                    NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                             File Name: 17a0512n.06

                                             No. 16-2370

                           UNITED STATES COURT OF APPEALS
                                FOR THE SIXTH CIRCUIT
                                                                                           FILED
                                                                                        Sep 01, 2017
                                                                                    DEBORAH S. HUNT, Clerk
CRAIG SERAFINO, WALTER TRIPP, and                           )
MICHAEL J. SZYMANSKI,                                       )
                                                            )
       Plaintiffs-Appellants,                               )       ON APPEAL FROM THE
                                                            )       UNITED STATES DISTRICT
v.                                                          )       COURT FOR THE
                                                            )       EASTERN DISTRICT OF
CITY OF HAMTRAMCK, MICHIGAN and                             )       MICHIGAN
CATHY SQUARE,                                               )
                                                            )
        Defendants-Appellees.                               )

BEFORE: BATCHELDER, GIBBONS, and COOK, Circuit Judges.

        JULIA SMITH GIBBONS, Circuit Judge.                     The state of Michigan appointed an

emergency manager for the City of Hamtramck (“the City”) because the City was facing a fiscal

crisis. To shore up the City’s financial situation, the emergency manager, among other things,

altered the health-insurance plans offered to plaintiffs, retired Hamtramck police officers and

firefighters. Under the new plans, the City continued to pay the plaintiffs-retirees’ health-

insurance premiums, but required greater deductibles and co-pays. Believing that these changes

violated the promises contained in certain collective-bargaining agreements (“CBAs”), plaintiffs

sued Hamtramck and Emergency Manager Cathy Square.

        The district court dismissed plaintiffs’ breach-of-contract claims because it found that the

relevant CBAs did not create a vested right to lifetime healthcare benefits. Because each of

plaintiffs’ constitutional claims required some property interest, that finding resulted in the

failure of all of plaintiffs’ constitutional claims as well. Plaintiffs appealed.
No. 16-2370, Serafino v. City of Hamtramck


       The district court was correct: the CBAs do not create a vested right to lifetime healthcare

benefits. From the four corners of the CBAs, there is no indication that the parties intended for

retiree healthcare to vest for life; instead, each CBA contains a general-durational clause that

explicitly limits the duration of plaintiffs’ rights under the contracts. We affirm.

                                                     I.

       Plaintiffs claim that their contractual and constitutional rights were infringed when the

City and Square took action to contain the City’s fiscal crisis. Some of these actions pertained to

retiree healthcare under prior CBAs that plaintiffs allege created vested, lifetime rights to

healthcare under specific terms.

                                                     A.

       At issue in this appeal are three separate groups of plaintiffs: (1) police officers who

retired under the Fraternal Order of Police (“FOP”) CBA; (2) police officers who retired under

the Ranking Officers Association (“ROA”) CBA; and (3) firefighters who retired under the

International Association of Firefighters (“IAF”) CBA. All retirees retired on or after July 1,

1986. The pertinent details of each CBA will be addressed in turn.

       Fraternal Order of Police CBA. The City and the Hamtramck FOP have entered into a

series of CBAs, dating back to at least the 1990s. Relevant here is the CBA effective as of July

1, 2007 (“2007 FOP CBA”). In Article VII, titled “Economic Matters,” that CBA provided the

following related to plaintiff-retiree healthcare:

       The City shall pay in full for the cost of medical, hospital, and surgical insurance
       (as more fully described in Section 7(a) [the provision for active employee
       healthcare insurance]) for employees and eligible members of employees’
       families who retire on or after July 1, 1986 until that retired employee attains the
       age of sixty-five (65) or is eligible for [M]edicare or [M]edicaid.




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No. 16-2370, Serafino v. City of Hamtramck


DE 36-14, Page ID 1033, 1040. The insurance available to retirees was to mimic the healthcare

insurance available to active employees. Active-employee healthcare insurance was contained in

Article VII, § 7(a) of the 2007 FOP CBA, which provides:

       The City shall provide fully paid medical, hospital and surgical insurance for all
       employees covered under this contract and eligible members of an employee’s
       family. The City shall provide continuous medical, hospital and surgical
       insurance coverage equivalent to or better than Michigan Blue Cross and
       Michigan Blue Shield MVFC-2 coverage with a Master Medical Plan
       supplemented together with the prescription drug rider.

Id. at 1037.

