Collective-bargaining Agreement

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United States Supreme Court

Case Name: CNH Industrial N.V., et al. v. Jack Reese, et al.

Case No.: 17-515

Focus: Collective-bargaining Agreement

Three Terms ago, this Court’s decision in M&G Polymers USA, LLC v. Tackett, 574 U. S. ___ (2015), held that the Court of Appeals for the Sixth Circuit was required to interpret collective-bargaining agreements according to “ordinary principles of contract law.” Id., at ___ (slip op., at 1). Before Tackett, the Sixth Circuit applied a series of “Yard-Man inferences,” stemming from its decision in International Union, United Auto, Aerospace, & Agricultural Implement Workers of Am. v. Yard-Man, Inc., 716 F. 2d 1476 (1983). In accord with the Yard-Man inferences, courts presumed, in a variety of circumstances, that collective-bargaining agreements vested retiree benefits for life. See Tackett, 574 U. S., at ___–___ (slip op., at 7– 10). But Tackett “reject[ed]” these inferences “as inconsistent with ordinary principles of contract law.” Id., at ___ (slip op., at 14).

In this case, the Sixth Circuit held that the same Yard- Man inferences it once used to presume lifetime vesting can now be used to render a collective-bargaining agreement ambiguous as a matter of law, thus allowing courts to consult extrinsic evidence about lifetime vesting. 854 F.3d 877, 882–883 (2017). This analysis cannot be squared with Tackett. A contract is not ambiguous unless it is subject to more than one reasonable interpretation, and the Yard-Man inferences cannot generate a reasonable interpretation because they are not “ordinary principles of contract law,” Tackett, supra, at ___ (slip op., at 14). Because the Sixth Circuit’s analysis is “Yard-Man re-born re-built, and re-purposed for new adventures,” 854 F. 3d, at 891 (Sutton, J., dissenting), we reverse.

Reversed

Dissenting: Sutton, J., dissenting

Concurring: GINSBURG, J., concurring

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.