Asmus v. Pacific Bell
| Decision Date | 23 October 1998 |
| Docket Number | No. 97-16236,97-16236 |
| Citation | 159 F.3d 422 |
| Parties | 98 Cal. Daily Op. Serv. 7952, 98 Daily Journal D.A.R. 11,047 Craig ASMUS, William J. Vasquez; Pacific Telesis Group Management Force Allocation Plan, and/or the Pacific Telesis Group Surplus Management Severance Plan aka MFAP; Phylyss Apel; Gloria Alas; Eldridge Aubrey; James Banks; Areleen Castille; Barbara Clark; John Gary Eidell Jr.; Margaret Emerick; Juanita Evans; Jeffrey E. Fulton; Camille Galyk; Norman Garcia; Gary Guardineer; Kenneth Hornback; Jerome Kahle; Rosalyn Kelsay; Jeannie M. King; Stephen H. Lawyer; Kathy Maltese; Leslie J. Mamuzich; Nancy R. Magdelano; Garvis Martin; Diane McGregor; Louise McKay; Dottie Orcutt; Lucille Overby; Lisa Perla; Carolyn Pollard; Diane Price; Lorene Reed; Patricia Reta; Cora Riddle; Margarita Romero; Marilyn Schmitter; Denise C. Shann; Susan Sollauer; Ronald Stephenson; Kathy M. Strok; Barbara Swanson; James Swenson; Stephen Taylor; Charles Van Buren; Varol Wiederofeft; Carolyn J. Castillo; Michael F. Coyne; Donna Critzer; Diane Dixon; Irene Garcia; James E. Gillard; Emily Higuera; Tony Jones; Lonnie Keces; John Kelley; Patricia L. Kowatsch, Susan Lasken; Paulette Mamuzich; Paulette Mitchell; Frank Nuanez; Patricia Rendon; William J. Vasquez, Plaintiffs-Appellees, v. PACIFIC BELL; Pacific Telesis Group, Defendants-Appellants. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Appeal from the United States District Court for the Northern District of California; Claudia Wilken, District Judge, Presiding. D.C. No. CV-96-00067-CW/FSL.
Before: T.G. NELSON, THOMAS and SILVERMAN, Circuit Judges.
We certify the following question to the Supreme Court of California all as set forth in the attached request:
Once an employer's unilaterally adopted policy--which requires employees to be retained so long as a specified condition does not occur--has become a part of the employment contract, may the employer thereafter unilaterally rescind the policy, even though the specified condition has not occurred?
We stay all further proceedings in the district court and this court pending receipt of the answer to the certified question. If the Supreme Court of California declines certification, we will resolve the issue according to our perception of California law.
The clerk of the court is hereby directed to transmit forthwith, under the official seal of the Ninth Circuit, a copy of this order, the attached Request for Certification, and copies of all briefs and excerpts of record submitted to this court to the Supreme Court of California. This case is withdrawn from submission until further order of the court.
Pursuant to Rule 29.5 of the California Rules of Court, a panel of the United States Court of Appeals for the Ninth Circuit, before which this appeal is pending, hereby certifies to the Supreme Court of California a question of contract law about which the California appellate courts provide no controlling precedent. The answer to the certified question will be determinative of part of this appeal. We respectfully request that the Supreme Court of California answer the certified question presented below. Our phrasing of the issue should not restrict the Court's consideration of the issue.
Pacific Telesis and Pacific Bell are deemed the petitioners in this request because they are appealing the district court's ruling on this issue. The captions of the case 1 and the names and addresses of counsel are as follows:
Craig ASMUS, William J. Vasquez; Pacific Telesis Group
Management Force Allocation Plan, And/Or The Pacific Telesis
Group Surplus Management Severance Plan Aka Mfap; Phylyss
Apel; Gloria Alas; Eldridge Aubrey; James Banks; Areleen
Castille; Barbara Clark; John Gary Eidell Jr.; Margaret
Emerick; Juanita Evans; Jeffrey E. Fulton; Camille Galyk;
Norman Garcia; Gary Guardineer; Kenneth Hornback; Jerome
Kahle; Rosalyn Kelsay; Jeannie M. King; Stephen H.
