[00:00:01] Speaker 05:
Case number 22-1204 Ed Al, 3D PLS Inc.

[00:00:05] Speaker 05:
doing business as right aid petitioner versus National Labor Relations Board.

[00:00:10] Speaker 05:
Mr. Silvestri for the petitioner, Ms.

[00:00:12] Speaker 05:
Beard for the respondent.

[00:00:17] Speaker 04:
Good morning.

[00:00:33] Speaker 03:
Good morning.

[00:00:35] Speaker 03:
My name is Stephen Silvestri.

[00:00:36] Speaker 03:
I'm here for Thrifty Payless, which I'm going to refer to as Rite Aid, because that's their current corporate name.

[00:00:42] Speaker 03:
With me on the brief and here at the council table is my colleague, Atlanta Glover.

[00:00:48] Speaker 03:
So I've reserved two minutes for rebuttal.

[00:00:50] Speaker 03:
There are three reasons we're urging for denial of enforcement of the NLRB.

[00:00:54] Speaker 03:
decision here.

[00:00:55] Speaker 03:
One is that it applied to be an impractical and inappropriate standard determining there was no exigent circumstances that allowed Rite Aid to move coverage of medical insurance from a co-sponsored health plan to Rite Aid's plan.

[00:01:11] Speaker 03:
The second is that the ALJ and the board ignored inappropriate and refused to consider uncontradicted record evidence that there was impasse at the time we moved it.

[00:01:22] Speaker 03:
And the third is that the NLRB, not the judge, but the NLRB inappropriately ordered Rite Aid to make payments of all of its contributions as a remedy, where that remedy wasn't requested in a complaint.

[00:01:35] Speaker 03:
No evidence was taken.

[00:01:36] Speaker 03:
The GC, the general counsel of the board, never introduced any evidence about that in trial.

[00:01:40] Speaker 03:
It was just a lack of due process in connection with that.

[00:01:44] Speaker 03:
There are important facts in the record that I want to point out first.

[00:01:48] Speaker 03:
One is that the bargaining unit here had 3,000 associates.

[00:01:51] Speaker 03:
And the number of covered lives were more than 10,000 in this plant.

[00:01:55] Speaker 03:
This wasn't a plant of a few hundred employees.

[00:01:58] Speaker 03:
There were many, many covered lives here.

[00:02:00] Speaker 03:
So second is that the Rite Aid and the union had a long history of collective bargaining.

[00:02:06] Speaker 03:
This is not something that's new.

[00:02:08] Speaker 03:
It's not something that the Rite Aid or the union approached with unprofessional negotiators or inexperienced counsel.

[00:02:16] Speaker 03:
The annual contributions of Rite Aid, third point is the collective bargaining through the collective bargaining agreement were like per hour rate for as many hours as the employees work.

[00:02:28] Speaker 03:
They were over $20 million a year.

[00:02:30] Speaker 03:
to cover these associates in this plan.

[00:02:34] Speaker 03:
But the exigency standard in this court is that the employer must show the exigency was caused by external events, was beyond its control, was not reasonably foreseeable.

[00:02:43] Speaker 04:
Mr. Silvestri, can I ask you about your remedy argument?

[00:02:46] Speaker 04:
Yes.

[00:02:47] Speaker 04:
I'm not sure.

[00:02:48] Speaker 04:
Are you saying that there was an alteration of the board compared to the remedy by the ALJ?

[00:02:56] Speaker 03:
Yes.

[00:02:57] Speaker 04:
I know you're saying that.

[00:02:58] Speaker 04:
Are you saying that that alteration

[00:03:01] Speaker 04:
created a windfall?

[00:03:03] Speaker 03:
Yes, it definitely could create a windfall because obviously when Rite Aid switched the coverage of the plan from the union from the Valley Employers Trust Fund,

[00:03:14] Speaker 03:
to the right aid plan.

[00:03:16] Speaker 03:
It continued to pay exactly those amounts for benefits.

[00:03:20] Speaker 04:
It sounds like what you're challenging in terms of remedy is the alteration, not what came before the alteration.

[00:03:28] Speaker 03:
Right.

[00:03:29] Speaker 03:
It's the alteration of having to pay without taking any credit for the amounts the right aides have already put in.

