Maurer v. Joy Technologies, Inc., PLAINTIFFS-APPELLEES

• Citation: 212 F.3d 907
• Decision Date: 15 December 1999
• Docket Number: V,98-4029,CROSS-APPELLEE,Nos. 98-3964,CROSS-APPELLANT,PLAINTIFFS-APPELLEES,DEFENDANT-APPELLANT,s. 98-3964
• Parties: (6th Cir. 2000) DONALD H. MAURER; LESLIE T. JOHNSON; WARREN H. REES; WILLIAM POMPEY; FLOYD F. GLADMAN; UNITED STEELWORKERS OF AMERICA,/JOY TECHNOLOGIES, INC.,/ Argued:
• Court: United States Courts of Appeals. United States Court of Appeals (6th Circuit)

Page 907

212 F.3d 907 (6th Cir. 2000)

DONALD H. MAURER; LESLIE T. JOHNSON; WARREN H. REES; WILLIAM POMPEY; FLOYD F. GLADMAN; UNITED STEELWORKERS OF AMERICA, PLAINTIFFS-APPELLEES/ CROSS-APPELLANTS,

V.

JOY TECHNOLOGIES, INC., DEFENDANT-APPELLANT/ CROSS-APPELLEE.

Nos. 98-3964, 98-4029

UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT

Argued: December 15, 1999

Decided and Filed: May 12, 2000

Appeal from the United States District Court for the Northern District of Ohio at Cleveland. No. 94-02015--Patricia A. Gaughan, District Judge. [Copyrighted Material Omitted]

[Copyrighted Material Omitted] Melvin P. Stein, United Steelworkers OF America, Pittsburgh, Pennsylvania, for Appellees.

David P. Bertsch, Buckingham, Doolittle & Burroughs, Akron, Ohio, Chris J. Trebatoski, Mitchell W. Quick, Michael, Best & Friedrich, Milwaukee, Wisconsin, for Appellant.

Before: Ryan and Norris, Circuit Judges; Feikens, District Judge.^*

OPINION

Alan E. Norris, Circuit Judge

Plaintiffs are the United Steelworkers of America union and several retirees formerly employed by defendant, Joy Technologies, Inc. ("Joy"). After Joy changed plaintiffs' retiree health benefit plans, plaintiffs filed suit alleging violations of § 301 of the Labor-Management Relations Act of 1947 ("LMRA"), 29 U.S.C.A. § 185 (West 1998), § 502(a)(1)(B) and (a)(3) of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C.A § 1132(a)(1)(B) and (a)(3) (West 1999), and the doctrine of promissory estoppel. Plaintiffs' complaint was based on their claim that their benefits were vested and could not unilaterally be altered by Joy. The district court granted summary judgment to those plaintiffs that had retired prior to August 19, 1991, on the LMRA and ERISA claims. Summary judgment was granted to Joy against those plaintiffs retiring after August 19, 1991, under the LMRA, ERISA, and promissory estoppel claims. Plaintiffs' motion for attorneys' fees was denied. On appeal, Joy challenges the judgment against it on the LMRA and ERISA claims. On cross-appeal, plaintiffs challenge the summary judgment against those plaintiffs retiring after August 19, 1991, and the district court's denial of attorneys' fees. For the following reasons, the district court is affirmed.

I.

Joy operates an industrial fan manufacturing plant in New Philadelphia, Ohio. Plaintiffs are former Joy employees who were represented by the United Steelworkers of America union ("the union") while active employees. The union served as the collective bargaining representative for the production and maintenance ("P&M") and clerical employees. The employment terms of these groups of workers were jointly negotiated (and the employee units were merged in 1980), but separate agreements were produced. The parties agree that the P&M and clerical units were given the same benefits under the collective bargaining agreements ("CBAs"); therefore, this court will discuss the CBAs for both units as if they were one.

Every three years, the parties negotiated a new CBA. One of the features of the CBAs was a provision for retiree benefits. The question in this case is whether, in the CBAs, the parties intended the retirement benefits either to vest as lifetime benefits or to terminate at the end of the three-year term of the CBA granting the benefits. The relevant provisions are as follows:

1974

In 1974, the CBA contained the following relevant provisions: Pensions, Group Insurance and Supplemental Unemployment Benefits. . . .

A group insurance agreement is contained in a separate document.

For pensioners and spouses, age 65 or over, who are now covered by the Group Insurance Program, the Company will make available a Medicare Supplemental Insurance Program. The cost is to be paid entirely by the pensioner and will be deducted from his pension check upon submission of an appropriate written authorization.

For pensioners and spouses under age 65, the retiree Group Insurance Programs in effect on September 1, 1974 will be continued until replaced by a new program on September 1, 1975.

Previous Agreements. This [CBA] when signed shall supersede all previous supplements and agreements made between the parties except as provided for under the terms of this [CBA].

Termination Date. The basic [CBA], the Pension Agreement, the Group Insurance Agreement, and the Supplemental Unemployment Benefit Agreement, shall remain in full force and effect until midnight August 31, 1977.