       The 2007 FOP CBA did not extend indefinitely.              Instead, it contained a general-

durational clause, which stated that the “agreement shall be effective as of the first day of July 1,

2007, and shall remain in full force and effect to and including the 30th day of June, 2011.” Id.

at 1070. Article XXI also required the parties to begin negotiations for a new agreement no later

than April 15, 2011. Another section governed the duration of the agreement in the event a new

CBA was not entered into by June 30, stating:

       In the event that negotiations extend beyond the 30th day of June, 2011, the terms
       and provisions of this Agreement shall remain in full force and effect pending
       agreement upon a new contract. Any additional benefits or increases in wages
       obtained as a result of negotiations after the expiration of this Agreement shall be
       retroactive to the 1st day of July, 2011.

Id. It appears that the City and the FOP did not enter into a new agreement until July 1, 2014.

       Ranking Officers Association CBA. The relevant ROA CBA was entered into on July 1,

2007. Its provisions for retiree healthcare differed materially from those contained in the 2007

FOP CBA. Specifically, Article VII, § 8 of the 2007 ROA CBA stated that “[t]he city shall pay

in full for the cost of hospitalization for employees and their families for persons who retire on or

after July 1, 1977 until that retired employee attains the age of sixty-five (65) or is eligible for

Medicare or Medicaid.” DE 44-4, Page ID 1267 (emphasis added). For those employees who

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No. 16-2370, Serafino v. City of Hamtramck


retired after July 1, 1990, the City promised to pay for the “full cost of supplemental insurance to

Medicare, which is equivalent or superior to that offered by and through Blue Cross/Blue Shield

of Michigan.” Id.

       Similar to the 2007 FOP CBA, the 2007 ROA CBA contained a general-durational

clause, which provided that “[t]he duration of this contract, both as to economic and non-

economic provisions[,] shall run from July 1, 2007 to June 30, 2011.” Id. at 1280. And, like the

2007 FOP CBA, the 2007 ROA CBA provided for the extension of the agreement until the

parties entered into a new agreement. The ROA and the City reached a new agreement on July

1, 2014.

       International Association of Firefighters CBA. The relevant IAF CBA was entered into

on July 1, 2009. The retiree-healthcare provisions in the IAF CBA closely mirrored the 2007

FOP CBA, and provide, for those retirees who retire after July 1, 1986, that “[t]he City shall pay

in full the cost of medical insurance [as described in § 6(a)] and Master Medical insurance . . .

until that employee attains the age of sixty-five (65) or is eligible for Medicare or Medicaid.”

DE 35-2, Page ID 564. Section 6(a) of the 2009 IAF CBA provided that:

       The City shall provide fully paid medical and prescription drug insurance for all
       employees covered under this contract and eligible members of an employee’s
       family. The City shall provide continuous medical insurance coverage equivalent
       to, or better than, Michigan Blue Cross and Blue Shield MVF-2 coverage with a
       Master Medical Plan.

Id. at 562. In addition, for those employees retiring after July 1, 1989, the City agreed to pay for

the cost of a Medicare supplemental insurance plan “equivalent or superior to that offered

through Blue Cross-Blue Shield of Michigan.” Id. at 564–65.

       Like the other CBAs at issue, the 2009 IAF CBA contained a general-durational clause,

which provided that “[t]he duration of this contract, both as to economic and non-economic



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No. 16-2370, Serafino v. City of Hamtramck


provisions, shall run from July 1, 2009 through June 30, 2014.” Id. at 568. And, just as the 2007

FOP and ROA CBAs, the 2009 IAF CBA provided for its extension should the parties not reach

a new agreement before it expired. Unlike the FOP and ROA agreements, however, it appears

the IAF agreement ended prematurely. IAF and the City entered into a new CBA with a stated

duration from November 23, 2013, through June 30, 2016.

                                               B.

       Since the Great Recession, many Michigan municipalities have struggled to avoid

bankruptcy.   See Phillips v. Snyder, 836 F.3d 707, 711 (6th Cir. 2016) (listing several

municipalities that have been assigned emergency managers, including Hamtramck, Highland

Park, Flint, Pontiac, Ecorse, Benton Harbor, and Village of Three Oaks). “When the finances of

a Michigan municipality or public school system are in jeopardy, a state law allows for the

temporary appointment of an emergency manager to right the ship.” Id. at 710. That state law,

as currently embodied, is known as the Local Financial Stability and Choice Act, and was

enacted as Public Act 436 (PA 436). Id. at 711 (citing Mich. Comp. Laws § 141.1549).

