Carpenters Pension Trust Fund for Northern California et al v. Lindquist

Filing 47

ORDER by Judge Samuel Conti granting 28 Motion for Summary Judgment (sclc2, COURT STAFF) (Filed on 7/19/2011) (Additional attachment(s) added on 7/19/2011: # 1 proof of service) (tdm, COURT STAFF).

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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CARPENTERS PENSION TRUST FUND FOR
NORTHERN CALIFORNIA, et al.

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Plaintiffs,

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v.
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For the Northern District of California

United States District Court

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MARK ALAN LINDQUIST,

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Defendant.

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) Case No. 10-3386 SC
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) ORDER GRANTING PLAINTIFFS'
) MOTION FOR SUMMARY JUDGMENT
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I.

INTRODUCTION

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Before the Court is a Motion for Summary Judgment, brought

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by Plaintiffs Board of Trustees of the Carpenters Pension Trust

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Fund for Northern California, et al. ("the Pension Fund" or

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"Plaintiffs"), against Defendant Mark Alan Lindquist

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("Lindquist" or "Defendant").

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is fully briefed.

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considered the papers submitted, the Court concludes that entry

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of Summary Judgment against Defendant is appropriate, and GRANTS

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Summary Judgment in favor of Plaintiffs.

ECF No. 28 ("Mot.").

The Motion

ECF Nos. 40 ("Opp'n"), 42 ("Reply").

Having

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II.

BACKGROUND
This action arises from Plaintiffs' efforts to recover

withdrawal liability owed by M.A. Lindquist Co., Inc. ("the

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Company") under the Employee Retirement Income Security Act

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("ERISA").1

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against the Company in favor of the Pension Fund in a related

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proceeding.

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M.A. Lindquist Co., Inc., No. 10-812, 2011 U.S. Dist. LEXIS

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12261 (N.D. Cal. Feb. 8, 2011).

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sole shareholder.

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10:7-24.2

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For the Northern District of California

United States District Court

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On February 8, 2011, this Court entered judgment

See Carpenters Pension Trust Fund for N. Calif. v.

Lindquist was the Company's

McDonough Decl. Ex. B ("Lindquist Dep.") at

The Pension Fund now seeks to recover the Company's

withdrawal liability from Lindquist directly.

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A.

The Company's Withdrawal from the Pension Fund

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The following facts are undisputed.

During the time period

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at issue in this lawsuit, Defendant owned one hundred percent of

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the outstanding shares of the Company.

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participating employer in the Pension Fund.

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("Answer") ¶ 10; Price Decl. ¶ 5.3

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obligated to make contributions to fund benefits for employees

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under the Pension Fund pursuant to a collective bargaining

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agreement with the Carpenters 46 Northern California Counties

Id.

The Company was a
ECF No. 9

As such, the Company was

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As explained more fully below, ERISA requires an employer that
withdraws from a multiemployer pension plan to compensate the
pension plan for benefits that have already vested with the
employees at the time of the employer's withdrawal. This
"withdrawal liability" is assessed against the employer to
ensure that employees are not deprived of anticipated retirement
benefits by virtue of their employer's withdrawal from the
pension plan before the plan has amassed sufficient funds to
cover the benefits owed to employees.
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Katherine McDonough ("McDonough"), attorney for Plaintiffs,
filed a declaration in support of the Motion. ECF No. 28-2.

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3

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Gene Price ("Price"), Administrator of the Carpenters Pension
Trust Fund, filed a declaration in support of the Motion. ECF
No. 28-1.

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Conference Board of the United Brotherhood of Carpenters and

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Joiners of America, the Agreement and Declaration of Trust of

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the Pension Fund, and Section 515 of the ERISA, 29 U.S.C. §

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1145.

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Id.
On or about April 1, 2006, the Company withdrew from the

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Pension Fund.

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1, 2006, the Pension Fund sent the Company a Notice of

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Withdrawal Liability informing the Company that it owed the

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Answer ¶ 12; Price Decl. ¶ 5.

On or about August

Pension Fund $954,508 and attaching the actuarial calculations

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For the Northern District of California

United States District Court

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in support of this figure.

Price Decl. Ex. A ("Aug. 1, 2006

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Notice").