[00:03:36] Speaker 04:
And the government says you can make your argument at the compliance proceedings.

[00:03:42] Speaker 03:
That's true, as long as the compliance judge doesn't accept as fact that remedy.

[00:03:48] Speaker 03:
Doesn't accept what?

[00:03:49] Speaker 03:
As fact, the remedy that's ordered by the board.

[00:03:52] Speaker 03:
If the compliance judge is saying, OK, now I'm willing to hear evidence and make findings with respect to the amounts you paid and whether there are any gaps in that.

[00:04:01] Speaker 04:
I think the government says, and I'll confirm,

[00:04:05] Speaker 04:
with the government.

[00:04:06] Speaker 04:
But I think the government says that in the compliance proceedings, they can do that regardless of what we do here.

[00:04:14] Speaker 03:
Well, maybe.

[00:04:16] Speaker 04:
With regard to remedy, regardless of what we do here.

[00:04:20] Speaker 04:
Do you agree with that?

[00:04:22] Speaker 03:
No, I would simply suggest that you have the power to order that.

[00:04:26] Speaker 03:
OK, I know that.

[00:04:26] Speaker 04:
But let's say that we don't.

[00:04:29] Speaker 04:
And then you argue in the compliance proceedings your windfall argument.

[00:04:35] Speaker 04:
Right.

[00:04:35] Speaker 04:
The government says the compliance proceeding resolution might agree with you and you might get what you want.

[00:04:42] Speaker 04:
Do you agree with that?

[00:04:43] Speaker 03:
If the government is willing to concede that we have a right to make that claim and a right to have a judgment based on that claim and reviewed by the NLRB and ultimately reviewed by this court or some other U.S.

[00:04:53] Speaker 03:
Court of Appeals, yeah, then I agree.

[00:04:56] Speaker 03:
I'll ask them.

[00:04:57] Speaker 03:
But it wasn't clear in the government's brief that I read that that was the case.

[00:05:04] Speaker 03:
So the board in this case adopted without change the LJ's findings and concludes the law.

[00:05:11] Speaker 03:
And I want to point out one one particular

[00:05:14] Speaker 03:
aspect of that finding on the executive standard that I think is glaring.

[00:05:19] Speaker 03:
So at Joint Appendix 15, the judge, the LJ, makes the following conclusion.

[00:05:25] Speaker 03:
Health plans by their very nature, now quoting, are full of uncertainty.

[00:05:29] Speaker 03:
It is impossible to predict what claims may have come in, how it would impact the reserves.

[00:05:35] Speaker 03:
Such predictions are left to the benefits experts.

[00:05:38] Speaker 03:
But wait a minute.

[00:05:40] Speaker 03:
Doing that, the judge and the board swept aside every single piece of evidence that was put in this case, every single actuary report.

[00:05:49] Speaker 03:
There was an expert that testified.

[00:05:51] Speaker 03:
The GC called her to testify.

[00:05:53] Speaker 03:
And the expert said in September of 2019, weeks before this impasse was declared, that there were 0.07 weeks

[00:06:04] Speaker 03:
of reserves left.

[00:06:05] Speaker 04:
The funds increased to 1.6 million in December, and I just wasn't sure why.

[00:06:11] Speaker 04:
Do you know why?

[00:06:12] Speaker 03:
No.

[00:06:12] Speaker 03:
It could be a change of revenue versus expenses.

[00:06:16] Speaker 03:
Well, presumably.

[00:06:17] Speaker 03:
Right.

[00:06:17] Speaker 03:
But do you know why?

[00:06:20] Speaker 03:
As of December, the fund experts reported that there was less than two months of reserves remaining.

[00:06:28] Speaker 04:
I went from 1.2 to 1.6 million.

[00:06:31] Speaker 04:
And I completely agree with you.

[00:06:32] Speaker 04:
Of course, it has to do with revenues versus expenses.

[00:06:34] Speaker 04:
Do you know if revenues went up?

[00:06:36] Speaker 04:
Did expenses go down?

[00:06:37] Speaker 03:
Well, revenues change from month to month, depending upon how many hours of work, how many employees are covered.

[00:06:43] Speaker 03:
So they vary.

[00:06:45] Speaker 03:
And obviously, expenses change from month to month.

