UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF MICHIGAN 

SOUTHERN DIVISION 

DOUGLAS W. STOCKWELL and 

INTERNATIONAL UNION OF 

OPERATING ENGINEERS LOCAL 324, 

 Plaintiffs, Civil Case No. 15-11609 

 Honorable Linda V. Parker 

v. 

JOHN M. HAMILTON and 

WILLIAM ROUGH, 

 Defendants. 

and 

JOHN M. HAMILTON, 

 Plaintiff, Civil Case No. 19-11566 

 Honorable Linda V. Parker 

v. 

OPERATING ENGINEERS’ LOCAL 

PENSION FUND and BOARD OF 

TRUSTEES OF THE OPERATING ENGINEERS’ 

LOCAL 324 PENSION FUND, 

 Defendants. 

__________________________________/ 

OPINION AND ORDER GRANTING 

MOTION TO APPROVE SETTLEMENT

 In 2015, Douglas Stockwell and the International Union of Operating 

Engineers Local 324 (“Local 324”) initiated a lawsuit against John M. Hamilton 

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7035 Page 1 of 9
2 

and William Rough, seeking reimbursement of the legal fees the Operating 

Engineers’ Local 324 Pension Fund (“Fund”) advanced to defend Mr. Hamilton 

and other Fund trustees in connection with certain federal investigations. In 2019, 

Mr. Hamilton sued Local 324 and the Fund’s Board, seeking a declaration that the 

Fund is obligated to advance attorneys’ fees to him pursuant to an agreement 

between himself, the Fund, and the Fund’s Board. The heart of the disputes arise 

under the Employment Retirement Income Security Act (ERISA), 29 USC Section 

1001 et seq. After contentious litigation, spanning almost five years, and over 

twenty-two (22) months of negotiations before the Honorable Nancy G. Edmunds 

and David R. Grand, the parties agreed to settle these lawsuits and two related 

matters.1

 (See ECF No. 216-1.) The matter is presently before the Court on a 

motion for approval of the Settlement Agreement. (ECF No. 216.) 

Under the Settlement Agreement, the Fund will recover approximately $1.6 

million in exchange for inter alia mutual releases barring future claims by Fund 

participants and beneficiaries and Local 324 members against Mr. Hamilton or Mr. 

Rough. To effectuate this bar, Local 324 and the Fund served notice of the 

agreement on 22,741 Fund participants and beneficiaries and Local 324 members 

and offered them the opportunity to assert written objections to the agreement. 

1

 Those matters are: Trustees of the Operating Engineers’ Local 324 Pension Fund 

v. Federal Insurance Company, AAA no. 01-18-0000-9316 and United States v. 

Hamilton, No. 19-mc-51805 (E.D. Mich. filed Dec. 13, 2019). 

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7036 Page 2 of 9
3 

One objection was received from Fund participant and Local 324 member James 

Arini. On April 21, 2020, the Court conducted a telephonic motion at which 

counsel for the parties and Mr. Arini addressed the Court. 

Courts in the Sixth Circuit approve settlement agreements when they 

represent a prudent, fair, and reasonable resolution for all interested parties and 

non-parties. Int’l Union v. Ford Motor Co., No. 05-cv-74730, 2006 WL 1984363, 

at *21 (E.D. Mich. July 13, 2006), aff’d sub nom. Int’l Union v. Gen. Motors 

Corp., 497 F.3d 615 (6th Cir. 2007). While the present matters are not class 

actions under Rule 23 of the Federal Rules of Civil Procedure, the Court finds the 

guidance for evaluating settlement agreements in such matters to be a useful guide 

here. As one judge in this District has observed: 

“In assessing the settlement, the Court must determine 

‘whether it falls within the range of reasonableness, not 

whether it is the most favorable possible result in the 

litigation.” ’ In re Domestic Air Transp. Antitrust Litig., 

148 F.R.D. 297, 319 (N.D. Ga. 1993) (quoting Fisher 

Bros. v. Cambridge-Lee Indus., 630 F. Supp. 482, 489 

(E.D. Pa. 1985). An appropriate range of reasonableness 

“recognizes the uncertainties of law and fact in any 

particular case and the concomitant risks and costs 

necessarily inherent in taking any litigation to 

completion.” Frank v. Eastman Kodak Co., 228 F.R.D. 