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follow-up letter on August 10, 2006.

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Letter").

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informing it that if an installment payment of $11,816 was not

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received within sixty days, the Pension Fund would require

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immediate payment of the entire withdrawal liability amount.

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Id. Ex. C ("Oct. 5, 2006 Letter").

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undeliverable.

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hand delivered the August 1, 2006 Notice and the October 5, 2006

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Letter to the Company.

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the Company received the withdrawal liability demand.

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Decl. Ex. B ("Def.'s Resp. to Pls.' RFA") at 2.

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Plaintiffs have not received a withdrawal liability payment from

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the Company or from Lindquist.

Plaintiffs received no payment and sent the Company a
Id. Ex. B ("Aug. 10, 2006

On October 5, Plaintiffs sent the Company a letter

Id.

The letter was returned as

On November 13, 2006, Plaintiffs' agent

Price Decl. ¶ 12.

Lindquist admits that
McDonough

To date,

Price Decl. ¶ 13.

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The Company did not submit a request for review of its

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withdrawal liability to the Pension Fund or initiate arbitration

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proceedings regarding the assessment of its withdrawal

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liability.

Price Decl. ¶¶ 14-15; Def.'s Resp. to Pls.' RFA at

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2-3.
On February 26, 2010, the Pension Fund filed suit against

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the Company ("the 10-812 action") under ERISA seeking to recover

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the payments owed.

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Fund, No. 10-812 (N.D. Cal. Feb. 26, 2010), ECF No. 1.

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August 2, 2010, the Pension Fund filed this parallel action

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against Lindquist in his personal capacity.

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("Compl.").

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judgment against the Company in the 10-812 action.

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For the Northern District of California

United States District Court

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See Complaint, Carpenters Pension Trust
On

ECF No. 1

On February 8, 2011, the Court granted summary
2011 U.S.

Dist. LEXIS 12261, at *11.

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B.

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In or around 1999, Lindquist and his wife purchased a

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commercial property located at 1701 Martin Luther King Jr. Way

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in Oakland, California ("the 1701 Property").

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11:4-45.

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1999 for $2,000 per month.

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the 1701 Property for office space for superintendents and

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foremen, for equipment storage, and as a cabinet shop.

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12:19-24.

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1701 Property terminated on March 31, 2006, the day before the

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Company withdrew from the Pension Fund.

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Lindquist has leased the 1701 Property to a construction

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management firm, 1701 Associates, Inc., owned by Lindquist and

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his daughter.

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Lindquist Dep. at

They began leasing the 1701 Property to the Company in
Id. at 12:4-18.

The Company used

Id. at

According to Lindquist, the Company's lease of the

Lindquist Decl. at ¶

Beginning in January 2007 and continuing until the present,

Lindquist Dep. at 24.

In 2005, Lindquist and his wife purchased a ski condominium

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Lindquist's Real Estate Leasing Activities

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Lindquist filed a declaration in support of his Opposition.
ECF No. 41.

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("the condominium") from the Company.

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rented out the condominium from approximately December 2005

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through March 2006.

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Id. at 23.

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Id.

Id. at 22-23.

They

They sold the condominium in May 2006.

Plaintiffs now seek summary judgment against Lindquist in

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his personal capacity based on his real estate leasing

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activities.

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especially his leasing of the 1701 Property to the Company,

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constitute a "trade or business" under common control with the

They argue that Lindquist's leasing activities,

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For the Northern District of California

United States District Court

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Company, and that Lindquist is therefore liable for the

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Company's withdrawal liability under ERISA's common control

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provisions.

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judgment should be denied because material issues of fact exist

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as to whether his real estate activities amounted to a "trade or

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business" as of the date of the Company's withdrawal from the

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Pension Fund on April 1, 2006.

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contends that the 1701 Property and the condominium were merely

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"passive investments" at that time.

Mot. at 7-8.

Lindquist argues that summary

Opp'n at 1-8.

Lindquist

Id.

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III. LEGAL STANDARD

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A. Summary Judgment

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Entry of summary judgment is proper "if the pleadings, the

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discovery and disclosure materials on file, and any affidavits

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show that there is no genuine issue as to any material fact and

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that the movant is entitled to judgment as a matter of law."

