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Fletcher v. ZLB Behring LLC.

January 27, 2006

GLORIA FLETCHER, JOAN LOVELL, AND KATHY WISNIEWSKI, ET AL., PLAINTIFFS
v.
ZLB BEHRING LLC, DEFENDANT.



The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge

MEMORANDUM OPINION AND ORDER

Plaintiffs Gloria Fletcher, Joan Lovell, and Kathy Wisniewski, on behalf of themselves and other unnamed Plaintiffs (collectively "Plaintiffs"), bring this four-count putative class action First Amended Complaint alleging two claims under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001 et seq. and two Illinois common law claims against their former employer Defendant ZLB Behring LLC ("ZLB Behring"). Before the Court is ZLB Behring's Motion to Dismiss Plaintiffs' Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) and ZLB Behring's Motion to Strike Plaintiffs' Request for Front Pay. For the following reasons, the Court grants in part and denies in part ZLB Behring's motion to dismiss. Furthermore, the Court denies ZLB Behring's motion to strike without prejudice.

LEGAL STANDARDS

A motion to dismiss pursuant to Rule 12(b)(6) tests the legal sufficiency of a complaint, not the complaint's factual sufficiency or the merits of the case. Szabo v. Bridgeport Mach., Inc., 249 F.3d 672, 675-76 (7th Cir. 2001); Triad Assocs., Inc. v. Chicago Hous. Auth., 892 F.2d 583, 586 (7th Cir. 1989). The Court will only grant a motion to dismiss if "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Centers v. Centennial Mortgage, Inc., 398 F.3d 930, 933 (7th Cir. 2005) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). The Court must assume the truth of the facts alleged in the pleadings, construe the allegations liberally, and view them in the light most favorable to the plaintiff. Centers, 398 F.3d at 933.

Under the federal notice pleading standards, a complaint need only include "a short and plain statement of the claim showing that the pleader is entitled to relief." See Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002) (citing Fed.R.Civ. P. 8(a)(2)). The short and plain statement must "give the defendant fair notice of what the plaintiff's claim is and the grounds upon which it rests." Id. (quoting Conley v. Gibson, 355 U.S. at 47). "This simplified notice pleading standard relies on liberal discovery rules and summary judgment motions to define disputed facts and issues and to dispose of unmeritorious claims." Id.

BACKGROUND

ZLB Behring operates a manufacturing plant in Kankakee, Illinois, where it employed Plaintiffs until May 2004. (R. 27-2; Am. Compl. ¶ 8.) ZLB Behring's employees included both hourly employees ("Union Plaintiffs"), who were members of Local 498 C of the International Chemical Workers Union Council ("Local 498 C") and worked under a collective bargaining agreement ("CBA"), and salaried employees ("Non-Union Plaintiffs"). (Id. ¶¶ 9, 10.) The Union Plaintiffs, Non-Union Plaintiffs, and other employees participated in the Armour Pharmaceutical Company Pension Plan, also known as the Aventis Behring, LLC Pension Plan ("Pension Plan"). (Id. ¶¶ 11, 12.)

By May 2004, Plaintiffs had earned, and were continuing to earn, service credit under the Pension Plan. (Id. ¶ 13.) Plaintiffs allege, however, that ZLB Behring wanted to stop incurring financial obligations under the Pension Plan and took several steps to achieve that end. (Id. ¶¶ 15-33.) First, ZLB Behring announced the layoff of Plaintiffs and approximately 480 other employees who had earned service credit and participated in the Pension Plan. (Id. ¶ 18.) Second, ZLB Behring officials told the affected employees that the downsize was permanent, more layoffs were coming, and the employees should accept a severance package and move on with their lives. (Id. ¶ 19.) At the time of these statements, however, Plaintiffs allege that ZLB Behring knew that the downsize would not be permanent. (Id. ¶¶ 20, 24.) Relying on the officials' allegedly false statements, Plaintiffs and other affected employees accepted the severance package, which offered severance pay in exchange for resignations and releases of all contractual and legal claims against ZLB Behring. (Id. ¶¶ 22, 23.)

Next, after the departure of Plaintiffs and the other affected employees, Plaintiffs allege that ZLB Behring exploited its strengthened position to negotiate a new collective bargaining agreement with Local 498 C, wherein future union employees would receive reduced wages and benefits. (Id. ¶¶ 24-28.) ZLB Behring also eliminated the right of non-union employees to continue earning service credit under the old Pension Plan. (Id. ¶ 29.) Finally, Plaintiffs allege that ZLB Behring increased operations at the Kankakee plant by hiring new employees and rehiring old employees at much lower wage rates and without the right to participate in the Pension Plan. (Id. ¶¶ 30-33.) At the time Plaintiffs filed their First Amended Complaint, ZLB Behring had rehired approximately thirty-five of the employees who had signed the releases and hired approximately twenty-five new employees. (Id. ¶ 32.)

Based on ZLB Behring's alleged scheme, Plaintiffs bring four counts against ZLB Behring. In Count I, Plaintiffs allege that ZLB Behring violated ERISA Section 510 by terminating Plaintiffs employment, which resulted in Plaintiffs losing all accrued benefits under the Pension Plan, and replacing Plaintiffs with newly hired or rehired employees who would not have similar rights under the plan. In Count II, Plaintiffs allege that ZLB Behring breached its fiduciary duty with respect to the Pension Plan in violation of ERISA Section 404 by failing to act solely in the interest of Plaintiff participants and their beneficiaries. In Counts III and IV, Plaintiffs allege that unilateral mistake and fraud, respectively, invalidate their resignations and release agreements under Illinois law.

ANALYSIS

I. Defendant's Arguments Affecting All Claims

A. Plaintiffs' Releases

ZLB Behring's first argument is that Plaintiffs' releases of all contractual and legal claims against ZLB Behring "in and of themselves" compel dismissal of the First Amended Complaint. As Plaintiffs correctly assert, however, this inquiry requires factual determinations concerning the enforcement and validity of the releases that are not proper at this procedural ...


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