[00:06:48] Speaker 04:
So one of the things.

[00:06:49] Speaker 04:
Maybe the answer is you just don't know.

[00:06:53] Speaker 03:
Why?

[00:06:54] Speaker 03:
No, there is, there is unanimity in the record, unanimity in the record that as of December of 2019 and the months before that, the fund was in fiscal crisis.

[00:07:04] Speaker 04:
That's not my question.

[00:07:05] Speaker 02:
Okay.

[00:07:05] Speaker 03:
Okay.

[00:07:05] Speaker 03:
Proceed.

[00:07:06] Speaker 02:
Yeah.

[00:07:07] Speaker 02:
All right.

[00:07:07] Speaker 02:
So can I just ask when you make those statements, are you relying on Ms.

[00:07:12] Speaker 02:
Lang?

[00:07:13] Speaker 02:
I am.

[00:07:13] Speaker 02:
Her statements in the record?

[00:07:15] Speaker 02:
I am, Judge.

[00:07:15] Speaker 02:
Yeah.

[00:07:15] Speaker 02:
Okay.

[00:07:16] Speaker 03:
So not only your statements in the record, but also the actual reports of the

[00:07:20] Speaker 03:
of the actuary month to month or quarter to quarter that are in the record.

[00:07:24] Speaker 02:
Right.

[00:07:24] Speaker 02:
Yeah.

[00:07:25] Speaker 02:
And so what she says, for example, is in November, there's $1.2 million left in reserves.

[00:07:32] Speaker 02:
And what you portray that as is this fund is three weeks from collapse.

[00:07:38] Speaker 02:
That's not really what it means, right?

[00:07:40] Speaker 02:
That's if you entirely stopped bringing in money.

[00:07:43] Speaker 03:
Right.

[00:07:43] Speaker 03:
What it means, you're right.

[00:07:45] Speaker 03:
It doesn't mean it's three weeks from collapse.

[00:07:47] Speaker 03:
It means that it's an inappropriate standard for running a health care fund with thousands of participants.

[00:07:54] Speaker 03:
So this fund also had a relatively low, surprisingly low stop loss floor, $150,000.

[00:08:01] Speaker 03:
So anything below $150,000 was coming out of the fund's wallet.

[00:08:06] Speaker 03:
Everything above $150,000 is coming out of the reinsurance wallet.

[00:08:09] Speaker 03:
And there's quotes from Ms.

[00:08:12] Speaker 03:
Lang and from the Union's chief negotiator that any number of claims that $100,000 or $100,000 will make this fund run out of money.

[00:08:22] Speaker 03:
That's in the fall of 2019 in the record.

[00:08:26] Speaker 03:
So again, it's not necessarily a question of whether the employer had notice of the exit circuit.

[00:08:32] Speaker 03:
Everybody had notice.

[00:08:33] Speaker 03:
In these kind of cases where there is experienced counsel and experienced experts involved in negotiations, you always have notice that the funds are gonna run out of money.

[00:08:41] Speaker 03:
They had notice since 2018.

[00:08:43] Speaker 03:
And gradually, those reserves got lower and lower.

[00:08:48] Speaker 02:
I just have one more specific question.

[00:08:49] Speaker 02:
So I understand you're relying on Ms.

[00:08:51] Speaker 02:
Lang.

[00:08:52] Speaker 02:
My understanding, or at least the board found,

[00:08:55] Speaker 02:
that on December 5th, Ms.

[00:08:57] Speaker 02:
Lang supported the union proposal and then later testified that it would have continued to increase the reserves.

[00:09:03] Speaker 02:
What's your response to that?

[00:09:04] Speaker 03:
The response is that that disagrees with the union's chief counsel that says we're ignoring reserves in our proposal.

[00:09:10] Speaker 03:
And I'll say that in the record, the union proposed in December 5th an increase of the contributions to $5.02, I think it was.

[00:09:21] Speaker 03:
where the union and Rite Aid, as a potential measure for trying to see if it could affect the funds, in three months, July, August, September of 2019, Rite Aid was contributing at $5.72, and that had very little effect on the reserves.

[00:09:39] Speaker 03:
So the union was proposing in the end a reduction in that, which we know would have not worked.

