Payne v. Briggs

Citation856 F.Supp.2d 915
Decision Date06 March 2012
Docket NumberCase No. 11–10769.
PartiesMarjorie PAYNE, Plaintiff, v. LOCAL LODGE 698, Raymond Briggs, and Mark Ward, Defendants, v. Jon Winterhalter, Third–Party Defendant.
CourtU.S. District Court — Eastern District of Michigan

OPINION TEXT STARTS HERE

Joseph P. Ciaramitaro, Jr., York, Dolan, Robert A. Kuhr, Robert A. Kuhr, PLLC, Clinton Township, MI, for Plaintiff.

Frederick Perillo, Sara J. Geenen, Previant, Goldberg, Milwaukee, WI, Kevin J. O'Neill, Kevin J. O'Neill, P.C. Attorney at Law, Dearborn, MI, for Defendants.

Richard R. Zmijewski, Berry Moorman, Detroit, MI, for Third–Party Defendant.

OPINION AND ORDER

PATRICK J. DUGGAN, District Judge.

Marjorie Payne (Plaintiff) filed this action to recover compensation under an employment contract. The defendants are the International Association of Machinists and Aerospace Workers Local Lodge 698 (Lodge 698) and two officials of Lodge 698's parent organization, Raymond Briggs and Mark Ward. Briggs has filed a counterclaim against Plaintiff and a third-party complaint against Jon Winterhalter, the former Directing Business Representative of the Local Lodge that employed Plaintiff. Before the Court are three motions for summary judgment: (1) Defendants' motion for summary judgment as to Plaintiff's claims; (2) Briggs' motion for summary judgment as to his counterclaim against Plaintiff and his third-party complaint against Winterhalter; and (3) Winterhalter's motion for summary judgment as to Briggs' third-party complaint. Briggs has also filed a motion to strike Winterhalter's jury demand. On January 30, 2012, the Court notified the parties that it was dispensing with oral argument concerning these motions pursuant to Eastern District of Michigan Local Rule 7.1(f)(2). For the reasons stated below, the Court grants Defendants' motion for summary judgment, grants in part Briggs' motion for summary judgment, and denies Winterhalter's motion for summary judgment. The Court denies as moot Briggs' motion to strike Winterhalter's jury demand.

I. Factual and Procedural Background

The International Association of Machinists and Aerospace Workers (“IAM”) is a union which charters lodges to represent various classes of employees. At the top level of the union's hierarchy is a Grand Lodge, which in turn charters District Lodges and Local Lodges. Each District Lodge provides services to several Local Lodges, and each Local Lodge is comprised of multiple bargaining units. A bargaining unit typically represents employees of a specific trade. District and Local Lodges employ business representatives to administer the collective bargaining agreements of each bargaining unit.

Winterhalter was the directing business representative of IAM Local Lodge PM2848 (Lodge 2848), which was incorporated in Michigan. In February 2006, the secretary employed by Lodge 2848 left her job to take a position at a District Lodge. Winterhalter wished to obtain a replacement. Lodge 2848's secretarial positions were represented by a union, the Office and Professional Employees International Union Local 42 (“OPEIU”). Winterhalter contacted Theresa Kandt, the OPEIU's bargaining representative, to obtain a list of candidates. Before receiving a response, however, Winterhalter learned through a friend that Plaintiff had previously worked for another IAM lodge and was familiar with the software used to run the union's monthly reports. Winterhalter met with Plaintiff on February 18, 2006. At this meeting, he informed Plaintiff that her employment would be covered by a collective bargaining agreement. Winterhalter Dep. 36:1–37:1, Aug. 31, 2011. Plaintiff was at first reluctant to accept the position, apparently because of her past experience working for the IAM. Winterhalter offered Plaintiff deferred compensation bonuses, a higher pay rate, and a severance package worth one year's pay and benefits. Winterhalter Dep. 121:1–122:15. He indicated that Plaintiff would only become entitled to severance if she worked for Lodge 2848 for six months and if she was terminated for a reason other than cause. Winterhalter Dep. 121:21–122:4.

Plaintiff accepted, and began working the following Monday, February 20, 2006. According to Winterhalter, Plaintiff became a member of the OPEIU bargaining unit on that date, Winterhalter Dep. 45:20–23, and Plaintiff was covered by the OPEIU collective bargaining agreement from that day forward. Winterhalter Dep. 29:11–23. The OPEIU became Plaintiff's exclusive bargaining representative, Winterhalter Dep. 29:11–16, and she began paying dues to the OPEIU. Payne Dep. 92:5–8, Sep. 1, 2011.