Lawyer; Kathy Maltese; Leslie J. Mamuzich; Nancy R.
Magdelano; Garvis Martin; Diane Mcgregor; Louise Mckay;
Dottie Orcutt; Lucille Overby; Lisa Perla; Carolyn
Pollard; Diane Price; Lorene Reed; Patricia Reta; Cora
Riddle; Margarita Romero; Marilyn Schmitter; Denise C.
Shann; Susan Sollauer; Ronald Stephenson; Kathy M. Strok;
Barbara Swanson; James Swenson; Stephen Taylor; Charles
Van Buren; Varol Wiederofeft; Carolyn J. Castillo;
Michael F. Coyne; Donna Critzer; Diane Dixon; Irene
Garcia; James E. Gillard; Emily Higuera; Tony Jones;
v.
PACIFIC BELL; Pacific Telesis Group, Defendants-Appellants.
H. Tim Hoffman and Arthur Lazear, Hoffman & Lazear, Oakland, California; Mark R. Thierman, Thierman Law Firm, San Francisco, California, for the individual plaintiffs.
Mary Lu Christie, Pacific Telesis Legal Group, San Francisco, California, for Pacific Telesis and Pacific Bell.
Robert F. Walker, Paul, Hastings, Janofsky & Walker, Santa Monica, California, for the amicus curiae, the California Employment Law Council.
Once an employer's unilaterally adopted policy-which requires employees to be retained so long as a specified condition does not occur-has become a part of the employment contract, may the employer thereafter unilaterally rescind the policy, even though the specified condition has not occurred?
In 1986, Pacific Bell instituted its Management Employment Security policy ("MES"), which provided:
It will be Pacific Bell's policy to offer all management employees who continue to meet our changing business expectations employment security through reassignment to and retraining for other management positions even if their present jobs are eliminated. This policy will be maintained so long as there is no change that will materially alter Pacific Bell's business plan achievement.
In January of 1990, Pacific Bell notified its managers that industry conditions could force it to discontinue MES. In a letter to managers, its chief executive officer wrote:
[W]e intend to do everything possible to preserve our Management Employment Security policy. However, given the reality of the marketplace, changing demographics of the workforce and the continued need for cost reduction, the prospects for continuing this policy are diminishing-perhaps, even unlikely. We will monitor the situation continuously; if we determine that business conditions no longer allow us to keep this commitment, we will inform you immediately.
On October 1, 1991, Pacific Bell announced that it would cancel MES on April 1, 1992. Also on April 1, 1992, it adopted a program designed to decrease management through voluntary and involuntary terminations. The plaintiffs are 60 former management employees of Pacific Bell who were designated as surplus under the program. 2 All but eight of them signed releases waiving their rights to assert claims stemming from their employment or its termination.
The plaintiffs filed a complaint against Pacific Bell and its parent company, Pacific Telesis, seeking declaratory and injunctive relief, as well as damages, for breach of contract, breach of fiduciary duty, fraud, and violations of the Employment Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq. Prior to discovery, the parties filed counter-motions for partial summary judgment. The district court granted summary judgment in favor of the defendants on all claims brought by the 52 appellants who signed releases. We affirmed the district court's decision on these issues.
The district court, however, granted summary judgment on the breach of contract claim in favor of the eight plaintiffs who did not sign releases. It held that Pacific Bell could not cancel its MES policy unless it first demonstrated "a change that will materially alter Pacific Bell's business plan achievement," and the defendants stipulated that they would not present...
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... ... Co. v. Jacobsen, 197 F.3d 1008 (9th Cir.1999) (insurance question); and Asmus v. Pac. Bell, 159 F.3d 422 (9th Cir.1998) (employment question) ... 3. See Mylene ... ...