COMMUNICATIONS WORKERS OF AMERICA, AFL-CIO, DISTRICT 13 v. VERIZON PENNSYLVANIA INC./VERIZON SERVICES CORP. et al

Filing 21

MEMORANDUM AND OPINION. SIGNED BY HONORABLE J. CURTIS JOYNER ON 8/5/11. 8/5/11 ENTERED AND COPIES E-MAILED.(fdc)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
COMMUNICATIONS WORKERS OF
:
AMERICA, AFL-CIO, DISTRICT 13,:
:
Plaintiff,
:
:
v.
:
:
VERIZON SERVICES CORP.,
:
et al.,
:
:
Defendants.
:

CIVIL ACTION
NO. 10-6840

ORDER
AND NOW, this

5th

day of August, 2011, upon

consideration of Plaintiff’s Motion for Summary Judgment (Doc.
No. 14), Defendants’ Response in Opposition Thereto (Doc. No.
19), Defendants’ Motion for Summary Judgment (Doc. No. 16), and
Plaintiff’s Response in Opposition Thereto (Doc. No. 18), and for
the reasons set forth in the accompanying memorandum, it is
hereby ORDERED as follows:
1) Plaintiff’s Motion for Summary Judgment is DENIED.
2) Defendants’ Motion for Summary Judgment is GRANTED, and
Judgment is hereby entered in favor of the Defendants and against
the Plaintiff in no amount.

BY THE COURT:

/s/ J. Curtis Joyner
______________________________
J. CURTIS JOYNER, C.J.

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
COMMUNICATIONS WORKERS OF
:
AMERICA, AFL-CIO, DISTRICT 13,:
:
Plaintiff,
:
:
v.
:
:
VERIZON SERVICES CORP.,
:
et al.,
:
:
Defendants.
:

CIVIL ACTION
NO. 10-6840

MEMORANDUM AND ORDER
Joyner, C.J.

August

, 2011

Plaintiff, Communications Workers of America (CWA), AFL-CIO,
District 13, and Defendants, Verizon Pennsylvania, Inc., Verizon
Delaware, Inc., and Verizon Services Corp.1, each file a motion
for summary judgment in their respective favor.

The case was

initiated by Plaintiff bringing a breach of contract claim on
behalf of CWA Local 13500 and CWA Local 13100.
Doc. No. 15).

(Pl.’s Mem., 3,

Plaintiff represented the aforementioned local

unions in a series of collective bargaining agreements (CBAs)
with Defendant, of which the agreement at issue was effective
August 3, 2008 through August 6, 2011.
No. 15).

(Pl.’s Mem., 3-4, Doc.

The primary issue is whether Defendant violated a

contracted agreement with Plaintiff when the decision was made to

1

As Defendants are all related corporate entities, they shall
hereafter be referred to as a singular “Defendant.”

1

provide more employees with Enhanced Income Security Plan (EISP)
benefits than were covered in the declared “surplus.”
I.

Facts

On June 30, 2000, Bell Atlantic merged with GTE and became
known as Verizon.
Facts, ¶ 13).

(Def.’s Statement of Undisputed Material

CWA and its affiliated Locals in District 13 have

represented employees of Bell Atlantic, and later Verizon in
Delaware and Pennsylvania since the 1990s.

(Id., ¶ 14).

The

Income Security Plan, and Enhanced Income Security Plan
provisions in the CBAs covering Locals 13000, 13500, 13100, 13101
(collectively “the Pennsylvania and Delaware CBAs”) set forth a
process by which the employers may reduce the size of their
respective workforces.

(Def.’s Statement of Undisputed Material

Facts, ¶ 12). Since 1996, and currently, the amended CBA
regarding EISPs between Pennsylvania Local 13500 and Verizon
states in relevant part:
21.01 If during the term of this Agreement, the Company notifies the
Union in writing that technological change (defined as changes in
equipment or methods of operation) has or will create a surplus in
any job title in a work location which will necessitate lay-offs
or involuntary permanent reassignments of regular employees to
different job titles involving a reduction in pay or to work
locations requiring a change of residence, or if a force surplus
necessitating any of the above actions exists for reasons other
than technological change and the Company deems it appropriate,
regular employees who have at least one (1) year of net credited
service may elect, in the order of seniority, and to the extent
necessary to relieve the surplus, to leave the service of the
Company and receive Income Security Plan (ISP) and if applicable,
during the term of this agreement, Enhanced Income Security Plan
(Enhanced ISP) benefits described in this Section, subject to the
following conditions:
(a) The Company shall determine the job titles and work locations
in which a surplus exists, the number of employees in such titles