[00:09:45] Speaker 03:
And they were also proposing, just to be fair to them, they were also proposing that employees pay, because the employees weren't paying anything.

[00:09:53] Speaker 03:
What would have happened if you finished your sentence?

[00:09:56] Speaker 03:
I'm sorry.

[00:09:57] Speaker 03:
No.

[00:09:57] Speaker 03:
All right.

[00:09:57] Speaker 03:
Just to finish your sentence.

[00:09:58] Speaker 03:
But that proposal that the union was making wouldn't kick in for 12 months after the first of the year.

[00:10:06] Speaker 04:
What would have happened if you had waited until the fund ran out and then switched the employees from the union fund to the company?

[00:10:15] Speaker 03:
the employees would have lost benefits because because the payments are in arrears.

[00:10:22] Speaker 03:
So if the fund runs out of fund runs out of cash, I'm pregnant or I'm I got my arm broken.

[00:10:27] Speaker 03:
I'm going to the accident room, put my medical card in.

[00:10:31] Speaker 03:
The administrative person calls the fund, the fund says, I don't have funds, you don't get service.

[00:10:36] Speaker 03:
So what would have happened is the union would have insisted, again, this is not in the record, but this is just collective bargaining.

[00:10:43] Speaker 03:
The union would have said, blank check, you guys pay for it.

[00:10:46] Speaker 03:
You're the only employer in the fund, so issue a blank check.

[00:10:49] Speaker 03:
That's what we were facing.

[00:10:51] Speaker 03:
So a blank check is not what's in the collective bargaining agreement.

[00:10:55] Speaker 03:
What's in the collective bargaining agreement is X dollars a month per person.

[00:10:58] Speaker 03:
Thank you, Mr. Silvestre.

[00:10:59] Speaker 01:
Thank you.

[00:11:00] Speaker 01:
I have one question for you.

[00:11:02] Speaker 01:
Yes, Judge.

[00:11:03] Speaker 01:
What is the difference in the cost to the employer of having the health

[00:11:09] Speaker 01:
plan in the employer's fund as opposed to continuing with the union?

[00:11:14] Speaker 03:
Substantial.

[00:11:15] Speaker 03:
So the employer's fund, substantial.

[00:11:18] Speaker 03:
And I don't have the actual number of what it would have saved, because the parties weren't focusing on that savings.

[00:11:27] Speaker 03:
The parties were focusing on the delivery of benefits to the employees.

[00:11:32] Speaker 03:
The reason why I say substantial is because that fund covered many more thousands of lives than the Valley Employers Fund.

[00:11:40] Speaker 03:
That fund covered all the rest of Rite Aid's employees across the United States.

[00:11:44] Speaker 03:
So not tens of thousands of employees, a lot more employees that spread the risk over in terms of the fund.

[00:11:52] Speaker 03:
That's why it would be cheaper.

[00:11:53] Speaker 01:
I understand.

[00:11:55] Speaker 04:
Thank you.

[00:11:55] Speaker 04:
Thank you.

[00:11:55] Speaker 04:
We'll give you a minute on rebuttal.

[00:11:56] Speaker 04:
Thanks.

[00:12:06] Speaker 00:
Morning, Heather Beard for the... The substantial evidence on the record here demonstrated that the company failed to prove that they were at an impact when they implemented their new collective bargaining agreement, including the new... Can you drop those microphones down a little bit?

[00:12:24] Speaker 01:
We'll hear you more clearly.

[00:12:27] Speaker 00:
Is this... Okay.

[00:12:30] Speaker 00:
So I'd like to address

[00:12:33] Speaker 00:
First, the issue of impasse, unless Judge Walker, I could go right to the remedy.

[00:12:38] Speaker 00:
It sounded like you had questions.

[00:12:40] Speaker 04:
I'll wait.

[00:12:41] Speaker 00:
Okay.

[00:12:41] Speaker 00:
So with regard to impasse, the board implied its well-established factors in looking at all of the evidence to determine that the company didn't establish the parties were at impasse on December 5th.

