# Petition for Writ of Certiorari — Branson v. Greyhound Lines, Inc., Amalgamated Council Retirement & Disability Plan

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1998
- **Citation:** 523 U.S. 1047

## Text

Court, D.
FILED
97 1247 JAN 2 8 19%
No. ___oeeice oF THE CLERK

IN THE

Supreme Court of the Anited States

October Term, 1997

JENNELL L. BRANSON
Petitioner

v.
GREYHOUND LINES, INC. AMALGAMATED

COUNCIL RETIREMENT AND
DISABILITY PLAN

Respondent

On Petition for Writ of Certiorari
To The United States Court of Appeals
for the Fifth Circuit

PETITION FOR WRIT OF CERTIORARI

MIKE MILLIGAN

Counsel of Record

303 Texas Avenue, Suite 808
El Paso, Texas 79901

(915) 544-5587

QUESTION PRESENTED FOR REVIEW

The administrator of an ERISA pension plan decides
that a participant’s rights in the plan will depend on the
lawfulness of his seniority agreement with the employer, as
determined by the NLRB. The NLRB decides in favor of the
participant, who then files suit for a declaratory judgment that
the plan must abide by the administrator’s decision. The plan’s
lawyer then has the plan trustees come up with a new reason for
ruling against the participant. The plan gives interpretive power
to the trustees, but there is reason to believe they have a conflict
of interest and are biased against the participant. Should the
“arbitrary and capricious” standard apply under these
circumstances?

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LIST OF PARTIES

All of the parties in the United States Court of Appeals

for the Fifth Circuit are listed in the caption.

TABLE OF CONTENTS

Page

QUESTION PRESENTED FOR REVIEW.................... i
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TABLE OF CITED AUTHORITIES...................000000000. iv
as Sono csccsscctveedecnedees<essisccscedecenss l
PAE Ee FOIEII EMIT oso ccseceopscsocerssesssessessoresseseses ]
STATUTORY PROVISIONS INVOLVED...................... |
STATEMENT OF THE CASE...............:..cccccccssssssessnsooees 2
REASONS FOR GRANTING THE WRIT.............00.0.0.... 7
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iv
TABLE OF CITED AUTHORITIES

Cases Page(s)

Branson v. Greyhound Lines, Inc. Amalgamated
Council Retirement and Disability Plan,
126 F.26 747 (SG Car. T9GT)......eccccccccesccsccceess 1,2

Brown v. Blue Cross & Blue Shield of Alabama,
Inc., 898 F.2d 1556 (11th Cir. 1990)................. 1]

Diaz v. Seafarers Union, 13 F.3d 454 (ist Cir. 1994)... 9

Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101,

109 S.Ct. 948, 103 L.Ed.2d 80 (1988)............ 7,8,9,10
Greyhound Lines, Inc. and Amalgamated Council,

SED LT, SEO Ci sisiivinipiccemenenrsinersns a5
Henry v. Home Insurance Company, 907 F.Supp.

SDURR RP Wr erecincticacacetaasencebiicceicngse. 10
Jones v. Sonat, Inc. Master Employee Benefits

Plan, 997 F.2d 1556 (11th Cir. 1990)................ 1]
Korematsu v. United States, 323 U.S. 215, 65 S.Ct.

193, 89 L.Ed.2d 194 (1944)... 10
Lowry v. Bankers Life & Casualty Retirement Plan,

S71 B20 S22 C5 Ce: TOI. noo seccccccccsccncss. 11]
Statutes
se BNE visi toeky cine venssctnltin Attire cen Cagadicbantn l

RT 6 1

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OPINIONS BELOW

The District Court made findings of fact and conclusions
of law, reproduced in the Appendix, but which were
unreported. The Court of Apneals affirmed. Branson v.
Greyhound Lines, Inc. Amalgamated Council Retirement and
Disability Plan, 126 F.2d 747 (Sth Cir. 1997).

BASIS FOR JURISDICTION

The judgment sought to be reviewed was entered on
October 30, 1997. This Court has jurisdiction to review the
judgment of the Court of Appeals pursuant to 28 U.S.C. §

1254(1).

STATUTORY PROVISIONS INVOLVED

Section 1132(a)({1)(B) of Title 29, United States Code,
provides in pertinent part as follows:
“(a) Persons empowered to bring civil action
A civil action may be brought —
(1) by a participant or beneficiary —

* * *

(B) to recover benefits due to him under the
terms of his plan, to enforce his rights
under the terms of the plan, or to clarify

2

his rights to future benefits under the
terms of the plan;”

STATEMENT OF THE CASE

| The Circuit Court’s summary of the evidence is

generally correct, but incomplete in several key respects.
Accordingly, other undisputed facts will be included, with
appropriate references to the record.

Mr. Branson sued his employer, Greyhound Lines, Inc.
(“Greyhound” or “GLI’) and the pension plan which GLI runs
with its union (“the Plan”). He accused GLI of breaching its
agreement to give him seniority credit for 10.18 years of prior
Greyhound service (followed by about a three-year break), and
he sought a declaratory judgment that the Plan should also treat
him as having that same seniority restored to him. He lost on
both issues in the United States District Court for the Western
District of Texas, but the Fifth Circuit reversed as to GLI and
affirmed as to the Plan, applying the familiar “abuse of
discretion” standard. Branson v. Greyhound Lines, Inc., 126
F.3d 747, 756-758 (Sth Cir. 1997). See also Appx., pp. 22a-
23a. The contract claim against GLI is not before this Court,
absent a certiorari application from it. However, many facts
about the contract claim are relevant to the pension plan issues

and will therefore be included in the summary.

3

Mr. Branson was a Greyhound bus driver from 1977 to
1987, hac a break in service of about two years and eight
months, and then returned to GLI during the bitter and vic!ent
strike of 1990. The National Labor Relations Board has
graphically described Greyhound’s negotiating strategy in
Greyhound Lines, Inc. and Amalgamated Council etc., 319
N.L.R.B. 554, 559-561 (1995).

In general, Greyhound was trying to break its union by
making non-negotiable demands for certain clauses in the
collective bargaining agreement then being negotiated. One
clause, entitled “Active Duty Language,” would have treated
returning strikers as new employees, with no seniority, when
they reapplied for reinstatement after the strike. 319 N.L.R.B.
at 566-567. The other, known as “Experience Based Seniority”
(“EBS”), gave drivers Greyhound seniority for all of their
experience “as a Department of Transportation qualified over-
the-road tractor-trailer operator, over-the-road charter bus

operator, or intercity bus operator,” Jd, p. 568, which
benefitted the strike breakers almost exclusively, since most of
them had been working elsewhere prior to the strike. Those
two clauses would have effectively placed the strike breakers at
the top of GLI’s seniority heap, to the extreme detriment of the
strikers. GLI’s tactics caused the strike to turn ugly and
violent, and at least one striker was killed. Jd, p. 561. Mr.

4

Branson was caught in the middle and very much still is, at least
as far as his pension rights are concerned. Despite the clear
distinction between EBS and Greyhound seniority, both GLI
and the Plan have chosen to treat Mr. Branson as a beneficiary
of the hated (and eventually banned) EBS ploy.

All the parties agreed and the District Court found that
Mr. Branson had a vested interest in the Plan as a result of his
10.18 years of prior service. R., Vol. 1, p. 39. The issue was
whether he could continue earning credits under the Plan for his
service after returning to work in 1990. The difference is
substantial: almost $1,100 per month for life. Jd, p. 47.

The clause in the Plan entitled “Break in Service” says
that an individual who returns to work with more than 10 years
of vesting service can resume accruing retirement credit in the
Plan. However, another clause, entitled “Participation,” says an
employee cannot later resume active participation if he
“terminates employment . . . and thereupon loses his seniority
under the collective bargaining agreement .. .”. Cf §§ 2.1 and
2.4 of Plaintiff's Exhibit 17. The two clauses cannot be
reconciled, unless they relate to different subjects.

When Mr. Branson first began trying to get the Plan to
follow its break in service clause, Plan administrator Paul E.
Owsley, a former president of the union, R., Vol. 5, pp. 71-72,

5

rebuffed him, on the grounds that Mr. Branson had been “re-
hired and not reinstated.” Then, Mr. Owsley and union
assistant business agent Wes Ponsford changed their position,
saying that Mr. Branson’s status as a re-employed employee
would be determined by the NLRB in its resolution of the EBS
issue. Plaintiff's Exhibit 18 (part). However, when Mr.
Branson raised the matter with GLI, it took the same position
in the exact same language as that first used by Mr. Owsley: Mr.
Branson could not take advantage of the break in service clause
because he had been “re-hired and not reinstated.” Plaintiff's
Exhibit 10.

