Opinion ID: 4522451
Heading Depth: 2
Heading Rank: 1

Heading: Yard-Man, Tackett, and Reese

Text: Some background is helpful. For years we applied a series of inferences, first adopted in UAW v. Yard-Man, Inc., to decide whether a CBA had vested lifetime healthcare benefits. See 716 F.2d 1476, 1479–83 (6th Cir. 1983). In Tackett, the Supreme Court found that “those inferences conflict with ordinary principles of contract law.” 135 S. Ct. at 933. The Court thus dismantled Yard-Man and reminded this circuit to use “ordinary contract principles” to “ascertain the intentions of the parties.” Id. at 935 (quoting 11 R. Lord, Williston on Contracts § 30:2, p. 18 (4th ed. 2012)). For a few years, we assumed that Yard-Man’s inferences were still relevant to whether a CBA was ambiguous, even if they were not relevant to the ultimate question of whether the benefits had vested. See Reese v. CNH Indus. N.V., 854 F.3d 877, 882 (6th Cir. 2017). But the Supreme Court disagreed once more—this time, it clarified that Tackett barred the use of those inferences for any purpose because they were “inconsistent with ordinary principles of contract law.” CNH Industrial v. Reese, 138 S. Ct. 761, 763 (2018) (quoting Tackett, 135 S. Ct. at 937). The Court then issued a renewed instruction to “comply with Tackett’s direction to apply ordinary contract principles” to the interpretation of CBAs. Reese, 138 S. Ct. at 765. Nos. 18-1471/1975/1976 UAW, et al. v. Honeywell Int’l, Inc. Page 20 In our eagerness to run far away from the Yard-Man inferences that twice rankled the Supreme Court, we have forgotten what Tackett and Reese actually said. The Court did not instruct our circuit to canvass CBAs in search of reasons to deny healthcare benefits to retirees, however divorced those reasons might be from ordinary principles of contract law. The Court’s direction was much narrower: in interpreting CBAs, we must apply the very same principles of contract law that we use in the typical case, “at least when those principles are not inconsistent with federal labor policy.” Tackett, 135 S. Ct. at 933; see also Reese, 138 S. Ct. at 764. That, and only that, is what Tackett and Reese instructed. The “earthquake in our caselaw,” Zino v. Whirlpool Corp., 763 F. App’x 470, 471 (6th Cir. 2019), did not leave a crater in its wake. The foundations of contract law remain. And we cannot secure those foundations unless we “comply with Tackett’s direction to apply ordinary contract principles” to the interpretation of CBAs. Reese, 138 S. Ct. at 765. Our recent caselaw has struggled with this lesson and, in my estimation, it has stretched ordinary principles of contract law beyond the breaking point. Take Fletcher v. Honeywell International, Inc., 892 F.3d 217 (6th Cir. 2018). There we declared that “a CBA’s general durational clause applies to healthcare benefits unless it contains clear, affirmative language indicating the contrary.” Id. at 223. Where do Tackett and Reese direct us to presume that benefits are not vested absent a “clear, affirmative” statement of vesting? Nowhere. In fact, Reese says just the opposite: in keeping with ordinary contract principles, the Court tells us to consider all “explicit terms, implied terms, or industry practice” to determine a CBA’s meaning; and if those terms are “reasonably susceptible to at least two reasonable but conflicting meanings,” then we must “consult extrinsic evidence” before reaching a conclusion. 138 S. Ct. at 765. Mindful of this mismatch between Fletcher and Reese, we have tried to rescue Fletcher by interpreting it narrowly. In Zino, for example, we held that Fletcher’s clear-statement rule applies only to the application of a CBA’s general durational clause. See 763 F. App’x at 472. But “[i]f a CBA does unambiguously disconnect certain benefits from the agreement’s general durational clause, the agreement might well vest those benefits—even absent clear vesting language.” Id. That qualification perhaps brings us within earshot of ordinary principles of Nos. 18-1471/1975/1976 UAW, et al. v. Honeywell Int’l, Inc. Page 21 contract law. I assume in this dissent that we are bound by Fletcher’s clear-statement rule, subject to Zino’s clarification. But even accepting that Fletcher is somehow consistent with Reese, this court must still apply ordinary contract principles to decide whether the parties included “clear, affirmative language” disconnecting Honeywell’s guaranteed contribution from the CBA’s durational clause. Reese, 138 S. Ct. at 765; Fletcher, 892 F.3d at 223. I turn to that task.