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and locations who are considered to be surplus, and the period
during which the employee may, if he or she so elects, leave the
service of the Company pursuant to this Section. Effective until
August 8, 1998, the Company will offer Enhanced ISP in the
circumstances described in Subsection 21.02(a) of this Section and
may also offer Enhanced ISP in other circumstances if they choose
to do so. The Company may limit acceptances to the number of
surplus and this Enhanced ISP offer would be in lieu of
obligations, if any, the Company may have to offer regular ISP.
Neither such determinations by the Company nor any other part of
this article shall be subject to arbitration.
(b) The number of employees who may make such election shall not
exceed the number of employees determined by the Company to be
surplus.
(c) An employee’s election to leave the service of the Company and
receive ISP or Enhanced ISP payments must be in writing and
transmitted to the Company within thirty (30) calendar days from
the date of the Company’s offer in order to be effective and it
may not be revoked after such thirty (30) calendar day period.

(Def.’s Mem. in Support of Def.’s Mot., 5-6, Doc. No. 17).
Delaware Local 13100 CBA Article 19.01 and the Income Security
Plan, Enhanced Income Security Plan provisions in the contracts
covering Locals 13000 and 13101, are identical except for some
article reference numbers.

(Id., 6).

Though the CBAs say, “effective until August 8, 1998,” the
provision that follows remains effectual because each time
Plaintiff and Defendant bargained a renewal of the CBAs, they
executed a memorandum of understanding providing that each of the
new collective bargaining agreements shall consist of the
provisions of the existing agreements, as modified in the
negotiations, and that all expiration dates would be updated
unless the parties agreed otherwise.

(Def.’s Statement of

Undisputed Material Facts, ¶ 25).
In 2010, Defendant along with other Verizon entities

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determined that there was a surplus of approximately 12,000
employees across a broad area, which if not relieved would
necessitate layoffs.

(Id., ¶ 37).

Per the EISP provisions in

the collective bargaining agreements, Defendant notified
Plaintiff of the surplus, and of their intent to offer
supplemented, more generous EISP incentives to alleviate the
surplus.

(Id., ¶ 38-39).

On April 21, 2010, Defendant entered

into a Memorandum of Agreement with the CWA covering several
bargaining units, including CWA Locals 13500 and 13100, creating
a supplemented EISP incentive that was to be made available to
employees on May 18, 2010.

(Id., ¶ 44-45).

Upon distribution,

561 eligible surplus employees within the Local 13500 and Local
13100 bargaining units applied to voluntarily resign from their
positions with Defendant in exchange for the negotiated
supplemented EISP benefits.

(Id., ¶ 58).

Despite a meeting on June 23, 2010 between Defendant and
Plaintiff in which Plaintiff stated that it believed Defendant
was required to seek Plaintiff’s agreement before accepting any
volunteers in excess of the prior stipulated surplus numbers,
Defendant accepted all 561 offers from surplus employees in
Locals 13500 and 13100.

(Id., ¶¶ 59-61).

Over 11,000 employees

left the employ of Defendant and other Verizon entities as a
result of the May 18, 2010 supplemented EISP, and pursuant to the
Incentive Memorandum of Agreement, Defendant has not laid off any

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Consultants or Service Representatives, and has announced that
the surplus declared by the company in 2010 has been alleviated.
(Id., ¶¶ 64, 66, 68).
In July 2010, both CWA Local 13500 and CWA Local 13100 filed
grievances with Verizon, protesting the “Company Exceeding
Announced Surplus.”

(Id., ¶¶ 69, 73).

In September and October

of 2010, both grievances were denied because it was Verizon’s
position that the Company had the flexibility to accept the oversubscription, and the sole discretion to determine and adjust the
surplus numbers.

(Id., ¶¶ 71-75).

