Dewhurst v. Century Aluminum Co.
2011 U.S. App. LEXIS 17464
| 4th Cir. | 2011Background
- Retirees (Dewhurst, Bryan) and the union challenge Century Aluminum's plan to modify or terminate retiree healthcare for those aged 65+ who retired between 1985 and 2006.
- Century cited financial difficulty and rising healthcare costs as reasons for potential changes to vested benefits.
- District court denied a preliminary injunction, finding no likelihood of success on the merits.
- This Fourth Circuit appeal concerns whether retiree health benefits survive the expiration of CBAs or are limited to the term of the agreement.
- Court reviews the Winter standard for preliminary injunctions and the interpretation of CBA durational language.
- Key CBAs and SPDs indicate retiree healthcare benefits are effective only during the life of the then-current CBA.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether retirees show likelihood of success on merits. | Dewhurst contends benefits vest beyond CBA terms under Keffer/Yard-Man reasoning. | Century argues durational CBA language controls; benefits do not extend beyond the CBA. | No likelihood of success; durational language governs. |
| Whether durational language in CBAs forecloses vesting of retiree healthcare. | Language does not preclude vesting beyond the term in all CBAs. | Explicit durational language shows benefits last only for the term of the agreement. | Durational language forecloses a likelihood of vesting beyond the CBA term. |
| Whether absence of a reservation of rights implies vesting in healthcare benefits. | No reservation of rights suggests they didn't delegate power to modify benefits. | Absence can be explained by subject arising anew each bargaining cycle; ambiguity does not show likelihood of success. | Ambiguity not enough; Winter standard not satisfied. |
| Whether pension-vesting language implies healthcare-benefit vesting. | Pension vesting language suggests broader vesting implications for related benefits. | Healthcare benefits lack explicit vesting language and are governed by separate plan terms. | Pension vesting language does not establish healthcare vesting. |
Key Cases Cited
- Winter v. Natural Resources Defense Council, 555 U.S. 7 (U.S. 2008) (set standard for preliminary injunctions requiring likelihood of success, irreparable harm, balance of equities, public interest)
- Musgrave v. WV Ass'n of Club Owners & Fraternal Servs., Inc., 553 F.3d 292 (4th Cir. 2009) (summarizes Winter standard and applies it to injunction review)
- Keffer v. H.K. Porter Co., 872 F.2d 60 (4th Cir. 1989) (retiree benefits may extend beyond expiration if contract language expressly so indicates)
- Yard-Man, Inc. v. Find- lay, 716 F.2d 1476 (6th Cir. 1983) (retiree benefits are a discretionary, not mandatory, subject of bargaining; apply contract interpretation)
- Royal Coal Co. v. United Mine Workers of America, 768 F.2d 588 (4th Cir. 1985) (benefits do not survive expiration without clear contractual intent)
- Real Truth About Obama, Inc. v. FEC, 575 F.3d 342 (4th Cir. 2009) (vacated and reinstated discussions on governing standards for injunctions)