       PA 436 provides for the appointment of emergency managers who exercise the power of

the local government.    Id. (citing Mich. Comp. Laws § 141.1549(2)).         At the governor’s

discretion, PA 436 permits the state treasurer to oversee the actions of the emergency manager.

Id. (citing Mich. Comp. Laws § 141.1549(8)).

       Our decision in Phillips v. Snyder detailed the process for appointing an emergency

manager under PA 436:

               There are eighteen scenarios contained in PA 436 that act as triggers for
       the statute. If one of those scenarios occurs, the “state financial authority” (the
       state treasurer for a municipality, or the superintendent of public education for a
       school district) conducts a preliminary review to determine whether a given entity
       is under “probable financial stress.” The financial authority then turns its final
       report over to a local emergency financial assistance loan board, which is a

                                               5
No. 16-2370, Serafino v. City of Hamtramck


       statutory entity established by § 141.932. This board reviews the authority’s
       report and makes an official finding of either probable financial stress or no
       financial stress. If the board reaches a conclusion of probable financial stress for
       an entity, the governor appoints a “review team.” Within sixty days of a review
       team’s appointment, it must turn in a report to the governor that reaches a
       conclusion on whether a financial emergency exists within the reviewed local
       government. Within ten days after receiving the review team’s report, the
       governor determines whether a financial emergency exists or not. A local
       government is provided an opportunity to appeal this determination to the
       Michigan court of claims.

               A local government has four options when confronted with a finding of a
       financial emergency: the local government can (1) enter into a consent agreement
       with the state treasurer; (2) accept the appointment of an emergency manager;
       (3) undergo a neutral evaluation process, which is akin to arbitration, with its
       creditors; or (4) enter into Chapter 9 bankruptcy.

Id. at 711–12 (internal citations omitted).

       On April 17, 2013, the State of Michigan appointed a financial review team to review the

City’s financial condition. Approximately a month later, the review team issued its report.     It

determined that a “financial emergency” existed in Hamtramck, and noted that “there was

essentially unanimous acknowledgement from every City and union official with whom the

Review Team met that a financial emergency exists within the City of Hamtramck.” DE 36-2,

Page ID 899.

       Cathy Square was appointed emergency manager for the City. She proposed various

budgetary changes designed to prevent the City from becoming insolvent, among which were

changes to retiree healthcare. The parties agree that plaintiffs originally had retiree-healthcare

plans under which they had no deductible and very low co-pays.              Those plans became

unavailable, however, and the City moved retirees to new plans that had deductibles and higher

co-pays. To offset these increased costs, the City provided the retirees with health-savings

accounts (“HSAs”) that covered the costs of the deductibles. Square’s proposed changes to the

retirees’ healthcare included removing these HSAs and covering retirees, instead, under a “Blue

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No. 16-2370, Serafino v. City of Hamtramck


Care Network” plan with a $2,000 deductible for single insureds and a $4,000 deductible for

family insureds. This new plan was essentially the same, from a deductible and co-pay

perspective, as the plan that previously governed retirees’ health benefits. The only difference

was that retirees, rather than the City, had to cover the costs of their deductibles. Importantly,

the City continued to pay all of the retirees’ health-insurance premiums. The City concurred in

all of Square’s proposed changes to retiree healthcare, and Square implemented the changes on

January 29, 2014.

                                                  C.

       The retirees did not agree with these changes to their healthcare and brought a putative

class-action lawsuit against the City and Square on October 24, 2014. Their complaint, as

amended, alleged five causes of action: three separate counts under 42 U.S.C. § 1983 for

violations of the Constitution’s (1) Contracts Clause, (2) Takings Clause, and (3) Due Process

Clause; (4) a violation of the Bankruptcy Code, 11 U.S.C. § 903; and (5) a breach-of-contract

action under Michigan law.

       On cross-motions for summary judgment, the district court dismissed all of plaintiffs’

claims. It did so because it found that plaintiffs could not demonstrate a vested, lifetime right to

health-insurance benefits. Because their rights had not vested, the district court concluded that

any changes to those rights were not protected by contract. This holding defeated not only

plaintiffs’ breach-of-contract claims, but also their remaining claims because each required a

protected property interest or some form of debt to be viable. Accordingly, because it found that

plaintiffs had no contractual right to healthcare benefits, the district court did not reach the merits

of plaintiffs’ constitutional or bankruptcy-law claims. Plaintiffs appealed.