[00:12:55] Speaker 00:
Now Judge Randolph's question to my friend on the other side was a good question about the

[00:13:01] Speaker 00:
cost of the new Rite Aid plan that the company was going to go into, that was something that despite the union asking over and over what that cost would be, that was not revealed until two days before the final bargaining session when the union was able to move very significantly towards keeping, as Rite Aid said it had wanted, trying to keep it cost neutral.

[00:13:26] Speaker 00:
That is one of the factors, one of the important factors under TAF,

[00:13:30] Speaker 00:
the party's contemporaneous understanding.

[00:13:33] Speaker 00:
And at the end of the day, on December 5th, the union had just received, a few days earlier, information as to how much more would the health care plan cost.

[00:13:43] Speaker 00:
And Rite Aid said it was willing to spend either $1.2 or $1.4 million a year in the Rite Aid plan.

[00:13:51] Speaker 00:
So what the union did, with the support of Ms.

[00:13:54] Speaker 00:
Lang,

[00:13:54] Speaker 00:
who came and testified and who supported what the union did is move as close as their understanding was to Rite Aid once they had the information so that they could do what Rite Aid said throughout the duration of the negotiations, which is we don't care whose name is on the health care plan.

[00:14:09] Speaker 00:
What we care about is actually covering these employees and getting a new collective bargaining

[00:14:16] Speaker 00:
We agree it's very significant how many people are covered by this.

[00:14:20] Speaker 00:
And this new Rite Aid plan did have employees who lost health care coverage.

[00:14:26] Speaker 00:
So we're not, this is not who's bad, who's good here.

[00:14:29] Speaker 00:
This is under the board's standards, where the parties had an impasse, which was the burden on the company.

[00:14:36] Speaker 00:
So we've got that factor number one alone sufficient for contemporaneous understanding.

[00:14:41] Speaker 00:
And the board went through, the board also found that the company negotiated.

[00:14:46] Speaker 00:
In bad faith here, they found that the importance of the issue in the history of the parties, again, I agree with my friend on the other side, this counts in favor of the fact that the company failed to demonstrate an impasse.

[00:14:57] Speaker 00:
There was a long bargaining history here.

[00:15:00] Speaker 00:
And so the TAF vectors are impasse.

[00:15:04] Speaker 00:
Now let's talk about economic exigency, if you will.

[00:15:07] Speaker 00:
The standard for economic exigency is whether there is a compelling reason to immediately implement

[00:15:15] Speaker 00:
There was not a compelling reason to immediately implement.

[00:15:19] Speaker 00:
Now, it is true that the reserves in the fund, which the company continuously said they wanted to build them up so that they had three months.

[00:15:27] Speaker 00:
This was also part of the bad faith finding.

[00:15:30] Speaker 00:
that my friend does not mention, which is that until the hearing, company didn't tell the union that it was looking at six months that it wanted these reserves there.

[00:15:38] Speaker 00:
But what Ms.

[00:15:39] Speaker 00:
Lang also said is that regardless of the reserves in the fund, a health care fund doesn't collapse if the reserves are low.

[00:15:46] Speaker 00:
It depends on the amount of contributions and the amount of expenses.

[00:15:50] Speaker 00:
And from the record, what was happening with this fund, as had happened for years, in fact, the fund had gotten

[00:15:56] Speaker 00:
low in 2013 and 2014, I believe, to 2.2 months, is that never had, I think it was 11 years, the company still did not need to contribute more, even when the funds reserve dipped low.

[00:16:07] Speaker 00:
So this was something that the union was concerned about in 2018 when the report came out that the funds had dipped, I think it was, to two and a half months.

[00:16:17] Speaker 00:
And the union said, let's talk about this, let's talk about it in 2018, before the year that our collective bargaining agreement is going to,

[00:16:26] Speaker 00:
to expire and so given that and given that the company always had the ability to increase contributions, which it did twice during the bargaining in 2019, there was no compelling reason to immediately change plans, which they would need to establish again, it's their burden of proof under the economic exigency test.

[00:16:46] Speaker 00:
So on the substantial evidence in the case, which the judge and the board

[00:16:51] Speaker 00:
This is not a case where the company has carried its burden of being able to unilaterally implement it.

[00:16:57] Speaker 04:
Ms.

[00:16:57] Speaker 04:
Beard, can you turn to remedy now, please?

[00:17:01] Speaker 00:
Absolutely.