The last of the 561 EISP

surplus beneficiaries from Locals 13500 and 13100 went off
payroll on November 21, 2010, and on November 22, 2010, Plaintiff
filed this lawsuit against Defendant.

(Def. Mem. in Support of

Mot. for Summary Judgment, 9, Doc. No. 17).
II.

Legal Standard

Summary judgment is governed by Fed. R. Civ. P. 56, which
states in pertinent part, “the court shall grant summary judgment
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).

However, “the mere existence of

some factual dispute between the parties will not defeat an
otherwise properly supported motion for summary judgment.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S. Ct.
2505, 91 L. Ed. 2d 202 (1986).

Summary judgment will only be

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precluded by disputes over facts that have the potential to
affect the outcome of the suit under governing law.

Id. at 248.

When considering a motion for summary judgment, the court must
“view the facts in the light most favorable to the non-moving
party, and make every reasonable inference in that party’s
favor.”

Graphic Communications Conference v. Bucks County

Courier Times, No. 06-5452, 2008 WL 3889591, at *1 (E.D. Pa. Aug.
18, 2008).
The same standards and burdens apply when the parties file
cross motions for summary judgment.

Graphics Communications

Conference, 2008 WL 3889591, at *2.

Cross motions for summary

judgment must be considered separately because they,
are no more than a claim by each side that it alone is entitled to
summary judgment, and the making of such inherently contradictory claims
does not constitute an agreement that if one is rejected the other is
necessarily justified or that the losing party waived judicial
consideration and determination whether genuine issues of material fact
exist.

Id. (quoting Transportes Ferreos de Venezuela II CA v. NKK Corp.,
239 F.3d 555, 560 (3d Cir. 2001); Rains v. Cascade Indus., Inc.,
402 F.2d 241, 245 (3d Cir. 1968)).
“Although a collective bargaining agreement differs from an
ordinary contract, the meaning of a collective bargaining
agreement may be determined by applying general rules of contract
law as long as federal labor law does not provide a conflicting
rule.”

Sheet Metal Workers Local 19 v. 2300 Group, Inc., 949

F.2d 1274, 1284 (3d Cir. 1991) (quoting Sheet Metal Workers Local

6

19 v. Keystone Heating & Air Conditioning, 934 F.2d 35, 40 (3d
Cir. 1991)).

The Court must deal with the question of law as to

whether a contract term is clear or is conversely susceptible to
reasonable alternative interpretations and therefore deemed
ambiguous.

Einhorn v. Fleming Foods, Inc., 258 F.3d 192, 194 (3d

Cir. 2001).

When ruling on ambiguity, the Court must take into

account, “the contract language, the meanings suggested by
counsel and the extrinsic evidence offered in support of each
interpretation.”

Id. at 194-95.

Extrinsic evidence has been

deemed to include, “the structure of the contract, the bargaining
history, and the conduct of the parties that reflects their
understanding of the contract’s meaning.’

These basic principles

of contract construction are not inconsistent with federal labor
policy.”

Teamsters Industrial Employees Welfare Fund v. Rolls-

Royce Motor Cars, 989 F.2d 132, 135 (3d Cir. 1993).
III.

Discussion

Plaintiff contends in its motion for summary judgment that
the Defendant entities violated the terms contained in the CBA
under subsection b of the Income Security Plan, Enhanced Income
Security Plan requiring that the number of employees accepted as
EISP volunteers not exceed the number of surplus positions
declared by the Company.

Plaintiff’s interpretation of the

language of the provision restricts Defendant’s methods for
alleviating a surplus by requiring that surplus numbers be

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calculated only with regard to specific positions at specific
locations, and EISP applications not be accepted when they exceed
these individualized numbers.

After analysis of the contract on

its face, this Court finds Plaintiff’s interpretation to be
erroneous.
“Under Pennsylvania law, it is well established that the
purpose of contract interpretation is to ascertain and effectuate
the objectively manifested intentions of the contracting
parties.”

Pension Fund for Nursing Homes and Health Care

Employees v. Resthaven Nursing Centers, No. 07-313, 2008 U.S.
Dist. LEXIS 40612, at *10 (E.D. Pa. May 20, 2008).

