Ludlum retirees lose suit over medical benefits; no appeal planned

Sept. 04--Allegheny Ludlum retirees do not have another appeal planned after the dismissal of their class-action lawsuit disputing recent union contracts that require them to contribute to the cost of their health insurance.

The U.S. 3rd Circuit Court last week upheld an August 2013 decision siding with the specialty steel manufacturer.

The original decision by U.S. District Judge Joy Flowers Conti of Pittsburgh dismissed the case that alleged Ludlum had breached past labor contracts when the company and the United Steelworkers negotiated new contracts in 2007 and 2011 that required retirees to begin paying health-insurance premiums for the first time in 2008.

Gregory Coleman, a Tennessee attorney representing the retirees, said there is no plan to appeal again because it is unlikely the U.S. Supreme Court will hear the case.

"It's disappointing," Coleman said. "The good thing is, the retirees are still continuing to receive their health-care benefits."

Dan Greenfield, spokesman for Ludlum's parent company Allegheny Technologies Inc., declined to comment.

At issue was whether Ludlum should be bound by previous contracts that provided free health care for retirees, who are impacted by new union contracts but don't get a vote once they've retired.

The courts agreed with Ludlum that there was clear language in prior contracts indicating the terms were only valid during the length of those contracts, and that employees who left Ludlum under an early retirement program offered in a 2004 contract also were bound by those terms.

"Plaintiffs have not identified any 'clear and express language' in the (contracts' pension benefits) that confers unalterable, vested lifetime health benefits," wrote 3rd Circuit Judge Patty Shwartz on behalf of the three-judge panel that heard the appeal. "Indeed, the 'Continuation of Coverage' provision explicitly reserves the right to change the health benefits for retirees through future agreement."

Ludlum and the Steelworkers in 2007 negotiated a contract that required retirees to begin paying premiums of $40 per month for a retiree or surviving spouse not yet eligible for Medicare and $80 per month for family coverage. Retirees eligible for Medicare paid half as much.

In August 2011, the union and Ludlum approved a four-year contract that hiked monthly retiree health-insurance premiums by as much as 500 percent.

The contributions in 2012 jumped to $130 per person or $260 per family for pre-Medicare retirees, and $100 to $200 for Medicare-eligible retirees.

The courts also accepted Ludlum's argument that the retirees had missed the three-year window to file the suit. Since the retirees would have known of the alleged breach of contract when the health-care premiums went into effect in January 2008, the case should have been filed by January 2011, Shwartz wrote. The suit wasn't filed until November 2011.

Court documents indicate an exact number of retirees affected by the premiums wasn't known but is believed to be in the thousands.

Impacted retirees included those from Ludlum's Brackenridge Works in Harrison, the Bagdad Works in Gilpin and the Vandergrift Works, plus facilities in Latrobe, Midland and Washington and out-of-state sites in Connecticut, Indiana, Massachusetts, Ohio and Oregon.

Kurt Szymanski of Leechburg, a 31-year employee and former president of the Local 1138 who retired in 2002, was one of the retirees named in the suit. He could not be reached for comment.

Anthony Slomkoski of Harrison, who has led a local branch of the Steelworkers Organization of Active Retirees, also could not be reached.

Coleman was a member of the legal team that represented AK Steel retirees who, in 2009, successfully sued the company over changes to their benefits.

"The language in the contracts was not the same," Coleman said in comparing the AK Steel and Ludlum cases. "We knew that going in. The language in the Allegheny Ludlum contracts was a little tougher."

Liz Hayes is a staff writer for Trib Total Media. She can be reached at 724-226-4680 or [email protected].

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