February 22, 2017
from the United States District Court for the Northern
District of Illinois, Eastern Division. No. 14 C 2017 - Jorge
L. Alonso, Judge.
Bauer and Williams, Circuit Judges, and DeGuilio, [*] District Judge.
Olson, Inc. ("Sullivan Olson"), which is now
Cremation Society of Illinois, Inc., filed suit against the
International Brotherhood of Teamsters Local No. 727
("the Union"), under Section 301 of the Labor
Management Relations Act ("LMRA"), 29 U.S.C. §
185(a), seeking a declaration that it had properly repudiated
and was no longer bound by the collective bargaining
agreement with the Union. The Union counterclaimed for a
confirmation of an arbitration award and to compel
arbitration pursuant to the LMRA and the Federal Arbitration
Act, 9 U.S.C. §§ 4 and 6. It also filed a
third-party complaint against Cremation Society. The district
court ruled in the Union's favor on cross-motions for
summary judgment. Cremation Society appeals the district
court's rulings. For the following reasons, we affirm.
Olson operated a funeral home known as Olson Burke/Sullivan
Funeral & Cremation Center ("OBS") in Chicago,
Illinois, until it was purchased by Cremation Society on
December 31, 2013, merged into Cremation Society in April
2014, and ceased to exist as an entity thereafter. The
Company's President and sole shareholder was Gerald
Sullivan. Sullivan is also the President and one of two
shareholders of Cremation Society (the other shareholder
being his wife). Cremation Society also conducts business in
the funeral services industry under the name OBS, and has
nine other locations in northern Illinois.
Union is a labor organization affiliated with the
International Brotherhood of Teamsters. Sullivan Olson's
relationship with the Union began after a settlement stemming
from an unrelated lawsuit brought by the trustee of the
Union's benefit funds. The Union's bargaining
relationship with Cremation Society terminated in 2007.
Compliance Agreement and Collective Bargaining
October 7, 2003, Sullivan Olson executed a Compliance
Agreement, binding it to the terms and conditions of the
Union's collective bargaining agreement ("CBA")
with the Funeral Directors Services Association of Greater
Chicago ("FDSA"). The Compliance Agreement provided
that it would remain in effect until June 30, 2007, and from
year to year thereafter. However, it could be terminated by
either party upon written notice to the other at least 60
days prior to June 30 of 2007, or any subsequent year.
between the Union and the FDSA recognized that the Union was
the exclusive collective bargaining agent for all employees
performing "bargaining unit work." As defined in
the CBA, "bargaining unit work" is "the
performance of embalming, whether in training or licensed,
funeral directing, whether training or licensed, and auto
livery chauffeur services." The definition also
explicitly includes "removals, transportation of
remains, embalming, funeral directing and all other work
historically done by the bargaining unit."
19 of the CBA set out a grievance and arbitration procedure
for "[a]ny complaint, grievance or dispute arising under
or concerning the meaning, application, or compliance with
the terms of this Agreement between the Employer and the
Union and/or an employee." This article provides that,
if the employer cannot resolve the dispute in two required
meetings, then the grievance may be referred to the Grievance
Board ("Board"), which is made up of three
individuals selected by the FDSA and three individuals
selected by the Union. The Board is required to conduct a
hearing and render a decision on the referred grievance. If
the Board fails to hold a hearing or issues a split decision,
the Union or employer may submit the matter to arbitration.
Either a majority decision of the Board or a decision of the
arbitrator is final and binding upon the parties.