Hargrove v. Eaglepicher Corp.

852 F. Supp. 2d 851, 2012 WL 1142268, 2012 U.S. Dist. LEXIS 53687
CourtDistrict Court, E.D. Michigan
DecidedApril 4, 2012
DocketCase No. 2:10-cv-10946
StatusPublished

This text of 852 F. Supp. 2d 851 (Hargrove v. Eaglepicher Corp.) is published on Counsel Stack Legal Research, covering District Court, E.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hargrove v. Eaglepicher Corp., 852 F. Supp. 2d 851, 2012 WL 1142268, 2012 U.S. Dist. LEXIS 53687 (E.D. Mich. 2012).

Opinion

ORDER GRANTING SUMMARY JUDGMENT AND PERMANENT INJUNCTION

ARTHUR J. TARNOW, District Judge.

Pursuant to plaintiffs’ motion for summary judgment and permanent injunction (docket 16) and the other papers filed regarding that motion (docket 26, 28, and 31), pursuant to the March 21, 2012 hearing addressing the motion, and the Court having considered the papers, evidence, and viewpoints presented by the parties and being otherwise advised, the motion is granted for the reasons stated on the record at the hearing and as summarized in the findings of fact and conclusions of law below. Judgment shall be entered for plaintiffs, and defendant shall be permanently enjoined as follows.

A. Background

1. Plaintiffs Frank Hargrove Jr. and Richard White are retirees and former employees of defendant EaglePicher. They worked at EaglePicher’s now-closed Wolverine Gasket plant in Inkster, Michigan where they were members of the collective bargaining unit represented by plaintiff International Union, United Automobile, Aerospace, and Agricultural Implement Workers of America (UAW). EaglePicher and UAW were parties to various collective bargaining agreements (“CBAs”) promising retirement healthcare benefits.

2. Plaintiffs Hargrove and White sue for themselves and for a similarly-situated class of approximately 22 retirees and retirees’ family members and surviving spouses. The class sues under Section 301 of the Labor-Management Relations Act (LMRA), 29 U.S.C. § 185, and Section [853]*853502(a) of the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1132(a). UAW sues under LMRA Section 301.

3. The class was certified. (Docket 34). It consists of: All former EaglePicher/Wolverine Gasket employees who were members of the UAW-represented collective bargaining unit at EaglePicher’s now-closed Wolverine Gasket plant in Inkster, Michigan who are eligible under collective bargaining agreements and welfare benefit plans for company-provided retirement healthcare, and all eligible surviving spouses and other eligible dependents of those retirees.

4. The lawsuit challenges defendant’s modification of collectively-bargained retirement healthcare benefits, defendant’s imposition on retirees and dependents of added risk and expense, defendant’s planned imposition of premium costs on retirees and their family members and surviving spouses, defendant’s planned termination of all company-paid retirement healthcare, and defendant’s assertion of a right to unilaterally modify and terminate the promised healthcare in the future.

5. EaglePicher promised to provide company-paid lifetime retirement healthcare in the various CBAs governing class members. For example, in Appendix “F” of the August 1, 2002-July 31, 2005 CBA, the last EaglePicher-UAW CBA in effect at the time of the 2003 closing of the Wolverine Gasket plant, EaglePicher promised that “upon retirement” employees with 20 or more years of service as of August 1, 1993 “will receive full medical benefits for life under the guideline of the current retiree medical benefit plan, at no premium cost to the employee.” Appendix “F” also is in the 1993-1996, 1996-1999, and 1999-2002 CBAs between EaglePicher and UAW. Earlier CBAs contain similar promises. For example, the 1984-1990 EaglePicher-UAW CBA promises that EaglePicher “will pay the full cost” of healthcare “for retired employees” and “for the surviving spouse of a retired employee.”

6. In addition, EaglePicher is the employer-“sponsor” and “administrator” of the ERISA-regulated, collectively-bargained “employee welfare benefit plan” that it operates to “provide healthcare benefits for UAW-represented retirees, including the individual plaintiffs and others similarly-situated and their spouses and surviving spouses and other eligible family members.” (Ans. ¶¶8-9, 12-13, 39 — 41).

7. EaglePicher provided the retirees and other class members with the promised healthcare from the retirees’ various retirement dates until January 1, 2010. As EaglePicher correspondence put it in 2009, EaglePicher provided the promised coverage “without any changes to benefits or costs [to retirees] for more than twenty years.”

