Tackett v. M & G Polymers USA, LLC
853 F. Supp. 2d 697
S.D. Ohio2012Background
- ERISA class action concerning lifetime contribution-free retiree health care benefits for retirees of M&G Polymers and predecessors at the Point Pleasant Plant.
- Bench trial held May 2011 on liability; Subclasses One–Four prevailed for plaintiffs, Subclass Five favored defendants.
- Plaintiffs sought a permanent injunction reinstating lifetime contribution-free health care; Court granted relief.
- Central dispute: whether health-care benefits vested and, if so, to what scope (plan details vs. general right).
- Agreements include multiple CBAs and side letters (notably Letter G and Letter H) and post-purchase side arrangements; treatment of cap letters and “me too” provisions is disputed.
- Court found vesting of a right to lifetime contribution-free health care for Subclasses One–Four, and a capped entitlement for Subclass Five; injunction granted with specified reinstatement steps.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether retirees have a vested right to lifetime contribution-free health care. | Tackett/USW argued vesting given 95-point rule and link to pension. | M&G contends benefits may be altered; no fixed plan details vest. | Yes; vested right to lifetime contribution-free benefits for Subclasses One–Four. |
| What is the proper scope of reinstatement if vested rights exist? | Reinstate to pre-2007 contribution-free plans. | Reinstatement limited to current plan versions; cap letters may apply. | Reinstatement into current versions for Subclasses One–Four; Subclass Five remains subject to cap-based terms. |
| Do cap letters and post-2000 side agreements bind retirees or bind M&G to cap benefits? | Cap letters not validly adopted; no binding obligation to cap. | Cap letters and Letter H controlled benefits for retirees. | No unbroken chain; cap letters not binding for Subclasses One–Four; Letter 2003-6 limited to Subclass Five. |
| Should the court impose an injunction without a bond? | Irreparable harm warrant injunctive relief. | Bond appropriate to secure against appellate risk. | No bond required; equitable relief warranted. |
Key Cases Cited
- UAW v. Yard-Man, Inc., 716 F.2d 1476 (6th Cir.1983) (instruction on vesting analysis for retiree benefits; examine CBA language for intent to vest; Yard-Man inference)
- Tackett v. M&G Polymers USA, LLC, 561 F.3d 478 (6th Cir.2009) (vesting framework; surrogate analysis of whether parties intended vesting; guidance on post-remand questions)
- Reese v. CNH America LLC, 574 F.3d 315 (6th Cir.2009) (modifications may occur through a negotiated process; fixed irreducible benefits not required; context of changes valuable)
- Noe v. PolyOne Corp., 520 F.3d 548 (6th Cir.2008) (retiree health plans are welfare plans; vesting hinges on intent within the CBA)