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Boeing Co. v. March

September 30, 2008

THE BOEING COMPANY AND THE BOEING COMPANY RETIREE HEALTH AND WELFARE PLAN, PLAINTIFFS,
v.
LORI M. MARCH AND WILLIAM G. TAKACS, ON BEHALF OF THEMSELVES AND AS REPRESENTATIVES OF A SIMILARLY SITUATED CLASS OF RETIREES, SURVIVING SPOUSES AND DEPENDENTS, AND THE INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, UAW, DEFENDANTS.
JOHN R. MAYFIELD, JESSIE MCKINNEY, ROBERT MECLEARY, AND THOMAS J. SHERIDAN, ON BEHALF OF THEMSELVES AND A SIMILARLY SITUATED CLASS, PLAINTIFFS,
v.
THE BOEING COMPANY AND THE BOEING COMPANY RETIREE HEALTH AND WELFARE PLAN, DEFENDANTS.



The opinion of the court was delivered by: Honorable David H. Coar

MEMORANDUM OPINION AND ORDER

These two cases, which involve claims under the Employee Retirement Income Security Act of 1974 and the Labor-Management Relations Act, were consolidated for all purposes. In both matters, the Boeing Company seeks a declaration that a series of collective bargaining agreements negotiated by Boeing, Local 1069, and the UAW did not vest lifetime health benefits for former hourly employees at Boeing's rotorcraft division (or its predecessors) who retired on or before March 11, 2006 and are currently participating in the Boeing Company Retiree Health and Welfare Plan (Plan 602) and receiving pension benefits under the Local 1069 Non-Contributory Retirement Plan (Plan 005) (collectively, these former employees will be referred to as "the retirees"). Boeing also seeks a declaration that it has the right to modify, amend, or terminate the retirees' health benefits. The plaintiffs in Mayfield v. Boeing ("Mayfield plaintiffs"), meanwhile, argue that Boeing does not have a unilateral right to modify the retirees' health benefits under the current collective bargaining agreement (CBA). Specifically, they contest Boeing's changes to those benefits on September 1, 2006, and Boeing's proposed changes for July 2009.

This opinion addresses (1) the Mayfield plaintiffs' motion to dismiss Boeing's counterclaim; (2) Boeing's motion to certify a class; and (3) the Mayfield plaintiffs' motion to certify a class. The opinion also revisits the court's previous order dismissing the Mayfield plaintiffs' vested-benefits claims with prejudice.

I. BACKGROUND

The two disputes in this consolidated action first appeared within days of one another in different courts. The Mayfield plaintiffs filed their complaint in the Middle District of Tennessee on September 13, 2006. Two days later, Boeing and the Boeing Company Retiree Health and Welfare Plan filed a complaint against individual retirees and others similarly situated, along with the UAW, in the Northern District of Illinois. Because discovery proceeded at a faster pace in this court, the court in the Middle District of Tennessee sua sponte transferred the Mayfield case here in June 2007.

Initially, the Mayfield plaintiffs alleged that Boeing's September 1, 2006 changes to the retirees' health benefits violate Boeing's obligation, negotiated under a series of CBAs, to provide vested, lifetime health benefits for the retirees. (R. 78, exh. 1, Mayfield First Am. Compl.) Following the transfer to this court, however, the Mayfield plaintiffs retreated from that theory. On October 26, 2007, the Mayfield plaintiffs sought leave to file a second amended complaint, in which, in addition to challenging the September 1, 2006 changes to the retirees' health benefits, they also would challenge Boeing's proposed changes for July 2009. But the new legal theory would be that the changes violate the current CBA, and neither set of changes would be challenged as violations of Boeing's purported obligation to provide vested, lifetime benefits for the retirees. (R. 71, exh. 1, Mayfield Second Am. Compl.)

Boeing protested the amendment, accusing the Mayfield plaintiffs of judge- and forum-shopping. Boeing noted that the UAW had voluntarily withdrawn a complaint seeking identical relief as the Mayfield plaintiffs' original complaint immediately before they filed it. According to Boeing, UAW withdrew its complaint because it anticipated unfavorable rulings from the judge assigned to that case in the Eastern District of Michigan. And, Boeing said, the Mayfield plaintiffs-who Boeing claims were in contact with the UAW's attorneys-filed their complaint in the Middle District of Tennessee to secure a judge favorable to their position. The proposed second amended complaint, according to Boeing, was another effort to avoid unfavorable resolution of the vested-benefits issue. (R. 77, Boeing Resp. 1-2.) (The Northern District of Illinois, Boeing suspects, is an unfavorable forum for the Mayfield plaintiffs.) To avoid sanctioning such forum-shopping, and to ensure that the preceding months of discovery were not wasted, Boeing requested that the court dismiss with prejudice the Mayfield plaintiffs' vested-benefits claims. (Id. at 4-8.)

While the Mayfield plaintiffs' motion to file a second amended complaint was pending before the court, both they and Boeing filed motions to certify a nearly identical class. (Compare R. 81, Mayfield MCC 5-6 with R. 78, Boeing MCC 2-3.) Because of their similarity, Boeing requested that the court adopt the Mayfield plaintiffs' proposed definition of the class, with minor modifications, and the Mayfield plaintiffs agreed. (R. 105, Boeing Resp. 2; R. 109, Mayfield Reply 1.) Boeing and the Mayfield plaintiffs dispute, however, whether class certification should apply to all claims in the consolidated litigation. (R. 105, Boeing Resp. 2.;

R. 109, Mayfield Reply 2-5.)

Without ruling on the class-certification motions, the court addressed the Mayfield

plaintiffs' motion to file a second amended complaint. After expressing concern that the proposed amendment would narrow the issues in the case to a point that it is "almost nonsensical," the court granted the motion with the caveat that the Mayfield plaintiffs' claims based on their vested-benefits theory would be dismissed with prejudice. (R. 110, Boeing Reply for MCC, exh. 1, Tr. Dec. 11, 2007 Hr'g 8; exh. 2, Tr. Jan. 17, 2008 Hr'g 3-4.) The court explained that the dismissal would apply only to the named Mayfield plaintiffs, reserving for later a ruling whether it would apply to the class those plaintiffs sought to represent. (Id. at exh. 3, Tr. Feb. 7, 2008 Hr'g 5.)

Boeing has filed an answer to the Mayfield plaintiffs' second amended complaint, along with a counterclaim for declaratory relief on the vested-benefits issue. (R. 97, Boeing Ans. 15- 18.) The Mayfield plaintiffs have responded with a motion to dismiss the counterclaim, which they describes as a "mirror-image" version of the claims this court dismissed with prejudice. (R. 106, Mayfield MTD 2-4.)

II. ANALYSIS

The parties have very different views about how this case should proceed. Boeing would like the court to resolve the vested-benefits issue, and it wants the court's ruling to bind the entire class. Boeing offers three ways for the court to do so: (1) bind the class to the dismissal of the Mayfield plaintiffs' vested-benefits claims; (2) name new class representatives; or (3) vacate the dismissal. (R. 111, Boeing Resp. 9-10; R. 110, Boeing Reply for MCC ...


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