Ronald Cup v. Ampco Pittsburgh Corp
Opinion
*60
This case involves a dispute over retiree healthcare benefits. Retired union member Ronald Cup and similarly situated retirees requested-and the District Court ordered-arbitration of the dispute under the Labor Management Relations Act (LMRA),
I
A
Akers operated a manufacturing facility in Avonmore, Pennsylvania. The Avonmore plant's employees were union members represented by the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO/CLC, formerly known as the United Steelworkers of America (USW). For many years Akers and the USW engaged in a negotiation process that culminated in a series of collective bargaining agreements, as well as memoranda of agreement addressing the details of various employment policies.
In 2016, Akers was acquired by Ampco and a dispute over healthcare benefits soon arose. At that time, former Avonmore plant employees who had retired but were still under the age of 65 ( i.e. , not yet eligible for Medicare) paid $195 per month for their healthcare. But in July 2016, Ampco announced its intention to eliminate this healthcare plan for former Avonmore plant employees who had retired before March 1, 2015. The new plan would require retirees to purchase health insurance on the private market and then be reimbursed up to $500 per month for individuals or $700 per month for families. The affected retirees opposed this change because "the monetary value of the monthly reimbursement ... is limited," "the reimbursement is only available for five years," and the retirees would have to "shop to purchase plans on the private market." App. 28. They also concluded that it violated a memorandum of agreement (MOA) dated February 26, 2015, which provided that while "[a]ll active employees [would] be transferred to the [Company's] new health plan. ... [c]urrent retirees will remain on their existing Plan ($195.00 monthly premium)." App. 95.
B
Shortly thereafter, the USW sought recourse under the collective bargaining agreement (CBA) in effect at the time. It filed a grievance under Section 6 of the CBA, which applies when "differences arise between the Company and the Union or its members as to interpretation or application of, or compliance with the [CBA's] provisions." App. 207-08. Ampco rejected the grievance on the ground that the Union no longer represented the retirees.
The USW and Ronald Cup, who retired from the Avonmore plant in 2014, sued the Company on behalf of Cup and other similarly-situated
*61
workers who retired before March 1, 2015. As amended, their complaint contains three counts: (I) a non-substantive claim compelling arbitration under § 301 of the LMRA, (II) a claim to enforce the CBA under § 301, and (III) in the alternative, a claim under § 502(a) of the Employee Retirement Income Security Act (ERISA),
The Company moved under Federal Rule of Civil Procedure 12(b)(6) to dismiss for failure to state a claim. The Union responded by moving to compel arbitration, arguing that Section 6, which permits the Union to "appeal[ ] ... to arbitration" an "unsatisfactory" Company grievance determination, App. 208, applied to the parties' dispute over the retiree-healthcare provision of the MOA as well as to the CBA itself. The District Court agreed and granted the motion to compel in an order entered on June 13, 2017. Emphasizing the "strong federal policy in favor of resolving labor disputes through arbitration," it found that the CBA's "broad arbitration provision ... does not expressly narrow or limit the types of disputes that the Parties intend to resolve through ... arbitration."
Cup v. Ampco-Pittsburgh Corp.
,
Having ruled in the Union's favor on the arbitration count, the District Court did three other things in its June 13 order. First, it dismissed the two substantive counts without ruling on their merits. Second, with the dispute apparently headed for arbitration, it denied the Company's motion to dismiss as moot and announced its intention to order the parties to mediation before the more formal arbitration, as stipulated. Finally, the Court administratively closed the case. The Company timely appealed.
Meanwhile, the District Court took a number of administrative actions related to the June 13 order. In another order filed the next day, it referred the parties to mediation, which was unsuccessful. The District Court later denied the Company's motion to stay discovery while this appeal was pending, but this Court stayed enforcement of the arbitration order pending the outcome of this appeal.
II
The Company appeals the District Court's order granting the Union's motion to compel arbitration, asserting appellate jurisdiction under
We have jurisdiction over "final decisions of the district courts."
See
*62
The Union claims the District Court's administrative closure does not mean that its order compelling arbitration was final and appealable. The Union is quite right on this point, as we made clear in
Penn West Associates, Inc. v. Cohen
,
Unlike in
Freeman
, where the plaintiff's substantive claim remained pending despite the arbitration order, the District Court here granted the relief the Union sought in Count I (compelled arbitration) and dismissed its substantive claims in Counts II and III, "end[ing] the litigation on the merits and leav[ing] nothing more for the court to do but execute the judgment."
See
Green Tree Fin. Corp.-Ala. v. Randolph
,
Our conclusion that the District Court's order is final and appealable was presaged by our decision in
Penn West
, where we made clear that an administrative-closure order "was not a final, appealable order absent a separate document to signal the court's 'view that the case had concluded.' "
For the reasons stated, we hold that the order compelling arbitration is final for purposes of
III
Having determined that we have jurisdiction to hear this appeal, we turn to the arbitration order itself. The parties agree that their dispute is arbitrable if it is properly characterized as a "difference[ ] ... between the Company and the Union or its members as to interpretation or application of, or compliance with the provisions of [the CBA]." See App. 207-08 (CBA Section 6). But the Company argues that this dispute is not subject to arbitration under Section 6, because retiree health benefits are not covered by the CBA. We agree.
