USWA files suit to block Cooper-Standard sale

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The United Steelworkers of America (USWA) has filed a lawsuit in a federal district court in Ft. Wayne, Ind., against Cooper Tire & Rubber Co. to hold off the sale of the company’s Cooper-Standard Automotive division to The Cypress Group and Goldman Sachs Capital Partners.

The USWA is filing the suit for 1,500 USWA members who work in four Cooper-Standard plants in Indiana, Ohio and Arkansas.

In a conference call earlier today, the USWA said it doesn’t object to the sale as such. It wants a chance for pre-sale bargaining with the new buyer in accordance with hammered-out change of ownership agreements already in place at the four plants. “We want the opportunity to negotiate with the buyer,” said a union spokesman. At issue are medical insurance, pension, legacy and other costs.

“Under current labor agreements, it is agreed that Cooper would sell USWA-represented plants only to new owners who had reached new labor agreements with the union prior to the sale,” the USWA wrote in a press release dated yesterday, Sept. 27. “Cooper had recently argued that this understanding does not apply to the announced sale, affecting four USWA-represent plants, because it will involve a stock transaction rather than a sale of assets. The union believes that the labor agreements expressly cover this kind of stock transaction and that Cooper backtracked on the change of ownership provisions of the agreements. Cooper has refused to arbitrate the dispute, forcing the union to sue in federal court to enforce its right to arbitration prior to a sale.”

Cooper Tire has expressed disagreement with the union’s interpretation of the change of ownership agreements. It has argued that the successor agreements –- as the union interprets them -- are unlawful. Therefore, the union decided to sue to force arbitration and has asked the court to hold off the sale until arbitration is complete.

Cooper had refused to seek the court’s assistance in the matter, the union says.

As yet, the union has not spoken with the proposed new buyers, and there has been no effort by The Cypress Group and Goldman Sachs Capital Partners to contact the union.

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