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McGoldrick v. Bradstreet

United States District Court, S.D. Ohio, Eastern Division

August 1, 2019

Joanne McGoldrick, et al., Plaintiffs,
Angela Bradstreet, Defendant.



         This matter is before the Court on plaintiffs' motion to reopen the case for the purpose of enforcing a 2008 Consent Decree. The Consent Decree governed how the defendant, the Labor Commissioner for the State of California's Department of Industrial Relations, would handle certain benefits claims filed by employees of Nationwide Mutual Insurance Company. Plaintiffs, which include Nationwide and its Benefits Administrative Committee, allege that the Labor Commissioner has recently taken or threatened to take action in violation of the Consent Decree.

         Plaintiffs' motion to reopen puts at issue the Court's authority to hear the current dispute. In plaintiffs' view, the Court has continued and inherent jurisdiction over the enforcement of its own order, one which contained provisions having prospective injunctive effect. The Labor Commissioner argues that the Consent Decree itself contained a one-year limitation on the Court's jurisdiction and that any dispute arising afterward must be treated as a new, breach of contract matter.

         For the reasons that follow, plaintiffs' motion is granted.

         I. Background

         A. The 2008 Lawsuit and Consent Decree

         Plaintiffs originally filed this suit in 2008, alleging that Nationwide sponsored an employee welfare benefit plan known as the “Your Time Plan.” The Benefits Administrative Committee administered the Your Time Plan on behalf of Nationwide employees. The complaint asserted that the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001, et seq., exclusively governed the Plan and preempted the application of state law. The complaint further asserted that the State of California's wage laws with respect to vacation benefits were inconsistent with the vacation wage benefits provided under the Your Time Plan. The Labor Commissioner, who was Angela Bradstreet at the time the complaint was filed, had allegedly adopted a position that she would enforce California law in determining claims made by Nationwide employees for accrued vacation pay. The complaint sought preliminary and permanent injunctive relief prohibiting the Labor Commissioner from processing or hearing claims filed against Nationwide under state wage laws.

         The parties reached a standstill agreement regarding plaintiffs' request for preliminary relief. On September 26, 2008, the Court granted the parties' motion to approve a Consent Decree. Under the Decree, the Labor Commissioner (referred to as the “Agency” in the Decree) stipulated as follows: “[T]he Agency agrees that at the present time, and for all periods since October 24, 2005, the Your Time Plan is and was an ERISA welfare benefit plan and California's vacation benefit laws are preempted as they relate to the Your Time Plan.” Consent Decree § I.

         The Decree established “an agreed protocol for the handling of claims filed with the Agency regarding the Your Time Plan.” Id. The protocol was set forth in Section IX of the Decree, under the heading of “Injunctive Relief.” The stated purpose of Section IX was to “establish a protocol for the processing of California Your Time Claims by the Agency and to provide the Agency with a mechanism for assessing whether the Your Time Plan continues to be maintained and funded in the same manner as it is currently maintained and funded.” Id. at § IX.A. The protocol provided that the Agency would dismiss a claim for payment of benefits that fell under the Your Time Plan. See id. at § IX.A.1. It also directed the Agency to notify Nationwide of claims that the Agency did not dismiss on its own initiative and give Nationwide an opportunity to respond. See id. at § IX.A.2.

         The protocol provided the Agency with an opportunity to notify Nationwide when it believed it was “no longer appropriate to follow the protocol.” Id. at § IX.A.4. The Agency could base such a determination “on account of changes in applicable law or existence of new facts.” Id. The Decree did not define the terminology “changes in applicable law” or “existence of new facts.” After making its determination, the Agency was required to notify Nationwide “at least 60 days before the proposed termination date of this protocol.” Id. The parties were then required to “meet and negotiate in an attempt to establish a new protocol.” Id. The Decree provided that “if no agreement is reached by the proposed termination date, this Decree and protocol shall be terminated (unless extended by agreement of the parties).” Id.

         The Consent Decree contains two other sections which are relevant to the Court's analysis of the motion to reopen. In Section VIII, entitled “Compliance and Dispute Resolution, ” the Decree provided: “If Nationwide believes that the Agency has failed to comply with any provision of this Consent Decree, it may petition this Court to enforce the Decree.” Id. at § VIII.A. Nationwide first had to provide written notice to the Agency of the nature of the dispute and allow the Agency 60 days to address the issue. Id. The Decree provided as follows if the parties could not resolve their dispute:

After 60 days have passed with no resolution or agreement to extend the time further, Nationwide may petition this Court for compliance with this Decree, seeking all available relief, including, but not limited to, an extension of the term of the Decree for such period of time as the Court deems necessary and appropriate to remedy the breach of the Decree.

Id. at § VIII.C.

         Section IV of the Decree was entitled “Effective Date and Duration of Decree.” It provided that the Decree was effective immediately. Id. at § IV.A. It further provided:

The Court shall retain jurisdiction over this Decree for a period of one (1) year after the Effective Date; however, the protocol set forth in section IX.A shall continue unless and until terminated in accordance with the provisions set forth therein.

Id. at § IV.B.

         The Court entered the Consent Decree on its docket on September 26, 2008. On the same day, the Clerk of Court administratively closed the case.

         B. The Current Dispute and the ...

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