Freight Drivers and Helpers Local Union No. 557 Pension Fund v. Penske Logistics LLC et al
Filing
40
MEMORANDUM. Signed by Judge Ellen L. Hollander on 7/2/2015. (hmls, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
FREIGHT
DRIVERS
AND
HELPERS LOCAL UNION NO. 557
PENSION FUND, by its Plan
Sponsor, the Joint Board of Trustees,
Plaintiff,
Civil Action No. ELH-12-02376
v.
PENSKE LOGISTICS LLC, et al.,
Defendants.
MEMORANDUM
Plaintiff Freight Drivers and Helpers Local Union No. 557 Pension Fund (the “Fund”), a
multiemployer pension fund, filed suit in August 2012 against defendants Penske Logistics LLC
and Penske Truck Leasing Co., L.P. (collectively, “Penske”). ECF 1. The Fund asked this Court
to vacate and/or modify an arbitration award issued by Arbitrator Ira F. Jaffe on July 13, 2012.
ECF 1 at 1. “The arbitration award at issue concerned disputes between the Fund and Penske”
over Penske’s alleged withdrawal liability, see id., pursuant to section 4219 of the Employee
Retirement Income Security Act of 1974 (“ERISA”), codified in relevant part at 29 U.S.C.
§ 1399. Id. ¶ 12; see also Trustees of the Plumbers & Pipefitters Nat’l Pension Fund v.
Plumbing Servs., Inc., ___ F.3d ___, No. 13-2403, 2015 WL 3940851, at *1 (4th Cir. June 29,
2015) (discussing ERISA withdrawal liability and applicable claim procedures). Plaintiff filed
an Amended Complaint in August 2013. ECF 15.
In February 2014, for reasons discussed in a Memorandum Opinion issued February 7,
2014 (see ECF 19), I construed the Amended Complaint as a motion to vacate the arbitration
award, determined that it was untimely, denied the motion, and closed the case. See ECF 19
(Memorandum); ECF 20 (Order). The Fund appealed. See ECF 27. In April 2015, the Fourth
Circuit reversed and remanded. See ECF 30; Freight Drivers & Helpers Local Union No. 557
Pension Fund v. Penske Logistics LLC, 784 F.3d 210, 211 (4th Cir. 2015).
In June 2015, the Fund filed a Motion to Stay Proceedings (ECF 37, “Motion”), with a
supporting memorandum (ECF 37-1, “Memo”).
Penske opposed the Motion (ECF 38,
“Opposition”), and the Fund replied (ECF 39, “Reply”).
The Motion has been fully briefed, and no hearing is necessary to resolve it. See Local
Rule 105.6. For the reasons that follow, I will grant the Motion in part and deny it in part. In
particular, I will stay the proceedings until October 2, 2015.
In its Memo, the Fund has provided a concise and correct articulation of the legal
standards governing a federal district court’s consideration of a motion to stay, stating, ECF 37-1
at 3-4 (alterations added):
The United States Supreme Court explained long ago that “the power to
stay proceedings is incidental to the power inherent in every court to control the
disposition of the causes on its docket with economy of time and effort for itself,
for counsel, and for litigants.” Landis v. N. Am. Co., 299 U.S. 248, 254 (1936).
Such discretion requires a court to “weigh competing interests and maintain an
even balance.” Id. at 254-55. “The determination by a district judge in granting
or denying a motion to stay proceedings calls for an exercise of judgment to
balance the various factors relevant to the expeditious and comprehensive
disposition of the causes of action on the court’s docket.” United States v.
Georgia Pacific Corp., 562 F.2d 294, 296 (4th Cir. 1977) (citing Landis, 299 U.S.
at 254). [Judge Motz of this District] has enumerated factors relevant to
consideration of a motion to stay, including: the length of the stay requested, the
hardship movant would suffer if the relief requested were denied, prejudice to the
non-moving party if the relief requested were granted, and whether the requested
relief promotes judicial economy by avoiding duplicative litigation. In re Mut.
Funds Inv. Litig., [JFM-04-01274,] 2011 WL 3819608, at *1 (D. Md. Aug. 25,
2011).
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The Fourth Circuit has acknowledged a federal district court’s “discretion
to stay proceedings on its docket pending the outcome of a similar suit instituted
earlier in another court.” Amdur v. Lizars, 372 F.2d 103, 106 (4th Cir. 1967)
(citing Int’l Nickel Co. v. Martin J. Barry, Inc., 204 F.2d 583 (4th Cir. 1953)).
Upon review of a motion to stay, consideration is properly given to whether the
pending case could provide guidance on a central issue, relative prejudice to the
parties and promotion of efficient judicial administration. Amdur, 372 F.2d at
107; Int’l Nickel, 204 F.2d at 585-86.
In its Opposition, Penske relies on the same standard. See ECF 38 at 2 (citing Georgia
Pacific Corp., 562 F.2d at 296, and Landis, 299 U.S. at 254). Penske asks the Court to deny the
Fund’s Motion, and, instead, to order the parties to set a schedule for the briefing of anticipated
cross-motions for summary judgment. ECF 38 at 3-4 (citing Local Rule 105.2(c)).