The NLRB ruled in Mr. Branson’s favor, basically. It
did hold that EBS was an unlawful superseniority program,
inherently destructive of the right to strike, 319 N.L.R.B. at
571-575, but it painstakingly distinguished EBS from
Greyhound seniority. Jd, at 570. The Board held that EBS
was illegal, but Greyhound seniority was not EBS. Mr.
Branson pointed this out in correspondence with both the union
and the company. See Plaintiff's Exhibit 18. The Plan ignored
him, and GLI informed him that it considered his Greyhound
seniority to be the same as EBS. Mr. Branson filed suit first
against the Plan and then against GLI after it kept refusing to
recognize the difference between EBS and Greyhound seniority.
See Plaintiff's Exhibit 4.

6

The Plan raised as a defense Branson’s failure to exhaust
his administrative remedies by appealing to the Plan trustees.
The District Court abated the proceedings so that he could do
so, which gave the Plan’s attorney an opportunity to come up
with a defense which would, hopefully, sound better than
deferring to the NLRB.

The Plan did not receive any independent advice about
the claim. Instead, its attorney of record in this case provided
a memo recommending denial of Mr. Branson’s claim because, _
upon his 1987 resignation, Mr. Branson had “thereupon” lost
his seniority under the applicable CBA. The CBA in effect then
set out various circumstances in which Greyhound was required
to recognize former seniority during subsequent employment.
The Plan’s attorney proposed that the trustees apply the
principle of “expressio unius est exclusio alterius” and interpret
the CBA’s requirement of prior seniority recognition in certain
circumstances as a prohibition of such recognition in all other
circumstances. Defendant’s Exhibit Plan F. The trustees
rubber stamped their attorney’s recommendation without
elaboration. Defendant’s Exhibit Plan G.

The trustees consisted of three company representatives
and three union representatives, including Mr. Dick Simpson,
R., Vol. 5, p. 75, the president and business agent for the union,

7

who previously had refused Mr. Branson’s request for union
assistance in this very same matter. Plaintiff's Exhibit 18 (letter
dated 9/14/93). The union appointees had obvious reason to
resent Mr. Branson for helping GLI try to break the union.
Greyhound showed its animus against Mr. Branson by trying to
break its 1990 agreement with him and by threatening him with
termination on the eve of trial if he did not accept its offer of

settlement. R., Vol. 1, pp. 86-88; R., Vol. 5, pp. 6-7.

At any rate, the Plan now had a new justification for its
denial of Mr. Branson’s claim and a new defense to his suit.
The distinction between being “re-hired” and “reinstated,”
drawn by Mr. Owsley and Greyhound, would not be mentioned
again. Likewise, there would be no further mention of how Mr.
Owsley and the union had told Mr. Branson that his rights under
the pension plan depended upon resolution of the EBS issue by
the NLRB.

REASONS FOR GRANTING THE WRIT

The deferential standard for judicial review of pension
plan determinations, variously called “abuse of discretion” and
“arbitrary and capricious,” has effectively eliminated any
meaningful judicial oversight in this critical area of our national
economy. The time has come for this Court to clarify whether

this is what it really meant to occur when it decided Firestone

Tire & Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 103
L.Ed.2d 80 (1988). The extreme misfortune of Mr. Branson
furnishes a good opportunity for such a salutary exercise of this
Court’s power.

Mr. Branson was unfortunate enough to find himself
caught in the middle of something like a war between two
exponents of big business and big labor who happened to
control a big pension plan. He allowed Greyhound to use him
in its shameless campaign of union busting, and it is fatuous to
say that the union bore him no grudge. Eventually, GLI turned
against him so completely that they threatened to terminate his
employment if he did not settle with them the day before trial.
There was certainly more than ample reason to believe that the
pension plan trustees appointed by GLI and the union were
“operating under a conflict of interest.” Firestone, 489 U.S. ai
115, 109 S.Ct. at 957.

Not surprisingly, the responses Mr. Branson got from
Greyhound, the union, the Plan administrator, and the trustees
all look suspiciously like a search for some excuse that would
fit their predetermined conclusion to deny his claim. At various
times they told him the problem was that he had been “re-hired
and not reinstated,” or that his rights would depend on the
NLRB’s predictable response to the pending no-brainer about

9

the legality of EBS, and finally that he lost because of a
completely new maxim of construction: “requirement of certain
things is prohibition of all others.” This case thus represents an
extreme, but probably not isolated, example of the extent to
which the deferential standard has immunized pension plan

Interestingly, this Court’s seminal decision establishing
the deferential standard in Firestone was dictum. The company
in that case was trying to get this Court to hold that ERISA
itself established the deferential standard without regard to plan
language. Firestone, 489 U.S. at 111-113, 109 S.Ct. at 954-
956. This Court held instead that ERISA mandates “a de novo
standard unless the benefit plan gives the administrator or
fiduciary discretionary authority to determine eligibility for
benefits or to construe the terms of the plan.” 489 U.S. at 115,
109 S.Ct. at 956-957.

What happened next was thoroughly predictable. Every
single ERISA plan in the country was changed to take
advantage of this Court’s dictum. Plans were even allowed to
apply the changes and the deferential standard retroactively.
Diaz v. Seafarers Union, 13 F.3d 454, 458 (Ist Cir. 1994). A
diligent search has turned up a grand total of one reported case
in which a court has held the deferential standard to have been

10

met. Henry v. Home Insurance Company, 907 F.Supp. 1392
(C.D.Cal. 1995).

Such a state of the law, as a practical matter, amounts
to considerably more than deference and something at least
fairly close to absolute immunity. Courts do hold, from time to
time, that various government agencies have behaved arbitrarily
and capriciously, and courts of appeal similarly will find, on
occasion, that trial judges have abused their discretion. ERISA
pension plans’ apparent one hundred percent litigation success
rate under the deferential standard, however, is even more
striking than experience with the “strict scrutiny” standard for
racial classifications which had at least one conspicuous
exception in Korematsu v. United States, 323 U.S. 215, 65
S.Ct. 193, 89 L.Ed.2d 194 (1944). Simply put, no decision —
and certainly no dictum — of this Court has ever immunized so
thoroughly an entire industry as Firestone apparently has.

Some courts of appeal, while never ruling against a
pension plan, have picked up on this Court’s dictum within

dictum to the effect that conflict of interest is a factor in
determining whether or not an abuse of discretion has occurred.
At least two courts have amplified on that a bit by holding that
even a legally correct interpretation of a plan may still constitute
an abuse of discretion and be “arbitrary and capricious if it

11

advances the conflicting interests of the fiduciary at the expense
of the affected beneficiary or beneficiaries unless the fiduciary
justifies the interpretation on the grounds of its benefit to the
class of all participants and beneficiaries.” Jones v. Sonat, Inc.
Master Employee Benefits Plan, 997 F.2d 113 (Sth Cir. 1993),
quoting Brown v. Blue Cross & Blue Shield of Alabama, Inc.,
898 F.2d 1556, 1566-1567 (11th Cir. 1990). In at least one
case, the Fifth Circuit has suggested that a slightly different
standard, something close to de novo review, might apply when
there is a “suspicion of partiality” on the part of the plan
trustees, in which case the court must resort to a “sliding scale”
applying greater scrutiny to the trustees’ decision as the
suspicion of partiality increases. Lowry v. Bankers Life &
Casualty Retirement Plan, 871 F.2d 522, 525 n. 6 (Sth Cir.
1989).

Both the District Court and the Court of Appeals
refused to consider applying anything other than the abuse of
discretion standard, despite all of the circumstantial evidence of
partiality, because of two occasions when the union assisted Mr.
Branson with minor matters. 126 F.3d at 756-757; Appendix,
pp. 24a, 38a-39a. Even if such weak evidence were enough to
exonerate the union, there is nothing to dispel the obvious

inference of Greyhound’s bias from its attempts to breach its

contract with Mr. Branson. Most significantly, not a single

12

member of the Plan’s board of trustees iestified at the trial so
that their claims of impartiality toward Mr. Branson could be
tested by cross examination.

CONCLUSION

It is respectfully submitted that, for the reasons outlined
above, this Petition for Writ of Certiorari should be granted.

Respectfully submitted,

/s/ Mike Milligan

Mike Milligan

Counsel of Record for Petitioner
303 Texas Avenue, Suite 808
El Paso, Texas 79901

(915) 544-5587

la

Jennell L. BRANSON, Plaintiff-
Appellant,

Vv.

GREYHOUND LINES, INC. AMALGAM-
ATED COUNCIL RETIREMENT AND
DISABILITY PLAN; Greyhound Lines,

Inc., Defendants-Appellees.

No. 96-50881

United States Court of Appeals,
Fifth Circuit.

Oct. 30, 1997.

Before JONES, EMILIO M. GARZA and PARKER,
Circuit Judges.

