Court Rejects Caterpillar's Arguments and Orders that Case Go Forward in Retiree Medical...

CHICAGO -- In an order issued today, May 17, 2007, Judge Trauger of the United States District Court for the Middle District of Tennessee rejected the arguments of Caterpillar, Inc. and ordered that a lawsuit against Caterpillar go forward for allegedly denying retirees and their surviving spouses

Caterpillar retirees and surviving spouses of retirees sued the company on March 28, 2006 alleging that Caterpillar has denied them retiree medical benefits that were offered for years under their union contracts. Caterpillar has charged retirees for portions of their medical insurance premiums and also charged retirees and surviving spouses of retirees increased payments on prescription drugs and medical procedures. Plaintiffs seek to represent a class of more than 4,000 retirees and surviving spouses who have been charged.

The plaintiffs sued Caterpillar on behalf of a class of all retirees and surviving spouses of retirees who were represented by the union and who retired on or after January 1, 1992 and before March 16, 1998. The plaintiffs brought their claims under ERISA, the Employee Retirement Income Security Act, 29 U.S.C. SSSS 1132(a)(1)(B) and (a)(3) and the LMRA, the Labor Management Relations Act ("LMRA"), 29 U.S.C SS 185 (a).

Caterpillar filed a motion to dismiss the entire complaint, advancing a variety of arguments against the plaintiffs' claims. In the May 17, 2007 Memorandum Opinion and Order, Judge Trauger rejected each of the defendant's arguments. She held that the plaintiffs have stated a claim under the LMRA and ERISA and are entitled to proceed with their lawsuit, summarizing the plaintiff's claim as follows:

"The plaintiffs claim that the defendant breached its promise to pay lifetime retiree health benefits at no cost when, in 2004, without the retirees' consent, Caterpillar began charging retirees and their surviving spouses for a portion of their medical care." (p. 2)

After reviewing the alleged facts and relevant law, the court stated:

"To summarize, in interpreting the language of the relevant documents, the court finds evidence that Caterpillar intended to confer lifetime vested retiree medical benefits upon the plaintiffs." (p. 27)

The judge ordered that the case will now proceed with the discovery and class certification phases.

Read the entire opinion (Winnett, et al v. Caterpillar, Inc., No. 06-cv-00235) at http://www.mmmglaw.com/CM/CurrentCaseUpdates/CurrentCaseUpdates105.asp

The plaintiffs and class are represented by Michael M. Mulder, Shona Glink, and Karen Sheley of Meites, Mulder, Mollica & Glink, 20 S. Clark Street, Suite 1500, Chicago, IL 60603, Elizabeth Alexander and Kathryn Barnett of Lieff, Cabraser, Heimann & Bernstein, LLP, 150 Fourth Avenue N, Suite 1650, Nashville, Tennessee 37219 and Jay Sushelsky of AARP Foundation Litigation, 601 E. Street, NW, Washington, DC.

Caterpillar is represented by Columbus Gangemi, Jr., Derek Barella and Joseph Torres of Winston & Strawn, 35 W. Wacker Drive, Chicago, IL 60601.

ABOUT MEITES, MULDER, MOLLICA & GLINK

Meites, Mulder, Mollica & Glink represents plaintiffs in nationwide class actions and multi-party complex litigation in federal and state courts, focusing on employment discrimination, workplace benefits, whistleblower actions, consumer rights, and securities litigation. The firm's guiding principle is to pursue cases that have a positive impact on society by advocating on behalf of classes of employees, investors, consumers, and others whose legal rights have been denied.