Adcox v. Teledyne, Inc.

21 F.3d 1381, 1994 WL 133480
Court of Appeals for the Sixth Circuit·Decided April 19, 1994·No. No. 93-3078·Published·Cited by 38 cases

Opinion

BOGGS, Circuit Judge.

A group of former Teledyne employees appeals the district court’s granting of summary judgment to defendants-appellees in the employees’ suit seeking lost welfare benefits and damages under both the Labor Management Relations Act (LMRA), 29 U.S.C. §§ 141 et seq., and the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001 et seq. For the reasons discussed herein, we affirm.

I

Plaintiffs-appellants are former employees of defendant Teledyne Monarch Rubber, a division of defendant Teledyne, Inc., and, while employed by Teledyne, were represented by defendants United Rubber, Cork, Linoleum and Plastic Workers of America International Union and its Local Union No. 99.. A collective bargaining agreement, which became effective January 1, 1988, and expired at midnight on June 15, 1991, governed the terms of their employment. Tele-dyne and the Union had also negotiated a Pension, Insurance and Service Award Agreement, which ran to June 15, 1985, but automatically renewed itself annually, unless either party gave notice of its desire to terminate the Service Award Agreement. The Service Award Agreement provided for service awards upon retirement and “special distribution” benefits on discontinuance of plant operations; the “special distribution” benefit functions essentially as severance pay.

In January 1991, Teledyne announced it would cease operations at its Hartville, Ohio, plant (where plaintiffs worked), sell the assets, and terminate the employees on June 15, 1991, the date when the labor agreement expired. Teledyne and the Union then engaged in “effects bargaining” from January through June 1991 to resolve the impact of the proposed closing on the employees. On April 5, Teledyne notified the Union that it desired to “terminate all agreements, including the Collective Bargaining Agreements, effective 12:01 a.m. the 16th of June, 1991.”

During these negotiations, the Union demanded that Teledyne provide the employees [1384]*1384with various benefits, including continuation of health insurance for eighteen months; immediate, unreduced early pension benefits for all employees regardless of the length of service; and “special distribution” benefits based on the Service Award Agreement. Teledyne agreed to continue medical insurance for fourteen months after closure, but declined to increase pension benefits or lower pension eligibility requirements, declined to pay to any employee a Service Award Agreement benefit, and informed the Union that retiree medical benefits would cease on June 15, 1991.

The Service Award Agreement provided for the special distribution to be calculated on the basis of an employee’s total earnings. The distribution was payable upon complete and permanent discontinuance of plant operations to each terminated employee with at least' five years of service who was “not eligible for a pension under any pension plan” of Teledyne and who was not eligible for a service award for retirement. At the time of termination, each plaintiff had at least five years of service and each was entitled to a deferred vested pension under Tele-dyne’s pension plan. During effects bargaining, the Union contended that “eligible for a pension” meant eligible for an immediate pension; Teledyne maintained that it meant eligible for any pension, including a deferred vested pension. Teledyne and the Union also disagreed as to whether the retiree medical benefit program was limited to the life of the collective bargaining agreement or to the life of each retiree.

As part of a tentative Plant Closing Agreement reached in early June 1991, Teledyne agreed to provide an immediate, lump-sum pension benefit option (thereby giving employees access to immediate cash); to pay the then-current premiums for a retiree medical program for the lifetime of each current retiree and each active employee who was eligible to begin receiving an immediate pension benefit on July 1, 1991, and who did not take the lump-sum pension benefit; to continue active employees’ health insurance for fourteen months or buy out that insurance on a lump-sum cash basis; and to increase the earnings permitted to recipients of certain pension benefits. The Union, as part of the compromise, agreed to a comprehensive release of claims, including a release concerning any Service Award Agreement benefits.