EMILIO M. GARZA, Circuit Judge:

Jennell L. Branson appeals from the district court’s
order dismissing his claims agains‘ “Greyhound Lines, Inc.
(“Greyhound” or “GLI’) and Greyhound Lines, Inc.
Amalgamated Council Retirement and Disability Plan (the
“Plan”). The district court held as a matter of law that

Branson’s breach of contract claim against Greyhound was

preempted by section 8 of the National Labor Relations Act
(“NLRA”), 29 U.S.C. § 158, and section 301 of the Labor
Management Relations Act (“LMRA”), 29 U.S.C. § 185. We

2a

reverse the district court’s preemption ruling and remand for

action consistent with this opinion.

The district court further ruled that the Plan Trustees did
not abuse their discretion under the Employees’ Retirement
Income Security Act (“ERISA”), 29 U.S.C. § 1132(a)(1)(B), by
rejecting Branson’s claim for additional seniority credit. We
affirm.

I.

Branson began working for Greyhound in May 1977 and
remained an employee of the company until July 1987, when he
resigned to take another job. At the time of Branson’s
voluntary termination, he was covered by the 1987 collective
bargaining agreement (“1987 CBA”), negotiated between
Greyhound and the Amalgamated Transit Union (the “Union’”)

Branson’s 10.18 years of service entitled him to certain
vested, non-forfeitable pension rights under the Plan, which
continues to exist as a legal entity separate and apart from
Greyhound and the Union. Branson later returned to work for
Greyhound as a replacement employee in April 1990, about a
month into a bitter strike.

By the time Branson returned to work for Greyhound,

the most recent collective bargaining agreement (the 1987

3a

CBA) had expired, and negotiations toward a new collective
bargaining agreement were proceeding. Greyhound also had
recently introduced a new term in its negotiations with the
Union, essentially designed to encourage experienced drivers to
cross the picket line. Greyhound labeled this new term
“Experience Based Seniority’ or “EBS”, and it promised
Greyhound seniority credit for any past commercial driving
experience. Greyhound informed the Union that it would not
abandon this program under any circumstances and began
implementing EBS without further negotiations. Shortly
thereafter, the Union filed an unfair labor charge with the
National Labor Relations Board (“NLRB” or “Board”) based
on the implementation of EBS.

Following Branson’s return to work, he filled out a
standard form by which he requested seniority credit not only
for his prior work with Greyhound, but also for driving
experience gained from other firms. Because Branson had
worked only part-time for these other companies, however,
Greyhound granted Branson credit only for his prior Greyhound

service.

The grants of EBS “super-seniority” to replacement

workers and returning strikers became a major issue in the

continuing negotiations between Greyhound and the Union.

4a

Even when Greyhound and the Union at last succeeded in
signing a new collective bargaining agreement (“1993 CBA”),
they inserted a provision leaving the resolution of EBS to the
NLRB. The Board later found EBS to be an unfair labor
practice and ordered Greyhound to “eliminate all effects of EBS
by all appropriate means.” Greyhound subsequently began an
EBS “buy-out” program, whereby the Company offered cash
payments to those employees that had earned EBS in exchange
for their signing a standard waiver form.

Branson refused to sign the waiver, insisting that he
wanted his additional seniority credit rather than the cash buy-
out. Thereafter, Branson brought suit against the Plan in federal
court, seeking declaratory relief setting forth his rights under the
Plan as provided in ERISA, 29 U.S.C. § 1132(a)(1)(B).
Because Branson had not submitted his claim to the Plan
Trustees before filing suit, the trial court granted a joint request
to modify the scheduling order to permit exhaustion. The
district court held the cause in abeyance while Branson
exhausted his administrative remedies. The Plan Trustees
subsequently held that Branson could not accumulate additional
seniority credit under the Plan beyond his already vested 10.18
years. In the meantime, Branson amended his complaint to

include a breach of contract claim against Greyhound based on

the alleged promise of seniority.

Sa

Branson then tried his case to the district court. At the
close of Branson’s presentation of evidence, the district court
dismissed Branson’s breach of contract claim against
Greyhound on preemption grounds. The bench trial continued
with respect to the Plan. Following the trial, the district court
ruled in favor of the Plan, finding that the Trustees did not
abuse their discretion in interpreting the Plan to deny Branson
additional seniority credit after his termination in 1987.
Branson’s timely appeal followed.

1
[1] At the close of Branson’s presentation of
evidence, the district court granted judgment as a matter of law
in favor of Greyhound on the grounds that both the NLRA and
the LMRA preempted Branson’s breach of contract claim.
Branson timely appealed the district court’s order on both
grounds.’ We review de novo the district court’s rulings on
preemption. Baker v. Farmers Elec. Coop., Inc., 34 F.3d 274,
78 (Sth Cir. 1994).
A
[2] In order to preserve the primary jurisdiction of

' Because we reverse the district court’s judgment as to the breach
of contract claim against Greyhound, we do not address Branson’s claim
that the district court erred in granting judgment for Greyhound without
adequate notice and without making findings of fact.

6a

the NLRB, the NLRA requires that courts not regulate activities
“when it is clear or may fairly be assumed that [such] activities
. . . are protected by § 7 of the National Labor Relations Act, or
constitute an unfair labor practice under § 8.” San Diego Bldg.
Trades Council v. Garmon, 359 U.S. 236, 244, 79 S.Ct. 773,
779, 3 L.Ed.2d 775 (1959); accord Belknap , Inc. v. Hale,, 463
U.S. 491, 498, 103 S.Ct. 3172, 3177, 77 L.Ed.2d 798 (1983);
Windfield v. Groen Div., Dover Corp., 890 F.2d 764, 767 (Sth
Cir. 1989). Here, Branson seeks to recover for Greyhound’s
alleged breach of a promise to restore Branson’s previously

acquired seniority.

The first prong of Garmon preemption requires us to
decide whether Branson bases his claim on an activity
“protected by section 7” of the NLRA. Garmon, 359 US. At
244, 79 S.Ct. At 779. Section 7 protects the rights of
employees to organize, strike, and collectively bargain. 29
U.S.C. § 157. Branson’s claim, however, relies on his
employer’s alleged breach of contract. Because the employer’s
alleged breach of contract does not constitute “activity
protected by section 7,” the first prong of Garmon protection
does not apply.

[3] | The second prong of Garmon preemption

requires us to decide whether Branson’s claim involves an

Ta

activity actually or arguably forbidden under section 8 of the
NLRA, which prohibits employers from engaging in unfair labor
practices. Garmon, 359 U.S. at 244, 79 S.Ct. At 779, 29
U.S.C. § 158. Branson argues that his claim arises solely under
an individual promise, unrelated to GLI’s implementation of
EBS, and therefore involves no terms of employment arguably
regulated by section 8. Whether Branson’s seniority is or is not
EBS, however, does not prove dispositive. Certainly if
Branson’s claims do not involve the EBS program, no colorable
argument exists for NLRB jurisdiction. See Belknap, 463 U.S.
at 512, 103 S.Ct. at 3184 (holding that federal law does not
preempt replacement employees from suing in state court for an
employer’s breach of individual promises of permanent

employment).

Yet our holding of no preemption remains the same
even if Branson’s clagahs do involve EBS. The Supreme Court
said as much in Belknap, where individual replacement
employees succeeded in maintaining their state breach of
contract claims against a company which promised them
permanent employment but then fired them to make room for
returning strikers. 463 U.S. at 495-497, 103 S.Ct. At 3175-
3177. There the Court explicitly rejected the employer’s
contention that the employees’ breach of contract suit was

preempted “because it related to . . . conduct that was part and

8a

a parcel of an arguable unfair labor practice.” /d at 510, 103
S.Ct. at 3183. Recognizing that “whether the strike was an
unfair labor practice strike and whether the offer to
replacements was the kind of offer forbidden during such a
dispute were matters for the Board,” the Court nevertheless
noted that in making those determinations, “the Board would be
concerned with the impact on strikers not with whether the
employer deceived replacements.” Jd Thus, the state law
causes of action were not preempted by the NLRA because they
were “of no more than peripheral concern to the Board and the
federal law . . .while [the state] surely [had] a substantial
interest in protecting its citizens from misrepresentations that
have caused them grievous harm.” /d At 511, 103 S.Ct. at
3183.

GLI seeks to distinguish Belknap on the grounds that
“Belknap did not involve a breach of contract based on a term
of employment concerning a mandatory subject of bargaining
(seniority) unilaterally implemented by an employer upon an
impasse in bargaining negotiations.” As an initial matter, we
note that Greyhound has failed to demonstrate whether impasse
in fact occurred before the implementation of EBS, a finding

necessary to complete Greyhound’s alleged distinction. More
fundamentally, however, Belknap indeed did involve a term of
employment (whether the position was permanent or

9a

temporary) concerning a mandatory subject of bargaining
(reinstatement of strikers) unilaterally implemented by an
employer upon an impasse in bargaining negotiations. See
Belknap, 463 U.S. at 493-496, 103 S.Ct. at 3174-3176.