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No. 16-2370, Serafino v. City of Hamtramck


                                                          II.

         We review the district court’s grant of summary judgment de novo.                              Domingo v.

Kowalski, 810 F.3d 403, 410 (6th Cir. 2016) (citing Green Party of Tenn. v. Hargett, 767 F.3d

533, 542 (6th Cir. 2014)). Construing the evidence in the light most favorable to the nonmovant,

Villegas v. Metro. Gov’t of Nashville, 709 F.3d 563, 568 (6th Cir. 2013), summary judgment is

appropriate if “the movant shows that there is no genuine dispute as to any material fact and the

movant is entitled to judgment as a matter of law,” Fed. R. Civ. P. 56(a).

                                                          III.

         Unless plaintiffs can demonstrate a vested right to lifetime healthcare benefits prior to the

expiration of their respective CBAs, their claims fail.1 This is so because the 2009 CBAs and the

contractual rights contained in them expired when they were replaced by new CBAs. Plaintiffs

do not allege that the City’s or Square’s actions violated the 2013 IAF CBA or the 2014 FOP and

ROA CBAs. Thus, unless their contractual rights vested and survived the expiration of the

earlier agreements, plaintiffs’ claims must fail because, as the district court held, they had no

contractual rights to breach and, concomitantly, no property rights from which they could derive

any of their constitutional or bankruptcy-law claims.

                                                          A.

1
  The district court found that plaintiffs did not have a vested right to lifetime healthcare benefits. Its inquiry was
focused on lifetime vesting because that was the nature of the right that plaintiffs asserted. The district court
correctly found that plaintiffs’ healthcare rights did not vest for life. It erred, however, in holding that “[t]he
agreements, by their terms, expired in 2011” and that, accordingly, “there was no contract to breach or impair.” DE
51, Page ID 2009. The 2007 FOP CBA and 2007 ROA CBA both contained provisions that extended their effective
date past June 30, 2011, if the unions and the City had not reached an agreement. Here, new FOP and ROA CBAs
did not take effect until July 1, 2014, meaning that, when Square and the City made changes to retiree healthcare
under those CBAs in January 2014, the FOP and ROA retirees had some contractual rights remaining under those
CBAs. But plaintiffs placed all of their eggs in the lifetime-vesting basket. They have focused, exclusively, on the
alleged lifetime nature of their rights. Plaintiffs have not argued in the alternative that their rights under the 2007
CBAs, which expired on June 30, 2014, were breached, albeit temporarily, by the City and Square’s changes to their
healthcare benefits. In fact, plaintiffs argued that Square’s actions were illegal, in part, because Michigan law grants
her the authority to alter only existing CBAs and that the CBAs under which they claim rights were not in existence
at the time of her changes. Thus, just as the parties and the district court have, we focus our inquiry on whether the
relevant CBAs evince an intent to vest plaintiffs’ healthcare benefits for life.

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No. 16-2370, Serafino v. City of Hamtramck


       The issue of whether retirees have vested rights to lifetime healthcare benefits is an active

one in this circuit. The flurry of cases stems from the Supreme Court’s recent invalidation of the

Sixth Circuit’s so-called Yard-Man inference. M & G Polymers USA, LLC v. Tackett, 135 S. Ct.

926, 930 (2015).

       Tackett held that ordinary principles of contract interpretation should apply to collective-

bargaining agreements. Id. at 935. Most courts in the country had always done so. See Noe v.

PolyOne Corp., 520 F.3d 548, 567–68 (6th Cir. 2008) (Sutton, J., concurring in part and

dissenting in part). The Sixth Circuit, however, had reviewed collective-bargaining agreements

“with a thumb on the scale in favor of employees.” Reese v. CNH Indus. N.V., 854 F.3d 877,

880 (6th Cir. 2017) (Reese III) (citing Tackett, 135 S. Ct. at 935). This favoritism derived from a

doctrine known most commonly as the Yard-Man inference. Id. “In Tackett, the Supreme Court

abrogated the Yard-Man inference and instructed courts to apply ‘ordinary principles of contract

law’ when reviewing collective-bargaining agreements.” Id. at 881.