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Fed. R. Civ. P. 56(c).

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the evidence would require a directed verdict for the moving

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party.

Summary judgment should be granted if

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251

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(1986).

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judgment . . . against a party who fails to make a showing

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sufficient to establish the existence of an element essential to

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that party's case, and on which that party will bear the burden

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of proof at trial."

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(1986).

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all justifiable inferences are to be drawn in his favor."

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Thus, "Rule 56(c) mandates the entry of summary

Anderson, 477 U.S. at 255.

Celotex Corp. v. Catrett, 477 U.S. 317, 322

"The evidence of the non-movant is to be believed, and

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For the Northern District of California

United States District Court

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IV.

DISCUSSION

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A.

"Withdrawal Liability" Under ERISA

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Pension plans are federally regulated pursuant to ERISA, 29

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U.S.C. § 1001 et seq.

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Act of 1980 ("MPPAA"), 29 U.S.C. §§ 1381-1453, amended ERISA to

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allow plans to impose proportional liability on withdrawing

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employers for the unfunded vested benefit obligations of

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multiemployer plans.

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Underground Constr. Co., Inc., 31 F.3d 776, 778 (9th Cir. 1994).

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The MPPAA sought to ensure that if a withdrawing employer's past

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contributions did not fully fund the obligations that had vested

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at the time of its withdrawal, then the withdrawing employer

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would have to pay its proportionate share of the deficit.

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The Multiemployer Pension Plan Amendments

Carpenters Pension Trust Fund v.

Id.

This system is designed to make employers pay their share

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of the real cost of pensions by paying a share of the difference

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between the assets already contributed and the vested benefit

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liability.

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Pension Trust Fund, 789 F.2d 691, 694 (9th Cir. 1986).

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employer withdraws from a multiemployer pension plan, ERISA

Woodward Sand Co., Inc. v. W. Conf. Teamsters

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When an

requires the withdrawing employer to compensate the pension plan

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for benefits that have already vested with the employees at the

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time of the employer's withdrawal.

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liability" is assessed against the employer to ensure that

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employees and their beneficiaries are not deprived of

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anticipated retirement benefits by the termination of pension

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plans before sufficient funds have been accumulated in the

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plans.

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Id.

This "withdrawal

Id.

Under 29 U.S.C. § 1399, the amount of a withdrawing

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For the Northern District of California

United States District Court

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employer's withdrawal liability is first computed by the pension

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plan's sponsor.

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owed and is entitled, within ninety days of such notice, to ask

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the sponsor to review any specific matter relating to the

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determination of the employer's withdrawal liability.

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§ 1399(c).

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sponsor relating to the employer's withdrawal liability "shall

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be resolved through arbitration."

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The employer is then notified of the amount

29 U.S.C.

"Any dispute" between an employer and the plan

29 U.S.C. § 1401(a)(1).

Arbitration may be initiated "within a 60-day period" after

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the employer is notified of the sponsor's final determination

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concerning withdrawal liability (or 120 days after the employer

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requested the sponsor to review the matter, whichever date is

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earlier).

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are not initiated within the time periods prescribed by the

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statute, "the amounts demanded by the plan sponsor . . . shall

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be due and owing on the schedule set forth by the plan sponsor."

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29 U.S.C. § 1401(b)(1).

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when due, and fails to cure the delinquency within sixty days of

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notice of the delinquency, the plan sponsor is entitled to

29 U.S.C. § 1401(a)(1).

If arbitration proceedings

If the employer fails to make payment

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obtain immediate payment of the entire amount of the employer's

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outstanding withdrawal liability.

29 U.S.C. § 1399(c)(5).

The MPPAA defines "employer" to include not only the entity

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making contributions to the pension plan, but also "trades or

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businesses (whether or not incorporated)" that are under "common

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control" with the contributing entity.

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Under § 1301(b)(1), trades or businesses under common control

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are therefore considered a single employer under ERISA and are

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jointly and severally liable for each other's withdrawal

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For the Northern District of California

United States District Court

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liability.