[00:17:02] Speaker 00:
So Judge Walker, your questioning of my friend is something that I want to echo here with regard to what is before this court properly about the remedy.

[00:17:12] Speaker 00:
When the ALJ issued the remedy here, the remedy did not include any sort of set off for what the plan would have saved had, for example,

[00:17:22] Speaker 00:
because the alternative plan went into effect.

[00:17:25] Speaker 00:
The remedy did not include that.

[00:17:27] Speaker 00:
Now, what my friend accepted to, in its exceptions, was the ALJ's remedy that included that setup.

[00:17:35] Speaker 00:
What it did not do is argue, put in front of the board, that restoring the fund and not allowing for any sort of

[00:17:47] Speaker 00:
offset was an abuse of discretion or was some sort of a windfall.

[00:17:53] Speaker 00:
They did not make that argument in front of the ALJ.

[00:17:56] Speaker 00:
Then what happened is the board issued its decision and did, as my friend stated and conceded, a different remedy.

[00:18:04] Speaker 00:
What the board did in its decision is say, you know what?

[00:18:07] Speaker 00:
There isn't gonna be such a set up.

[00:18:09] Speaker 00:
We're gonna give our standard remedy when there's a fund that employees still may have a legitimate interest in.

[00:18:14] Speaker 00:
We are gonna say you restore the viability of the fund.

[00:18:17] Speaker 00:
goes to status quo anti-relief.

[00:18:20] Speaker 00:
And that was when, if my opponent had an objection to such a set-off or a windfall argument, that is when under Section 10E of the National Labor Relations Act, this court's decision in spectrum should have and needed to make an objection to the remedy that they're now making in their brief.

[00:18:39] Speaker 00:
Because they did not do that, they are foreclosed from making that argument.

[00:18:43] Speaker 00:
I get that, and you might be right.

[00:18:45] Speaker 04:
But where our discussion led, where I'd like to get some clarity from you, is there's a line in your brief, I think it says something along the lines of, Rite Aid is, this may not be a direct quote, Rite Aid is free to make their remedy argument at the compliance proceedings.

[00:19:04] Speaker 00:
Sure.

[00:19:05] Speaker 00:
They are free to make traditional compliance arguments as to how much money they are owed.

[00:19:11] Speaker 00:
However, what the brief didn't say and what we are not saying is that in compliance, Rite Aid is free to argue that the fund would be getting that kind of a windfall.

[00:19:22] Speaker 00:
They cannot make that argument in compliance because the board's remedy, the standard remedy that the board- They can't make their, is it Grondorf, do I pronounce the name?

[00:19:29] Speaker 04:
Correct.

[00:19:30] Speaker 04:
They can't make it Grondorf.

[00:19:32] Speaker 00:
Correct, well, depends what you mean by a Granddorf argument.

[00:19:36] Speaker 00:
The board's view is that in order to restore a fund to its undiminished viability, what needs to happen is the delinquent contributions to the fund have got to be restored, period.

[00:19:49] Speaker 00:
That's the board's holding, that's the board's view.

[00:19:51] Speaker 00:
The board did not engage with any sort of windfall Granddorf, any of that, because it wasn't raised to them.

[00:19:57] Speaker 00:
But to the extent you would,

[00:19:59] Speaker 00:
do what I would ask, which is enforce this order, there will be compliance proceedings.

[00:20:04] Speaker 00:
I believe in Grondorf, the court talked about remanding.

[00:20:07] Speaker 00:
You don't ever have to remand for compliance.

[00:20:09] Speaker 00:
Compliance happens after a board order on the merits.

[00:20:13] Speaker 00:
But in a compliance proceeding, there are various things an employer can do.

[00:20:17] Speaker 00:
I'm representing to this court, if this court enforces the order, I do not believe in compliance

[00:20:24] Speaker 00:
the company will be able to come in and make an offset windfall argument for the fund.

[00:20:28] Speaker 00:
The board's remedy in this case is it's standard.

[00:20:31] Speaker 01:
The union fund still in existence?

[00:20:34] Speaker 00:
I believe.

[00:20:35] Speaker 01:
Or did it dissolve?

[00:20:38] Speaker 00:
I don't, I'm not 100% sure, your honor, because it's outside.