GLI more correctly observes that Belknap did not
involve either an NLRB unfair labor practice finding or a
specific order issued by the NLRB because the parties settled
their differences before such a decision could issue.
Nevertheless, Belknap addressed that very argument by noting
that even in the face of an explicit Board order directing an
employer to violate contracts made with replacement workers,
“the suit for damages for breach of contract could still be
maintained without in any way prejudging the jurisdiction of the
Board or the interest of the federal law in insuring the
replacement of strikers.” 463 U.S. at 512, 103 S.Ct. at 3184.

The Supreme Court faced a similar issue in J. /. Case v.
NLRB, 321 U.S. 332, 64 S.Ct. 576, 88 L.Ed 762 (1944). There
the Court ordered an employer not to enforce individual
employment contracts that forestalled collective bargaining or
deterred self-organization. 321 U.S. at 341-42, 64 S.Ct. at 582.
Nonetheless, the Court specifically preserved the right of the
employees to seek damages for the breach of their individual

agreements. Jd.

10a

GLI also makes much of Bassette v. Stone, 25 F.3d 757
(9th Cir. 1994), cited by the district court for the proposition
that Branson may have been able to bring his claim under
section 8 of the NLRA. Bassette does hold that in addition to
“limiting employers in which terms they may implement after
impasse, section 8 requires that employers honor those terms
once they are implemented . . . the latter duty follow[ing] from
the former.” 25 F.3d at 761. In Zassette, however, the court
confronted the claims of an employee represented under the
expired collective bargaining agreement, who continued to
work during negotiations over a new collective bargaining
agreement and whose claim rested on a unilaterally implemented
term validly implemented under section 8.

Whether or not we should accept Bassette generally is
a question we leave for another day. At the very least,
however, we decline to apply Bassette on the facts currently
before us, where a replacement employee has challenged the
breach of a promise arguably based on a_ unilaterally
implemented term that the NLRB already has determined
violates section 8. Applying Bassette in this way would create
an unacceptable incoherence in the duties required by section 8.
It cannot both be an unfair labor practice to refuse to honor an
implemented term and then also an unfair labor practice to

continue to honor that same term.

lla

In addition, simply labeling a term of employment
“unilaterally implemented” cannot transform replacement
workers into participants in the collective bargaining process.
See Service Elec. Co., 281 N.L.R.B. 633, 641 (1986) (holding
that employer has no duty to negotiate with the union regarding
the terms and conditions of the replacements’ employment);
Leveld Wholesale, Inc., 218 N.L.R.B. 1344, 1350 (holding that
union’s duty of fair representation does not interfere with its
ability to insist during negotiations that an employer terminate
replacements to make room for returning strikers). These
replacement workers come to work when no collective
bargaining agreement is in effect, and they work under
conditions that have not been collectively bargained for their
benefit. -See Service Elec., 281 N.L.R.B. 633; Leveld, 218
N.L.RB. at 1350 (“Strike replacements can reasonably foresee
that, if the union is successful, the strikers will return to work
and the strike replacements will be out of a job.”); cf Belknap,
463 U.S. at 513-514, 103 S.Ct. at 3184-3185 (Blackmun, J.,
concurring) (“During settlement negotiations, the union can be
counted on to demand reinstatement for returning strikers as a
condition for any settlement.”).

To assert that such replacement workers must bring

their claims to the NLRB rather than to an appropriate court,

seems to vest this federal administrative body with power over

12a

disputes purely private and independent of an unfair labor
practice or collective bargaining agreement. See 29 U.S.C. §
160 (giving Board jurisdiction only to prevent any person from
engaging in any unfair labor practice); see also National
Licorice v. NLRB, 309 U.S. 350, 366, 60 S.Ct. 569,578, 84
L.Ed. 799 (“the National Labor Relations Act contemplates no
more than the protection of the public rights which it creates
and defines”). Federal labor law may create in represented
employees a certain expectation and interest that an employer
will abide by terms properly and unilaterally implemented during
negotiations over a collective bargaining agreement. See
Bassette, 25 F.3d at 760. Nevertheless, the expectations of
replacement employees, who trust that an employer will keep its
promises, stem from the different and more traditional source of
state contract law. See Belknap, 463 U.S. at 507, 103 S.Ct. at
3181 (holding that even if replacement employees are
“represented” by the Union in some technical sense, and thus
governed by whatever settlement the Union negotiates to end
the strike, this cannot change the Court’s holding in J. J. Case
that such currently “represented” employees may sue for
damages on their non-collective contracts); see also Caterpillar
Inc. v. Williams, 482 U.S. 386, 396, 107 S.Ct. 2425, 2431-32,
96 L.Ed.2d 318 (1987) (finding that a state-law plaintiff may be
covered by a collective bargaining agreement, but still may have
independent contract rights arising under state law).

13a

[4] The remainder of GLI’s arguments for affirming
the district court’s findings of preemption relates to the
possibility that a court might order GLI to behave in a manner
contrary to the NLRB’s decision. As Belknap makes clear,
however, “it will not be open to any tribunal to compel the
employer to perform the acts, which, even though he has bound
himself by contract to do them, would violate the Board’s order
or be inconsistent with any part of it.” Belknap, 463 U.S. at
$12 n. 13, 103 S.Ct. at 3184 n. 13 (quoting National Licorice
Co. v. NLRB, 309 U.S. at 365, 60 S.Ct. at 577). GLI fails to
recognize the flip side of this statement, that although no
tribunal may order specific performance in the face of a contrary
NLRB order, proper tribunals nonetheless may award damages
for that very breach “without in any way prejudicing the
jurisdiction of the Board or the interest of the federal law in
insuring the replacement of strikers.” Belknap, 463 U.S. at 512,
103 S.Ct. at 3184. J. 1. Case makes a similar distinction,
providing that its order for the employer to bargain collectively,
despite the existence of non-expired individual contracts, is
“without prejudice to the assertion of any legal rights the
employee may have acquired under such contract or to any
defenses there-to by the employer.” 321 U.S. at 342, 64 S.Ct.
at 582.

Because Branson’s breach of contract claim is not based

14a

on activity arguably protected or prohibited under the NLRA,

it is not preempted under Garmon.

B

The district court also held that section 301 of the
LMRA preempted Branson’s breach of contract claim because
a resolution of the relevant allegations would depend on the
analysis of one or more collective bargaining agreements.
Because Branson bases his breach of contract claim on either
the 1990 EBS program unilaterally implemented by GLI or a
separate individual promise made to Branson, we disagree.”

[5,6] The district court’s ruling on preemption is a
question of law which we review de novo. Baker v. Farmers
Elec. Coop., Inc., 34 F.3d 274, 278 (Sth Cir. 1994). Section
301 preempts state causes of action that allege the violation of
a collective bargaining agreement affecting interstate commerce.
Allis-Chalmers Corp., 471 U.S. at 210, 105 S.Ct. at 1911;
Eitmann v. New Orleans Public Serv., Inc., 730 F.2d 359, 361-

? In earlier proceedings, Branson made an alternative argument
that “if for some reason the 1990 agreement should prove to be invalid,
then Mr. Branson would nevertheless be entitled to his seniority under the
plain and unmistakable language of the [1993] collective bargaining
agreement itself.” Because Branson does not reassert this argument in his
briefs on appeal, it is waived. See Zuccarello v. Exxon Corp., 756 F.2d
402, 407-408 (5th Cir. 1985); FED. R. APP. P. 28.

15a

62 (Sth Cir. 1984). When the resolution of a state law claim
substantially depends on the meaning of a collective bargaining
agreement, courts must treat the claim as o ne made under
section 301 or dismiss it as preempted by federal labor law.
Allis-Chalmers, 471 U.S. at 220, 105 S.Ct. at 1916; Thomas v.
LTV Corp., 39 F.3d 611, 617 (Sth Cir. 1994). Nonetheless,
section 301 does not necessarily preempt every state law claim
between the parties to a collective bargaining agreement, nor
does it preempt claims only tangentially related to such an
agreement. Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S.
309, 409-11, 108 S.Ct. 1877, 1883-85, 100 L.Ed.2d 410
(1988); Allis-Chalmers, 471 U.S. at 211-12, 105 S.Ct. at 1911-
1912; Thomas, 39 F.3d at 617.