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29 U.S.C. § 1301(b)(1).5

Bd. of Trustees W. Conf. of Teamsters v. Lafrenz,

837 F.2d 892, 893 (9th Cir. 1988).
Under the above framework, in order to impose the Company's

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withdrawal liability on Lindquist as sole proprietor of a real

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estate operation, two conditions must be satisfied: (1) the real

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estate operation must be under common control with the Company;

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and (2) it must qualify as a "trade or business" under §

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1301(b)(1).

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Plaintiffs argue that summary judgment is appropriate

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because the undisputed evidence establishes both of the elements

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above.

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control" element needed for joint and several liability is

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satisfied, as Lindquist was the sole shareholder of the Company

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and the owner of the real estate operation.

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Therefore, the only question at issue is whether Lindquist's

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leasing operation constituted a "trade or business" for the

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Mot. at 1.

Lindquist does not dispute that the "common

See Opp'n.

Congress enacted § 1301(b)(1) in order "to prevent businesses
from shirking their ERISA obligations by fractionalizing
operations into many separate entities." Teamsters Pension
Trust Fund v. Allyn Transp. Co., 832 F.2d 502, 507 (9th Cir.
1987).

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purposes of § 1301(b)(1).
Plaintiffs argue that all courts that have considered the

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issue, including the Ninth Circuit, have found summary judgment

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in favor of the pension fund appropriate where, as here,

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controlling shareholders in a withdrawing corporation own

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property that they lease to the corporation.

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hold otherwise, according to Plaintiffs, would undermine the

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purpose behind § 1301(b)(1) by allowing business owners to

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escape withdraw liability by maintaining business assets in

Mot. at 18.

To

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For the Northern District of California

United States District Court

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their own name and leasing those assets to the company.6

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Relying on Central States v. Fulkerson, 238 F.3d 891, 895-95

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(7th Cir. 2001), Lindquist argues that his involvement with the

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lease of the 1701 Property was so minimal as to render the lease

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a "passive investment" rather than a trade or business.

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at 4-7.

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B.

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ERISA does not contain a definition of the term "trade or

Id.

Opp'n

"Trade or Business" Under 29 U.S.C. § 1301(b)(1)

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business."

Lafrenz, 837 F.2d at 894 n.6.

Section 1301(b)(1)

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provides that the phrase "trades or businesses (whether or not

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incorporated) which are under common control" has the same

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meaning as that provided in the regulations promulgated under

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section 414(c) of the Internal Revenue Code.

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business" is not clearly defined in either section 414(c) or the

However, "trade or

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Plaintiffs also argue briefly that Lindquist's leasing of the
ski condominium and the manner in which Lindquist claimed
deductions on his tax returns further support the conclusion
that his leasing activities were a trade or business under
ERISA. The Court does not address these arguments because it
finds Lindquist's lease of the 1701 Property to the Company
sufficient to establish liability.

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regulations promulgated thereunder.

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qualify as a "trade or business" is essentially a factual

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inquiry.

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inquiry, courts look to Congress's purpose in enacting §

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1301(b)(1): "to prevent the controlling group of a company from

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avoiding withdrawal liability by shifting corporate assets into

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other business ventures under its control."

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Id.

Lafrenz, 837 F.2d at 894 n.6.7

Whether activities

To guide this factual

Id. at 894.

The facts of Lafrenz closely parallel those of the instant

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case.

In Lafrenz, a pension plan was unable to collect

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For the Northern District of California

United States District Court

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withdrawal liability from a withdrawn corporation because the

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corporation declared bankruptcy.

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therefore sued Stanley and Anita Lafrenz, who owned ninety-six

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percent of the corporation's outstanding shares and also owned

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two dump trucks, which they leased to the corporation for

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profit.

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operation was a "trade or business" under common control with

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the corporation because the Lafrenzes owned both.

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court granted summary judgment in favor of the pension fund,

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holding the Lafrenzes personally liable for the withdrawal

Id.

Id.

The pension plan

The district court held that the truck-leasing

Id.

