ORDER
Plaintiffs allege that “Defendant bargained with the Union Local Lodge No. 933 for four consecutive Collective Bargaining Agreements (CBAs) spanning a period of over fourteen years (beginning in 1990 and ending in 2004) that retirees and their spouses would have company-paid health care coverage until age 65.” 1 (P’s Response to Motion for Judgment on the Pleadings (Rule 12(c) Motion) at 6.) Plaintiffs sue Defendants under the Employee Retirement Income Security Act (ERISA) and the Labor Management Relations Act (LMRA), challenging Defendant’s decision that they must contribute toward the cost of their retirement healthcare benefits. Plaintiffs allege this breached the CBAs in violation of the LMRA and that correspondingly modifying the healthcare bene *729 fit plans violated ERISA. Plaintiffs seek reinstatement of their company-paid retirement benefits, damages for healthcare expenses they incurred, extra-contractual damages for mental and emotional distress, and punitive damages. Plaintiffs seek certification of this case as a class action.
Defendant argues for judgment on the pleadings, pursuant to Fed.R.Civ.P. 12(c), because extra-contractual damages and punitive damages cannot be recovered under either ERISA or LMRA. Defendant objects to the class definition proposed by the Plaintiffs, arguing that it must be narrowed to exclude individuals who released or waived any claims against Defendant and to exclude persons whose claims are based on retirement before July 1, 1994, and retirement after or on November 2, 2003. Furthermore, Defendant argues that membership in the class must be limited by express qualifying conditions in the CBAs for retirees, spouses, and dependants. Otherwise, there is no objection to certifying the class.
Extra-contractual and punitive damages are not available under ERISA or LMRA.
First, the Court notes that the First Amended Complaint seeks compensatory and punitive damages under ERISA, section 502(a)(1)(B), and LMRA, section 301(a), see (First Amended Complaint at ¶¶22 and 32), but does not allege mental or emotional distress. Plaintiffs, however, submit affidavits to support their Motion for Class Certification that allege in relation to each Plaintiff-representative that mental and emotional suffering was caused by the alleged breach of the CBAs and the ERISA violation. In response to Defendant’s Rule 12(c) Motion, Plaintiffs argue that ERISA and the LMRA provide for punitive damages and extra-contractual damages for mental and emotional distress. (P’s Response to D’s Rule 12(c) Motion; P’s Reply to D’s Opposition to P’s Motion for Class Certification at 10.)
Under ERISA, section 502(a)(1)(B), Plaintiffs may recover benefits due them and may sue to enforce their rights under a plan or to clarify their rights to future benefits under a plan. 29 U.S.C. § 1132(a)(1)(B). Extra-contractual damages are those that give a beneficiary more than he or she is entitled to receive under terms and provisions of the plan.
Zielinski v. Pabst Brewing Comp.,
There are six carefully integrated civil enforcement provisions found in section 502(a) of ERISA, which provide “strong evidence” that Congress did not intend to authorize other remedies. Congress has repeatedly emphasized that the purpose of ERISA is to protect contractually defined plan benefits. The stark absence in the statute itself and in its legislative history of any reference to recovery of extra-contractual damages led the Supreme Court to conclude that ERISA bars extra-contractual claims.
Massachusetts Mut. Life Insurance Co. v. Russell,
The Supreme Court has repeatedly rejected claims for punitive and extra-contractual damages under ERISA.
See Aetna Health Inc. v. Davila,
In
Bast v. Prudential Insur. Co.,
In the ninth circuit, a participant may file a civil action “to recover benefits due him under the terms of his plan,”
Bast,
Plaintiffs concede that under the LMRA, “ ‘the general rule, [ ], is that punitive damages are not allowed in actions for breach of contract brought under section 301,’ ” (P’s Response at 2) (quoting
Moore v. Local Union 569 of the IBEW,
These breach of labor contract cases are in keeping with the general rule that mental suffering is not compensation for breach of a contract. 24 Williston on Contracts § 64:7 (4th ed.2007) (citing
Farmers Insur. Exchange v. Henderson,
Likewise, Plaintiffs argue, “that in very limited circumstances a court may award punitive damages under Section 301.” (P’s Response at 2-3 (citations omitted)). Plaintiffs argue that damages for emotional distress are available under the LMRA because the underlying CBAs dealt with matters of “obvious mental concern and solicitude for retirees such as maintenance of health and vision care during their declining years when they are no longer actively earning an income.”
Id.
(quoting
Int’l Union, United Automobile, Aerospace and Agricultural Implement Workers of America v. Federal Forge, Inc.,
Plaintiffs argue that “[p]unitive and extra-contractual damages
are
appropriate in this case given the scope of Raytheon’s ‘persistent misconduct’ and ‘salutary effect’ that would be created generally within the defense industry, and specifically at Arizona’ largest defense contractor, by deterring such conduct in the future.” Plaintiffs refer to conduct by Raytheon in Texas similar to that allegedly taken by Raytheon in this case and to another ease in Arizona where Raytheon took similar action against non-bargaining retirees.
