UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF MICHIGAN 

SOUTHERN DIVISION 

WILLARD L. SLOAN, EUGENE J. 

WINNINGHAM, and JAMES L. KELLEY,

 Plaintiffs, 

 v. 

BORGWARNER INC., BORGWARNER 

DIVERSIFIED TRANSMISSION 

PRODUCTS INC., and BORGWARNER 

FLEXIBLE BENEFITS PLANS, 

 Defendants. 

Case 2:09-cv-10918-PDB-MKM 

U.S. District Judge Paul D. Borman 

U.S. Magistrate Judge Mona K. Majzoub 

BORGWARNER’S RESPONSE TO 

PLAINTIFFS’ NOTICE OF SUPPLEMENTAL AUTHORITY 

BorgWarner Inc., BorgWarner Diversified Transmission Products Inc., and BorgWarner 

Flexible Benefits Plans—referred to collectively as “BorgWarner”—hereby respond briefly to 

Plaintiffs’ notice regarding the recent decision in United Steel Workers Int’l Union v. KelseyHayes Co., Case 4:11-cv-15497-GAD-MAR (E.D. Mich. Apr. 24, 2013) (ECF No. 65). Cf. Fed. 

R. App. P. 28(j) (allowing responses to notices of supplemental authority). Even if correctly 

decided, the United Steel Workers decision is irrelevant to the parties’ pending summaryjudgment motions for at least three reasons. 

First, Plaintiffs ignore BorgWarner’s argument that their benefits are not vested because 

(a) the parties “agreed to disagree”—and thus reached no agreement—on vesting, (b) the benefits 

expired in 2009 when they were not renewed, and (c) the parties’ negotiations treated the benefits 

as if they were not vested. (E.g., R. 95, BorgWarner’s Mot. Summ. J. 12–16.) Accordingly, 

BorgWarner’s May 2009 changes to Plaintiffs’ benefits are permissible regardless of whether the 

benefit changes satisfy the Reese standard. Indeed, if it cannot—for whatever reason—rule as a 

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matter of law that the changes satisfy Reese, the Court should assess whether Plaintiffs’ benefits 

are vested. Determination of the vesting issue in BorgWarner’s favor resolves this case. 

Second, Plaintiffs continue to misunderstand the holding in Reese, which is that—“unless 

[the CBA] says otherwise”—modifications can be made to vested retiree health benefits “that are 

reasonably commensurate with the benefits provided [currently], reasonable in light of changes 

in health care and roughly consistent with the kinds of benefits provided to current employees.” 

Reese v. CNH Am. LLC, 574 F.3d 315, 326 (6th Cir. 2009) (emphasis added) (internal quotation 

marks omitted). Statements in the CBA that certain changes can be made only with mutual 

assent are insufficient to make Reese inapplicable. There must be a broader agreement—as there 

appears to have been in Moore v. Menasha Corp.—“that the CBAs could only be modified on the 

signed, mutual consent of the parties” to waive the ability to make Reese-sanctioned changes. 

690 F.3d 444, 459 (6th Cir. 2012). 

Finally, no such agreement exists in the BorgWarner–UAW agreements at the center of 

this case. Plaintiffs quote extensively from—but misread—article 11, section 7 of the Health 

Insurance Agreement to mean BorgWarner is precluded from modifying Plaintiffs’ benefits 

absent an agreement between the company and the UAW. (R. 120, Notice Supp’l Auth. 3.) The 

article from which Plaintiffs quote addresses coordination of Plaintiffs’ benefits between 

BorgWarner’s plan and other plans (like, for example, Medicare). (See generally R. 96 Ex. 1, 

1989 HIA art. 11.) Among other things, the parties agreed, “To the extent that coverage under 

this Plan may be duplicated by coverage available under any Federal Medicare Program or Plan 

of National Health now or later adopted, such duplicate coverage will be deleted from this Plan.” 

(Id. art. 11, § 4.) The provision from which Plaintiffs quote begins with language conveniently 

omitted by Plaintiffs: “If the coverages provided by the provisions of this Agreement are provided 

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 3 

by Federal or State laws then; . . . .” (Id. art. 11, § 7 (emphasis added).) Perhaps under those 

limited circumstances, the HIA requires benefit changes to be made by mutual assent, but this 

case does not involve changes made to integrate Plaintiffs’ previous plan with governmentprovided benefits. The language on which Plaintiffs rely simply does not apply in this case. Even 

if it did apply, the limited scope of the provision is insufficient to constitute an agreement that 

Plaintiffs’ benefits are inalterable absent an agreement between BorgWarner and the UAW.*

United Steel Workers does not alter the record before the Court, and BorgWarner urges 

the Court to grant it summary judgment either because Plaintiffs’ benefits are not vested or 

because the May 2009 changes were reasonable under the Reese standard. 

Dated: May 16, 2013 

Elisa Angeli Palizzi (P52088) 

(angeli@millercanfield.com) 

Miller, Canfield, Paddock and Stone, P.L.C. 

150 West Jefferson, Suite 2500 

Detroit, Michigan 48226 

313.496.7635 

313.963.6420 fax 

Respectfully submitted, 

s/Bobby R. Burchfield

Bobby R. Burchfield 

(bburchfield@mwe.com) 

Joshua David Rogaczewski 

(jrogaczewski@mwe.com) 

McDermott Will & Emery LLP 

The McDermott Building 

500 North Capitol Street, Northwest 

Washington, District of Columbia 20001 

202.756.8000 

202.756.8087 fax 

Attorneys for BorgWarner Inc., BorgWarner Diversified Transmission Products Inc., and 

BorgWarner Flexible Benefits Plans

 *

 In fact, the language relied upon in United Steel Workers is not sufficiently broad to 

render Reese inapplicable in that case, and the court erred in holding as such. 

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CERTIFICATE OF SERVICE 

I hereby certify that on May 16, 2013, I electronically filed the foregoing BorgWarner’s 

Response to Plaintiffs’ Notice of Supplemental Authority with the Clerk of the Court using 

the ECF system which will send notification of such filing to all ECF participants. 

s/Bobby R. Burchfield

Bobby R. Burchfield 

(bburchfield@mwe.com) 

McDermott Will & Emery LLP 

The McDermott Building 

500 North Capitol Street, Northwest 

Washington, District of Columbia 20001 

202.756.8000 

202.756.8087 fax 

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