The

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Lindquist urges the Court to apply the definition of "trade or
business" used by the Supreme Court when interpreting a
different provision of the Internal Revenue Code, and
subsequently used by the Seventh Circuit in a withdrawal
liability case like this one. See Comm'r of Internal Revenue v.
Groetzinger, 480 U.S. 23, 35 (1987); Fulkerson, 238 F.3d at 89595. For an activity to be a trade or business under the
Groetzinger test, a person must engage in the activity: (1) for
the primary purpose of income or profit; and (2) with continuity
and regularity. 480 U.S. at 35. The second prong of the
Groetzinger test distinguishes between active and passive
investments. Fulkerson, 238 F.3d at 895-95. However, the Ninth
Circuit has not adopted this approach, and the Court declines to
do so here. Lafrenz, 837 F.2d at 894.

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liability because they were sole proprietors of the truck

2

leasing operation.

Id.

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On appeal, the Lafrenzes argued, as Lindquist does here,

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that their truck-leasing operation should not be considered a

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trade or business because it was a passive investment.

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894.

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statute does not distinguish between active and passive

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investments.8

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cases holding that a proprietorship which leased property to a

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For the Northern District of California

United States District Court

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commonly controlled corporation was a trade or business under §

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1301(b)(1).

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Supermarkets, 644 F. Supp. 633, 638 (D.N.J. 1986), and Pension

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Benefit Guar. Corp. v. Ctr. City Motors, 609 F. Supp. 409, 412

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(S.D. Cal. 1984)).

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trucks, arranged for the truck leases and admittedly leased the

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trucks for profit.

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truck-leasing operation a 'trade or business' under the sweeping

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language of the statute."

Id. at

The Ninth Circuit rejected this argument, noting that the

The Court cited with approval two district court

Id. at 895 (citing United Food v. Progressive

The Court stated: "[t]he Lafrenzes own the

That is plainly sufficient to make the

837 F.2d at 894.

Here, the undisputed evidence shows that Lindquist leased

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the 1701 Property to the Company for nearly seven years and

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received $2,000 per month in revenue from the leasing

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arrangement.

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simply no significant basis for distinguishing this case from

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Lafrenz or a multitude of other cases that have uniformly found

Lindquist Dep. at 11:2-25, 12:1-5.

There is

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In a footnote the court acknowledged that some type of "passive
investments" might exist that would not qualify as a trade or
business: "[w]e do not hold that every 'passive investment' is
necessarily a trade or business. We hold only that the facts in
this case justify the conclusion that the truck-leasing
operation is a trade or business." Id. at 895 n.7.

11

property leases between two commonly controlled entities to

2

constitute a trade or business under § 1301(b)(1).

3

Ctr. City Motors, 609 F. Supp. at 412 ("[T]he court finds that

4

Congress did not intend to exclude from its definition of a

5

'trade or business' in § 1301, a rental proprietorship which

6

leases property, under a net lease, to an entity that is under

7

common control."); Cent. States S.E. & S.W. Areas Pension Fund

8

v. Ditello, 974 F.2d 887, 890 (7th Cir. 1992) ("Federal courts

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reaching this issue, including this circuit, have uniformly held

See, e.g.,

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For the Northern District of California

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that leasing property to a withdrawing employer is a 'trade or

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business' for purposes of section 1301(b)(1)."); Vaughn v.

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Sexton, 975 F.2d 498, 503 (8th Cir. 1992) (family trust that

13

leased real property to withdrawing entity was a trade or

14

business under ERISA).

15

contrary.9

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§ 1301(b)(1) by allowing controlling shareholders to evade

17

withdrawal liability by maintaining property under separate

18

ownership and leasing it to the company.

Indeed, to hold otherwise would thwart the purpose of

Lindquist seeks to distinguish Lafrenz on the ground that

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20

Lindquist provides no authority to the

the extent of his leasing activity "was so minimal as to make

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9

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24
25
26
27
28

Lindquist's reliance on Fulkerson is misplaced. In Fulkerson,
the Seventh Circuit applied the Groetzinger test for "trade or
business" and found that the defendants' leasing activities were
too passive to qualify as a trade or business under §
1301(b)(1). 238 F.3d at 895. The court explained that the
defendants' mere holding of real property leases -- without
taking actions such as negotiating the leases, researching
properties, or maintaining the properties -- constituted a
passive investment akin to owning stocks or commodities. Id.
As noted above, the Ninth Circuit has not adopted the
Groetzinger test. Moreover, unlike in this case, the defendants
in Fulkerson did not lease property to the withdrawing employer.
Id. at 893.

