Trustees of the National Automatic Sprinkler Industry Welfare Fund et al v. Kimberly Harvey d/b/a All Valley Fire Protection et al
MEMORANDUM OPINION. Signed by Judge George Jarrod Hazel on 10/27/2017. (tds, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
TRUSTEES OF THE NATIONAL
AUTOMATIC SPRINKLER INDUSTRY
WELFARE FUND, et al.,
Case No.: G.JH-17-0449
KIMBERLY HARVEY D/B/A ALL
VALLEY FIRE PROTECTION, et aI.,
The Trustees of the National Automatic
Sprinkler Industry Welfare Fund. National
Sprinkler Industry Pension Fund. Sprinkler Industry Supplemental
Training Fund ("'Plaintiffs"
Pension Fund. and
or the "NASI Funds") bring this action against
Kimberly and Gregory Harvey. both in their individual capacities and to the extent
that they do business as All Valley Fire Protection ("Defendants")
under the Employee
Income Security Act of 1974 ('"ERISA"). as amended by the Multiemployer
Act of 1980, 29 U.S.c.
~~ 1001 el seq. Following Defendant's
answer or otherwise defend in this action, the Clerk of the Court entered default against
on June 7, 2017. ECF No. 12. Now pending before the Court is Plaintifls'
pursuant to Fed. R. Civ. P. 55(b). ECF No. 11. No hearing
See Loc. R. 105.6 (D. Md. 2016). For the reasons that follow. Plaintiffs'
is granted. Judgment
is entered against Defendants
in the total amount of
The NASI Funds are multi employer
ERISA, 29 U.S.c.
1002(3). ECF No. I
to the provisions
and the Collective
at 8000 Corporate
under the laws of the State of California,
operate as a contractor
ERISA, 29 U.S.c.
worked by their employees
to the Complaint.
doing business in California:
with offices located in California./d.
in the sprinkler
industry, and at all times
in an industry affecting commerce
as detined by
entered into agreements
with the Unions. which. in turn.
between the Unions and the
8. Pursuant to the Collective
to pay to the NASI Funds certain sums of money for each hour
who were covered by the Collective
2009 through the present. /d. ~ 10.
facts are taken from Plaintiffs
covered by the Collective
at all times relevant to the action, Defendant
and the Guidelines
142(1). (3) and 152(2). See id.
bound them to the Collective
1002(5), (9). (11), (12) and (14) and by the Labor-Management
PlaintitTs allege that Defendants
of Trust establishing
and the Defendants.
All Valley Fire Protection.
relevant to the action were and are employers
and Gregory Harvey are individuals
the Harveys also do business as Defendant
Fitters Local Unions No. 669 and 483 (the "Unions")
NASI Funds are administered
benefit plans as defined in Section 3(3) of
I. The Funds are established
of the Restated Agreements
the NASI Funds ("Trust Agreements").
was bound to the Trust
in the NASI Funds ("Guidelines")
ECF No. I.
Id.,r 9. Under
the terms of the Trust Agreements,
when an employer becomes two or more months delinquent
in making the required contributions,
and has not submitted the proper reporting forms. the NASI
Funds are permitted to project the amount of the employer's
using the following
[T]he greater of (a) the average of the monthly payments or reports
submitted by the Employer for the last three (3) months for which
payments or reports were submitted, or (b) the average of the
monthly payments or reports submitted by the Employer for the
last twelve (12) months for which payments or reports were
17; ECF NO.1 1-14 at 24-25. Additionally,
when an employer fails to timely pay
the employer is obligated to pay liquidated damages under the following
(1) If payment is not received ... by the 15th of the month, 10% of
the amount [owed] is assessed.
(2) An additional 5% is added if payment is not received ... by the
last working day of the month in which payment was due.
(3) An additional 5% is added if payment is not received by the
15th of the month following the month in which payment was
20; ECF No. 11-14 at 23.
