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Grove v. Johnson Controls, Inc.

United States District Court, M.D. Pennsylvania

December 3, 2014

WILLIAM GROVE, SR.; VIRGINIA B. GROVE; SANDRA PALMIERI; MICHAEL G. FUHRMAN; WILLIAM WINTER; PRESTON HIMES; and EDWARD MYERS, on behalf of themselves; and FLOYD MITZEL, MAURICE KEFAUVER, III, HAROLD G. LUCKENBAUGH, WILMER C. BARRETT, LARRY LEHMAN, GERALD A. YOUNG, and JOHN C. DOUGLASS, on behalf of themselves and others similarly situated; and INTERNATIONAL UNION UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, UAW, Plaintiffs
v.
JOHNSON CONTROLS, INC.; JOHNSON CONTROLS, INC. UNION RETIREE WELFARE PLAN (PLAN 570); JOHNSON CONTROLS, INC. UNION WELFARE PLAN (PLAN 565); and DOES 1 through 20, Defendants

For William Grove, Sr., Michael G. Fuhrman, William Winter, Floyd Mitzel, Plaintiffs: Tybe A. Brett, LEAD ATTORNEY, Joel R Hurt, McKean J Evans, Pamina G. Ewing, Stephen M. Pincus, William T Payne, Feinstein Doyle Payne & Kravec, LLC, Pittsburgh, PA USA.

For Harold G. Luckenbaugh, Preston Himes, Edward Myers, Maurice Kefauver, III, Plaintiffs: McKean J Evans, Pamina G. Ewing, Feinstein Doyle Payne & Kravec LLC, Pittsburgh, PA USA; Stephen M. Pincus, William T Payne, Feinstein Doyle Payne & Kravec, LLC, Pittsburgh, PA USA.

For Wilmer C. Barrett, on behalf of himself and others similarly situated, Sandra Palmieri, Plaintiffs: McKean J Evans, Feinstein Doyle Payne & Kravec LLC, Pittsburgh, PA USA; Stephen M. Pincus, Feinstein Doyle Payne & Kravec, LLC, Pittsburgh, PA USA; William T Payne, Feinstein Doyle Payne & Kravec, LLC, Aspinwall, PA USA.

For Larry Lehman, Plaintiff: McKean J Evans, Feinstein Doyle Payne & Kravec LLC, Pittsburgh, PA USA; William T Payne, Feinstein Doyle Payne & Kravec, LLC, Aspinwall, PA USA; Stephen M. Pincus, Feinstein Doyle Payne & Kravec, LLC, Pittsburgh, PA USA.

For Gerald A Young, John C. Douglass, Virginia B. Grove, Plaintiffs: Stephen M. Pincus, Feinstein Doyle Payne & Kravec, LLC, Pittsburgh, PA USA.

For Johnson Controls, Inc., Defendant: Alan R. Boynton, Jr. McNees, Wallace & Nurick Harrisburg, PA USA; Bernard J. Bobber, Foley & Lardner LLP, Milwaukee, WI USA; Brian F. Jackson, McNees, Wallace & Nurick, Harrisburg, PA USA; John F. Birmingham, Foley & Lardner LLP, Detroit, MI USA; Larry S. Perlman, Foley & Lardner LLP, Miami, FL USA.

For Johnson Controls, Inc. Union Retiree Welfare Plan (Plan 570), Johnson Controls, Inc. Union Welfare Plan (Plan 565), Defendants: Bernard J. Bobber, Foley & Lardner LLP, Milwaukee, WI USA; Larry S. Perlman, Foley & Lardner LLP, Miami, FL USA.

ORDER

Sylvia H. Rambo, United States District Judge.

