Appeals court rules against Hoover Co. retirees

Feb. 28-- Feb. 28--A federal appeals court has ruled Hoover Co. retirees are not entitled to lifetime health care benefits.

The 6th Circuit Court of Appeals ruling is the latest development in the long legal saga that could mark the end of the legal fight.

A three-judge panel earlier this month reversed a U.S. District Court ruling that said the former Hoover workers were entitled to lifetime medical insurance.

In a 2-1 decision, the appeals court ruled against the retirees and in favor of the Whirlpool Corp.

Jim Repace, former longtime president and business manager of International Brotherhood of Electrical Workers Local 1985, said he's outraged by the ruling.

"These judges don't care about the American worker," said Repace, who has been heavily involved in representing the interests of the retirees during the prolonged legal battle. "All they care about is big business and that's the direction they go in their decision."

"Every one of our retirees knows what they were promised when they retired," Repace added. "They (based ) retiring when they did on knowing they had (health care) benefits for life."

In January, Hoover retirees overwhelmingly rejected a proposed settlement.

"It's not fair that with a stroke of a pen that judges (reversed the district court ruling) not having knowledge of what happened in the negotiations," Repace said, noting contract adjustments had been made over the years on wages and other employment issues to ensure lifetime health care benefits.

A motion is expected to be filed on behalf of the retirees requesting all of the 6th Circuit judges to review the ruling, Repace said.

'Extremely disappointed'

Brian Zimmerman, among the attorneys representing the retirees, said a majority of the judges would have to agree to a review. If that happens, he said, potential outcomes include reversing the panel's ruling, modifying the ruling or sending the case back to U.S. District Court.

The next option would be to ask the U.S. Supreme Court to hear the case.

"I'm extremely disappointed with the ruling but I'm not surprised at all," Zimmerman said on Wednesday.

He estimated the decision by the Cincinnati-based 6th Circuit impacts an estimated 1,300 to 1,500 retirees. The former workers retired from the North Canton-based Hoover Co. and its successors, Maytag and Whirlpool, during a 27-year period.

Zimmerman said he had strongly recommended retirees accept the settlement based upon recent decisions by the 6th Circuit and U.S. Supreme Court. "The vast majority of the retirees (attending the January meeting) followed counter advice," he said.

Attorneys representing Whirlpool in the litigation did not respond to email messages Wednesday.

Zimmerman said it's up to Whirlpool on how to proceed with the health insurance issue and decide whether the retirees will receive no medical benefits or a monthly stipend of $85; that was the amount the company offered in 2011 when it notified retirees it planned to reduce health care benefits and reserved the right to terminate them. Retirees responded with the federal lawsuit.

Zimmerman said he couldn't comment on the terms of the proposed settlement that was rejected.

Three-judge panel

Judges Eugene E. Siler and Richard A. Griffin sided with Whirlpool, finding there was no specific collective bargaining agreement language promising lifetime health care benefits. Their ruling overturns the 2014 ruling by U.S. District Court Judge Benita Y. Pearson that more than 1,000 retirees were entitled to lifetime health care benefits.

Zimmerman said those two judges ruled that when individual collective bargaining agreements ended so did the terms of the healthcare benefits.

Judge Jane B. Stranch had a vastly different opinion.

"Over and over again, companies promised their retirees lifetime health care benefits," she writes. "But now, over and over again, we find that the contracts they negotiated unambiguously state the opposite.

"We thereby avoid the mountains of evidence that the parties intended exactly what they promised," she added. "... In these cases, the contractual language was negotiated in a legal environment in which everyone understood it is to constitute an ongoing promise, the employer publicly and repeatedly reiterated that promise in word (both spoken and written) and in deed, and working men and women relied on that promise.

"Because we changed the rules of the game after the game was over, I respectfully dissent."

Devastating impact

Whirlpool acquired Hoover Co. during a 2006 merger with Maytag, which purchased Hoover in 1989. Whirlpool sold the Hoover business to Techtronic Industries but agreed to fund future retiree liabilities.

Losing the Hoover-related health care benefits will be devastating for retirees, Zimmerman said.

"You're dealing with mostly people of advanced age who are having numerous health issues and have a very limited fixed income," the attorney said. "So for them to now have to pay enormous co-pays or enormous costs for prescription drugs, many of them are not going to be able to afford it."

Reach Ed at 330-580-8315 and [email protected]

On Twitter @ebalintREP

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