Verso Corporation v. United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO/CLC
3:19-cv-00006
S.D. OhioMar 29, 2022Background:
- Verso announced in Aug. 2017 it would eliminate certain healthcare benefits for union-represented employees who retired before age 65 (retirements between Dec. 21, 2012 and Dec. 31, 2017).
- The USW filed grievances for roughly 178 affected retirees; Verso filed a declaratory-judgment action on Jan. 8, 2019 asserting the change did not violate the LMRA, ERISA, or the CBAs.
- After motions and dismissals, the Court (May 4, 2021) concluded the Master and local CBAs require arbitration of the retiree-health disputes and conditioned arbitrability on the USW obtaining each retiree's consent to representation.
- Plaintiffs moved for reconsideration and, alternatively, for certification of an interlocutory appeal under 28 U.S.C. § 1292(b).
- The Court (Mar. 29, 2022) denied reconsideration and §1292(b) certification, reaffirmed arbitration (with retiree consents), and stayed proceedings pending arbitration; retirees proceed directly to arbitration because they cannot satisfy early grievance steps.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Arbitrability of retirees' healthcare disputes | Grievance procedure structure shows parties did not intend arbitration for retiree disputes | Master CBA and local CBAs are broad; healthcare falls within substantive scope and presumption favors arbitration | Arbitration required under presumption of arbitrability; no clear error in May 4 order |
| Requirement that USW obtain retiree consent | Requiring consent effectively creates class‑wide arbitration prohibited by Stolt‑Nielsen/Lamps Plus/Epic | Not class arbitration; consent is a gatekeeping rule under Sixth Circuit cases allowing union to arbitrate only with retiree consent | Requiring individual retiree consent does not create class arbitration; USW must secure consent and arbitrator will determine scope |
| §1292(b) interlocutory appeal certification | Immediate appeal appropriate because controlling legal questions exist | No controlling question of law in §1292(b) sense; issues are contract interpretation not exceptional | Certification denied — elements of §1292(b) not met (no controlling question/substantial difference of opinion) |
Key Cases Cited
- Granite Rock Co. v. International Brotherhood of Teamsters, 561 U.S. 287 (presumption of arbitrability governs ambiguous grievances)
- AT&T Technologies, Inc. v. Communications Workers, 475 U.S. 643 (framework for interpreting arbitration clauses)
- Cleveland Elec. Illuminating Co. v. Utility Workers Union, 440 F.3d 809 (6th Cir.) (union may arbitrate third‑party retiree rights only with retiree consent)
- United Steelworkers v. Cooper Tire & Rubber Co., 474 F.3d 271 (6th Cir.) (arbitrability and retiree consent principles)
- Van Pamel v. TRW Vehicle Safety Sys., 723 F.3d 664 (6th Cir.) (confirming need for retiree consent before union pursues contractual benefits)
- Stolt‑Nielsen S.A. v. AnimalFeeds Int'l Corp., 559 U.S. 662 (class arbitration requires clear contractual consent)
- Lamps Plus, Inc. v. Varela, 139 S. Ct. 1407 (ambiguity cannot supply contractual basis for class arbitration)
- Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612 (arbitration agreements waiving collective/class procedures are enforceable)