In its Memo, the Fund asserts that all of its claims against Penske regarding withdrawal
liability were consolidated into one arbitration, before Arbitrator Jaffe, in December 2011, ECF
37-1 at 1; that “the Parties completed the hearing in the arbitration proceedings on April 4,
2014”, id. at 3; and that the arbitrator’s “final award is expected imminently.” Id. Moreover, the
Fund argues that the final award may “obviate the need for the current litigation,” because if
Penske prevails in the pending arbitration, there would be no occasion to reach the legal issue
disputed in this action. Id. at 4. Consequently, in the interest of judicial economy, the Fund
urges this Court to stay the action until Arbitrator Jaffe issues the final award.
Id. at 6.
Additionally, the Fund maintains that Penske “will not suffer any prejudice if a stay is granted”,
id. at 4, but the Fund would suffer prejudice if the stay is denied, in that it will incur “the costs of
litigation that could be materially affected by the outcome of underlying arbitration.” Id. at 6.
In its Opposition, Penske argues that the pending final award could only possibly result in
a “comprehensive disposition of the instant case” if Penske prevails in its arguments before the
Arbitrator, and the Fund chooses not to challenge the final award in court. ECF 38 at 2. Further,
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Penske points out that the Fund is asking this Court to grant an “open-ended stay”, since the
“parties waived any precise time limits on the issuance of the award”. Id. at 3 (citation omitted).
Penske observes that the final award will not be decided for an unknown period of time, id., and
that, in any event, the Fund would pursue a judicial challenge if it were unsuccessful in
arbitration. Id. at 2. It states, id. (emphasis in original):
If the Arbitrator rules against the Plaintiff … , “it may be unnecessary” to resolve
the issue in the instant case only if Plaintiff concedes the rulings in the other two
arbitrations without a court challenge. Defendants have no reason to think that
Plaintiff will concede multimillion dollar adverse rulings.
In effect, therefore, Penske asserts that granting the Motion would only delay the case
and the litigation that is inevitable.
Penske also argues that the requested extension would be contrary to the purpose of
procedures governing pension disputes such this, set forth by Congress in the Multiemployer
Pension Plan Amendments Act of 1980 (“MPPAA”), 29 U.S.C. §§ 1381, et seq. ECF 38 at 3.
Specifically, Penske states, id. (alteration to case name by the Court, alteration to quote by
Penske):
In [Board of Trustees, Sheet Metal Workers’ National Pension Fund v. BES
Services, Inc.], 469 F.3d 369 (4th Cir. 2006), the appellate court explained that the
MPPAA’s arbitration requirement ensures a “streamlined process for resolving
disputes over withdrawal liability determinations,” and was intended to “limit[ ]
dispute-resolution costs and preserv[e] plans’ assets.” 469 F.3d at 374. A stay in
the instant case will frustrate MPPAA’s goal of expediency and efficiency.
I am persuaded that the interests of judicial economy and efficient administration, as well
as the MPPAA itself, favor granting a limited stay of these proceedings. Penske does not dispute
the relevant facts in the Fund’s Memo, i.e., that the parties’ withdrawal liability disputes have
been consolidated into one arbitration, which was ripe for disposition more than one year ago,
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and which has the potential to moot this action. Nor does Penske argue that it would be
prejudiced in any way. See generally ECF 38. Moreover, Penske itself highlighted that the
MPPAA embodies a clear Congressional preference for a “streamlined process for resolving
disputes” and preservation of the assets of pension funds. See ECF 38 at 3 (quoting BES
Services, Inc., 469 F.3d at 374). I note that in BES Services, Inc., on which Penske relies, the
Fourth Circuit went on to say: “Congress did not intend to create a new, broad category of
litigation that would force benefit plans to spend their assets on court costs and attorneys fees.
Rather, it chose to require arbitration, with judicial review, to create a more efficient disputeresolution process.” BES Services, Inc., 469 F.3d at 374; accord, Freight Drivers & Helpers
Local Union No. 557 Pension Fund, 784 F.3d at 217.
In my view, a three-month stay is warranted. Although Penske disputes the likelihood
that a decision will be issued within the near future, or that a decision will moot this action, it
appears reasonable to expect a decision fairly soon. See ECF 38 at 3 (stating that, in March
2015, Arbitrator Jaffe estimated he would issue the final award “within the next few weeks”)
(citation omitted). Weighing the absence of prejudice to Penske against the costs for all involved
of briefing cross-motions on summary judgment now, and in light of the MPPAA’s intent to
streamline the claims at issue and to minimize such costs, the likelihood that the final award will
materially affect the parties’ actions in this case is sufficient to warrant a stay. Nonetheless, I
agree with Penske that granting a totally open-ended stay, as the Fund requests, would endanger
the efficient resolution of this case, which has been pending since 2012.
Accordingly, I will stay all proceedings until October 2, 2015. I will also direct the
parties to submit a joint status report by October 2, 2015, or within ten days from the issuance of
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the final award, whichever is earlier. Further, if the parties desire to move forward with this
litigation when they file the requested status report, then the parties shall submit with their status
report a joint proposed briefing schedule. See Local Rule 105.2(c). It shall specify, inter alia,
that the first motion for summary judgment is due no later than October 16, 2015, and all
briefing shall be completed by December 16, 2015.
A separate Order follows, consistent with this Memorandum.
Date: July 2, 2015
/s/
Ellen Lipton Hollander
United States District Judge
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