In February 2015, the Plaintiffs filed a separate lawsuit in this Court against Defendants
and obtained a judgment
in favor of Plainti ITs in the amount of $243,480.26.
initially made some payments to reduce the amount owed, they began experiencing
difficulty making payments and, in October 2016, the Plaintiffs and Defendants entered into a
private Settlement Agreement
No. 1 1- 18. The Settlement
a payment plan for Defendants.
12: see also ECF
required the Defendants to make monthly payments over
a period of fifty-two months. and required the Defendants to remain current on all subsequent
to the Plaintiffs. Id. ~ 13. In their Complaint
Plaintiffs allege that Defendants
failed to make settlement
due on January
failed to pay
2016 through January 2017. Id. ~
which were owed for the months from November
initiated this action against Defendants
January 2017; $2,231.58
fees for contributions
2017. ECF No.4;
that became due subsequent
Id. at 8-9. Summons
costs, interest, and
to the filing of their Complaint
were returned as executed on March 21,
which was served on Defendants,
since the tiling of their Complaint,
Motion for Default Judgment.
favor of Plaintiffs,
result of Defendants'
on May 10. 2017, ECF No. 10.
on June 7, 2017. ECF No. 12. In their Motion
Plaintiffs allege that they have incurred
that were due since the tiling of the Complaint.
Id ~ 15. They also
moved for an entry of default against Defendants
ECF No. I. In
ECF NO.5; ECF NO.6; ECF NO.7; ECF NO.8. With no Answer having been
for Default Judgment,
and the Clerk entered default against Defendants
damages assessed on late contributions;
fees; and, all contributions,
through the date of judgment.
due for work performed
under the Settlement
fees and reinstated
have not made
ECF No. 11-1 at 2-3.
ECF No. II, is now ripe for review. I-laving
of the Complaint,
and the Motion for Default Judgment
the Court now grants default judgment
in the total amount of $192,943.96,
broken down as follows: $155.842.40
default on the terms of the Settlement
fees of $1,100.50,
enter the party's
$827.21 in interest,
and costs of $730.00.
"When a party against whom a judgment
plead or otherwise
relief is sought has failed to
defend, and that failure is shown by affidavit or otherwise,
Fed. R. Civ. P. 55(a). "A defendant's
entitle the plaintiff to entry of a default judgment:
the clerk must
default does not automatically
rather, that decision is left to the discretion
the court." Educ. Credit lv/gmt. Corp. v. Optimum Welding, 285 F.R.D. 371, 373 (D. Md. 2012).
"[t]he Fourth Circuit has a 'strong policy'
that 'cases be decided on their merits,'''
Choice Hotels Intern .. Inc. v. Savannah Shakti Carp., No. DKC-II-0438,
20 II WL 5118328 at
*2 (D. Md. Oct. 25,2011)
(citing United States v. ShqfTer Equip. Co., II F.3d 450, 453 (4th Cir.
1993)), "default judgment
may be appropriate
because of an essentially
process has been halted
It!. (citing S.E.C. v. Lawhaugh, 359 F. Supp. 2d
(D. Md. 2005).
"Upon default, the well-pled
when the adversary
court first determines
as to damages
in a complaint
as to liability are taken as true,
are not." Lawbaugh. 359 F. Supp. 2d at 422. Thus, the
whether the unchallenged
of action. Agora Fin.. LLC v. Sander, 725 F. Supp. 2d 491, 494 (D. Md. 2010). In determining
whether the factual allegations
cause of action, courts typically apply the
Iqbal/Twombly pleading standard. See Baltimore Line Handling Co. v. Brophy, 771 F. Supp. 2d
531, 544 (D. Md. 20 11) (finding Iqbal "relevant
to the default judgment
fails to state a claim entitling the pleader to relief if the complaint
'" labels and conclusions'"
assertion[ s]' devoid of' further factual enhancement.'"
Ashcr<~fiv. Iqbal. 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twomhly. 550 U.S.