[7] Inthe instant case, GLI claims that resolution of
Branson’s breach of contract claim depends on the
interpretation of the 1987 CBA. We disagree. Greyhound
concedes that at the time Branson retired in 1987, he had
accumulated 10.18 years of seniority under the 1987 CBA.
Deciding whether or not GLI made a subsequent promise in
1990 to credit Branson with that amount of seniority, whether
Branson relied on such a promise, and whether GLI breached
such a promise will not require the interpretation of the 1987

CBA and thus cannot support a finding of preemption. See
Lingle, 486 U.S. at 413, 108 S.Ct. at 1885 (holding that section

16a

301 preempts “an application of state law . . . only if such
application requires the interpretation of a collective bargaining

agreement”).

GLI also claims that a court would have to consider the
1993 CBA’s seniority provision “to consider the merits of the
parties’ dispute as to the nature of Branson’s seniority.” The
seniority provision of the 1993 CBA, however, contains no
precise definition of EBS, nor does it clarify whether EBS
contemplated the extension of seniority credit only for non
Greyhound driving experience. Even if it did, what Greyhound
and the Union say in 1993 (in the CBA) about what Greyhound
and Branson agreed to in 1990 cannot alter the analysis of the
1990 agreement itself (unless one argues that the 1993
agreement supersedes the one made in 1990, an argument
addressed and rejected below). Thus, if and when a court
attempt to resolve the merits of the dispute over the nature of
the seniority allegedly promised to Branson in 1990, interpreting
the 1993 CBA will not prove necessary or useful.

GLI additionally claims that a court must consider the

1993 CBA’s seniority provision “to consider GLI’s defense that
validity of its action is based on the NLRB’s order.” We
disagree. While GLI indeed may attempt to use the NLRB
order as a defense to the state contract claim, section 301 does

17a

not provide for the preemption of claims that might involve the
interpretation of an NLRB order. See Belknap, 463 U.S. at
512, 103 S.Ct. at 3184. Simply pointing out that the 1993 CBA
anticipates the issuing of such an order cannot transform GLI’s
defense into one based on the 1993 CBA.’ To the extent that
such a defense would implicate the 1993 CBA at all, it would do
so only tangentially and thus would not preempt the underlying
state claim.’ See Allis-Chalmers, 471 U.S. at 211, 105 S.Ct. at

3 The 1993 CBA anticipates an NLRB order because Greyhound
and the Union explicitly agreed to leave the resolution of EBS to the NLRB
and to abide by whatever decision the NLRB made.

* The Supreme Court faced, but refused to decide, a similar issue
in Caterpillar, Inc. v. Williams, where former employees brought a breach
of contract suit in state court against their former employer based on
alleged individual employment contracts. Caterpillar, Inc. v. Williams,
482 U.S. 386, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987). The employer
sought to remove the case to federal court, arguing that its intent to raise
a collective bargaining agreement as a defense mandated preemption under
section 301. Jd. at 390, 107 S.Ct. at 2428. Because of the procedural
posture of the case — whether or not removal of the state claims to federal
court was appropriate — the Supreme Court expressly declined to rule on
the merits of the preemption issue. 482 U.S. at 398 n. 13, 107 S.Ct. at
2433 n. 13. Nonetheless, the Court expressly held that section 301 does
not so “completely preempt” a state law claim for breach of contract that
simply raising a collective bargaining agreement as a defense would merit
removal. Jd: see also Franchise Tax Bd. V. Construction Laborers
Vacation Trust, 463 U.S. 1, 24, 103 S.Ct. 2841, 2854, 77 L.Ed.2d 420
(1983) (“[I}f a federal cause of action completely preempts a state cause of
action any complaint that comes within the scope of the federal cause of
action necessarily ‘arise under’ federal law.”). The Court noted that even
when an employer-defendant alleges that a subsequent collective

18a

1911 (“not every dispute concerning employment, or
tangentially involving a provision of a collective-bargaining
agreement, is pre-empted by § 301”).

GLI also argues that section 301 preempts Branson’s
breach of contract claim because the alleged individual seniority
agreement seeks to limit or condition the 1993 CBA. Yet each
of the cases that Greyhound cites for this proposition concern
individual agreements made in the context of currently binding
collective bargaining agreements. See Thomas, 39 F.3d at 617-
18; Eitmann, 730 F.2d at 363. In Zhomas,, we held that an
individual attendance probation agreement negotiated by the
employee, his union, and the employer that set forth minimum
attendance requirements for the year and modified the discharge
procedures of the existing CBA, would be treated as a CBA for
section 301 preemption purposes. Thomas, 39 F.3d at 614-17.
In Eitmann, we found that where an employer’s pre-
employment promises conflicted with the collective bargaining
agreement in effect at the date of hire, section 301 would
preempt a state law claim based on the pre-employment
promise. 730 F.2d at 360-63.

bargaining agreement supersedes the individual agreement at issue, section
301 does not necessarily mandate preemption. 482 U.S. at 394-97, 107
8.Ct. at 2430-32.

19a

Here, in contrast to the cases cited by Greyhound, at the
time Branson allegedly struck his individual deal with
Greyhound, the 1987 CBA had expired and the bargaining
parties had yet to agree on the 1993 CBA. In fact, Branson was
a replacement employee and had no interest in the CBAs. See
Service Elec., 281 N.L.R.B. at 641 (employers have no duty to
bargain with a striking union about terms for replacement
employees). Thus, because no collective bargaining agreement
governed at the time Branson and Greyhound allegedly made
their individual contract, we cannot find that Branson’s
individual claim seeks to limit or condition a collective

bargaining agreement.

Whether or not the 1993 CBA supersedes the alleged
individual agreement, even though made outside the context of
a binding collective bargaining agreement, presents a different
issue. GLI relies on /. J. Case for the proposition that collective
bargaining agreements must supersede and thus preempt
individual employment contracts. Yet while J. J. Case did state
broadly that the “very purpose of providing by statute for the
collective agreement is to supersede the terms of separate
agreements by employees,” see 321 U.S. at 338, 64 S.Ct. at

580, the Court also explicitly sought to preserve the rights of
employees to seek damages based on these superseded
individual contracts. See 321 U.S. at 342, 64 S.Ct. at 582.

20a

[8] | The Supreme Court has attempted to correct this
type of erroneous interpretation before. In Caterpillar, the
employer “argue[d] that when respondents returned to the
collective-bargaining unit, their individual employment
agreements were subsumed into, or eliminated by, the collective
bargaining agreement.” 482 U.S. at 395-96, 107 S.Ct. at 2431.
With unmistakable clarity, the Court responded:

Caterpillar is mistaken . . . J. J. Case does not stand for
the proposition that all individual employment contracts
are subsumed into, or eliminated by, the collective-
bargaining agreement... Thus, individual employment
contracts are not inevitably superseded by any
subsequent collective agreement covering an individual
employee, and claims based upon them may arise under
state law.

482 U.S. at 396, 107 S.Ct. at 2431 (citations omitted).
“Caterpillar’s basic error,” continued the Court, “is its failure to
recognize that a plaintiff covered by a collective bargaining
agreement is permitted to assert legal rights independent of that
agreement, including state law contract rights, so long as the
contract relied upon is not a collective bargaining agreement.”
Id. Whether Branson’s claim for breach of contract arises out
of a purely individual agreement, as he alleges or out of
Greyhound’s unilateral implementation of EBS, as GLI alleges,
no one posits that his claim arises out of a contract that is itself

Zia

a collective bargaining agreement.’ GLI’s arguments of
supersession thus cannot withstand appropriate scrutiny.

In its final plea for a finding of section 301 preemption,
GLI notes that should Branson prevail on his breach of contract
claim, a court could not determine Branson’s damages without
looking to the rates of pay included in the 1993 CBA, or the
parameters of any proper injunction without looking to the
seniority provisions of the 1995 modification. Assuming
arguendo that this proposition is true, it hardly establishes that
Branson’s underlying claim “is substantially dependent upon” an
analysis of the terms of a collective bargaining agreement.
Allis-Chalmers, 471 U.S. at 211, 105 S.Ct. At 1916. Indeed,
the Supreme Court rejected this very argument in Lingle, 486
US. at 413 n. 12, 108 S.Ct. at 1885 n. 12, holding that while
collective bargaining agreements may contain information such
as rates of pay, possibly helpful in determining the damages due

5 GLI does half-heartedly assert that the EBS provisions are the
“functional equivalent” of a collective bargaining agreement for
preemption purposes. We disagree. The 1990 contract terms were not a
collectively bargained instrument, and were functionally distinct in many
ways. See Thomas, 39 F.3d at 618 (defining collective bargaining as
“bargaining by an organization or group of workmen on behalf of its
members with the employer”). The terms were implemented three days
after being presented to the union. Lastly, section 301 preempts claims
that depend on a CBA, not its functional equivalent. A/lis-Chalmers, 471
U.S. at 220, 105 S.Ct. At 1916.

22a

to a worker prevailing in a state-law suit, and while “federal law
would govern the interpretation of the agreement to determine
the proper damages, the underlying state-law claim, not
otherwise preempted, would stand.”