174, 186 (W.D.N.Y. 2005) (quoting Newman v. Stein, 

464 F.2d 689, 693 (2d Cir. 1972)). Under this standard, 

“[a] just result is often no more than an arbitrary point 

between competing notions of reasonableness.” In re 

Corrugated Container Antitrust Litig. (II), 659 F.2d 

1322, 1325 (5th Cir. 1981). 

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7037 Page 3 of 9
4 

Ford Motor Co., 2006 WL 1984363, at *21. Courts in the Sixth Circuit find eight 

factors relevant in considering whether a class action settlement is fair, adequate, 

and reasonable: 

“(1) the risk of fraud or collusion; (2) the complexity, 

expense and likely duration of the litigation; (3) the 

amount of discovery engaged in by the parties; (4) the 

likelihood of success on the merits; (5) the opinions of 

class counsel and class representatives; (6) the reaction of 

absent class members; and (7) the public interest.” 

Moulton v. U.S. Steel Corp., 581 F.3d 344, 349 (6th Cir. 2009) (quoting UAW v. 

Gen. Motors Corp., 497 F.3d at 631). “The district court enjoys wide discretion in 

assessing the weight and applicability of these factors.” Granada Investments, Inc. 

v. DWG Corp., 962 F.2d 1203, 1205-06 (6th Cir. 1992); see also Ford Motor Co., 

2006 WL 891151, at *14 (“The court may choose to consider only those factors 

that are relevant to the settlement at hand and may weigh particular factors 

according to the demands of the case.”). 

 Here, the Settlement Agreement is the byproduct of serious, informed, and 

non-collusive negotiations between the parties. Beginning in May 2018, the 

parties engaged in multiple months of settlement negotiations overseen by two 

respected judicial officers in this District. Counsel met with Magistrate Judge 

Grand and/or Judge Edmunds for at least seven formal settlement conferences, and 

met independently outside those conferences, to forge the present agreement. 

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7038 Page 4 of 9
5 

The Settlement Agreement does not favor any one party but represents a 

compromise among them all. The amount the Fund will recover under the 

Settlement Agreement reflects forty percent (40%) of what it hoped to recover if 

the 2015 matter proceeded to trial. This is substantial, particularly when 

considering the significant attorneys’ fees that would have been expended if a trial 

was necessary. Moreover, despite the fact that the 2015 litigation is approaching 

its fifth anniversary, the parties had significant additional discovery to complete 

and additional motions to file, which would have further reduced any recovery at 

trial and possibly required further litigation funding by Local 324. 

There also is uncertainty as to whether Local 324 or the Fund would prevail 

at trial. Moreover, a judgment could result in additional lengthy disputes regarding 

enforceability, collectability, and insurance coverage. If Mr. Hamilton prevailed, 

he, and possibly the insurance carriers, could seek reimbursement of defense costs 

under the indemnification agreements with Local 324 and the Fund. 

Mr. Arini raises several objections to the Settlement Agreement. He 

contends that the amount to be recouped by the Fund is insufficient, that Local 324 

should receive reimbursement for the $820,000 it contributed to fund the 2015 

litigation, and that Local 324 lacked the authority to release its members’ rights to 

sue Mr. Hamilton and Mr. Rough. Mr. Arini further argues that by releasing 

members’ rights, the Settlement Agreement violates the Labor Management 

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7039 Page 5 of 9
6 

Reporting and Disclosure Act of 1959 (“Landrum-Griffin Act”), 29 U.S.C. §§ 401-

531. The Court appreciates Mr. Arini’s objections. Nevertheless, they do not 

convince the Court that it should refrain from approving the Settlement 

Agreement. 

As one of the attorneys pointed out at the motion hearing, the sign of a good 

compromise is that neither side is fully satisfied. Undoubtedly it would be optimal 

for the Fund and its participant and beneficiaries if all of the costs that had been 

advanced to Mr. Hamilton and others were recovered. However, there was no 

guarantee that this would be the result if the Fund and Local 324 pursued this 

litigation to trial. Moreover, pursing this optimal relief would come at significant 

expense and risk. 