[00:20:42] Speaker 00:
Suppose it dissolved.

[00:20:43] Speaker 00:
Suppose it's no longer in existence.

[00:20:47] Speaker 01:
Well, if the fund is no longer... You know, what I'm thinking about and what I'm focusing on, trying to focus on in this question is the employees.

[00:20:59] Speaker 01:
I mean, if the remedy is what you say it is, then on the day that we enforce that remedy, do all the employees revert back to the union plan?

[00:21:12] Speaker 00:
Right.

[00:21:13] Speaker 00:
My understanding is that the plan is viable to the extent this court orders the board's remedy to take place, that the plan can be restored to what the board has ordered, which is to undiminished viability.

[00:21:26] Speaker 00:
But that's from the intervenor union.

[00:21:30] Speaker 00:
And my understanding, again, outside the record.

[00:21:32] Speaker 00:
But if there was in compliance, Your Honor, my understanding is those kinds of arguments, like impossibility, for example, if my friend wanted to argue on the other side.

[00:21:41] Speaker 00:
It's impossible.

[00:21:42] Speaker 00:
There is no fund.

[00:21:43] Speaker 00:
We can't restore it.

[00:21:44] Speaker 00:
I do believe that is something that can be raised in compliance.

[00:21:47] Speaker 00:
I think that the only twist here with regard to compliance is this issue of whether they could bring specific evidence in that claims would have been paid by the alternate fund.

[00:21:57] Speaker 00:
You know, one thing I also want to say about that is about should this court, which I don't think you should reach the Grondorf issue.

[00:22:03] Speaker 00:
This case is not like that in that in Grondorf.

[00:22:07] Speaker 00:
There was the statement that the court made in Grondorf was that there were comparable health care benefits.

[00:22:12] Speaker 00:
We are not, it's not in dispute here.

[00:22:15] Speaker 00:
Health care benefits here do not include retirees.

[00:22:17] Speaker 00:
So retirees lost their health care in January 1st, 2020 when this went into effect.

[00:22:22] Speaker 00:
Doesn't include a platinum level plan.

[00:22:25] Speaker 00:
It only includes one lower plan, gold level plan.

[00:22:29] Speaker 01:
Is there anything in the union plan that bars pre-existing conditions?

[00:22:37] Speaker 00:
Your Honor, I'm not sure of the answer to that question.

[00:22:41] Speaker 00:
I don't know.

[00:22:42] Speaker 00:
My friend on the other side might know the answer to that question.

[00:22:44] Speaker 00:
But what the board is trying to do here is restore the status quo ante under its clear standards.

[00:22:52] Speaker 00:
And I would urge the court to go ahead and import.

[00:22:55] Speaker 02:
I just want to make sure I understand your point about the distinction between a Grondorf type argument and the argument that the company made in accepting to the ALJ's decision.

[00:23:05] Speaker 02:
So I'm just looking at, this is page 36 of the appendix, and it says,

[00:23:11] Speaker 02:
Respondent accepts to the recommended remedy of making all contractually required contributions to the fund.

[00:23:18] Speaker 02:
As unit employees have been covered by a substantially similar health plan since right aids implementation after impasse now one reading of that is saying.

[00:23:27] Speaker 02:
we need an offset here for the alternative benefit we've been providing.

[00:23:31] Speaker 02:
So I just wanna make sure I understand what else should they have said?

[00:23:34] Speaker 00:
Sure, I would say that given what they were accepting to, the remedy from front of the ALJ did provide for that offset.

[00:23:43] Speaker 00:
The exact remedy that that exception, I think it was number 52, was responding to was to the order, which what the judge had in the order was there will be such a set off.

[00:23:52] Speaker 00:
So I myself do not understand what the exception was because that order had

[00:23:58] Speaker 00:
not that the exception should have been different if they had filed a motion for otherwise put this in front of the board after the board amended the remedy it could say exactly what this says it could also say there will be a there could possibly be a windfall or an offset and the board would look at it and say well that's what the judge said and we changed it so that there isn't one so that's that's where the 10e and the jurisdictional bar comes in the board needs to be on notice that what the company is is objecting to is is that thank you

[00:24:29] Speaker 00:
If there are no further questions, I will sit down.