12

the investment passive."

2

in Lafrenz acknowledging that some passive investments may not

3

be considered a trade or business.

4

argument, Lindquist declares that he "spent less than 5 hours

5

per year related to the 1701 investment" and that the Company

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"took care of all operations at the property."

7

¶ 12.

8

to the Company terminated the day before the Company withdrew

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from the pension plan.

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For the Northern District of California

United States District Court

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Opp'n at 5-6.

Id.

He points to a footnote

In support of his

Lindquist Decl.

He further declares that the lease of the 1701 Property

Id. ¶ 13.

Even assuming the truth of these assertions, Lindquist has

11

provided no significant basis for distinguishing his case from

12

Lafrenz or the multiplicity of other district and appellate

13

cases that have found leasing property to a withdrawing employer

14

to be a trade or business under ERISA.

15

Company, rather than Lindquist personally, took care of the 1701

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Property is immaterial.

17

in United Food, "the fact that one of the entities bore nearly

18

all the responsibilities under the lease [does] not insulate the

19

other from being treated as a 'trade or business' for purposes

20

of § 1301(b)(1)."

21

Ctr. City, 609 F. Supp at 612).

22

First, the fact that the

As stated in Center City and reiterated

United Food, 644 F. Supp. at 639 (quoting

Second, the fact that the lease terminated the day before

23

the Company's withdrawal similarly does not alter the Court's

24

analysis.

25

terminated more than four months before its withdrawal from the

26

pension fund, but the court did not find this to be a

27

significant factor in determining whether the defendant's

28

leasing activities were a trade or business under ERISA.

In United Food, the withdrawing entity's lease

13

644 F.

Supp. at 639; see also Cent. States S.E. and S.W. Areas Pension

2

Fund v. Pers., Inc., 974 F.2d 789 (7th Cir. 1992) (leasing

3

property to employer qualified as trade or business even though

4

lease expired almost two years before withdrawal).

5

finds the same here.

6

the lease's termination should be relevant to the "trade or

7

business" inquiry.

8

that the common control element of the analysis must be

9

determined as of the date of withdrawal.

The Court

Lindquist does not explain why the date of

He cites to out-of-circuit authority stating

See Opp'n at 2 (citing

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For the Northern District of California

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1

IUE AFL-CIO Pension Fund v. Barker & Williamson, 788 F.2d 118,

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125 (3rd Cir. 1986)).

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dispute that Lindquist owned both the company and the real

13

estate operation on the date of withdrawal.

14

rule proposed by Lindquist, employers could avoid group

15

liability by simply terminating their leases the day before

16

withdrawing from the pension fund.

17

purpose of the statutory scheme.

18

Barker is inapposite, as there is no

Moreover, under the

This would undermine the

Last, the fact that Lindquist spent fewer than five hours

19

per year "related to the 1701 investment" is also irrelevant.

20

It is unclear what Lindquist means by this statement.

21

presumably provides this information because the Fulkerson court

22

held that a lease in that case was a passive investment in part

23

because the lessor "averred that he never spent more than five

24

hours in a year dealing with the lease or the leased

25

properties."

26

Fulkerson is inapposite because the defendant in that case,

27

unlike here, did not lease property to the withdrawing employer.

28

Lindquist concedes that the Company, of which he was the sole

238 F.3d at 896.

He

However, as noted above,

14

shareholder, made extensive use of the 1701 Property, using it

2

as office space, storage space, and a cabinet shop.

3

Dep. at 11-12.

4

activities related to the property does not transform his

5

leasing operation from a trade or business into a passive

6

investment.

7

Lindquist

The amount of time spent by Lindquist himself on

In short, while Lafrenz does indicate that there are some

8

types of investments that might be too "passive" to qualify as a

9

trade or business under ERISA, leasing property to a withdrawing

10
For the Northern District of California

United States District Court

1

entity is certainly not one of them.

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stocks or bonds in publicly traded companies, which, for

12

example, might properly be considered passive investments beyond

13

the scope of § 1301(b)(1), Lindquist's leasing operation poses

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precisely the type of fractionalization threat that § 1301(b)(1)

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was designed to address.

