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International Union, United Automobile, Aerospace and Agricultural, Implement Workers of America (UAW) v. TRW Automotive U.S. LLC

United States District Court, E.D. Michigan, Southern Division

January 16, 2018

INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL, IMPLEMENT WORKERS OF AMERICA (UAW), MARTIN LAMAR, JOHN YASSO, KIM TASKILA, and RONALD GARDNER, Plaintiffs,
v.
TRW AUTOMOTIVE U.S., LLC, Defendant.

          ORDER: (1) DENYING WITHOUT PREJUDICE PLAINTIFFS' MOTION FOR ATTORNEY FEES [#33]; (2) GRANTING PLAINTIFFS' RENEWED MOTION FOR SUMMARY JUDGMENT [#39]; (3) DENYING DEFENDANT'S MOTION TO STRIKE RENEWED MOTION FOR SUMMARY JUDGMENT [#44]; AND (4) GRANTING PLAINTIFFS' MOTION TO MAKE WHOLE [#56]

          DENISE PAGE HOOD, CHIEF JUDGE, UNITED STATES DISTRICT COURT

         I. INTRODUCTION

         This matter involves retiree benefits that arise under a collective bargaining agreement. Now before the Court are four motions:

A. Plaintiffs' Motion for Attorney Fees;
B. Plaintiffs' Renewed Motion for Summary Judgment;
C. Defendant's Motion to Strike Renewed Motion for Summary Judgment (“Motion to Strike”); and
D. Plaintiffs' Motion to Enforce Arbitration Award with “Make Whole” Amounts to Individual Retirees (“Motion to Make Whole”).

         For the reasons stated below, the Court: (1) denies without prejudice Plaintiffs' Motion for Attorney Fees; (2) grants Plaintiffs' Renewed Motion for Summary Judgment; (3) denies Defendant's Motion to Strike; and (4) grants Plaintiffs' Motion to Make Whole.

         II. STATEMENT OF FACTS

         On October 21, 2011, Plaintiffs International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (“UAW”), Martin Lamer, John Yasso, Kim Taskila, and Ronald Gardner filed the present action on behalf of the individual plaintiffs and those similarly-situated against Defendant TRW Automotive U.S. LLC (“TRW”) “to enforce rights to lifetime retirement healthcare benefits and coverage, including prescription drug, dental, vision, and hearing benefits, under collective bargaining agreements (“CBAs”) and employee welfare plans.” [Dkt. No. 1, Compl. at PgID 1] Martin Lamer began working for the Sterling Heights TRW facility in 1976 and retired in 2006. John Yasso began working for the Sterling Heights TRW facility in 1972 and retired in 2002. Kim Taskila began working at the Sterling Heights TRW facility in 1972 and retired in 2002. Ronald Gardner began working for the Sterling Heights TRW facility in 1960 and retired in 1997. The proposed class consists of “all persons who retired from TRW at its Sterling Heights plant, including the retirees' dependents and surviving spouses, who are eligible to receive retirement healthcare under the CBAs, excluding any retirees, dependents, and surviving spouses who have legally released their rights to such claims.” [Dkt. No. 1, Compl. at ¶ 20]

         In 2002, UAW and TRW negotiated the last of a series of CBAs. Pursuant to the 2002 CBA, retirees were covered by healthcare insurance through Blue Cross Blue Shield and retirees paid a portion of the costs (in the form of premiums, deductibles and/or co-pays) associated with that healthcare coverage. On August 17, 2005, TRW announced that it planned to close the Sterling Heights facility. The parties agreed to extend the final CBA, dated August 6, 2002, until an agreement regarding the closing of the Sterling Heights facility, but an agreement was not reached. In 2007, TRW began providing Sterling Heights retirees with group health insurance through Humana that imposed no deductibles or co-pays. On September 14, 2011, TRW notified Plaintiffs by letter that, effective January 1, 2012, it would discontinue providing Medicare-eligible retirees and surviving spouses the existing healthcare insurance and instead provide Health Reimbursement Accounts (“HRAs”) for retirees that would be funded at TRW's discretion.