A percentage of the Local 324 membership may not be pension fund 

participants. Nevertheless, Local 324 had the authority to decide that this litigation 

was appropriate and in the best interests of its members and to forgo 

reimbursement of the amount it paid to support the litigation. 

Contrary to Mr. Arini’s assertions, Local 324 had the authority to bind its 

members to the Settlement Agreement provided the release of their statutorily 

protected rights is “clear and unmistakable” and the union did not act in bad faith 

or arbitrarily. See Dotson v. Arkema, Inc., 397 F. App’x 191, 194 (6th Cir. 2010);

Int’l Longshore & Warehouse Union v. Columbia Grain, Inc., 714 F. App’x 660, 

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7040 Page 6 of 9
7 

662 (9th Cir. 2017) (citing Vaca v. Sipes, 386 U.S. 171, 177, 190-91; NLRB v. 

Allis-Chalmers Mfg. Co., 388 U.S. 175, 180 (1967)). Mr. Arini does not claim that 

the release is unclear or ambiguous and the Court finds no indication that Local 

324 is acting in bad faith or arbitrarily. Moreover, Mr. Arini’s claims, if any, 

would be barred by ERISA’s six-year statute of repose as Mr. Hamilton’s role as a 

fiduciary with respect to Local 324 and the Fund ended more than seven years ago. 

See Durand v. Hanover Ins. Grp. Inc., 806 F.3d 367, 376 (6th Cir. 2015) (citing 29 

U.S.C. § 1113 and explaining that “ERISA specifies a three- or six-year limitations 

period for claims of breach of fiduciary duty.”). 

Because Mr. Arini’s potential claims are time-barred, the Court does not 

believe the Settlement Agreement violates his rights under the Landrum-Griffin 

Act (hereafter also “Act”). In other words, the Landrum-Griffin Act does not 

protect a union member’s right to bring an untimely claim. Moreover, the Court 

concludes that the Act does not apply to the claims waived in the agreement. 

“ ‘The LMRDA was the product of congressional concern with widespread 

abuses of power by union leadership.’ ” Babler v. Futhey, 618 F.3d 514, 520 (6th 

Cir. 2010) (quoting Sheet Metal Workers’ Int’l Assoc. v. Lynn, 488 U.S. 347, 352 

(1989)) (internal quotation marks omitted). The Act contains a “Bill of Rights” for 

union members “ ‘designed to guarantee every union member equal voting rights, 

rights of free speech and assembly, and a right to sue.’ ” Id. (quoting United 

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7041 Page 7 of 9
8 

Steelworkers of Am. v. Sadlowski, 457 U.S. 102, 109 (1982)). “In providing these 

protections, ‘Congress sought to further the basic objective of the LMRDA: 

ensuring that unions are democratically governed and responsive to the will of 

their memberships.’ ” Id. (quoting Lynn, 488 U.S. at 352) (additional quotation 

marks, citation, and brackets omitted). The Supreme Court has held that union 

members cannot establish a violation of the statute where their claims are 

“inconsistent with the LMRDA’s ‘overriding objective’ of democratic union 

governance.” Lynn, 488 U.S. at 353 (quoting Finnegan, 456 U.S. at 441). The 

disputes here pertain to the ERISA rights of pension fund participants to sue for, or 

settle, breach of fiduciary claims thereunder. The claims waived by union 

members in the Settlement Agreement have nothing to do with democratic union 

governance. 

For these reasons, the objections Mr. Arini raises do not impact this Court’s 

conclusion that the Settlement Agreement is prudent, fair, and reasonable. 

Accordingly, 

IT IS ORDERED that the motion for approval of the Settlement Agreement 

is GRANTED. 

IT IS FURTHER ORDERED that the parties shall submit a proposed 

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7042 Page 8 of 9
9 

Judgment within fourteen (14) days of this Opinion and Order. 

IT IS SO ORDERED. 

s/ Linda V. Parker 

LINDA V. PARKER

U.S. DISTRICT JUDGE

Dated: May 11, 2020

Case 4:15-cv-11609-LVP-DRG ECF No. 224 filed 05/11/20 PageID.7043 Page 9 of 9