16

Unlike the purchase of

Accordingly, the Court GRANTS summary judgment in favor of

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Plaintiffs.

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C.

19

ERISA provides that "[i]n any action under this section to

Remedy

20

compel an employer to pay withdrawal liability, any failure of

21

the employer to make any withdrawal liability payment within the

22

time prescribed shall be treated in the same manner as a

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delinquent contribution . . . ."

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action to enforce payment of delinquent contributions, a

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plaintiff is entitled to recover the unpaid contributions,

26

interest, liquidated damages, and reasonable attorneys' fees and

27

costs.

28

Pension Trust Fund v. Clarke's Welding, Inc., 688 F. Supp. 2d

29 U.S.C. § 1132(g)(2).

29 U.S.C. § 1451(b).

In an

See also Operating Eng'rs

15

902, 914 (N.D. Cal. 2010).
1.

2

Liquidated Damages

ERISA section 502(g)(2)(C) authorizes a liquidated damages

3
4

award pursuant to the terms of the pension plan in an amount not

5

in excess of twenty percent of the total withdrawal liability.

6

29 U.S.C. § 1132(g)(2)(C)(ii).

7

that "the amount of damage to the Fund and the Pension Plan

8

resulting from any failure to promptly pay shall be presumed to

9

be the sum of $20.00 per delinquency or 10% of the amount of the

Here, the pension plan provided

10
For the Northern District of California

United States District Court

1

Contribution or Contributions due, whichever is greater."

Price

11

Decl. ¶ 16; Aug. 1, 2006 Letter.

12

liquidated damages equal to ten percent of the total withdrawal

13

liability amount of $954,508, amounting to a total of $95,450.80

14

in liquidated damages.

15

2.

Accordingly, Plaintiffs seek

Interest

ERISA Section 502(g)(2)(B) provides that interest on unpaid

16
17

contributions shall be determined based on the rate provided

18

under the plan, or, if none, the rate prescribed under section

19

6621 of the Internal Revenue Code.

20

Here, the plan provides that interest on past due withdrawal

21

liability shall be calculated using the California statutory

22

rate of ten percent for unpaid judgments.

23

Cal. Code Civ. Proc. § 685.010.

24

total interest owed from October 1, 2006 through the filing of

25

this Motion on March 31, 2010 to be $429,397.85.

26

17.

27

October 1, 2006 as the starting date for the interest

28

calculation.

29 U.S.C. § 1132(g)(2)(B).

Price Decl. ¶ 17;

Plaintiffs have calculated the

Price Decl. ¶

However, Plaintiffs have not explained why they used

Plaintiffs shall file a supplemental declaration

16

with the Court explaining the basis for using October 1, 2006 as

2

the start date for interest accrual.
3.

3

Attorneys' Fees and Costs

ERISA section 502(g)(2)(D) entitles Plaintiffs to an award

4
5

of reasonable attorneys' fees and costs.

6

1132(g)(2)(D).

7

attorneys' fees and costs but assert that they will move for

8

fees and costs if judgment is awarded in their favor.

9

29 U.S.C. §

23.

Plaintiffs must do so within thirty days.

V.

CONCLUSION

Plaintiffs have not provided a statement of

Mot. at

10
For the Northern District of California

United States District Court

1

11
12

The Court GRANTS the Motion for Summary Judgment filed by

13

Plaintiffs Carpenters Pension Trust Fund of Northern California

14

and Board of Trustees of the Carpenters Pension Trust Fund for

15

Northern California and against Defendant Mark Alan Lindquist,

16

in the amount of $954,508.00 in unpaid principal withdrawal

17

liability, $95,450.80 in liquidated damages, and applicable

18

interest in an amount to be determined.

19

of this Order, Plaintiffs shall: (1) file a declaration with the

20

Court explaining why the start date for interest accrual should

21

be October 1, 2006; and (2) file a motion for attorneys' fees

22

and costs.

Within thirty (30) days

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24

IT IS SO ORDERED.

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27

Dated: July 19, 2011
UNITED STATES DISTRICT JUDGE

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