Bullock v. City of Antioch
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Seventeen retired city employees who receive retiree health benefits through CalPERS under the city’s Medical After Retirement (MAR) plan filed suit. Five were union members before their retirement. The memorandums of understanding (MOU) and other benefits documents applicable to each of the bargaining units state: “ The City shall pay the PERS required Minimum Employer Contribution (MEC) per month on behalf of each active and retired employee who participates in the City’s health insurance plans.” The city pays the MEC to CalPERS and then deducts that amount from the retiree’s premium reimbursement owed under the MAR plan.
Plaintiffs alleged the practice amounted to improper use of their MAR benefits, resulted in improper reductions of benefits, and violated Government Code section 228923 and the applicable MOUs. The city argued the complaint was barred by issue preclusion based on a 2017 administrative proceeding between the city and the union, following a union grievance. The trial court dismissed, based upon issue preclusion, stating: “[T]he emphasis is not on a concept of identity of parties but on the practical situation.” The court of appeal reversed, citing due process requirements. There is no basis for concluding that the plaintiffs should reasonably have expected to be bound by, or were even aware of, the union’s grievance proceeding. The city has not demonstrated that the claims are barred for failure to allege exhaustion of administrative procedures.
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