Sometime during March 2006, Winterhalter memorialized in writing the agreement he had made with Plaintiff. He backdated it to February 20, 2006 and Plaintiff signed it. A few days later, after deciding that the severance agreement “looked like a contract between me and [Plaintiff],” Winterhalter drafted a second version “between the local lodge and [Plaintiff].” 1 Winterhalter Dep. 38:7–20. Winterhalter subsequently contacted Kandt to inform her of modifications to the pension and insurance terms of the collectivebargaining agreement. Winterhalter Dep. 47:6–23. He did not mention the severance agreement. Winterhalter Dep. 47:12–23.

Winterhalter and Kandt allegedly met during March 2006 for Kandt to sign off on the pension and insurance modifications to the collective bargaining agreement.2 At that meeting, Winterhalter allegedly told Kandt that he had also promised Plaintiff “certain benefits,” although he did not refer to a “severance package” or go into detail concerning the nature of these benefits. Winterhalter Dep. 50:8–20. Kandt allegedly said that she did not care, “as long as it doesn't change the contract.” Winterhalter Dep. 50:5–6. It is undisputed that the severance agreement was never presented to Kandt for her signature. Winterhalter soon notified the Lodge 2848 executive board of the pension and insurance modifications to the OPEIU collective bargaining agreement. He did not mention the severance agreement, however, because he believed it would “start a firestorm with our members that would result in what would probably be viewed as an attack on the Grand Lodge.” 3 Winterhalter Dep. 97:10–15.

In 2006, 2007, and 2008, Winterhalter sought the Local Lodge executive board's approval to pay Plaintiff's deferred compensation bonuses. These bonuses were paid, although one board member objected in 2008. At some point, a District Lodge official suggested that Winterhalter contact IAM General Vice President Lynn Tucker about these bonuses. Winterhalter contacted Tucker and stated that he had an enforceable contract with Plaintiff to pay these bonuses. Tucker responded that if he had a contract with Plaintiff, the expenditure was appropriate and did not require authorization from the Grand Lodge.

By late 2009, Lodge 2848's membership had dwindled to approximately 300. The Grand Lodge assigned an auditor to review the Lodge's finances, and Winterhalter believed that the Lodge was going to be placed under “supervision.” 4 Lodge 2848 was at that time affiliated with District Lodge 60. In December 2009, Winterhalter told Mark Ward, the Directing Business Representative of District Lodge 60, about the severance agreement with Plaintiff. Ward notified Kandt, who confirmed that she had neither negotiated nor signed the severance agreement. Ward Aff. ¶ 5. Ward also notified the Grand Lodge, and Lynn Tucker responded in a letter to Winterhalter indicating that he believed the severance agreement violated the IAM constitution and Lodge 2848's bylaws. Winterhalter Dep. 54:17–25.

Ward addressed Lodge 2848's executive board at a meeting on March 2, 2010, and advised the board that the severance agreement with Plaintiff would not be honored, as it was null and void. Payne Dep. 27:5–10. Plaintiff was in attendance at this meeting, and she contacted Kandt about this matter. Kandt again denied having approved the severance agreement.

In June 2010, Briggs was appointed “supervisor” over Lodge 2848. He determined that Lodge 2848 had failed to conduct meetings in accordance with quorum requirements for the last two years. Briggs Aff. ¶ 8. Briggs also noted that Lodge 2848 was operating at a financial deficit. He therefore recommended to the Grand Lodge that Lodge 2848 be “merged out of existence.” Id. Briggs attempted to contact Kandt on August 30, 2010 to bargain over the effects of the Lodge's closure, but received no response. On September 30, 2010, Briggs notified Kandt via letter that the Lodge was withdrawing recognition of the OPEIU bargaining unit. Id. ¶ 10. Lodge 2848 closed at the end of that same day. Plaintiff remained an employee of Lodge 2848 up until it closed.

Upon closure, Lodge 2848's bargaining units were divided among six other Local Lodges. Defendant Lodge 698 received 11 of the 22 bargaining units. According to Stuart Proctor, Lodge 698's president, the members transferred from Lodge 2848 now compose about 15% of Lodge 698's membership. Proctor Aff. ¶ 5. These individuals became members of Lodge 698 and are subject to Lodge 698's bylaws. Id. Proctor claims that Lodge 698 did not assume the OPEIU collective bargaining agreement, and does not employ any former Lodge 2848 employees. Id. ¶ 7.

Although Lodge 2848 closed on September 30, 2010, Plaintiff reported for work on her next scheduled workday, October 4, 2010. Briggs was at Lodge 2848's office winding up its affairs. He and Ward met with Plaintiff that day, and explained that Lodge 2848 no longer existed and her employment was terminated. Briggs Aff. ¶ 12. Plaintiff demanded the severance promised under her agreement with Winterhalter. Id. ¶ 13. Briggs refused, indicating that the IAM would not pay this severance. Over the following month, Lodge 2848's affairs were settled, and the assets of the Lodge were apparently transferred to the Grand Lodge pursuant to the IAM constitution.

On January 31, 2011, Payne filed this suit in ...

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