       The Supreme Court also provided a refresher course on contract law. It noted that, when

interpreting CBAs, “as with any other contract, the parties’ intentions control.” Tackett, 135 S.

Ct. at 933 (quoting Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662, 682 (2010)).

Further, “[w]here the words of a contract in writing are clear and unambiguous, its meaning is to

be ascertained in accordance with its plainly expressed intent.”        Id. (quoting 11 R. Lord,

Williston on Contracts § 30:6, p. 108 (4th ed. 2012)). Tackett noted that any assumption “in

favor of vested retiree benefits in all collective-bargaining agreements” rests on “assessment[s]

of likely behavior” between the parties that “is too speculative and too far removed from the

context of any particular contract to be useful in discerning the parties’ intention.” Id. at 935.

Indeed, “[p]arties . . . can and do voluntarily agree to make retiree benefits a subject of



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No. 16-2370, Serafino v. City of Hamtramck


mandatory collective bargaining,” and they do so despite unions representing only active

employees and not retirees. Id. at 936.

       The Supreme Court instructed courts “not [to] construe ambiguous writings to create

lifetime promises.” Id. (citing 3 A. Corbin, Corbin on Contracts § 553, p. 216 (1960) (explaining

that contracts that are silent as to their duration will ordinarily be treated not as “operative in

perpetuity” but instead as “operative for a reasonable time”)). And, like other contracts, the

obligations under collective-bargaining agreements “cease, in the ordinary course, upon

termination of the bargaining agreement.” Id. at 937 (quoting Litton Fin. Printing Div., Litton

Bus. Sys., Inc. v. NLRB, 501 U.S. 190, 207 (1991)).

       Although a contract’s general-durational clause does not say everything about the parties’

intent to vest a benefit, Tackett v. M & G Polymers USA, LLC, 811 F.3d 204, 209 (6th Cir. 2016)

(Tackett III), it certainly says a lot. So, “[w]hen a specific provision of the CBA does not include

an end date, [this court] refer[s] to the general durational clause to determine that provision’s

termination.” Gallo v. Moen, Inc., 813 F.3d 265, 269 (6th Cir. 2016). Absent some strong

indication within the four corners of the agreement itself—perhaps, a specific-durational clause

that applied to certain provisions but not others—the contractual rights and obligations under a

CBA terminate along with the CBA. Tackett, 135 S. Ct. at 937.

       We have, on occasion, found that a general-durational clause did not unambiguously

apply to certain benefits contained within a CBA. Generally, we have done so where some other

durational language cast doubt on a general-durational clause’s otherwise-unequivocal province.

In Reese III, we found that a CBA’s general-durational clause did not unambiguously prevent

vesting because the parties had “carved out certain benefits, such as life insurance and healthcare

insurance, and stated that those coverages ceased at a time different than other provisions of the



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No. 16-2370, Serafino v. City of Hamtramck


CBA.” 854 F.3d at 882. Similarly, in UAW v. Kelsey-Hayes Co., we found that, where certain

healthcare benefits were time limited but others were not, language noting that those benefits

“continued” created an ambiguity about the duration of the employer’s promise. 854 F.3d 862,

867 (6th Cir. 2017). Yet, merely having a CBA that contains “phrases [such as] ‘continued,’

‘will be provided,’ ‘will be covered,’ and the like” tells us only that the terms are “guarantee[d]

benefits until the agreement expires, nothing more.” Gallo, 813 F.3d at 269 (citations omitted).

Thus, “[a]bsent a longer time limit in the context of a specific provision, the general durational

clause supplies a final phrase to every term in the CBA: ‘until this agreement ends.’” Id.

       Of course, Tackett arose in a different context than the claims presented here.

Specifically, those cases were brought under ERISA, which governs the relationships and

agreements between private employers and their employees but excludes public employers and

employees, like plaintiffs here. See 29 U.S.C. § 1003(b)(1). Thus, what rights exist under these

CBAs is determined by Michigan contract law. Yet, despite the different setting, Michigan

courts have unanimously endorsed Tackett’s reasoning in both the private- and public-sector

context. See Arbuckle v. Gen. Motors LLC, 885 N.W.2d 232, 242–43 (Mich. 2016) (applying

Tackett’s reasoning in interpreting a CBA under ERISA); Harper Woods Retirees Ass’n v. City

of Harper Woods, 879 N.W.2d 897, 904–05 (Mich. Ct. App. 2015) (noting that Tackett’s

reasoning is “consistent with Michigan’s contract jurisprudence regarding CBAs, which applies

with equal force in both the public and private sectors”). Thus, we are free to look to Tackett and

its progeny in interpreting the CBAs at issue here.

