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Bricklayers & Trowel Trades International Pension Fund v. Kafka Construction, Inc.

United States District Court, District of Columbia

August 11, 2017

BRICKLAYERS & TROWEL TRADES INTERNATIONAL PENSION FUND, Plaintiffs,
v.
KAFKA CONSTRUCTION, INC. Defendant.

          MEMORANDUM OPINION

          CHRISTOPHER R. COOPER UNITED STATES DISTRICT JUDGE.

         Plaintiffs in this ERISA action-an employee pension benefit plan and an employee welfare benefit plan-seek to recover unpaid contributions and associated damages from a New York-based construction company. Despite having been properly served, the company has not responded to the complaint, the Clerk's entry of default, or the Court's order to show cause why judgment should not be entered against it. Plaintiffs now request a default judgment, monetary damages, and attorney's fees, as well as an injunction requiring the company to make the required plan contributions going forward. As Plaintiffs have adequately established that the Defendant is liable and that they are entitled to all of the requested relief, the Court will grant their motion and enter judgment against the company.

         I. Background

         Plaintiffs-the Bricklayers & Trowel Trades International Pension Fund (“IPF”) and the International Masonry Institute (“IMI”)-are “employee benefit plans” and “multiemployer plans” under the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1002 et seq. (“ERISA”). The plans are funded by contributions made by employers who are signatories to collective bargaining agreements. New York-based Kafka Construction Co. is one such employer. It is required under its collection bargaining agreements and the plans' written procedures governing the collection of employer contributions (“Collection Procedures”) to submit monthly reports and payments to the plans based on the number of hours worked by its employees in covered job positions. David F. Stupar Supp. Pls.' Mot. Default J. (“Stupar Decl.”) ¶ 7. If Kafka Construction fails to make the required contributions, Plaintiffs are entitled to file suit to recover the unpaid contributions; interest on the unpaid contributions; either an additional assessment of interest on the unpaid contributions or liquidated damages provided for under the plan not in excess of 20 percent, whichever is higher; reasonable attorney's fees and costs; and other legal or equitable relief as the court deems appropriate. 29 U.S.C. § 1132(g)(2).

         Plaintiffs allege that Kafka Construction failed to “report and pay all amounts owing to [them] as required” by the applicable collective bargaining agreements and the plans' Collection Procedures. Compl. ¶ 10. Kafka Construction was properly served on August 1, 2016. Pls.' Aff. Service. It did not respond to the complaint, however, and the Clerk of the Court entered default on June 1, 2017. Entry of Default. Plaintiffs now petition the Court to enter a default judgment, seeking a monetary judgment against Kafka Construction in the amount of $28, 901.17, which includes delinquent contributions, interest on delinquent payments, liquidated damages, process server costs, filing fees, and attorney's fees. Stupar Decl. ¶¶ 9-12, 14-16.

         Section 502(e)(2) of ERISA provides for federal jurisdiction “in the district where the plan is administered.” 29 U.S.C. § 1132(e)(2). According to the complaint, both the IPF and the IMI are administered in the District of Columbia. Compl. ¶¶ 1-2. The Court therefore has jurisdiction over the case. Plaintiffs filed the complaint within ERISA's three-year statute-of-limitations period. See 29 U.S.C. § 1113.

         II. Standard of Review

         The standard for default judgment is a two-step procedure. See, e.g., Boland v. Cacper Constr. Corp., 130 F.Supp.3d 379, 382 (D.D.C. 2015). First, the plaintiff requests that the Clerk of the Court enter default against a party who has “failed to plead or otherwise defend.” Fed.R.Civ.P. 55(a). Second, the plaintiff must move for entry of default judgment. Fed.R.Civ.P. 55(b). Default judgment is available when “the adversary process has been halted because of an essentially unresponsive party.” Boland v. Elite Terrazzo Flooring, Inc., 763 F.Supp.2d 64, 67 (D.D.C. 2011) (internal citation omitted). “Default establishes a defaulting party's liability for the well-pleaded allegations of the complaint.” Id. After establishing liability, the court must make an independent evaluation of the damages to be awarded and has “considerable latitude in determining the amount of damages.” Id. The court may hold a hearing or rely on “detailed affidavits or documentary evidence” submitted by plaintiffs in support of their claims. Boland v. Providence Constr. Corp., 304 F.R.D. 31, 36 (D.D.C. 2014) (quoting Fanning v. Permanent Sol. Indus., Inc., 257 F.R.D. 4, 7 (D.D.C. 2009)).

         III. Analysis

         The Court must determine whether entry of default judgment is appropriate and, if Kafka Construction is liable, whether Plaintiffs are entitled to the manner and amount of relief they request. The Court concludes that the company breached its duties under ERISA and the Collection Procedures and that Plaintiffs are entitled to both the monetary and injunctive relief requested.

         A. Liability

         Plaintiffs filed suit in July 2016 to recover the damages prescribed by ERISA and the Collection Procedures. Compl. ¶ 1. Kafka Construction was served with the summons and complaint on August 1, 2016. Pls.' Mot. Default J. 1. The Clerk of the Court declared it to be in default on June 1, 2017. Entry of Default. On June 6, 2017, the Court issued an Order to Show Cause why judgment should not be entered for Plaintiffs and set June 20, 2017 as the deadline for Kafka Construction to respond. Kafka Construction has not responded to either the complaint, the Clerk's entry of default, or the Court's Order to Show Cause.

         Because the Clerk of the Court has entered default and Kafka Construction has failed to respond, the Court accepts Plaintiffs' well-pleaded allegations and holds that Kafka Construction is liable and that entry of default judgment is appropriate. See Elite Terrazzo Flooring, Inc., 763 F.Supp.2d at 67. ERISA requires employers to make contributions to multiemployer plans “in accordance with the terms and conditions of” the relevant collective bargaining agreements. 29 U.S.C. § 1145. The IPF and IMI's Collection Procedures specify that contributions are due “on or before the 15th day of the month” after the month in which work was performed. Stupar Decl. ¶ 5. They further provide that Kafka Construction will “submit monthly fringe benefit remittance reports and pay monthly fringe benefit contributions to the IPF and IMI for each hour of covered work performed by its employees within the work and geographic jurisdictions of the Agreement.” Stupar Decl. ¶ 7. By failing to submit required reports and pay the required contributions to IMI and IPF for covered work, Kafka Construction is liable for contractual and statutory damages.

         The Court may enter default judgment when a defendant makes no request “to set aside the default” and gives no indication of a “meritorious defense.” Fanning, 257 F.R.D. at 7. Kafka Construction, as noted above, has not responded to the complaint since being served in August 2016. The ...


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