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Society of Professional Engineering Employees v. Boeing Co.

United States District Court, D. Kansas

July 20, 2018

BOEING CO., et al., Defendants.



         This case comes before the court on Boeing's[1] motion for separate trials (Doc. 697) and Boeing's motion for summary judgment (Doc. 727). The motions have been fully briefed and are ripe for decision. (Docs. 698, 707, 718, 728, 745, 752.)[2] Boeing's motions are DENIED for the reasons stated herein.

         I. Facts and Procedural History[3]

         This case revolves around the sale of Boeing's Wichita plant to Spirit in 2005 and Boeing's treatment of its employees surrounding the sale. An Asset Purchase Agreement (“APA”) was executed in February 2005 and contained terms regarding the hiring of Boeing's workforce. While Spirit was not required to hire all Boeing employees, the purchase price was increased if Spirit hired less than 90% of Boeing's workforce. Boeing employees were informed that they must execute a Consent to Release Information form to be considered for employment by Spirit. Boeing would then release the employee's record to Spirit for consideration. Spirit hired most but not all of the Boeing employees. (Doc. 581 at 4-7.)

         The Boeing Employee Benefits Plans Committee (“Committee” or “EBPC”), which is the Plan Administrator of the Boeing Company Employee Retirement Plan (“BCERP”), the Boeing Retiree Health and Welfare Benefit Plan (“BRHP”), and the Boeing Company Layoff Benefits Plan (“Boeing Layoff Benefits Plan”), informed all Boeing employees prior to the sale that employees who refused to apply for or declined a position at Spirit and those who went to work at Spirit would not be treated as “laid off” for the purposes of pension, medical and severance benefits. Employees who accepted positions with Spirit were considered “terminated pursuant to divestiture, ” which is abbreviated as “TER-DIV.” Employees who applied for a position with Spirit but were not hired were considered “laid off” from Boeing. Finally, Boeing employees who did not apply for a position with Spirit or declined an offer of employment with Spirit were considered “resigned” from employment. This last group is comprised of the remaining individual Plaintiffs in this case. (Doc. 581 at 9-10.)

         This litigation began as a result of Boeing's classification of its employees after the sale. Litigation was initiated in 2005 by the Society of Professional Engineering Employees in Aerospace (“SPEEA”). SPEEA and Plaintiff International Association of Machinists and Aerospace Workers and its District Lodge 70 (“IAM”) are unincorporated labor organizations that represent employees in industries affecting commerce for purposes of collective bargaining.[4]These unions represented a majority of the workforce at Boeing. SPEEA initially brought claims pursuant to § 301 of the Labor Management Relations Act (“LMRA”), § 510 of ERISA, and the Declaratory Judgment Act. (Doc. 1.) In 2007, several individual plaintiffs filed an action against Boeing, the BCERP, the Retiree Health Plan, the EBPC, Spirit Holdings and the Spirit Mirror Plans in case number 07-1043. (Doc. 581 at 10.) Plaintiffs[5] filed motions to consolidate in both cases. (Doc. 74 in No. 05-1251 and Doc. 42 in No. 07-1043.) Magistrate Judge Humphreys granted the motions to consolidate. (Doc. 81.) Magistrate Judge Humphreys held that Boeing could later move for separate trials pursuant to Fed.R.Civ.P. 42(b) for “convenience, to avoid prejudice, or to expedite and economize.” (Doc. 81 at 2.)

         In their complaints, Plaintiffs allege claims pursuant to § 301 of the LMRA. Essentially, Plaintiffs allege that Boeing breached the various collective bargaining agreements (CBAs) due to Boeing's failure to classify all employees as “laid off” from employment at Boeing at the time of the sale. As a result, the employees who were between the ages of 49 and 55 could not collect an early retirement pension and health care benefits at age 55. Plaintiffs also allege that Boeing breached the CBAs by amending the BCERP. The individual plaintiffs additionally brought claims under ERISA, seeking the benefits that would have been provided if the employees were “laid off.” The terms “laid off” and “layoff” are used in various Boeing documents, including the CBAs and the benefit plans, but they are not defined in the documents. The meaning of the terms has been the subject of this litigation.

         The individual plaintiffs were comprised of two different groups: the Harkness Class and the McCartney-Boone Plaintiffs. The Harkness Class was comprised of Boeing employees who were between the ages of 49 and 54 years of age as of June 16, 2005, and began employment with Spirit on Day One (June 17, 2005). The McCartney-Boone Plaintiffs are comprised of Boeing employees who were between the ages of 49 and 54 years of age as of June 16, 2005, but either refused to complete the consent form or declined an offer of employment from Spirit. (Doc. 548 at 9.)

         In July 2008, the court granted class certification of the Harkness Class. (Doc. 118.) The Harkness Class included approximately 1, 800 individuals. There are fifteen individuals remaining in the group of McCartney-Boone Plaintiffs. The McCartney-Boone Plaintiffs did not seek class certification.

         On October 3, 2011, the pretrial order was entered. The pretrial order sets forth Plaintiffs' claims and Boeing's defenses and estimated that the trial would last two to three weeks. The pretrial order set forth a briefing schedule for the parties' motions for summary judgment. The pretrial order did not contemplate a motion to bifurcate the trials. (Doc. 548.)

         The parties filed their respective motions for summary judgment in late 2011 and in 2012. Boeing moved for summary judgment on all claims. (Doc. 555.) On December 11, 2012, Judge Belot entered an order denying Plaintiffs' motion for partial summary judgment and granting in part and denying in part Boeing's motion for summary judgment (the “Summary Judgment Order”). (Doc. 581.) Plaintiffs moved for reconsideration of the Summary Judgment Order pertaining to IAM's claim for breach of contract. (Doc. 582.) Boeing opposed the motion due to Plaintiffs' failure to show that the motion met the standards for reconsideration and because Plaintiffs raised arguments that could have been raised at the time the motion was filed. (Doc. 584.) The court denied Plaintiffs' motion. (Doc. 585.)

         On January 31, 2013, the court issued an order determining that Plaintiffs had a right to a jury trial on the § 301 claims. (Doc. 588.) The court declined Plaintiffs' request that the jury issue an advisory opinion on the ERISA claims. (Id.) The parties engaged in further discovery on damages after the court's orders. On May 8, 2015, Plaintiffs filed an unopposed motion for approval of the Harkness Class settlement. (Doc. 632.) The court held a fairness hearing on August 19, 2015, and entered an order approving the Harkness Class settlement on September 3, 2015. (Doc. 671.)

         The McCartney-Boone Plaintiffs and the unions have not resolved the remaining claims. On April 24, 2017, Judge Marten held a status conference.[6] The parties then submitted an agreed scheduling order to the court. (Doc. 689.) The scheduling order established deadlines for the remaining damages discovery. It also included deadlines for Boeing to file motions for summary judgment on liability and damages. (Id.)

         On June 15, 2017, Boeing filed a motion for separate trials. (Doc. 697.) Plaintiffs filed a response in opposition. (Doc. 707.) On September 22, 2017, Boeing again moved for summary judgment on all remaining claims. (Doc. 727.) On January 8, 2018, Plaintiffs filed a response to Boeing's motion arguing that the motion failed to comply with this court's rules on motions for reconsideration ...

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