City of West Branch held that
decisions by an arbitrator, unlike decisions by a state court, should
not be given preclusive effect in subsequent § 1983 cases. However, as discussed
below, that holding has been drastically undermined by more recent
McDonald completed a trilogy of cases that
held that a collective bargaining agreement could not eliminate an
individual employee's right to go to federal court to assert federal
statutory rights. Before McDonald, the
Court had held that arbitration awards would not have preclusive
effect in subsequent Title VII actions or in subsequent FLSA minimum wage
suits. See Alexander v. Gardner-Denver Co.,1
Barrentine v. Arkansas-Best Freight System, Inc.,2
This trilogy was generally understood to hold that arbitration awards
should be given neither collateral estoppel nor res judicata effect.
(For a brief explanation of collateral estoppel and res judicata, click
here.) The trilogy
decisions stressed various arguments
against preclusion: that arbitrators' authority is limited to the
contract and they may lack expertise on statutory issues, that
arbitration may provide fewer procedural protections for the plaintiff,
and that the union—which controls
collectively bargained arbitrations—may
have interests that conflict with the interests of the plaintiff.
Alexander-Barrentine-McDonald trilogy has now been seriously
undermined (if not effectively overruled) by a series of cases beginning
with Gilmer v. Interstate/Johnson Lane Corp.,3 and culminating in
14 Penn Plaza LLC v.
Pyett Court reinterpreted
the three cases narrowly to hold that the particular federal court
statutory suits could proceed only because the language of the arbitration
clauses did not specifically authorize resolution of statutory claims.
As a result, it now appears that, if a collectively bargained
arbitration clause is sufficiently specific, it can require that
employees pursue their
§ 1983 cases before an arbitrator rather than in federal court.
The Court explicitly suggested that Alexander
(and by implication the rest of the trilogy) might be overruled.
As a result,
McDonald now stands at most for two more limited
principles: First, a prior arbitration award will not be given res
judicata effect (i.e., will not entirely bar a subsequent federal court
suit) unless the arbitration agreement explicitly requires that
statutory claims (such as ones under
§ 1983) be resolved through arbitration.
Second, if the federal suit is not entirely barred, a prior arbitration award will not be given
collateral estoppel effect, i.e., its factual findings may be
considered, but will not be binding, in a subsequent
§ 1983 suit in federal court.
the 1970's, West Branch, Michigan was a small community of fewer than
2,000 people with a police force of three officers. On November
25, 1976, West Branch Police Chief Paul Longstreet fired ten-year
veteran officer Gary McDonald (pictured at right). As
discussed below, the reasons for the firing were hotly contested in two
separate proceedings with two utterly inconsistent results: An
arbitrator found that McDonald was fired because
he had engaged
in sexual misconduct. A federal jury found that McDonald had been
fired because of First Amendment activity including complaining that
had engaged in sexual misconduct.
Relations between the Officer McDonald and the Chief had been troubled
for some time, heating up as McDonald became the spokesman for the local
union. They reaching a boiling point after McDonald and the other
officers reported to various city officials that a number of women had
complained that Chief Longstreet had engaged in sexual assault
misconduct. These reports led to an investigation by the Michigan
State Police. The officers complained to the City Manager that
Chief Longstreet was harassing and threatening them because of the
investigation. They also attempted to meet with the Mayor, but
were instead confronted by Chief Longstreet who again threatened
McDonald. The next day, the Chief and City Manager advised the
council that McDonald would be fired, and McDonald was notified of the
firing the following day.
McDonald claimed that he had been fired due to
First Amendment activities as a spokesman for the local union including
his reports of alleged misconduct by the Chief and his protests of
harassment for those reports. The City and the Chief, on the
other hand, claimed that McDonald had been fired for various reasons
including "Conduct unbecoming an officer" which was later amended to
allege that McDonald had committed a sexual assault. Prior to the
arbitration hearing, the City refused to inform McDonald date or
location of the alleged assault or the name of the alleged victim.
After a one day hearing, the arbitrator (a retired state court judge)
found that the assault had occurred and that it justified McDonald's firing. He
credited the testimony of the young woman and found that, during a
traffic stop, McDonald had fondled her and asked her to take off
her blouse. In doing so, the arbitrator
explicitly disbelieved McDonald's denial that the incident had occurred,
and upheld McDonald's discharge.
The subsequent federal trial was quite different in procedure and
outcome. The case was tried to a jury rather than to an
arbitrator. McDonald (rather than the union) was a party and
selected his own lawyer. In the arbitration, the union refused to
call a crucial corroborating witness, Louis Osten; in the federal trial,
Officer Osten testified that he was present with McDonald at the time of
the traffic stop and that McDonald neither touched the woman nor said
anything offensive to her. The jury, after hearing six days of
testimony as well as the findings of the arbitrator, found that Chief
Longstreet had fired McDonald for his union activities in
violation of his First Amendment rights, implicitly rejecting the
argument that he had been fired for misconduct. However,
it only awarded him $8,000.00 in damages.
The federal case was appealed to the United States Court of Appeals for
the Sixth Circuit reversed on the basis that the arbitration award
barred the subsequent
federal § 1983 suit. The Supreme Court reversed unanimously,
reinstating the judgment in favor of McDonald.
After being fired, Gary McDonald bought and ran Mac's
Place Restaurant for nineteen years. He died in 2014.