Stone v. Signode Industrial Group LLC

Dist. Ct. did not err in granting plaintiffs-retirees’ motion for summary judgment in proposed class action, alleging that defendants breached 2002 Agreement between defendants' predecessors in interest and plaintiffs’ union to provide health-care benefits for retirees, where, according to plaintiffs, said denial of benefits by defendants violated Labor-Management Relations Act, as well as ERISA. While defendants argued that health-care benefits provided to retirees that were contained in 2002 Agreement did not survive termination of said Agreement, Ct. of Appeals held that: (1) language in 2002 Agreement made clear that promised health-care benefits for retirees would survive termination of Agreement; (2) other courts construing similar language found that continuation-of-coverage provision created vested benefits; and (3) Term Provision in instant Agreement only provided means of expiration of Agreement without affecting already vested benefits. Moreover, behavior of parties supported finding that Agreement provided for vested benefits for retirees, where individual who helped negotiate said Agreement testified that he understood 2002 Agreement to create vested lifetime benefits, and that he advised employees that if they wanted such benefits that they had to retire prior to expiration of 2002 Agreement.