Id.
at 4 (citing
Holodnak v. Avco Corporation, Avco-Lycoming Division, Stratford Connecticut,
When employees sue their union, the United States Supreme Court has decidedly held that punitive damages are not available for breach of the duty of fair representation.
Merk v. Jewel Food Stores,
The court in
Merk
relied on
Foust,
which involved a claim under the Railroad Labor Act (RLA), but it and the National Labor Relations Act (NLRA) and the LMRA are all labor statutes that are all essentially remedial in nature, rather than punitive.
Foust,
In a case for breach of a collective bargaining agreement, the award of compensatory damages depends on “a causal relationship between the company’s violation of the agreement and the loss claimed by the employee.”
Howard P. Foley v. IBEW, Local 639,
Nevertheless, in the ninth circuit there is some precedent for awarding damages for mental and emotional distress.
See: Bloom v. Int’l Bhd. of Teamsters, Local 468,
Fortunately, this Court does not need to decide the question as a matter of first impression because Plaintiffs fail to allege
*733
facts to support either a claim for punitive damages or mental and emotional distress. There is no legal support for awarding such damages on facts similar to those in this case, except for
Federal Forge, Inc.,
where the court held that CBA provisions involving retirement healthcare benefits are contractual agreements “which by their very nature, so plainly involve the emotions of the plaintiff that liability for mental distress was or could have been within the contemplation of the parties when it was executed.” Almost all retirement benefits can be similarly described. Almost all healthcare benefits can be similarly described.
Federal Forge
reaches beyond the limited scope of recovery for mental distress envisioned by the Restatement of Contracts.
See
Restatement (Second) of Contracts, § 353, comment and illustrations (loss of money is often disturbing, especially if it causes impoverishment or bankruptcy, and may by chance cause severe emotional disturbance, but the contract must be one where there is a “particularly likely” risk of emotional disturbance.
See Brooks v. Hickman,
Allegations in the First Amended Complaint do not allege extreme and outrageous conduct such as that relied on in
Richardson v. Communications Workers of America,
The Court finds that the are no facts or law to support Plaintiffs claims for punitive damages and for extra-contractual damages for mental and emotional distress. The Court grants Defendant’s Motion for Judgment on the Pleadings, Fed. R.Civ.P. 12(c), because it appears that Defendant is entitled to judgment as a matter of law.
Geraci v. Homestreet Bank,
First Amended Motion for Class Certification
A. The class should exclude persons who released or waived their claims.
Defendant argues that some employees who were eligible for coverage under the Plan, waived coverage for various reasons, such as spouses who declined coverage because they were covered under some other plan. (D’s Objection at 2.) Defendant argues that in exchange for early retirement packages, other employees executed Separation and Release Agreements “which included, without limitation, ‘claims arising under the applicable collective bargaining agreement.’ ” Id. at 3 (citing Ex. A-l Separation and General Release Agreement signed by Class-Representative Claire L’Armee on December 23, 1998.) Defendant argues that the class should not include employees who either waived their coverage or released their claims.
In the event the Court decides to include these individuals in the class, the Defendant requests leave to Amend its Answer to include an affirmative defense of release and counterclaims where appropriate. (Id. at 3.)
Plaintiff does not dispute Defendant’s challenge to employees that waived coverage under the Plan so such retirees, there spouses, or their dependants shall be *734 excluded. Plaintiff does, however object to Defendant’s assertion that some employees released their claims.
The release relied on by Defendant is in pertinent part, as follows:
In exchange for supplemental benefits as set forth in the Voluntary Supplemental Separation Plan (VSSP), Employee does hereby release and forever discharge [Defendant] ... from any and all claims, litigation, demands and causes of action, known or unknown, fixed or contingent, which Employee may have or claim to have against [Defendants] arising from or connected with Employee’s employment by, or termination from Raytheon, and does hereby covenant not to file a lawsuit to assert such claims. This includes but is not limited to claims arising under the applicable collective bargaining agreement, if any, or federal, state or local laws prohibiting employment discrimination or claims growing out of any legal restrictions on Raytheon s right to terminate its employees (including claims under the Age Discrimination in Employment act (ADEA)).
(D’s Objection, Ex. A-l: Separation and General Release Agreement.)
The employees signing this release agreed to not file a lawsuit to assert claims “arising from or connected with Employee’s employment by, or termination from Raytheon,” including such claims arising under the CBAs, federal, state or local laws prohibiting employment discrimination or claims growing out of any legal restrictions on Raytheon’s right to terminate its employees (including the ADEA). The Court finds that the language releasing claims employees “may have or claim to have” was written in the present tense and did not reach future, actionable, conduct by the Defendant. Furthermore, the release was limited to claims related to employment by Raytheon or Raytheon’s termination of that employment. The Court finds that this release does not reach claims against Raytheon accrued subsequent to the execution of the Release Agreements. Especially, the release does not reach these Plaintiffs’ claims, which relate to Raytheon’s administration of the Plan and termination in company-paid healthcare benefits and not their employment by or termination by Raytheon. Because the Court finds this argument lacks merit, there is no basis for Defendant to amend its Answer to add these arguments as affirmative, defenses or counterclaims.