                                                B.

       All of the CBAs at issue in this appeal contain unambiguous general-durational clauses

that defeat plaintiffs’ argument that they have vested, lifetime rights to healthcare benefits.



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No. 16-2370, Serafino v. City of Hamtramck


Looking to the four corners of the agreements, there is no indication that the City intended to

provide any healthcare benefit to the retirees for life, let alone a right to deductible-free, low-co-

pay, forever-unalterable healthcare insurance.

                                         1. 2007 FOP CBA

       The 2007 FOP CBA contained a general-durational clause, providing that the agreement

terminated on June 30, 2011, or, if a new CBA had not been reached by then, when a new CBA

came into effect. Because a new agreement was reached on July 1, 2014, the 2007 FOP CBA

needs to contain some indication that plaintiffs’ healthcare benefits were excepted from this

general-durational clause. “First and foremost, nothing in this or any of the other CBAs says

that [the City] committed to provide unalterable healthcare benefits to retirees” for life. Gallo,

813 F.3d at 269. Further, unlike in Reese III and Kelsey-Hayes, there is no ambiguity as to this

general-durational clause’s application to the retirees’ healthcare benefits. As noted above, the

CBA in Reese III carved out health insurance as a benefit that ended at a different time than other

benefits, rendering the duration of that benefit ambiguous. See 854 F.3d at 882. Similarly, the

CBA at issue in Kelsey-Hayes “use[d] . . . three different types of durational language for

specific provisions within the agreement,” which furthered the ambiguity. See 854 F.3d at 872.

No such provisions are present in this CBA.

       Other language in the 2007 FOP CBA belies vesting. For example, the 2007 FOP CBA’s

Art. VII, § 8(c)—the retiree-healthcare-benefit provision at issue here—governs retirement

benefits for former employees who retired on or after July 1, 1986—a group that obviously

includes retirees who retired under pre-2007 CBAs. But, since each successive FOP CBA has

contained substantially similar language regarding retiree healthcare, that raises the question: if

anyone—the FOP, the retirees, or the City—believed that the retirees’ rights had vested, why



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No. 16-2370, Serafino v. City of Hamtramck


would their healthcare benefits be included in a 2007 CBA? The only reasonable inference, of

course, is that the parties did not believe this language created a vested right to lifetime

healthcare benefits and thus had to include it in each new CBA. Indeed, “[t]here would be no

need to continue such benefits if prior CBAs had created vested rights to such benefits.” See

Gallo, 813 F.3d at 270 (internal quotation marks omitted). This reinforces the general-durational

clause’s application and provides further evidence that the parties did not intend to vest retiree

healthcare benefits for life.2

         Plaintiffs argue that phrases such as “until that retired employee attains the age of sixty-

five,” “shall be eligible for,” and “continuous” indicate an intent to vest benefits for life. See CA

6 R. 27, at 22–30. And notably, plaintiffs claim the healthcare provision “does not read ‘until

they reach age 65 or are eligible for Medicare or Medicaid OR UNTIL THE EXPIRATION OF

THIS AGREEMENT WHICHEVER IS SOONER.’” Id. at 23. But that is exactly how it reads

because, unless there is “a longer time limit in the context of a specific provision, the general

durational clause supplies a final phrase to every term in the CBA: ‘until this agreement ends.’”

Gallo, 813 F.3d at 269.




