Marcatante v. City of Chicago
657 F.3d 433
7th Cir.2011Background
- Retiree plaintiffs were city employees represented by coalitions of unions under 1999-2003 CBAs; ERIP offered enhanced pension benefits but no guaranteed retroactive wage increases.
- Negotiations for 2003-2007 CBAs extended the 1999-2003 CBAs via a June 26, 2003 letter providing that wage increases would be retroactive only if the parties agreed; the City handwritten “if any” modifying retroactivity.
- During negotiations, the City proposed retroactive raises for some employee groups, but ultimately the 2003-2007 CBAs did not grant retirees retroactive pay for July 2003 onward.
- The plaintiffs retired under ERIP in early 2004 and later sought retroactive wage increases from July 2003 through their retirement dates; the district court granted summary judgment for the City on federal due process and equal protection and on state law express contract, but for the plaintiffs on implied contract.
- The district court found an implied contract entitling plaintiffs to retroactive pay, which the Seventh Circuit reversed, holding no implied contract existed due to the express 1999-2003 and 2003-2007 CBAs and the enforceable letter agreement.
- The court remanded to enter summary judgment for the City on the implied contract claim while affirming the rest of the district court’s rulings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an implied contract for retroactive wages exists. | Plaintiffs allege conduct and past practice imply a contract. | Express CBAs govern pay; no implied term exists. | Implied contract claim cannot succeed; no implied term given express contracts. |
| Whether the 2003 letter agreement created retroactive pay rights for retirees. | Past practice and the letter suggested retroactivity. | Letter merely stated negotiations could yield retroactive raises; no guaranteed retroactivity. | Letter is too indefinite to create retroactive pay rights; no implied promise. |
| Whether there is an implied-in-law (quasi-contract) recovery. | Unjust enrichment theory supports recovery for retirees. | Express contract governs wage terms; no enrichment without contract. | No implied-in-law contract; not supported where express contract exists. |
| Whether the due process claim supports damages or affects judgment. | City misrepresented intentions to induce ERIP participation. | No misrepresentation; retirees chose voluntary retirement. | Due process claim fails; no coercion or misrepresentation proven. |
| Whether plaintiffs’ cross-appeal was proper. | Seeking modified judgment on due process. | Cross-appeal improper; only alternative grounds for affirmance were raised. | Cross-appeal stricken; district court's rulings largely upheld. |
Key Cases Cited
- Zadrozny v. City Colls. of Chi., 220 Ill.App.3d 290 (1991) (implied-contract requirements and conduct-based duties under Illinois law)
- Ekl v. Knecht, 223 Ill.App.3d 234 (1991) (implied-in-fact contract; no express promise to pay regular charges required at time of contract)
- Martin v. Campanaro, 156 F.2d 127 (2d Cir.1946) (when CBA expires, implied contract to pay reasonable value may arise; distinguishable on facts)
- Murray v. Abt Assocs., Inc., 18 F.3d 1376 (7th Cir.1994) (parties may negotiate without guaranteeing outcome; autonomy in negotiations respected)
- Klekamp v. City of Burbank, 266 Ill.App.3d 81 (1994) (no implied-in-law contract where express contract governs same subject)