B. The class should exclude persons who retired before July 1, 199U or after November 2, 2003.
Plaintiffs have included in their proposed class definition employees, spouses of employees, and dependants of employees, who retired under CBAs in existence prior to July 1, 2004, including CBAs that became effective in 1990, 1993, 1996, and 1999. Defendant objects to the inclusion of the 1990 CBA.
First, the First Amended Complaint did not allege any rights under the CBA, effective in 1990. It only describes company paid retiree medical coverage granted in CBAs effective for 1993, 1996, and 1999. Second, the CBAs provided benefits for retirees who were “at least 55 but less than age 65” when they retired. Defendant calculates that anyone who retired at age 55 under the 1990 CBA or the 1993 CBA would have aged out of coverage by the time the 2004 changes were implemented. In other words, persons who retired before July 1, 1994 would have turned 65 before July 1, 2004, when the contested changes to Raytheon’s retiree healthcare plan took effect. Defendant asserts that the class definition should exclude all persons who retired prior to July 1, 1994, and their spouses and dependents.
*735 Plaintiffs admit that the mathematical calculations are correct for retirees, but not for spouses and dependents. Spouses remained eligible until they attained the age of 65 and dependent children remained eligible for coverage until the age of 21 or 25, if attending college. Plaintiffs give several examples to prove their point that while retirees would have aged out of the class, some spouses and dependants of retirees, retiring before July 1, 1994, would remain. The Court is not persuaded that the beginning time period, July 1, 1994, proposed by Defendant serves to clarify or narrow the class definition.
Similarly, the Court is not persuaded that there is any benefit to setting an end period for the class. Defendant argues that the class should exclude persons who retired on or after November 2, 2003. Defendant submits that the changes in healthcare benefits challenged by the Plaintiffs occurred in the 2003 CBA, effective November 2, 2003, Therefore, persons retiring after November 2, 2003, should be excluded from the class. This end date conflicts with the date the premium changes were implemented: July 1, 2004. This confusion seems pointless, given the simplicity of connecting class membership to the CBAs at issue in the case.
The Court rejects setting a beginning and ending time period as part of the class definition. These dates seem to only confuse the definition, which is more accurately described by the CBA which covered the employee’s retirement. The class definition should be limited to retirees, spouses of retirees, and eligible dependents of retirees, “who retired under collective bargaining agreements in existence prior to July 1, 2004, effective in 1993, 1996, and 1999.”
The Court will not approve a class definition broader than the allegations in the First Amended Complaint. Unless the First Amended Complaint is amended to allege a violation of the 1990 CBA, the proposed class is limited to those who retired under the CBAs, effective in 1993, 1996, and 1999.
C. The class must be defined consistent with section D of the CBAs.
Both parties agree that any certified class must take into account the CBAs express restrictions on coverage, all of which are contained in section D of the CBAs. The Court has reviewed the definitions of the class proposed by both Plaintiffs and Defendant. The Plaintiffs’ proposed definition contains persons retiring under the 1990 CBA and fails to include the section D limitations. The Defendant’s proposed definition contains the beginning and end dates, which this Court has concluded will only confuse matters. In light of the rulings by the Court made here, the parties should work together to revise the class definition in accordance with the directives of the Court. The parties should take care to draft a clear and concise class definition.
Class Certification
Given the parties’ presentation to the Court of a class defined as described by the Court in this Order, it shall be certified. The Individual Plaintiffs and Proposed Class Representatives are approved. It is undisputed that the prerequisites for a class action exist as provided for in Fed.R.Civ.P.23(a):
One or more members of a class may sue or be sued as representative Parties on behalf of all only if (1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the represen *736 tative parties will fairly and adequately protect the interests of the class.
In addition to all of the above prerequisites being met in this case, it is undisputed that the class may be certified under Rule 23(b)(1) and (2).
Under Rule 23(b)(1) the class is certified because ERISA requires plan administrators to treat all similarly situated participants in a consistent manner,
John Blair Communications, Inc. Profit Sharing Plan v. Telemundo Group, Inc. Profit Sharing Plan,
The test for certifying the class under Rule 23(b)(2) is also met here. It is undisputed that the Defendant acted or refused to act on grounds applicable to the class, making final injunctive relief or corresponding declaratory relief appropriate with respect to the class as a whole.
See Davis v. Weir,
Accordingly,
IT IS ORDERED that Defendant’s Motion for Judgment on the Pleadings (document 68) is GRANTED. Plaintiffs’ claims for punitive damages and claims for extra-contractual damages are dismissed.
IT IS FURTHER ORDERED that Plaintiffs’ Motion to Certify the Class (document 63) is GRANTED. Within 20 days of the filing date of this Order, the parties shall jointly file the class definition, pursuant to the directives of this Court. In the event the parties are unable to jointly file the definition, the Plaintiffs shall file the proposed definition. Defendants shall have 10 days to respond. There shall be no Reply unless requested by the Court.
Notes
. Eligible dependants also received healthcare benefits under the CBAs.
. Rule 23(b)(1)(A) provides for a class action if prosecution of separate actions would create a risk of: "inconsistent or varying adjudications with respect to individual members of the class which would establish incompatible standards of conduct for the party opposing the class.”
