the FAA, Part 6.6 limits an arbitrator's authority when
she would modify any term of the CBA instead of merely
second important section of the CBA is Article XVI:
Insurance. Id. at 36-39. Part 16.2 permits Prospect
to modify medical and dental plan designs or other aspects of
the benefit plans, provided the changes apply equally to
non-represented employees "as specified herein."
Id. at 36. Part 16.2 also limits out-of-pocket
maximum increases to no more than $400 per year. Finally,
Part 16.2 allows Prospect to make additional changes to
"carrier, eligibility, coverage, benefits, or cost of
the insurance programs, provided such changes provide
benefits that are substantially equivalent to those in effect
as of the date of the CBA.
2017, Prospect introduced a wellness incentive program that
reduced insurance premium co-pays for participants by $50
monthly in exchange for program participation. Prospect
subsequently modified the qualification criteria for the
program, maintaining the $50 reduction in co-pays as a reward
for participation. Separately, in late 2017, Prospect
announced that it would limit spousal eligibility for vision
and dental insurance to match the existing limitations in
place for medical insurance.
filed one grievance against Prospect for each of these three
actions. Those grievances were consolidated into a single
arbitration proceeding before an Arbitrator, when the parties
stipulated to resolution of two questions' "Did
[Prospect] violate the CBA when it made changes to the
employee medical, dental, and vision coverage and introduced
and changed a wellness plan? If so, what shall be the
remedy?" ECF 7 at 17.
arbitration, the Arbitrator found for UNAP on all three
counts. First, he concluded that the phrase "as
specified herein" introduced a degree of ambiguity into
Prospect's ability to change insurance coverage. ECF 1-2
at 26. He went on to conclude that the imposition of a $50
surcharge on employees not participating in the wellness
incentive program flouted Part 16.2's prohibition on
annual out-of-pocket cost increases more than $400 per year.
ECF 1-1 at 37, ECF 1-2 at 28. The Arbitrator next struck the
change to spousal insurance eligibility because, in his
estimation, it was impermissible for a third party to a CBA
to participate in changes to insurance coverage. ECF 1-2 at
30. In the alternative, he found that elimination of spousal
eligibility for vision and dental coverage was also invalid
because it did not comport with Part 16.2's requirement
of "substantially equivalent" benefits.
Id. at 31.
STANDARD OF REVIEW
judgment is warranted when there is no genuine issue as to
any material fact and the movant is entitled to judgment as a
matter of law. Fed.R.Civ.P. 56. The Court must look to the
record and view all the facts and inferences in the light
most favorable to the non-moving party. Audette v. Town
of Plymouth, 858 F.3d 13, 20 (1st Cir. 2017).
evaluating "cross-motions for summary judgment, the
standard does not change; [courts] view each motion
separately and draw all reasonable inferences in favor of the
respective non-moving party." Bonneau v. Plumbers
& Pipefitters Local Union 51 Pension Tr. Fund ex rel
Bolton, 736 F.3d 33, 36 (1st Cir. 2013) (quoting Roman
Catholic Bishop of Springfield v. City of Spring field, 724
F.3d 78, 89 (1st Cir. 2013)). The Court must determine
whether either party is entitled to judgment as a matter of
law based on the undisputed facts. Scottsdale Ins. Co. v.
Torres, 561 F.3d 74, 77 (1st Cir. 2009).
the First Circuit, there are two sources of authority to
vacate an arbitrator's award: statutory and common-law.
The first source of authority is the Federal Arbitration Act
at 9 U.S.C. ...