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Service Employees International National Industry Pension Fund v. Tandem Development Group, LLC

United States District Court, District of Columbia

August 16, 2017




         Plaintiffs Service Employees International National Pension Fund (“SEIU Pension Fund” or “Fund”) and the Trustees of the Fund brought this action against defendant Tandem Development Group, LLC, [1] pursuant to the Employee Retirement Income Security Act (“ERISA”), as amended, 29 U.S.C. § 1132 et seq. Compl. [Dkt. # 1]. They allege that defendant failed to submit certain payroll records to the Fund in violation of the parties' collective bargaining agreement, and that defendant failed to submit to mandatory payroll audits. Compl. ¶¶ 14, 17-18.

         Now pending before the Court is plaintiffs' motion for an entry of default judgment. Pls.' Mot. for Default J. [Dkt. # 11] (“Pls.' Mot.”); Pls.' Mem. in Supp of Pls.' Mot. [Dkt. # 11-1] (“Pls.' Mem.”). Plaintiffs seek injunctive relief in the form of the payroll reports and they request a court order requiring defendant to submit to the payroll audits and to pay reasonable attorneys' fees and costs. Pls.' Mem. at 11-12. Having considered plaintiffs' submissions, applicable case law, statutory authority, and the record as a whole, the Court will grant plaintiffs' motion for default judgment.


         In January 2011, plaintiffs and defendant entered into a collective bargaining agreement Compl. ¶ 9; Ex. 1 to Compl. [Dkt. # 1-3] (“CBA”). As part of the CBA, defendant agreed to abide by a Trust Agreement, under which employers must “contribute to the [SEIU Pension] Fund the required contributions and shall make such reports to the Fund as may be required by the Trustees.” Ex. 2 to Compl. [Dkt. # 1-4] (“Trust Agreement”) § 3.1; CBA at 15; see also Compl. ¶ 14. Under the Trust Agreement, an employer must submit “remittance reports” that contain “the names of each covered employee and the number of compensable hours for each employee during the reporting month, ” along with the corresponding contributions. Compl. ¶ 14. Pursuant to the Trust Agreement and the CBA, “[d]efendant was required to contribute $0.15 per hour for each hour worked by covered employees.” Id. ¶ 10; CBA at 19.

         The CBA also includes a collection policy, and that policy includes a provision requiring defendant to submit to a “compliance audit program, ” through which “[a]ll contributing Employers are to be audited at least once over a six-year period.” CBA Collection Policy [Dkt. # 1-3] ¶ 7. The complaint states that the purpose of a payroll audit “is to verify that an employer's monthly self-reporting of employee hours is consistent with the employer's payroll records and state and federal tax filings.” Compl. ¶ 15. The parties agreed in the Trust Agreement that the Fund could “examine payroll and other pertinent records of any Employer whenever such examination is deemed necessary or advisable.” Trust Agreement § 5.1(14).

         The Fund exercised its authority and selected defendant for two payroll audits for the periods of January 2011 through December 2012 and January 2012 through December 2013. Compl. ¶¶ 17-18. Plaintiffs sent several letters to defendant about each audit, “informing Defendant of the audit” and requesting “certain documentation necessary to perform the payroll review.” Id. Defendant failed to respond to these letters and failed to provide the required payroll records. Id.

         Plaintiffs filed a complaint with this Court on December 29, 2016, to “enforce Defendant's contractual and statutory obligations to provide payroll review records” to the SEIU Pension Fund. Compl. ¶ 1. Defendant was served on February 16, 2017, see Aff. of Special Process Server [Dkt. # 6], but it did not file an answer or otherwise respond to the complaint. Plaintiffs then filed an affidavit for default, Pls.' Aff. for Clerk's Entry of Default [Dkt. # 7], and the Clerk of Court entered defendant's default. Clerk's Entry of Default [Dkt. # 10]. Plaintiffs then filed a motion for default judgment, requesting a Court order to require defendant to provide the payroll reports and submit to the audit of its books and records, and seeking attorneys' fees and costs. Pls.' Mot. at 1.


         Federal Rule of Civil Procedure 55(a) provides that the clerk of the court must enter a party's default “[w]hen a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend, and that failure is shown by affidavit or otherwise.” Fed.R.Civ.P. 55(a). After a default has been entered, a court may enter a default judgment order pursuant to Rule 55(b). Whether default judgment is appropriate is in the discretion of the trial court. Keegel v. Key West & Caribbean Trading Co., 627 F.2d 372, 375 n.5 (D.C. Cir. 1980); Jackson v. Beech, 636 F.2d 831, 836 (D.C. Cir. 1980). Upon entry of default by the clerk of the court, the “defaulting defendant is deemed to admit every well-pleaded allegation in the complaint.” Int'l Painters & Allied Trades Indus. Pension Fund v. R.W. Amrine Drywall Co., Inc., 239 F.Supp.2d 26, 30 (D.D.C. 2002), citing Trans World Airlines, Inc. v. Hughes, 449 F.2d 51, 63 (2d Cir. 1971). “Although the default establishes a defendant's liability, the court is required to make an independent determination of the sum to be awarded unless the amount of damages is certain.” Id., citing Adkins v. Teseo, 180 F.Supp.2d 15, 17 (D.D.C. 2001). Accordingly, when moving for a default judgment, the plaintiff must prove its entitlement to the amount of monetary damages requested. Id. (citation omitted). “In ruling on such a motion, the court may rely on detailed affidavits or documentary evidence to determine the appropriate sum for the default judgment.” Id. (citation omitted)


         Given “the absence of any request to set aside the default or suggestion by the defendant that it has a meritorious defense, ” the Court concludes that default judgment is appropriate in this case. Int'l Painters & Allied Trades Indus. Pension Fund v. Auxier Drywall, LLC, 531 F.Supp.2d 56, 57 (D.D.C. 2008), quoting Gutierrez v. Berg Contracting Inc., No. 99-3044, 2000 WL 331721, at *1 (D.D.C. Mar. 20, 2000). The Clerk of Court has already entered defendant's default, so the factual allegations in the complaint are therefore taken as true. See R.W. Amrine Drywall Co., Inc., 239 F.Supp.2d at 30. The Court finds that plaintiffs' complaint sufficiently alleges facts to support its claims, and therefore, plaintiffs are entitled to default judgment on the question of defendant's liability for its failure to turn over the required payroll records and submit to the required audits.

         I. Plaintiffs are entitled to the payroll review records, and the Court will order defendant to cooperate with the required audits.

         Under ERISA, “[e]very employer who is obligated to make contributions to a multiemployer plan . . . under the terms of a collectively bargained agreement shall, to the extent not inconsistent with law, make such contributions in accordance with the terms and conditions of . . . such agreement.” 29 U.S.C.A. § 1145. ERISA also requires that the court “shall award . . . such other legal or equitable relief as the court deems appropriate.” 29 U.S.C. § 1132(g)(2)(e). This relief can include an injunction requiring a defendant to permit, and cooperate with, an audit of its books and records. See, e.g., Boland v. Smith & Rogers Constr. Co., 201 F.Supp.3d 144, 150 ...

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