[00:24:31] Speaker 00:
Thank you.

[00:24:38] Speaker 03:
One, the issue of reserves and the scarcity of reserves was an issue that the union raised in 2018.

[00:24:50] Speaker 03:
They raised it in 2018 bargaining meetings.

[00:24:54] Speaker 03:
They raised it in 2019 bargaining meetings.

[00:24:57] Speaker 03:
They raised it in every single

[00:24:59] Speaker 03:
bargaining meeting up to December when they flipped and said, oh, we don't care about the reserve anymore.

[00:25:06] Speaker 03:
If that's not evidence of best faith bargaining, I don't know what is.

[00:25:09] Speaker 03:
That's a flip.

[00:25:10] Speaker 03:
So the judge – and we didn't – I didn't do much about my impasse argument, but there's plenary evidence in the record.

[00:25:18] Speaker 03:
Any experienced collective bargaining person would know that the union slow-walked this all the way through those 18 months.

[00:25:26] Speaker 03:
They went months between meetings.

[00:25:28] Speaker 03:
They came to meetings with no proposals.

[00:25:31] Speaker 03:
They went golfing on a day that they said they would be there.

[00:25:35] Speaker 03:
They came in and threatened to strike when Rite Aid even suggested that its plan might help.

[00:25:41] Speaker 03:
And then they did.

[00:25:43] Speaker 03:
They did protest, and they increased the protest as evidence of that to record.

[00:25:46] Speaker 03:
They went on a campaign to get people to switch their prescriptions from Rite Aid to some other employer and appeared in pickets in front of the Rite Aid stores in Northern California.

[00:25:57] Speaker 03:
So that's evidence of impasse as well that was totally ignored by the judge.

[00:26:01] Speaker 03:
And to say, for example, that a proposal at the end was actually substantially breaking the impasse, right?

[00:26:08] Speaker 03:
They just told the union it was an impasse in September when the union came to the table and threatened to strike.

[00:26:14] Speaker 04:
I'm still a little confused about what you're saying and a little bit confused about what the government is saying with regard to remedy.

[00:26:21] Speaker 04:
Let me try one more time for clarity.

[00:26:24] Speaker 04:
I'll read to you what the government said, I think, in the brief.

[00:26:30] Speaker 04:
Right Aid is free to make their remedy argument at compliance proceedings.

[00:26:35] Speaker 04:
You mentioned that you were looking for a concession.

[00:26:39] Speaker 04:
Is that the concession you're looking for?

[00:26:40] Speaker 03:
Actually, I got the opposite concession from my friend here.

[00:26:43] Speaker 03:
What she said was, no, you don't have the right to introduce that evidence.

[00:26:47] Speaker 04:
That's how I heard it, too.

[00:26:48] Speaker 03:
Yeah.

[00:26:48] Speaker 03:
And so I just believe that.

[00:26:50] Speaker 04:
And then I asked you.

[00:26:54] Speaker 04:
Earlier are you challenging the alteration because the alteration leads to a windfall.

[00:27:01] Speaker 04:
or not, or are you challenging something beyond that?

[00:27:04] Speaker 04:
And you said just the alteration.

[00:27:06] Speaker 03:
When you said the alteration.

[00:27:09] Speaker 04:
The board's alteration to the ALJ's remedy.

[00:27:11] Speaker 03:
Yes, well, obviously I'm challenging the board's alteration to the ALJ's remedy, but I'm also taking a position that the refusal, the trial in this case had no introduction of that evidence or that issue.

[00:27:29] Speaker 03:
And so right, they did not have an opportunity to put that in front of the ALJ.

[00:27:33] Speaker 03:
And then when the board altered the remedy, obviously we didn't have any chance of putting any evidence on that.

[00:27:38] Speaker 04:
You're only challenging the alteration by the board to the ALJ's remedy.

[00:27:43] Speaker 04:
Then that's forfeited because you didn't move for reconsideration.

[00:27:49] Speaker 03:
I don't believe one of the cases I'm required to move for reconsideration.

[00:27:52] Speaker 03:
The cases we cited all say that we're not required to do that.

[00:27:55] Speaker 03:
So, you know, I respectfully disagree with that.

[00:28:01] Speaker 03:
Thank you.