         The relevant CBA provides the following grievance procedure:

4.1 Exclusive Remedy. The Union and the employees agree that the grievance and arbitration procedures provided herein are adequate to provide a fair and final determination of all grievances which may arise out of the employment relationship during the term of this Agreement and that such procedures shall be the exclusive remedy for the enforcement by them of any claim against the Company. Nothing contained herein, however, shall preclude an employee covered by this Agreement from filing a charge of illegal discrimination with the Equal Employment Opportunity Commission.
4.1.1 Grievance Denied. A grievance is any complaint, dispute or controversy in which an employee or the Union claims that the Company has failed to carry out a provision of the Agreement and which involves a question concerning the interpretation or application of or compliance with this Agreement, including any question relating to rates of pay, hours of work and other conditions of employment of any employee.
4.1.2 Interpretations-Final and Binding. Any interpretation of this Agreement agreed upon by the Company and the shop committee shall be final and binding upon any person involved or affected.
4.1.3 Union Sole and Exclusive Representative. With respect to the processing, disposition, and/or settlement of any grievance initiated under the grievance procedure of this Agreement, and with respect to any court or administrative action or procedure alleging a claim arising out of the employment relationship, the Union shall be the sole and exclusive representative of the employee or employees covered by this Agreement. The disposition or settlement by and between the Company and the Union of any grievance or other matter shall constitute a full and complete settlement thereof and of related matters and shall be final and binding upon the Union and its members, the employee or employees, the Company and all persons involved or affected.
4.1.4 Appeal-Internal Union Remedy. There shall be no appeal of an employee from any settlement of any grievance or other matter nor from the decision or award of an impartial arbitrator. The Union will discourage any attempt of its members, and will not encourage or cooperate with any of its members, in any appeal to any court or administrative agency. Nothing in this Paragraph 4.1 shall be construed to prevent an employee from pursuing his internal Union remedies in accordance with the International Constitution of the Union.
4.1.5 Claims-Union Representative. No. employee or other person shall have any right under this Agreement in any claim, proceeding, action or otherwise on the basis, or by reason, of any claim that the Union or any Union prosecution or settlement of any grievance or other matter as to which the Union or any Union representative has authority or discretion to act or not to act under the terms of this Agreement.

         On January 25, 2012, Defendant TRW filed a Motion to Compel Arbitration. [Dkt. No. 8] On January 30, 2012, Plaintiffs' filed their Motion for Summary Judgment and Permanent Injunctive Relief. [Dkt. No. 9] On September 30, 2012, the Court entered an Order: (a) granting Defendant's Motion to Compel Arbitration; (b) denying without prejudice Plaintiffs' Motion for Summary Judgment and Permanent Injunctive Relief; and (c) dismissing the case without prejudice. [Dkt. No. 26] In that Order, the Court stated that “[a]ny party may file a motion to reopen the case after the arbitration has concluded.” Judgment was entered in favor of the Defendant against Plaintiffs. [Dkt. No. 27]

         On October 2, 2012, Plaintiffs filed a Notice of Appeal. [Dkt. No. 28] About the same time, the parties submitted their dispute to arbitration. On April 18, 2013, Arbitrator Michael Long of the American Arbitration Association Voluntary Labor Arbitration released the arbitration decision for this case. In a 24-page decision, Arbitrator Long identified each of the issues that Plaintiffs presented. Specifically, he stated that Plaintiffs asked him to:

1. Declare that by terminating retirement health insurance, and by substituting individual health retirement accounts for the health insurance subject to TRW's self-declared “right to amend or terminate” those accounts, TRW breached the governing CBAs and the ERISA-regulated health insurance plan, violated ERISA, and breached its fiduciary duties, and
2. Declare that TRW is liable, for those breaches and violations, and
3. Direct TRW to cease its CBA breaches and ERISA violations and to rectify those breaches and violations (A) by restoring the status quo ante, and (B) by making retirees, dependents, surviving spouses, and UAW whole for all expenses, costs, fees, and losses incurred as a result of the TRW's breaches and violations, and
4. Direct TRW to take suitable action to ensure full and prompt “make whole” relief, including gathering the information necessary to quantify “make whole” amounts from its records and from the records of the retirement benefits administrators employed and directed by TRW, and to fully and ...

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