At least (60) days prior to August 31, 1977, either party may give notice to the other party of its desire to negotiate with respect to the terms and conditions of a new Agreement, including the terms and conditions of new Pension, Insurance, and Supplemental Unemployment Benefit Agreements. If the parties shall not agree on the terms and conditions of such new agreements by midnight August 31, 1977, either party may thereafter resort to strike or lockout . . . .

A Memorandum of Agreement was also executed by the parties in 1974. It contains the following pertinent language:

Retiree's Insurance.

1. Effective September 1, 1975, for employees who retire on or after August 31, 1974 . . .

a. The Company will establish a group insurance program to provide hospital benefits and physicians' service benefits coverage . . . for pensioners (and their eligible dependents) who are not eligible for Medicare . . . .

c. The Company will pay the cost of such program coverage.

d. Participation in such program in the case of pensioner . . . shall terminate when such person first becomes eligible for Medicare.

Finally, the 1974 Insurance Certificate contains the following relevant provisions:

Section 13. Insurance after Retirement.

FOR EMPLOYEES WHO ELECT THE ACCIDENT AND HEALTH RETIREMENT PLAN EFFECTIVE PRIOR TO SEPTEMBER 1, 1975. . . . A retired Employee not eligible for Medicare may continue his [hospital, surgical, laboratory and x-ray and major medical] Insurance for himself and his spouse, with the retired Employee paying the full premium for these coverages.

ACCIDENT AND HEALTH PLAN FOR QUALIFIED RETIREES RETIRING ON OR AFTER SEPTEMBER 1, 1975, AND THEIR QUALIFIED DEPENDENTS. The following shall be applicable to retired employees . . . who are not eligible for Medicare and are classified as:

1. Employees who retire on or after August 31, 1974 . . . .

Section 14. MEDICARE SUPPLEMENT. . . . (2) On and after the date on which an employee or dependent becomes eligible for benefits under Medicare, he shall not be eligible or insured under this Policy for any coverage providing benefits for Hospital, Surgical, Laboratory and X-Ray Expenses or Major Medical Expense Insurance. . . . The following benefits serve as a "Medicare Supplement" . . . [at a monthly cost to the employee of $5.00].

Termination. 1. This Agreement, and the Group Insurance Plan established hereunder shall remain in effect without change until midnight, August 31, 1977.

1978

The 1978 CBA and Insurance Certificate were essentially the same as those of 1974. The 1978 Memorandum of Agreement did not refer to any changes in retiree health insurance benefits.

1980

The 1980 CBA contained the same Termination and Previous Agreements clauses. The following Pensions, Group Insurance and Supplemental Unemployment Benefits clause was also contained in the CBA:

For pensioners and spouses, age 65 and over, who are now covered by the Group Insurance Program, the Company will make available and pay for a Medicare Supplemental Insurance Program.

For pensioners and spouses under age 65, the retiree Group Insurance Programs in effect on September 1, 1975, as outlined in the Certificate of Insurance, will remain in effect.

The 1980 Memorandum of Agreement stated that Joy would pay the full Medicare Supplement cost for all then-current retirees and those retiring under the 1980 CBA.

1983

The 1983 CBA contained relevant language identical to the 1980 CBA. In 1983, however, an Insurance Certificate was not prepared.

1986

The 1986 CBA was identical in all relevant respects to those of 1980 and 1983. The 1986 Memorandum of Agreement indicates that there would be a change in the Medicare Supplement deductible for those retiring after September 1, 1986. Also in 1986, an Employee Benefits Plan booklet (formerly the Insurance Certificate) was issued with the following provision:

Termination of the Plan. Joy Manufacturing Company reserves the right to terminate, suspend, withdraw, amend or modify the Group Health Care Benefits Plan in whole or in part at any time.

The booklet contained a clause stating that "[b]enefits provided during retirement are described in a separate booklet." Plaintiff presented evidence suggesting that the booklet was not distributed to retirees and that no separate booklet describing retirement benefits was created.

1989

In 1989 the CBA was the same in relevant respects as those of the previous three agreements. In addition, a handbook was prepared entitled "Your Benefits Handbook -- Hourly and Salaried Bargaining Employees." Plaintiffs presented evidence that this handbook was not distributed to retirees until August 1991. It contained the following provision:

Amendments. Joy reserves the right to amend or terminate any of the plans. The right to amend includes the right to curtail or eliminate coverage for any treatment, procedure, or service regardless of whether you are receiving treatment for an injury, illness, or disease contracted prior to the effective date of the amendment.

A supplement entitled "Health Care Coverage After Retirement," sent with a letter dated August 19, 1991, contained the following language:

Plan Changes. This insert summarizes your current retiree health care coverage. However, since no one can predict the future, Joy reserves the right to make changes or terminate these Plans.

In March 1993, Joy sent letters to plaintiff retirees (who had retired under the 1974 through the 1989 CBAs), announcing a new cost-sharing...