2
  Although outside the four corners of the agreement and thus irrelevant to the vesting analysis, plaintiffs’ own
complaint provides some acknowledgement of the non-vested nature of the retirees’ healthcare benefits. They agree
that the City made changes to their healthcare but claim that “[t]hese changes were not challenged because the
retirees determined that they were equivalent or better than the plan referenced in the contracts or were too
insignificant to warrant substantial litigation.” DE 9, Page ID 45. But that is not the way vesting works. When a
retiree’s rights vest, those rights become forever unalterable. Arbuckle, 885 N.W.2d at 241. This differentiates non-
vested retiree benefits, which unions, though they represent only current employees and not retirees, are permitted to
make part of their negotiations. See Allied Chem. & Alkali Workers of Am., Local Union No. 1 v. Pitt. Plate Glass
Co., Chem. Div., 404 U.S. 157, 181–82, 181 n.20 (1971); see also Arbuckle, 885 N.W.2d at 241 (“[A] union may
represent and bargain for already-retired employees, but only with respect to nonvested benefits. By contrast, when
an employer explicitly obligates itself to provide vested benefits, that promise is rendered forever unalterable
without the retiree’s consent.”); Kendzierski v. Macomb Cty., --N.W.2d--, No. 329576, 2017 WL 1398769, at *2–3
(Mich. Ct. App. Apr. 18, 2017) (applying Arbuckle in the public-union context). Here, retirees benefited from the
FOP’s continued successful negotiations for their retirement benefits, and that is why they did not object to the
changes. Now that those benefits’ non-vested nature has worked to the retirees’ detriment, the retirees cannot claim
that their rights are, and have been, forever unalterable.

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No. 16-2370, Serafino v. City of Hamtramck


       Further, plaintiffs contend that the tying of healthcare benefits to retiree status indicates

an intention to vest those benefits. The Supreme Court, however, has limited courts’ ability to

rely on tying as evidence of vesting. See Tackett, 135 S. Ct. at 937. True, post-Tackett, we have

determined that tying may further an ambiguity. See Reese III, 854 F.3d at 882–83 (finding that

tying of healthcare benefits to pensioner status, when coupled with silence and confusion about

the duration of healthcare benefits, rendered a CBA ambiguous). But, again, the CBAs in that

case contained separate durational clauses coupled with evidence of tying. See id. The 2007

FOP CBA is not silent as to duration and does not contain conflicting durational clauses. As

such, evidence of tying cannot create an ambiguity where none would otherwise exist.

Accordingly, the general-durational clause controls and plaintiffs’ rights did not vest.

                                         2. 2007 ROA CBA

       The 2007 ROA CBA in many ways mirrors the 2007 FOP CBA. Like the 2007 FOP

CBA, it contains a general-durational clause. And, also like the 2007 FOP CBA, it lacks any

ambiguity as to that provision’s application to retiree-healthcare benefits. Accordingly, the

above analysis applies with equal force to the 2007 ROA CBA and similarly precludes a finding

of vested benefits.

       The 2007 ROA CBA, however, does contain an important distinction: it does not provide

for retiree healthcare insurance at all. Instead, it covers only the “full . . . cost of hospitalization

for employees and their families for persons who retire on or after July 1, 1977.” DE 44-4, Page

ID 1267 (emphasis added). And, for those employees who retire after July 1, 1990, it provides

for supplemental insurance to Medicare. Thus, even assuming that those plaintiffs covered by

the 2007 ROA CBA had vested rights, the City’s changes to their healthcare would not infringe




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No. 16-2370, Serafino v. City of Hamtramck


plaintiffs’ rights at all. In fact, it appears the City has been providing them with greater benefits

than those to which they are entitled and that the City, even after the changes, continues to do so.

                                         3. 2009 IAF CBA

         As with the other CBAs at issue here, the 2009 IAF CBA’s general-durational clause

precludes a finding that the retirees’ rights vested. The 2009 IAF CBA is nearly identical to the

2007 FOP CBA and likewise lacks sufficient evidence to overcome the general-durational

clause’s force. That clause, which provides that “[t]he duration of this contract, both as to

economic and non-economic provisions, shall run from July 1, 2009 through June 30, 2014,” DE

35-2, Page ID 568, supplies the final phrase to the retiree-healthcare-benefits provision contained

in the 2009 IAF CBA: “until this agreement ends.” See Gallo, 813 F.3d at 269.

                                                ***

         It is important to remember the equities at issue here. No one, of course, wants to see

cuts to retiree healthcare.    But these retirees are still receiving premium-free healthcare

insurance. And even if we found that the retirees had vested rights to healthcare insurance, the

City’s changes likely do not infringe those rights. After all, the CBAs, at best, promise to pay for

the “full . . . cost of medical insurance.” See DE 35-2, Page ID 564. As commonly understood,

the “cost” of an insurance plan is the premium paid by the insured, which the City continues to

cover.

                                                IV.

         For the above reasons, we affirm the district court’s grant of summary judgment for

defendants.




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