GLI has presented no persuasive authority for the
proposition that section 301 preempts Branson’s breach of

contract claim.

Ill
Branson appeals the district court’s decision in favor of
the Plan on two grounds: first, Branson argues that the district
court erred in using the abuse of discretion standard to review
the Trustees’ interpretation; and second, he argues that the
Trustees’ interpretation was nonetheless an abuse of discretion.
We disagree on both counts.

[9] The district court applied an abuse of discretion
standard because it found that the Plan conferred discretionary
authority on the Trustees. See Firestone Tire & Rubber Co. v.
Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 957, 103 L.Ed.2d 80
(1989); Chevron Chem. Co. V. Oil, Chem. and Atomic Workers
Local Union 4-447, 47 F.3d 139, 142 (Sth Cir. 1995). Whether
the district court employed the correct standard of review for
analyzing the Trustees’ interpretation of the Plan is a question

23a

of law which we review de novo. Chevron Chem., 47 F.3d at
142.

{10} The district court must apply an abuse of
discretion standard only when the Plan itself confers
discretionary authority on the Trustees to interpret the Plan.
See Firestone Tire, 489 U.S. at 115, 109 S.Ct. at 956-57
(holding that “a denial of benefits . . . is to be reviewed under a
de novo standard unless the benefit plan gives the administrative
or fiduciary discretionary authority to determine eligibility for
benefits or to construe the terms of the plan”); Chevron Chem.,
47 F.3d at 142. In Chevron Chem., we held that the district
court correctly used the abuse of discretion standard where the
pension plan conferred discretionary authority in the following
manner: “[T]he administrator is empowered to ‘make such
rules, regulations, [and] interpretations . . . and [to] take such
other action... as [he] may deem appropriate.” 47 F.3d at 143
(emphasis and alterations in original)(quoting pension plan).

[11] Im the case at hand, the Plan uses similar
language to confer discretionary authority upon the Trustees.
Section 6.2 of the Plan states that the Trustees have the power
“[t]o decide any question arising in the administration,
interpretation, and application of this Plan.” Consequently, the
district court correctly used the abuse of discretion standard to

24a

review the decision of the Trustees.

Branson argues, however, that the Trustees here are
subject to a “suspicion of partiality”® and that the district court
should have used a sliding scale — something less than the
abuse of discretion standard — to review the Trustees’ decision.
See Lowry v. Bankers Life and Casualty Retirement Plan, 871
F.2d 522, 525 & n. 6 (Sth Cir. 1989)(suggesting the possibility
of using a sliding scale to review trustees’ decisions). We

disagree.

[12,13] The district court found, as a matter of fact,
that no animosity toward replacement workers influenced either
Greyhound or the Union. We review the district Court’s factual
findings for clear error. See Bellaire Gen. Hosp. V. Blue Cross
Blue Shield, 97 F.3d 822, 829 (Sth Cir. 1996). Branson does
not dispute that in 1990 the Union helped him correct
Greyhound records to reflect his actual starting date and that
later, the Union pursued Branson’s grievance regarding a
company decision to place him on sick leave for an extended
period of time. Under these circumstances, we cannot say that

* — Branson claims that the Plan operates under a conflict of
interest because the Plan is managed by a six-member Board of Trustees,
half chosen by the Union and half by Greyhound, none of whom have an
interest in helping former strike-breakers.

25a

the district court committed clear error in finding no suspicions
of partiality. Thus, the district court was correct in refusing to
use a suspicion of partiality as a factor in determining whether
the Trustees abused their discretion.

[14] Branson additionally claims that the district court
erred in finding no abuse of discretion because: (1) the Trustees
looked to the 1987 CBA instead of the 1993 CBA to determine
whether Branson lost his seniority;’ and (2) even the 1987 CBA
did not explicitly state that Branson would lose his seniority
when he quit. We review de novo the district court’s ultimate
legal conclusion that there was no abuse of discretion by the
Trustees. See Sweatman v. Commercial Union Ins. Co., 39
F.3d 594, 601 (Sth Cir. 1994).

[15-17] A two-step inquiry governs whether the
Trustees abused their discretion in refusing to give Branson the
additional seniority he claimed. Pickrom v. Belger Cartage
Serv., Inc., 57 F.3d 468, 471 (5th Cir. 1995). First, we
determine whether the Trustees gave the Plan a “legally correct”

7 Branson also appears to argue that the Trustees should have
looked to the 1990 Agreement implemented unilaterally by Greyhound to
determine whether he lost his seniority. This argument ignores the fact
that under section 11.1 of the Plan, any action taken by Greyhound without
the concurrence of the Union can have no effect on the Plan.

26a

interpretation. Jd In deciding the first step —- whether the
Plan’s interpretation was legally correct — we consider three
factors: (1) whether the Trustees have given the pension plan a
uniform construction; (2) whether the Trustees’ interpretation
is consistent with a fair reading of the Plan; and (3) whether
different interpretations of the Plan will result in unanticipated
costs. /d.; Chevron Chem., 47 F.3d at 145.

In the instant case, the first factor proves insignificant
because the Trustees have not previously interpreted the
relevant provisions. Although not determinative, the third
factor of unanticipated costs supports the Trustees. Indeed, the
Trustees’ interpretation seems designed to thwart the very
unanticipated costs that Branson’s interpretation inevitably
would produce. Particularly with employees like Branson, who
have accumulated long terms of seniority and then left the
company, attempting to arrange actuarially for the possibility
that these employees might reenter the Plan at any moment,
demanding immediate recognition of substantial terms of
seniority, certainly results in unanticipated costs.

The second factor, relating to whether or not the
Trustees’ engaged in a “fair reading of the Plan,” forms the basis
of Branson’s argument that the Trustees’ abused their discretion
in interpreting the Plan to deny him additional seniority credit.
We find, however, that the Trustees’ interpretation is a fair

27a

reading of the Plan.

Section 2.1 of the Plan provides:

Notwithstanding anything to the contrary in this Section
2.1(1), however, an Active Participant who
subsequently terminates employment with an Employer
and thereupon loses his seniority under the Collective

Bargaining Agreement . . . shall thereafter cease to be an
Active Participant regardless of whether such

Participant is subsequently re-employed by an Employer
or a Related Employer.

The Plan provides in 2.3(2) that only Active Participants may
accrue pension credit or benefits under the Plan. In 1987,
Branson was an “Active Participant who subsequently
terminate{d] employment with an Employer.” Thus, the
question for the Trustees became whether Branson “thereupon
los[t] his seniority under the Collective Bargaining Agreement.”
The Trustees found that Branson did lose his seniority under the
1987 CBA and thus “cease[d] to be an Active Participant” in the
Plan, meaning that he could no longer accrue additional pension
credit, regardless of his later re-employment.

Branson argues that using the 1987 CBA does not
comport with a fair reading of the Plan because the definition of
“Collective Bargaining Agreement” includes not only “[t]he
current collective bargaining agreement between the Company
and the Union,” but also any “extensions thereof, or any

successor agreements between the parties.” This definition,

28a

however, cannot alter the import of the phrase, “thereupon loses
his seniority” in section 2.1 (emphasis added). Black’s Law
Dictionary defines “thereupon” as: “without delay or lapse of
time.” BLACK’S LAW DICTIONARY 1478 (6th ed. 1990).

Webster’s New Collegiate Dictionary similarly defines
“thereupon” as “immediately after that.” WEBSTER’S NEW
COLLEGIATE DICTIONARY 1201 (1979). Thus, the
Trustees did engaged in a fair reading of the Plan by looking to
the collective bargaining agreement in effect “immediately after”

Branson terminated his employment in 1987.

Branson also argues that the Trustees failed to make a
fair reading of the Plan by interpreting the 1987 CBA to
impliedly revoke seniority for employees who voluntarily quit.
We disagree. Branson correctly notes that the 1987 CBA
neither explicitly protects nor explicitly revokes the seniority of
employees who voluntarily quit. The 1987 CBA does, however,
explicitly retain seniority for several categories of employees,
including employees entering the armed forces, employees
receiving leaves of absence for less than 30 days, employees
furloughed as part of a reduction in force (so long as they return
to work when it becomes available), employees in the service of
the union, and employees accepting supervisory positions (so

long as they resume a position within the bargaining unit within

24 months). The Latin maxim expressio unius exclusio alterius

29a

proves instructive. The Trustees found that the inclusion of
specific circumstances in which an employee retained seniority
meant that an employee did not retain seniority in other
circumstances. Consequently, those employees who voluntarily
quit “lost” their seniority, and the Plan could not allow any later
accumulation of additional seniority. Branson has failed to
show that this not a fair reading of the Plan.