Further,

“[i]n determining the meaning of a contract, the initial resort
should be to the four corners of the agreement itself.”

Id.

(citing Washington Hospital v. White, 889 F.2d 1294, 1300 (3d
Cir. 1989)).
Article 21.01(a) of the Union/CWA Local 13500 and Verizon
Pennsylvania, Inc. collective bargaining agreement states that,
“the Company may limit acceptances to the number of surplus”
(emphasis added).

(Doc. No. 15, 14).

This is not a mandatory

declaration, as “may” is defined as, “[a]n auxiliary verb
qualifying the meaning of another verb by expressing ability,
competency, liberty, permission, possibility, probability, or
contingency.”

Black’s Law Dictionary (6th Ed.) (citing U.S. v.

Lexington Mill & Elevator Co., 232 U.S. 399, 411, 34 S. Ct. 337,

8

58 L. Ed. 658 (1914).

Further, with regard to employee election

to accept the EISP, Article 21.01(b) states that, “[t]he number
of employees who make such election shall not exceed the number
of employees determined by the Company to be surplus.”
15, 14).

(Doc. No.

Plaintiff’s interpretation of these two sections of the

agreement would put them at odds with one another, and render the
bargaining agreement meaningless.

However, “in making a

determination concerning the clarity or ambiguity of the contract
terms, the Court should avoid interpreting contractual language
in a way that renders any term of the contract meaningless or
superfluous.”

Glenpointe Assocs. v. Regency Savings Bank, No.

06-1690, 2006 U.S. Dist. LEXIS 74996, at *14-15 (D.N.J. Sept. 25,
2006).

In order to avoid applying a meaning that would render a

portion of the contract superfluous, the Court finds that each of
the two aforementioned quotations deal with separate issues: the
first regarding the Company’s choice as to whether to accept more
employees than a stipulated surplus number, and the second
dealing with the inability of employees to oversubscribe to the
surplus.
In furtherance of this notion, the contract bargained for by
the parties also asserts that the Company may declare a surplus
and offer EISPs when faced with the possibility of “lay-offs or
involuntary permanent reassignments of regular employees to
different job titles involving a reduction in pay or to work

9

locations requiring a change of residence.”

(Doc. No. 15, 14).

The goal of these incentives is to entice enough employees to
voluntarily forfeit their positions to avoid rearranging the
company or downsizing the workforce without compensation.

This

goal was achieved, with over 11,000 employees accepting the EISP,
and no layoffs occurring to date.

(Def.’s Mem. in Support of

Mot. for Summary Judgment, 16, Doc. No. 17).

It is logical to

presume from the face of the contract that a vast number of
employees would choose a benefit package and severance from the
company as opposed to merely being let go, and the contract is
designed to protect the company from being obligated to provide
EISPs to all of those employees who chose to accept the offer.
Once the surplus is alleviated, it is left to the discretion of
the company to determine if providing more EISPs would benefit or
harm the company, and it is logical that the contract would
empower it to act accordingly.
Additionally, the surplus was reported to be 12,000
employees, while just over 11,000 EISP applications were accepted
by the company.

While the individual job and location surplus

numbers may have been exceeded in some regions and job positions,
the Company stayed under overall surplus ‘limit.’

Regardless,

exhibits 1-5 attached to Defendants’ Memorandum in Support of
Their Motion for Summary Judgment (Doc. No. 17) illustrate
accepted bargaining history and prior EISP disbursement in which

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the practice of providing more applicants with EISPs than a
surplus declared available for individual jobs and locations.
The Court believes that a reasonable jury could rule in
favor of Defendant, and therefore denies Plaintiff’s motion for
summary judgment.

In turn, given the absence of a dispute of any

material fact, the language of the collective bargaining
agreement, and the extrinsic evidence offered in consideration of
the agreement, the Court finds that no reasonable jury could find
in favor of Plaintiff and that Defendant is entitled to judgment
as a matter of law.

Therefore, the Court grants Defendant’s

motion for summary judgment.
IV.

Conclusion

For all of the foregoing reasons, Plaintiff’s Motion for
Summary Judgment is denied, and Defendant’s Motion for Summary
Judgment is granted as set forth in the attached order.

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