8. EaglePicher wrote to “EaglePicher Retirees with Medical Coverage” in 2009 announcing “changes to the health coverage you have been receiving as an eligible EaglePicher retiree.” On January 1, 2010, EaglePicher unilaterally reduced benefits and imposed greater expense and risk on covered persons. For example, until January 2010, covered persons paid $2 per-prescription co-payments. Under the unilaterally-imposed 2010 plan for retirees and family members 65 and over, covered persons were required to co-pay 15%, 25%, or 35% of prescription costs, up to $4,550 annually, and after reaching that annual limit, they still would be required to pay 5% co-payments for prescriptions, without any limit.

9. EaglePicher announced in 2009, too, that it planned “to begin charging for retiree health coverage” beginning on January 1, 2011. EaglePicher announced that this “cost-sharing” would be implemented [854]*854in “phases.” Retirees and covered family members would be obligated to pay 20% of premium costs in 2011, 40% in 2012, 60% in 2013, 80% in 2014, and “100% of the cost of coverage in 2015 and thereafter.” EaglePicher notified retirees in November 2010, however, after this lawsuit was filed, that they “will not be required to contribute towards the premium cost for 2011.” Nevertheless, EaglePicher asserted in 2011 that retirement healthcare benefits were “subject to change at any time,” that the company had the “unlimited right to make benefit plan changes at any time,” and that any changes would be “effective regardless of whether notice has been given” to retirees.

10. Plaintiffs sued on March 9, 2010, challenging defendant’s unilateral changes, the added expense and risk imposed by defendant on retirees and dependents, defendant’s planned imposition of premium costs on retirees and dependents, defendant’s planned termination of all company-paid healthcare, and defendant’s assertion of the right to unilaterally modify and terminate retirement healthcare.

11. Plaintiffs asked the Court to grant summary judgment in their favor, to declare defendant in breach of CBA and in violation of ERISA, and to issue its permanent injunction (1) restraining defendant from imposing premium costs; (2) barring defendant from discontinuing full company funding of retirement healthcare; (3) directing defendant to restore the status quo ante by promptly reinstating and permanently maintaining the lifetime healthcare benefits that were in effect before the January 1, 2010 and later changes; and (4) directing defendant to promptly make whole class members for expenses incurred due to defendant’s CBA and ERISA violations. (Docket 16 and 28). Defendant responded. (Docket 26 and 31). The Court heard the parties on these matters on March 21, 2012. The Court granted plaintiffs’ motion for the reasons stated from the bench at the hearing and as set out in this order.

B. Conclusions of Law

12. Collectively-bargained retirement healthcare promises are enforceable under LMRA Section 301. See e.g., UAW v. Yard-Man, Inc.,

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

Related

Noe v. PolyOne Corp.
520 F.3d 548 (Sixth Circuit, 2008)
Schreiber v. Philips Display Components Co.
580 F.3d 355 (Sixth Circuit, 2009)
Winnett v. Caterpillar, Inc.
553 F.3d 1000 (Sixth Circuit, 2009)
Reese v. CNH AMERICA LLC
583 F.3d 955 (Sixth Circuit, 2009)
Cole v. ArvinMeritor, Inc.
549 F.3d 1064 (Sixth Circuit, 2008)
Reese v. CNH AMERICA LLC
574 F.3d 315 (Sixth Circuit, 2009)
Golden v. Kelsey-Hayes Co.
954 F. Supp. 1173 (E.D. Michigan, 1997)
Cole v. ArvinMeritor, Inc.
516 F. Supp. 2d 850 (E.D. Michigan, 2005)
McCoy v. Meridian Automotive Systems, Inc.
390 F.3d 417 (Sixth Circuit, 2004)
Yolton v. El Paso Tennessee Pipeline Co.
435 F.3d 571 (Sixth Circuit, 2006)
Golden v. Kelsey-Hayes Co.
73 F.3d 648 (Sixth Circuit, 1996)
Industrial Bank, N.A. v. City Bank
127 S. Ct. 555 (Supreme Court, 2006)

Cite This Page — Counsel Stack

Bluebook (online)
852 F. Supp. 2d 851, 2012 WL 1142268, 2012 U.S. Dist. LEXIS 53687, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hargrove-v-eaglepicher-corp-mied-2012.