Having found that the Trustees’ interpretation of the
Plan was legally correct, we need not proceed to the second
step of our analysis. Pickrom v. Belger Cartage Serv., Inc., 57
F.3d 468, 472-473 (Sth Cir. 1995). The Trustees did not abuse
their discretion in interpreting the Plan.

IV

[18] In summary, we hold that Branson’s breach of
contract claim against Greyhound is not preempted by the
NLRA or the LMRA.* We reverse and remand to the district

type, if any, of seniority credit Greyhound offered Branson, what that
seniority credit would have done for Branson, whether or not Greyhound’s
subsequent behavior contradicted any accepted offer and whether
Greyhound has any viable defenses.

30a

court for proceedings consistent with this opinion.” We affirm
the district court’s judgment in favor of the Plan.

. Branson’s only remaining claim is a breach of contract based on
State law. In light of this opinion, the district court may revisit its decision
paduaseine tan tuiiaaenc shes Sa ceyelt
Parker & Parsley Petrolewn Co. v. 85 (Sth
Cir. 1992) (“Our ee Ens sie te he
Claims to which they are pendent are dismissed.”).

3la

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TEXAS
EL PASO DIVISION

JENNELL L. BRANSON,
Plaintiff,

v. EP-95-CA-235-DB

GREYHOUND LINES, INC.—

AMALGAMATED COUNCIL

RETIREMENT AND DISABILITY

PLAN and GREYHOUND

LINES, INC.,
Defendants.

rr GP ar LN LN MN LN LF Li Lr

FINDINGS OF FACT AND CONCLUSIONS OF LAW

On this day, the Court considered the above-captioned
cause. Trial in this matter was before the Bench on Wednesday,
September 25, 1996. The Plaintiff filed his Proposed Findings
of Fact and Conclusions of Law on October 1, 1996.
Defendant Greyhound Lines, Inc. Amalgamated Council
Retirement and Disability Plan, also filed its Proposed Findings
of Fact and Conclusions of Law on October 1, 1996. After due
consideration, the Court is of the opinion that this matter be

resolved as set forth below:

32a
Dismissal of Plaintiff's Claims As Against
Greyhound Lines, Inc.

At this point, the Court notes that, on the day of trial,
after Plaintiff had presented all of his evidence, the Court
dismissed Plaintiff's action as against Greyhound Lines, Inc.,
because state law causes of action are preempted by the
National Labor Relations Act (“NLRA”) when they concern an
activity which is actually or arguably protected by the NLRA.
San Diego Building Trades Council v. Garmon, 359 U.S. 236,
245 (1959). In this instance, Plaintiff's action is based on
conduct which is actually or arguably prohibited by Section 8 of
the NLRA. Bassette v. Stone Container Corp., 25 F.3d 757
(9th Cir. 1994). Finally, Section 301 of the Labor Management
Relations Act preempts a state law claim, the resolution of
which is dependent on the consideration or analysis of a
collective bargaining agreement for resolution. Allis-Chalmers
Corp. v. Lueck,, 471 U.S. 202, 220 (1985); Thomas v. LTV
Corp., 39 F.3d 611, 616 (Sth Cir. 1994); Baker v. Farmers
Electric Cooperative, Inc., 34 F.3d 274 (Sth Cir. 1994).

FINDINGS FACT

1. Plaintiff Jennell L. Branson went to work for
Greyhound Lines, Inc. or one of its predecessors on or about
| May 16, 1977 as a bus driver. Plaintiff remained an employee
of Greyhound Lines, Inc. (“the Company”) until about July 20,
1987, when he resigned from the company to pursue other

33a
employment opportunities. At the time of his resignation in
1987, Plaintiff had vested pension rights with the Greyhound
Lines, Inc.- - Amalgamated Council Retirement and Disability
Plan (“the Plan”) based on his 10 years’ service with the
Company. Plaintiff returned to work for the Company as a bus
driver on or about April 1, 1990.

2. Plaintiff filed this suit in the U.S. District Court for
the Western District of Texas seeking declaratory relief setting
forth his rights under the Plan, as provided in the Employee
Income Retirement Security Act of 1974 (ERISA), 29 U.S.C.
§ 1132(a)(1)(B). Plaintiff requests a declaration that he is
entitled to pension credit for the time he has worked for the
Company since his return in 1990. Defendant Plan duly
answered, denying Plaintiff's right to such pension credit.
Plaintiff has exhausted his remedies under the Plan. The Plan
trustees considered and rejected Plaintiff's claim on or about
February 6, 1996. This decision was then communicated in
writing to Plaintiff and his counsel.

3. The Plan is managed by a six-member board of
trustees. Half of the trustees are chosen by Greyhound Lines,
Inc., and the other half are chosen by the Amalgamated Council
of Greyhound Local Unions. The Plan was created in march
1987 and is a legal entity separate and apart from the Company
and the Union.

4. Only those persons who were participating in one of

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several predecessor retirement plans in 1987 could become
participants in the Plan. As of January 1995, the Plan had about
17,074 participants. Of those, 1,466 are “active participants”
who continue to accrue pension benefits under the Plan. About
10,754 of the participants are now receiving pension benefits.
The remaining 4,854 participants, including Plaintiff, are
classified as “inactive, non-retired participants,” meaning they
have vested pension benefits but are neither accruing additional
benefits nor have begun receiving pension payments.

5. The Plan provides that a person who leaves the
company and loses his seniority at that time ceases to be an
active participant in the Plan even if he later returns to work for
the Company. The Plan, at Sec. 2.1(1), states:

Notwithstanding anything to the contrary in this
Section 2.1(1), however, an Active Participant
who subsequently terminates employment with
an Employer and thereupon loses his seniority
under the Collective Bargaining Agreement . . .
shall thereafter cease to be an Active Participant
regardless of whether such Participant is
subsequently re-employed by an Employer or a
Related Employer.

The Plan, at Sec. 2.3(2), provides that only Active Participants
may accrue pension credit or benefits under the Plan. The Plan,
at Sec. 6.2(b), provides that the trustees have the power “To
decide any question arising in the administration, interpretation,
and application of this Plan; . . .” The Plan may be amended

Te

35a

only by the joint action of the Union and the Company, as
provided in Sec. 11.1.

6. At the time Plaintiff resigned from the Company in
1987, a collective bargaining agreement was in effect between
the Company and the Amalgamated Council. Plaintiff was
subject to the terms and conditions of the collective bargaining
agreement. The collective bargaining agreement contains the
following provisions regarding when covered employees may
retain their seniority:

© Section A-17 (employees “in the service of the Union

_etain and accumulate all seniority rights and benefits . . .”);

© Section A-18 (bargaining unit employees accepting
supervisory positions retain seniority for 24 months and “suffer
no loss of seniority” if they resume a bargaining unit position
during that period);

© Section A-24 (employees entering the armed forces
“retain and accumulate seniority rights and benefits” during their
military service);

© Section B-6 (by agreement, employees may receive
leaves of absence of 30 days or more “without loss of
seniority”); and

@ Section B-7 (employees furloughed as part of a
reduction in force “retain their seniority,” although it may be

lost if they decline to return to the company when work

36a

becomes available).

The collective bargaining agreement, however, contains
no language permitting a covered company employee who has
resigned to pursue other employment interests to retain his
seniority. Robert Tancos, a labor relations specialist with the
Company, testified that the 1987-90 agreement had always been
construed as divesting a driver of his seniority if he voluntarily
quit the service of the Company. The current labor contract

contains substantially the same provisions. Tancos further
testified that in the thirty years he has been involved in labor
relations for the Company, every labor agreement between the
Company and the Union has been so construed with respect to
the seniority of voluntary resignees. Likewise, Tancos testified
that the labor agreements never provided for “bridging” of
seniority for voluntary resignees. This position is also reflected
in the documentary evidence submitted in this case.

7. In rejecting Plaintiffs contention that he should
accrue pension benefits under the Plan for the time he has
worked for the Company since 1990, the Trustees relied on Sec.
2.1(1) of the Plan.

8. Until Plaintiff's claim had been submitted, the
Trustees had not been called upon to interpret the Plan language
for purposes of determining if a person who voluntarily resigned
from and later returned to employment with the Company
should be permitted to accrue pension benefits based on the

37a

latter period of employment.

9. Based on the pension benefits he accrued between
1977 and 1987, Plaintiff would be eligible to receive $134.99
per month for life if he retiree at age 55. Assuming Plaintiff
works for the Company until he turns 55 years of age and were
to receive pension credit not only for the time he worked from
1977 until 1987 but also for the time he would have worked
after April 1990, Plaintiff would be eligible to receive $1,228.92
per month for life, if he retired at age 55. This calculation is
based on the assumption Plaintiff would receive annual wage
increases of 2 percent during that time, since pension payments
are tied to a pafticipant’s average final earnings with the
company.