The background of this order is as follows: Plaintiffs Floyd Mitzel, Maurice Kefauver III, Harold G. Luckenbaugh, Wilmer C. Barrett, Larry Lehman, Gerald A. Young, and John C. Douglass (" Class Representatives") filed this action on behalf of themselves and similarly-situated groups of retirees (" Retirees"), including the additional individually-named Plaintiffs, who were previously represented by Plaintiff International Union United Automobile, Aerospace and Agricultural Implement Workers of America, UAW (" UAW") and its Local Union No. 1872 (collectively " the Union"). (Doc. 85, ¶ 1.) Retirees built products at manufacturing facilities in the York, Pennsylvania, area that have been owned by Borg-Warner Air Conditioning Inc., Applied Systems, York International Corporation, and Defendant Johnson Controls Inc. (Id.) Johnson Controls is now the plan sponsor and fiduciary of the employee benefit plan that provides retiree health benefits to Retirees. (Id. at ¶ ¶ 9-10.)

In their fourth amended complaint, Plaintiffs allege that successive collective bargaining agreements, which were created as a result of bargaining between the Union and Retirees' former employer, contained provisions that established the employer's obligation to provide retiree health benefits to Retirees and their spouses. (Id. at ¶ 26.) The underlying agreements specified that retiree health benefits would continue for Retirees throughout their retirement, with no lifetime maximum limit or cap on benefits. (Id. at ¶ 28.) Nevertheless, Defendant Johnson Controls unilaterally reduced Retirees' retiree health benefits by instituting a $50, 000.00 cap on benefits incurred by each participant after age 65. (Id. at ¶ 31.)

In Count I of the amended complaint, Plaintiffs allege that, because Retirees' right to retiree health benefits were created through agreements between a labor organization and an employer, violation of those agreements is actionable in this court under Section 301 of the Labor Management Relations Act (" LMRA"), 29 U.S.C. § 185(a). In Count II, which is brought pursuant to Section 502(a)(1)(B) and (a)(3) of the Employee Retirement Income Security Act of 1974 (" ERISA"), 29 U.S.C. § 1132(a)(1)(B), Plaintiffs seek a declaration that Retirees' rights to retiree health benefits provided under the collective bargaining agreements have vested and that the negotiated plan terms cannot be unilaterally modified or terminated by Defendants. In Count III, Plaintiffs assert a claim for breach of fiduciary duty under Sections 404 and 502 of ERISA.

On October 28, 2014, Class Representatives filed a motion for certification of subclasses (Doc. 80) and brief in support (Doc. 81), seeking certification pursuant to Federal Rule of Civil Procedure 23 and Local Rule 23.3. (Doc. 80, p. 1 of 4.) In their motion, Class Representatives seek class certification as to Counts I and II of their amended complaint, [1] and propose the following subclasses for certification:

Subclass A
Former employees of Johnson Controls, Inc. and/or its predecessors who (1) worked at facilities of Johnson Controls, Inc. and/or its predecessors in York, Pennsylvania; (2) retired before November 1, 1984; (3) were represented by the International Union United Automobile, Aerospace and Agricultural Implement Workers of America, UAW (" UAW") and its Local Union No. 1872 in collective bargaining; and (4) after retirement, received health care benefits; as well as the spouses and surviving spouses of these former employees.

Subclass B

Former employees of Johnson Controls, Inc. and/or its predecessors who (1) worked at facilities of Johnson Controls, Inc. and/or its predecessors in York, Pennsylvania; (2) retired between November 1, 1984 and October 31, 1996, inclusive; (3) were represented by the International Union United Automobile, Aerospace and Agricultural Implement Workers of America, UAW (" UAW") and its Local Union No. 1872 in collective bargaining; and (4) after retirement, received health care benefits; as well as the spouses and surviving spouses of these former employees.

Subclass C

Former employees of Johnson Controls, Inc. and/or its predecessors who (1) worked at facilities of Johnson Controls, Inc. and/or its predecessors in York, Pennsylvania; (2) retired between November 1, 1996 and June 30, 2000, inclusive; (3) were represented by the International Union United Automobile, Aerospace and Agricultural Implement Workers of America, UAW (" UAW") and its Local Union No. 1872 in collective bargaining; and (4) after ...

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