MWA Arbitration Update

Breaking news on the MWA situation: There is a conference in federal court on Friday afternoon at 2:30 in the Benefit Funds matter (before Judge Stanton). The MWA will seek permission to amend its answer in the suit brought against it by the Funds (to restore full member benefit payments) by asking the court to allow it to sue the Funds and the District Council for millions of dollars (perhaps as much as $50 million).

In May 2012 we reported the MWA won in arbitration a lawsuit it brought against the District Council, having to do with a shady deal made in 2009 by Dennis Sheil, (former disgraced Vice President of the corrupt Forde administration) with a company called Gilbert Displays, Inc,  (an out-of-association contractor) that sets the wage and benefit package for journeymen employees at a rate lower than that in the July 1, 2007 - June 30, 2012 agreement with the MWA.

The Arbitrator (Rosemary A. Townley) found in favor of the MWA's arbitration claim, that its "most favored nations" clause entitles MWA employers to receive the same terms granted by the Gilbert/Sheil shady deal.

Starting in June, the MWA used that decision to unilaterally cut the hourly fringe benefit rates to all shop and outside installers to $10.94 (a position which the Funds has rejected and filed an action in federal court seeking a preliminary injunction).

In July at a hearing at the American Arbitration Association, the MWA claimed its damages were $59 million based on the Gilbert Displays deal. That is approximately $9 million more than the total assets of the District Council. The District Council made a 4 million cash settlement offer (no question asked) to end the arbitration, which the MWA rejected.

Among other things that occurred at the hearing, Review Office Dennis Walsh informed counsel for the District Council and the MWA that if any award was issued in the range of 14 to 59 million dollars he would make a Paragraph 12.i motion under the Stipulation and Order to preserve the District Council, allow it to meet its obligations under the Consent Decree and Stipulation and Order to end corruption and racketeering and protect the goals of the court orders from being impinged by this matter.

Importantly, after the question was raised by counsel for the District Council, the arbitrator indicated she would in fact like the question of the impact of the Decree and Stipulation and Order addressed in briefs which the District Council filed on September 28, (it is expected that no decision on damages will be rendered for a matter of weeks).