Laborers' Pension Fund et al v. Aces Environmental, Corp. et al
Filing
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MEMORANDUM Opinion and Order. Signed by the Honorable George W. Lindberg on 11/29/2011. Mailed notice(meg, )
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
LABORERS’ PENSION FUND AND
LABORERS’ WELFARE FUND OF THE
HEALTH AND WELFARE DEPARTMENT
OF THE CONSTRUCTION AND GENERAL
LABORERS’ DISTRICT COUNCIL OF
CHICAGO AND VICINITY, ET. AL.,
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Plaintiffs,
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v.
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ACES ENVIRONMENTAL, CORP., ET. AL., )
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Defendants.
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No. 11 CV 1803
Senior U. S. District Court Judge
George W. Lindberg
MEMORANDUM OPINION AND ORDER
Plaintiffs, Laborers’ Pension Fund and Laborers’ Welfare Fund of the Health and
Welfare Department of the Construction and General Laborers’ District Council of Chicago and
Vicinity and James S. Jorgensen, Administrator of the Funds, bring a three count complaint
against defendants, Aces Environmental, Corp. (“Environmental”), Aces Environmental
Consulting Corp. (“Consulting”), Aces Demolition Corporation (“Demolition”), Bonnie Coyne
and Daniel Coyne, alleging claims for defaulting on an installment note and to impose liability
for a previously entered money judgment against Demolition (Count I); failure to submit benefit
contributions against all defendants (Count II); and failure to submit dues against all defendants
(Count III). Defendants have moved to dismiss Count I of plaintiffs’ complaint for lack of
subject matter jurisdiction.
In considering a motion to dismiss under Rule 12(b)(1), a court accepts all well-pleaded
facts alleged in the complaint, and draws all reasonable inferences from the facts in the
plaintiffs’ favor. See St. John’s United Church of Christ v. City of Chicago, 502 F.3d 616, 625
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(7th Cir. 2007). A court “may properly look beyond the jurisdictional allegations of the
complaint and view whatever evidence has been submitted on the issue to determine whether in
fact subject matter jurisdiction exists.” Id. (quoting Long v. Shorebank Dev. Corp., 182 F.3d
548, 554 (7th Cir. 1999)). “The burden of proof on a 12(b)(1) issue is on the party asserting
jurisdiction.” United Phosphorus, Ltd. v. Angus Chem. Co., 322 F.3d 942, 946 (7th Cir. 2003).
“The general rule . . . is that absent clear direction to the contrary by Congress, the federal courts
have the power to award any appropriate relief in a cognizable cause of action brought pursuant
to a federal statute.” Franklin v. Gwinnett County Public Schools, 503 U.S. 60, 70-71 (1992).
This Court will first consider whether it has original jurisdiction over Count I’s claims for
defaulting on an installment note and to impose liability for a previously entered money
judgment against Demolition. Plaintiff alleges that this court has subject matter jurisdiction
because defendant Demolition is an alter ego and/or single employer of defendants,
Environmental and Consulting.
As to the claim for defaulting on an installment note, that claim is based on a breach of
contract. A breach of contract claim is a state law claim over which this court does not have
original jurisdiction.
As to the claim against Demolition for liability on a previously entered money judgment,
defendants counter plaintiffs’ assertion that subject matter jurisdiction exists by citing Thomas v.
Peacock, 516 U.S. 349 (1996), where the Supreme Court rejected plaintiff’s argument that
ERISA provided a jurisdictional basis for his piercing the corporate veil claim. The Supreme
Court held that ERISA did not provide subject matter jurisdiction, as nothing in ERISA provided
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for imposing liability for an existing ERISA judgment against a third party. Peacock, 516 U.S. at
353. Likewise, in this case plaintiff seeks to impose liability against a third party for an existing
ERISA judgment, albeit on alter ego and single employer theories. ERISA provides no basis for
such liability, so this court does not have subject matter jurisdiction over Count I. Ultimately, it
is irrelevant whether or not Demolition is an alter ego or a single employer of Environmental and
Consulting, since any claim under Count I is a state law claim.
Plaintiffs argue this Court should exercise supplemental jurisdiction over the claims in
Count I pursuant to 28 U.S.C. § 1367 based on the claims in Counts II and III. “Although the
district court may not exercise jurisdiction absent a statutory basis, it is well established—in
certain classes of cases—that, once a court has original jurisdiction over some claims in the
action, it may exercise supplemental jurisdiction over additional claims that are part of the same
case or controversy.” Exxon Mobil Corp. v. Allapattah Services, Inc., 545 U.S. 546, 552 (2005)
citing United Mine Workers of Amercia v. Gibbs, 383 U.S. 715, 725 (1966). Count I concerns
ERISA contributions for the period of January 2005 through July 2009. Counts II and III
concerns ERISA contributions for the period of September 2010 forward. Therefore, Count I is
not part of the same case or controversy as Counts II and III. Plaintiffs argue that judicial
economy would be served if the court exercised jurisdiction over Count I. However, judicial
economy is not of itself a sufficient basis for the exercise of supplemental jurisdiction. Plaintiffs’
assertion that defendants have already answered Counts II and III is not accurate, as the Court
has entered an order striking defendants’ answer to plaintiffs’ Complaint, and is in any event a
non sequitur. Thus, this Court will not exercise supplemental jurisdiction over Count I.
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ORDERED: Defendants’ motion to dismiss [19] is granted. Count I of the complaint is
dismissed.
ENTER:
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GEORGE W. LINDBERG
Senior U.S. District Judge
Dated: November 29, 2011
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