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

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

January 16, 2018

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

          ORDER DENYING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT [#12], GRANTING DEFENDANTS' MOTION TO AFFIRM ARBITRATOR'S AWARD [#13] and DISMISSING PLAINTIFF'S CAUSE OF ACTION

          Denise Page Hood Chief Judge, United States District Court

         I. INTRODUCTION

         In 2011, Defendants (collectively, “UAW”) filed suit against Plaintiff TRW Automotive U.S. LLC (“TRW”) regarding retiree benefits. See No. 11-14630. After the Court granted Plaintiff's motion to compel arbitration in that case, the parties appeared before Arbitrator Michael Long of the American Arbitration Association Voluntary Labor Arbitration. On April 18, 2013, Arbitrator Long released his arbitration decision, wherein he concluded that TRW breached the parties' collective bargaining agreement (“CBA”). In the 24-page decision, Arbitrator Long granted the following relief (collectively, the “Arbitration Award”):

In formulating a remedy it is recognized that the hospital-medical-surgical plan existing prior to January 1, 2012 was offered to the retirees and, as far as can be determined by the record, accepted by the retirees. Therefore, it is that plan which must be considered as agreed upon as the existing iteration of the coverage required pursuant to the retirees' vested right under Paragraph 32.1 et seq. TRW shall restore coverages granted to retirees, their spouses and eligible dependents according to the hospital-medical-surgical plan in effect immediately before the January 1, 2012 change.
TRW shall make retirees, eligible dependents, surviving spouses whole for all expenses, costs, fees, and losses incurred as a result of the TRW's breaches and violations, and shall take immediate 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 promptly reimburse those "make whole" amounts, with interest, and TRW shall maintain promised and vested health insurance for the lifetimes of the retirees and their dependents and surviving spouses[.]
Pursuant to Paragraph 4.4 of the CBA, each party shall bear the expense of its own representatives; and all other expenses of the arbitration, if any, shall be shared equally by the parties. The expenses of the impartial arbitrator, if any, shall be shared and paid equally by the parties.

         [No. 11-14630, Dkt. No. 1, PgID 153-54]

         On May 15, 2013, TRW filed the instant cause of action, wherein it asks the Court to vacate that part of the Arbitration Award that requires TRW to “restore coverages granted to retirees, . . . according to the hospital-medical-surgical plan in effect immediately before the January 1, 2012 change” in healthcare coverage from the Humana plan to Health Reimbursement Accounts (“HRAs”). TRW filed a motion for summary judgment, and UAW filed a cross-motion seeking to affirm the Arbitration Award. The motions have been fully briefed and a hearing was held regarding the motions. For the reasons that follow, TRW's Motion for Summary Judgment is denied, UAW's Motion to Affirm Arbitrator's Award is granted, and TRW's cause of action is dismissed.

         II. BACKGROUND

         The following facts constitute the basis upon which the Arbitration Award was issued.

         On October 21, 2011, UAW (including retirees Martin Lamer, John Yasso, Kim Taskila, and Ronald Gardner) filed an action on behalf of the individual plaintiffs and those similarly-situated against 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.” [No. 11-14630, Dkt. No. 1, Compl. at 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.”

         In 2005, UAW and TRW negotiated the last of a series of CBAs. 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; an agreement was not reached. On September 14, 2011, TRW stated by letter that, effective January 1, 2012, it would discontinue providing Medicare-eligible retirees and surviving spouses healthcare but instead provide Health Reimbursement Accounts 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 ...

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