A
Because CBAs must be interpreted "according to ordinary principles of contract law,"
*63
M&G Polymers USA, LLC v. Tackett
, --- U.S. ----,
The Union mischaracterizes Section 19 as "identif[ying] Company benefits plans enjoyed by both employees and retirees ." Union Br. 15 (emphasis added). Contrary to the quoted statement, the CBA states that it applies only to "employees"-a term defined elsewhere to include "production and maintenance employees at the Company's Avonmore plant as of the date of this Agreement and thereafter ." App. 205 (emphasis added). So former employees like Cup, who retired before the CBA went into effect on March 1, 2015, are not "employees" under the CBA.
B
The Union's fallback position is that even if retirees are not among the "employees" to whom Section 19 expressly applies, Section 19 implicitly incorporates the MOA, which
does
discuss retiree health benefits. In relevant part, the MOA provides that while "[a]ll active employees wi[ll] be transferred to [a] new health plan ... [c]urrent retirees will remain on their existing Plan ($195.00 monthly premium)." App. 95. The Union contends that this section is implicitly tied to Section 19, which refers to "Medical Insurance."
See
App. 236. Persuaded by this argument, the District Court concluded that the dispute was within the ambit of the CBA (and, by extension, Section 6's arbitration procedure) because the CBA "expressly includes 'Medical Insurance' as an included ' Other Plan.' "
Cup
,
Even assuming Section 19's reference to "Medical Insurance" includes retiree health benefits as well as the "new health plan" for current employees,
see
App. 95, this single mention is insufficient to incorporate the MOA on the subject of retiree healthcare into the CBA. Our conclusion is consistent with
United Steelworkers of America v. Rohm & Haas Co.
,
The Union tries to distinguish
Rohm & Haas
on the ground that the disability plan in that case, unlike the healthcare plan at issue here, "contained its own dispute-resolution procedures." Union Br. 53. This, it contends, is "potent evidence" that
*64
the parties in
Rohm & Haas
"did not intend that disagreements arising under that plan be resolved by the CBA's arbitration procedure."
Perhaps for that reason, the Union bases its argument not on
Rohm & Haas
but on our decision in
RCA Corp. v. Local 241, International Federation of Professional and Technical Engineers
. Like the retiree health plan under discussion here, the retirement plan at issue in
RCA
"fail[ed] to provide an independent basis for mandatory arbitration."
The same is true of the CBA and MOA in this case. Despite the Union's arguments to the contrary, Section 19 of the CBA does not incorporate the MOA because "[m]ere reference to another contract or document is not sufficient to incorporate its terms into a contract. There must be an express intent to incorporate, and there is no such expression here."
Rosenblum
,
If anything, the CBA suggests an intent not to incorporate the MOA, as language expressly incorporating other agreements can be found elsewhere in the CBA. Section 9-E(6), for example, declares that "[t]he Absentee Control Program and the Tardy/Short Shift Programs ... are incorporated in this contract as a [sic] separate memoranda." App. 214. This section makes clear that the parties to the CBA knew how to incorporate other agreements into the CBA, so it's telling that they chose not to use the same language in Section 19.
With the benefit of hindsight, the Union now tries to reverse-engineer the requisite intent to incorporate, arguing that "[o]ver the years, the parties [have] repeatedly used the CBA grievance and arbitration procedures to resolve their disputes about benefits identified in the CBA's 'Other Plans' section, including disputes regarding retiree benefits." Union Br. 9. But "extrinsic evidence of 'past practice' [may] be admitted, if at all, only to resolve an ambiguity in the CBA,"
Quick v. NLRB
,
Our conclusion that the CBA does not incorporate the MOA has an additional consequence: the Union cannot invoke the presumption of arbitrability to salvage its position. Where the presumption applies, a court may not deny a motion to compel arbitration "unless it may be said with positive assurance that the [contract's] arbitration clause is not susceptible of an interpretation that covers the asserted dispute."
*65
AT&T Techs., Inc. v. Commc'ns Workers of Am.
,
Because the parties' dispute over retiree medical benefits is not subject to Section 6 of the CBA, it is not arbitrable. As the Company correctly points out, "there is no provision in the CBA regarding retiree medical benefits," and the MOA does not provide for arbitration. Company Br. 10. Nor did the CBA include retirees in its definition of "employees" or incorporate the MOA's provisions regarding retiree health benefits. The District Court therefore erred when it granted the Union's motion to compel arbitration. The Union may, of course, pursue its substantive claims in Counts II and III on remand.
* * *
The collective bargaining agreement at issue in this appeal does not address retirees, whose health benefits are discussed in a memorandum of agreement that was never incorporated into the CBA. We cannot know whether this result was intentional or inadvertent, but we must enforce the contracts as written. Accordingly, we will reverse and remand.
The District Court had jurisdiction over this dispute under
Reference
- Full Case Name
- Ronald A. CUP, on Behalf of Himself and All Other Persons Similarly Situated; United Steel Paper and Forestry Rubber Manufacturing Allied Industrial and Service Workers International Union AFL CIO CLC v. AMPCO PITTSBURGH CORPORATION; Akers National Roll Company; Akers National Roll Company Health & Welfare Benefits Plan, Appellants
- Cited By
- 25 cases
- Status
- Published