544, 555-57 (2007)). As the Fourth Circuit has recognized, ...the court need not accept the legal
conclusions drawn from the facts. and [ ] need not accept as true unwarranted inferences.
unreasonable conclusions, or arguments.'" Monroe v. City (~rCI1(Jrloffes\'ille.579 F.3d 380. 38586 (4th Cir.2009) (citation omitted), cert. denied. 559 U.S. 992 (20 I0); accord Simmons v.
United Mortg. & Loan Investment. LLc' 634 F.3d 754, 768 (4th Cir. 2011). Indeed. "where the
well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct.
the complaint has alleged-but
it has not 'show[n]'-'that
the pleader is entitled to relief.'"
Iqhal. 129 S.Ct. at 1950 (quoting Fed. R. Civ. P. 8(a)(2)).
If liability is established. the court then makes an independent determination of damages.
Agora Financial. LLC, 725 F. Supp. 2d at 494. Fed. R. Civ. P. 54(c) limits the type of judgment
that may be entered based on a party's default: "A default judgment must not differ in kind from.
or exceed in amount, what is demanded in the pleadings." In entering default judgment. a court
cannot, therefore. award additional damages "because the defendant could not reasonably have
expected that his damages would exceed th[e] amount [pled in the complaint]." In re Genesys
Data Techs .. Inc., 204 F.3d 124, 132 (4th Cir. 2000). While the Court may hold a hearing to
prove damages, it is not required to do so; it may rely instead on "detailed affidavits or
documentary evidence to determine the appropriate sum." Adkins. 180 F. Supp. 2d at 17 (citing
United Artists Corp. v. Freeman. 605 F.2d 854. 857 (5th Cir. 1979)); see also Lahorers' District
Council Pension. et al. v. E.
c.s.. Inc.. No. WDQ-09-3174.
2010 WL 1568595. at *3 (D. Md.
Apr. 16. 2010) ("[O]n default judgment. the Court may only award damages without a hearing if
the record supports the damages requested.").
Under ERISA, "[e]very
who is obligated
to make contributions
plan under the terms of the plan or under the terms of a collectively
make such contributions
with the terms and conditions
plan or such agreement."
Constr .. Inc., No. I: 14-CV -161-LMB- TRJ, 2015 WL 1305003 L at *3
Fllml v. Camelot
~ 1145; see Bd. (?f'Trllstees. Sheet lv/etal Workers'
(E.D. Va. Apr. 14.2015).
have failed to appear or otherwise
that: (1) Defendants
to the Plaintiffs,
make timely contributions
in the Complaint.
Ryan. 253 F.3d at 780. Those allegations
by the terms of the Settlement
and that Defendants
failed to make those payments;
by the terms of the CBA. the Trust Agreements.
and the Guidelines
to the NASI Funds for any hours worked by covered employees.
that Fire Tech failed to make those payments
2017. The Complaint
defend. the Court accepts as true
and for additional
for the periods from November
2016 through May
are liable to the Trustees
as set out in the governing
enforce the payment
29 U.S.C. ~ I I 32(g)(2) provides that in any action brought to
and in which a judgment
the court shall award the plan:
the unpaid contributions.
equal to the greater 01'the unpaid contributions. or
in favor of the plan is
liquidated damages provided for under the plan in an
amount not in excess of 20 percent (or such higher
percentage as may be permitted under Federal or State law)
of the amount determined by the court under subparagraph
reasonable attorney's fees and costs of the action, to be paid
by the defendant, and
such other legal or equitable relief as the court deems
29 U.S.c. ~ I I 32(g)(2); see also Columbus Show Case Co.. 2014 WL 3811252. at *4 (E.D. Va.
Int'/ Painters & Allied Trades Indus. Pension Fund v. Capital Restoration &
Painting Co., 919 F. Supp. 2d 680, 686 (D. Md. 2013); Trustees qf Plwnbers & Pipe.!itters Nat.
Pension Fund v. Lake Side Plumbing & Heating. Inc., No. I: 12-CV-00298
LO/lDD, 2012 WL
6203001, at *4 (E.D. Va. Nov. 20, 2012).