10. The Trustees were advised that it would be
inconsistent with the actuarial assumptions upon which the
Plan’s obligations have been calculated to allow a participant to
accrue additional pension benefits once he had left the
Company’s employ, even if he should later return to work for
the Company. Such an interpretation of the Plan language
would have an adverse impact on contributions or benefits or
both.

11. When Plaintiff returned to work in 1990, the labor
contract had expired, and the union had called a strike. In an
effort to induce non-union drivers to work during the strike, the
Company promised them employment based seniority (“EBS”).

ail

38a

This was seniority credit for any prior full-time employment
they had as over-the-road drivers. When he returned to work
in 1990, the Company credited Plaintiff with about 10 years’
seniority. EBS was intended to enhance a driver’s seniority for
purposes of assignment of bus routes and, in turn, could affect
his pay and vacations. The National Labor Relations Board |
subsequently found the Company’s use of EBS to be illegal as
an unfair labor practice. Thereafter, the Company and the
Union agreed that all EBS would be rescinded. The Company
then rescinded the 10 years’ seniority it had credited to Plaintiff
when he returned to work in 1990.

12. Plaintiff contends the Company promised him
restoration of his Greyhound Seniority as such rather than EBS
credit for that time. Tancos testified that the Company offered
only EBS. As discussed below, neither EBS nor a unilateral
promise of restored Greyhound seniority would affect Plaintiff s
pension rights under the Plan.

13. There is no evidence to support the argument that
the Union or the Company has been influenced by any

purported animosity toward drivers, such as Plaintiff, who
worked during the strike. After Plaintiff returned to work in
1990, the Union helped him correct Company records to reflect
his actual starting date. Later, the Union pursued to Plaintiff's
satisfaction his grievance regarding the Company decision to

39a

place him on sick leave for an extended period of time. In
January 1996, Plaintiff filed a grievance with the Union of the
recision of his seniority. The Union did not pursue that

_ grievance.

CONCLUSIONS OF LAW

1. This Court has jurisdiction over Plaintiff s claim. See
§ 5029e) of ERISA, 29 U.S.C. § 1132(e). Plaintiff has
exhausted his internal Plan remedies. His suit was timely filed,
and the Plan, likewise, timely answered.

2. In § 6.2, the Plan furnishes the Trustees the authority
to interpret and apply the plan language in their sound
discretion. Therefore, this Court must accept any such
interpretation unless it amounts to an abuse of that discretion.
Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 111, 109
S.Ct. 948, 103 L-Ed.2d 80 (1989) (recognizing the abuse-of-
discretion standard to be controlling, when the trustees are
afforded such authority); Chevron Chem. v. Workers Union 4-
447, 47 F.3d 139, 142-43 (Sth Cir. 1995) (same and noting that
language comparable to that in § 6.2 is sufficient to confer such
authority). The Court must accord the Trustees’ interpretation
considerable deference. Penn v. Howe-Baker Engineers, Inc.,
898 F.2d 1096, 1100 (Sth Cir. 1990) (the courts must afford

“great deference” to interpretations of plan language); Wallace
v. American Petrofina, 668 F.Supp. 586, 591 (E.D.Tex. 1987)

40a

(if the trustees of a pension fund and a participant offer rational,
though conflicting interpretations, the trustees’ interpretation
must control).

3. The Trustees’ interpretation of § 2.1 of the Plan is
reasonable and conforms to the language of that section. The
language provides that a participant who leaves the Company’s
employ and, thereby loses his seniority, ceases to be an active
participant in the Plan, even if he later returns to work for the
Company. This is the most natural reading of that section and
the one the Trustees have given it. The interpretation does not
conflict with other provisions of the Plan or with the Summary
Plan Description. The SPD states:

What happens if I quit or am laid off and
then I come back to work?

If your employment terminates and you lose
seniority under the Collective Bargaining
Agreement . . . then you cannot become an
Active Participant in this Plan again, even if you
come back to work. If you did not lose your
seniority, you will become an Active Participant
again when you return to work, as long as you
... return as a Re-Employed Employee.

This question and answer directly addresses Plaintiff's
circumstance and is consistent with the Trustees’ position.

4. The Trustees also properly interpreted the Plan as
stating that only “active participants” may accrue pension

benefits. The Trustees properly read the collective bargaining

4la

agreement in effect at the time Plaintiff voluntarily quit the
Company in 1987 as divesting him of his seniority. The
agreement contains numerous provisions detailing when
seniority may be retained. None permits a voluntary resignee,
such as Plaintiff, to retain seniority. Had the parties to the
agreement intended such a result, they would have so stated.

5. The net effect of these provisions of the Plan and the
relevant labor agreement is that a participant who leaves the
Company and loses his seniority becomes ineligible to accrue
additional benefits under the Plan even if the participant later
returns to work for the Company. Plaintiff is such a participant
and, accordingly, could not earn additional pension credit for
the time he has worked for the company since 1990.

6. The Trustees’ conclusion is reasonable in light of the
language of the Plan and the collective bargaining agreement.
There was no abuse of discretion. See Chevron Chem., 47 F.3d
at 145 (if trustees’ position reflects a “reasonable reading” of
the Plan, it generally should be upheld). This conclusion is
further bolstered in that the Trustees have never rendered a
contrary interpretation of the Plan Id. Similarly, a contrary
interpretation of the Plan, as Plaintiff would give it, creates
additional, unanticipated pension liability. This is a factor that
may be considered, as well. Id. While the latter two

considerations are not especially significant here, they are

42a

consistent with the Trustees’ decision in this case. See Jordan
v. Cameron Iron Works, Inc., 900 F.2d 53, 56 (Sth Cir. 1990),
cert. denied, 498 U.S. 939 (1990) (Absent any evidence
concerning either prior interpretations of the plan language or
unanticipated costs, the appellate court upholds summary
judgment based on the trustees’ “fair reading of the plan.”’).

7. Whether the Company offered Plaintiff EBS or actual
Greyhound seniority in 1990 to induce him to return to work is
irrelevant. In materials submitted to the Trustees, Plaintiff
specifically disavowed any reliance on EBS. Furthermore, EBS
was never intended to affect pension benefits. It has been
declared illegal and it has been rescinded by mutual agreement

of the Company and the Union. For these, among other

reasons, EBS cannot and does not afford Plaintiff any right to
pension credit for his employment with the Company since
1990. Assuming Plaintiff were, in fact, offered Greyhound
seniority rather than EBS, this amounted to a unilateral action
_of the Company and cannot legally bind the Plan. The Plan
itself provides it may be amended only by the joint action of the
Union and the Company. In addition, ERISA will not give any
legal effect to oral or written representations that “are not and,
do not purport to be, formal amendments of a plan. . .” Borst
v. Chevron Corp., 36 f.3d 1308, 1322 (Sth Cir. 1994), cert.
denied, _—US. ___, 115 S.Ct. 1699 (1995) (written

cee cake SI ni SAU st ema
SN re Ce en a

43a

representations); Rodriguez v. Western and Southern Life Ins.

Co., 948 F.2d 969, 971 (Sth Cir. 1991) (Fifth Circuit has
rejected argument that an ERISA plan participant is entitled to
additional benefits based on oral representations of his
employer’s representative), Degan v. Ford Motor Co., 869 F.2d
889, 895 (Sth Cir. 1989) (Court holds “that ERISA precludes
oral modifications to benefit plan and that claims of promissory
estoppel are not cognizable in suits seeking to enforce rights to
pension benefits.”). Whatever the Company’s representations
to Plaintiff may have been, they did not constitute amendments
of the Plan entitling him to additional pension credit.

8. Finally, Plaintiff has offered no evidence that the
Trustees labored under any sort of conflict in this case. There
is no showing that the Union or the Company has targeted
employees hired during the strike for disfavored treatment. In
fact, the Union has taken action on Plaintiff s behalf on several
occasions since his return in 1990. Moreover, the Plaintiff has
offered no evidence the Trustees made their decision in this case

based on any sort of improper grounds or because of any

improper motives.

Accordingly, IT IS HEREBY ORDERED,
ADJUDGED and DECREED that Plaintiff's claims against
Defendant Greyhound Lines, Inc. are DISMISSED.

IT IS FURTHER ORDERED that judgment is

44a

rendered on behalf of Defendant Greyhound Lines, Inc. - -
Amalgamated Retirement and Disability Plan.

IT IS FURTHER ORDERED that Plaintiff shall take
nothing, and Plaintiff's cause of action is hereby DISMISSED,
with prejudice.

Finally, IT IS ORDERED that all taxable costs are
hereby assessed against Plaintiff.

SIGNED this 30th day of October, 1996.

s/ David Bri

THE HONORABLE DAVID BRIONES
UNITED STATES DISTRICT JUDGE

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386013_2135%3A1. Public record. Not legal advice.