At Union meetings on June 14, June 15, and June 28, Union representatives explained to the employees the Plant Closing Agreement, including that there was substantial doubt whether the employees were entitled to the special distribution under the terms of the Service Award Agreement and that there was an equal chance of prevailing or losing in litigation. Dorothy Bixler, a union official and one of the plaintiffs-appellants, explained that if they received the special distribution it would be set off against their pension. The employees at the June 14 meeting voted not to ratify the Plant Closing Agreement. A subsequent telephone poll of employees showed that a majority of the employees contacted wanted another vote. However, at the June 28 meeting, held to decide whether there should be another vote, the majority voted against reconsideration of the agreement.

In July 1991, withdrawal cards were issued by the International to the members of Local No. 99, except to the officers. Members receiving such cards forfeit all rights and privileges in the Union. A withdrawal card is automatically issued to a terminated employee who has not applied for a dues waiver and enables the employee to have his membership rights and privileges restored if subsequently hired at another plant organized by the United Rubber Workers.

In early August, Teledyne increased its offer concerning the buy-out of health insurance from $500 to $600 for single coverage and from $1000 to $1200 for family coverage. The Union polled the membership through the use of postcards; a majority indicated that they wanted to reconsider the agreement. A vote by secret ballot was held on August 22,1991, and the majority ratified the Plant Closing Agreement. The Agreement was signed by the Union and Teledyne on August 26, effective retroactive to June 15, 1991. The Agreement has been fully implemented.

There is some dispute as to whether the Union constitution authorizes the procedures [1385]*1385used (i.e., postcard polling and secret ballot without a meeting). Plaintiffs also claim that many of the voters thought they were voting on Teledyne’s proposed changes, not the agreement as a whole; that the Union told them that if it were not approved, retirees would lose their health coverage, employees would not be able to get their vested pension money, and employees would not get their pension money at all if they insisted on receiving the special distribution; and that the Únion denied them additional information and an opportunity to debate and organize opposition to the plan. A protest to Local No. 99 was denied, as was a request for reconsideration. Appeals to the International were similarly denied, because the appellants were no longer members.

Plaintiffs filed suit in December 1991, alleging that Teledyne’s failure to pay the special distribution benefits was a breach of contract under § 301 of the LMRA and that the Union violated its duty of fair representation under § 9(a) of the LMRA (count I).

Free access — add to your briefcase to read the full text and ask questions with AI

Adcox v. Teledyne, Inc., 21 F.3d 1381, 1994 WL 133480 (6th Cir. 1994).

21 F.3d 1381 (Adcox v. Teledyne, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Ritter v. USPS
Virgin Islands, 2023
Winnett v. Caterpillar, Inc.
553 F.3d 1000 (Sixth Circuit, 2009)
Pfahler v. National Latex Products Co.
517 F.3d 816 (Sixth Circuit, 2007)
Tullis v. UMB Bank, N.A.
464 F. Supp. 2d 725 (N.D. Ohio, 2006)
Pfahler v. National Latex Co.
405 F. Supp. 2d 839 (N.D. Ohio, 2005)
Bauer v. RBX Corp
Sixth Circuit, 2004
Trull v. Dayco Products, LLC
214 F.R.D. 394 (W.D. North Carolina, 2003)
Gieger v. Unum Life Insurance Co. of America
213 F. Supp. 2d 813 (N.D. Ohio, 2002)
United States v. Hillman Housing Corp.
212 F. Supp. 2d 252 (S.D. New York, 2002)
Bond v. United Steel Workers of America
31 F. App'x 874 (Sixth Circuit, 2002)
Pratt v. National Postal Mailhandlers Union
25 F. App'x 166 (Fourth Circuit, 2002)
Smolinsky v. IUE-CWA Automotive Conference Board
179 F. Supp. 2d 808 (N.D. Ohio, 2002)
Williams v. Wci Steel Company, Inc.
170 F.3d 598 (Sixth Circuit, 1999)
Williams v. WCI Steel Co.
170 F.3d 598 (Sixth Circuit, 1999)
Quinn v. Police Officers Labor Council
572 N.W.2d 641 (Michigan Supreme Court, 1998)