In support of the request for damages, Plaintiffs refer to the Declaration of John P. Eger,
who attests that Defendants
in fact failed to make payments under the Settlement Agreement
January 2017 through May 2017, and failed to pay contributions
2016 through March 2017, and that Defendants
owed for the months of
failed to submit report forms for those
months. ECF No. 11-4 at 3-4. Eger also attests to a projected delinquency
2016 through March 2017 in the amount of $27,894.73,
described supra. ECF No. 11-4
for the months of
using the projection
15. Pursuant to the liquidated damages formula described
earlier, and as Eger attests in his Declaration,
further owes $6,549.12 in liquidated
damages. ECF No. 11-4 ~ 18; see 29 U.S.c. ~ I I 32(g)(2)(C)(ii).
interest assessed at twelve percent per annum on unpaid contributions
and accruing through the date of payment, totaling $21,301.21.
owed pursuant to 29 U.S.C. ~ 1 I 32(g)(2)(B)
through March 31,2017,
ECF No. II
and the Trust Agreements.
4. The interest is
In support of their
damages, Plaintiffs further attach all the relevant contracts, Trust Agreements,
and Policies. See ECF No. 11-5; ECF No. 11-6; ECF No. 11-7; ECF No. 11-8; ECF
No. 11-9; ECFNo.
11-13 ; ECFNo.
ECF No. 11-15; ECF No. 11-16; ECF No. 11-17; ECF No. 11-18.
Finally, in support of their claim for attorneys'
of their attorney,
Charles W. Gilligan,
fees and costs, Plaintiffs submit the
ECF No. 11-19, a spreadsheet
hourly billing by Gilligan and his paralegal
with respect to the instant lawsuit, ECF No. 11-20,
and invoices for costs spent on out-of-state
process service, ECF No. 11-21. These materials
indicate that Gilligan's
firm spent 8.25 hours on this case on behalf of Plaintiffs,
$122.00 per hour for paralegal
time and $310.00 per hour for attorney time. ECF No. 11-19 ~13,
5; ECF No. 11-20. These rates are within the local guidelines
and are reasonable.
App. B (D. Md. July 1, 2016). Plaintiffs are therefore awarded $1,100.50
record also substantiates
at a rate of
See Loc. R.
$330.00 for service of process and $400.00 for
filing fees. ECF No. 11-19 ~ 6; ECF No. 11-20; ECF No. 11-21. Thus, Plaintiffs are awarded
$730.00 in costs.
The Court notes that the judgment
it is awarding
and that under Fed. R. Civ. P. 54(c), "[a] default judgment
kind from, or exceed in amount, what is demanded
could not reasonably
in the complaint]."
in the pleadings."
must not differ in
This is "because
that his damages would exceed th[el amount [pled
In re Gene.sys Data Techs., Inc., 204 F.3d 124, 132 (4th Cir. 2000). However,
in cases where plaintiffs
sought in their Complaint
become due in subsequent
what could be included
is higher than the amount sought in the
months, this Court has held that defendants
in any additional
sought to recover in default judgment
amount that would
properly "had notice of
notice of the
when they were served with
copies of Plaintiffs'
Motion for Default Judgment."
Indus. We(fcrreFund v. Harvey, No. GJH-15-521,
Trustees (~lthe Nat 'I A utomatic Sprinkler
2016 WL 297425, at *6 (D. Md . .Ian. 21.
2016). See also Trustees qlNat'l Automatic Sprinkler Indust. We(fcrreFund v. First Responder
Fire Prot. Corp., No. GJH-16-4000,
to make contributions
award is proper under Rule 54(c).
increase due to the continuing
to the Funds under the applicable
As such, the Court finds that the additional
For the foregoing
at *2 (D. Md. Aug. 1L 2017)
is fairly regarded to be on notice of the subsequent
2017 WL 3475678,
Motion for Default Judgment
and in favor of Plaintiff
is granted. Judgment
in the total amount
shall accrue until the judgment
~ 1961. A separate Order shall issue.
'b-7 . 2017
GEORGE J. HAZEL
United States District Judge
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