National Electrical Benefit Fund v. EGF Electrical Incorporated

Filing 8

MEMORANDUM OPINION. Signed by Judge George Jarrod Hazel on 2/7/2018. (aos, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
SOlltltem Divisio/l

NATIONAL ELECTRICAL
BENEFIT FUND,

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Plaintiff,

v.

Case No.: G.JH-17-857

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EGF ELECTRICAL

INCORPORATED

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Defendant.

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MEMORANDUM

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EGF Electrical Incorporated

Income Security Act of 1974 ("ERISA"),
Amendments

Act of 1980,29

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OPINION

Plaintiff National Electrical Benefit Fund ("Plaintiff'
against Defendant

*

("Defendant")

or "NEBF") brings this action
under the Employee Retirement

as amended by the Multiemployer

U.S.c. ~~ 1001 el seq. Following Defendant's

Pension Plan
failure to answer or

otherwise defend in this action, the Clerk entered default against Defendant on July 24,2017.
ECF NO.7. Now pending before the Court is Plaintiffs

Motion for Partial Default Judgment

against Defendant pursuant to Fed. R. Civ. P. 55(b). ECF NO.6. No hearing is necessary. See
Loc. R. 105.6 (D. Md. 2016). For the following reasons, Plaintiffs
Judgment
I.

Motion for Partial Default

is granted.

BACKGROUND
The following facts are established

by the Complaint.

exhibits in support of the Motion for Partial Default Judgment.
multiemployer

ECF No. J. and evidentiary
ECF NO.6-I.

The NEBF is a

employee pension benefit plan within the meaning of Section 3(2) of ERISA, 29

U.S.C.

S

1002(2), which has been established

International

Brotherhood

Contractors

Association

participate

of Electrical
("NECA").

Workers ("IBEW")

local unions. ECF NO.1

Boulevard,

Suite 500, Rockville,

Maryland

S

bargaining

representatives

Collective

Bargaining

behalf of employees
conditions
governed

Agreements

Employees

for the NEBF to determine

allegedly

and records after a demand
Bargaining

Illinois

Id.

to collective

bargaining

with an IBEW Local Union, the collective

lei. ~ 6. According

Defendant

to the Complaint

to submit contributions

the

to the NEBF on

lei. Defendant was also bound to the terms and

Benefit Agreement

of the NEBF. lei.

to submit contributions.

the Collective

obligated

commerce.

was a signatory

employees.

covered by the Agreements.

administration

Defendant

Agreements")

for Defendant's

of the Restated

records necessary
obligations

Bargaining

is an Illinois corporation

within the meaning of Section 3(5) of ERISA,

At all times relevant to the action, Defendant
("Collective

agree to

with the IBEW or one of

is 20602 Abbey Drive, Frankfort,

1002(5), and is engaged in an industry affecting

agreements

1

at 1. Employers

at 2400 Research

and beliet~ that Defendant

is an employer

Electrical

Id.

20850-3238.

address and main place of business

60423. ECF No. 1 ~ 5. Defendant

agreements

4. The NEBF is administered

Plaintiff states, upon information
whose business

bargaining

entered into between the

and the National

4; see ECF NO.6-I

ECF No. I

in the NEBF pursuant to collective

its affiliated

29 U.S.C.

pursuant to an agreement

7. Defendant
whether

and Trust ("Trust Agreement"),

which

was required to provide access to the

Defendant

was complying

with its

lei. ~ 8.

failed to allow the NEBF to complete
for an audit was made. lei.
Agreements,

an audit of Defendant's

books

9. Thus, NEBF argues that pursuant to

the Trust Agreement,

and 29 U.S.c.

S

I I 132(g)(D)(2),

1 Pin cites to documents filed on the Court's electronic filing system (CM/ECF) refer to the page numbers generated
by that system.

2

Defendant

is required to pay the attorney's

in connection

fees, auditor fees, and court costs incurred by NEBF

with the audit and this action to compel compliance.

Plaintiff filed the instant Complaint

against Defendant

Among other relief, Plaintiff sought access to Defendant's
1, 2011 through December

January

that Defendant
pursuant

Id. ~ 10.

on March 30, 2017. ECF No.1.

payroll records for the period of

31, 2015, for the purposes of conducting

was making its required contributions.

Id. at 4. The Defendant

to Rule 4 of the Federal Rules of Civil Procedure

Answer was due on or before April 25,2017.

an audit to ensure
was served

on April 4, 2017. ECF NO.4-I.

Id. No Answer was filed, Plaintiff moved for

default on June 27, 2017, ECF NO.4, and the Clerk entered default against Defendant
2017, ECF NO.7. On July 19,2017,
Judgment,
records.

II.

seeking an order requiring

An

on July 24,

Plaintiff filed the pending Motion for Partial Default
the Defendant

to provide NEBF with access to its payroll

ECF NO.6 at 2.

STANDARD

OF REVIEW

"When a party against whom a judgment
plead or otherwise
enter the party's

for affirmative

relief is sought has failed to

defend, and that failure is shown by affidavit or otherwise,
default."

entitle the plaintiff

Fed. R. Civ. P. 55(a). "A defendant's

to entry of a default judgment;

the clerk must

default does not automatically

rather, that decision is left to the discretion

of

the court." Educ. Credit Mgmt. Corp. v. Optimum Welding, 285 F.R.D. 371, 373 (D. Md. 2012).
Although

"(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 Stales v. Shqffer Equip. Co.. II F.3d 450. 453 (4th Cir.
1993)), "default judgment

may be appropriate

when the adversary

3

process has been halted

because of an essentially
418,421

unresponsive

party[.]"

Id. (citingSE.C

v. Lawbaugh, 359 F. Supp. 2d

(D. Md. 2005)).
"Upon default, the well-pled

although

the allegations

allegations

as to damages

in a complaint

as to liability are taken as true.

are not." Lawbaugh, 359 F. Supp. 2d at 422; see also

Ryan v. Homecomings Fin. Network, 253 F.3d 778, 780 (4th Cir. 2001) (noting that "[tlhe
defendant,

by [its] default, admits the plaintiff's

well-pleaded

allegations

of fact," which provide

the basis for judgment).

Upon a finding of liability, "(t]he court must make an independent

determination

damages

regarding

... " In! '/ Painters & Allied Trades Indus. Pension Fund v.

Capital Restoration & Painting Co., 919 F. Supp. 2d 680, 684 (D. Md. 2013). Fed. R. Civ. P.
54(c) limits the type of judgment
judgment

that may be entered based on a party's default: "A default

must not differ in kind from, or exceed in amount, what is demanded

While the Court may hold a hearing to prove damages,
instead on "detailed

affidavits

or documentary

in the pleadings."

it is not required to do so; it may rely

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)).

III.

ANALYSIS
Plaintiff seeks an Order requiring

by Plaintiff, to ensure that Defendant
has subject matter jurisdiction

Defendant

to produce its books and records for an audit

has been making the appropriate

in Rockville,

The Court

over this action pursuant to Section 502 of ERISA, 29 U.S.c.

1132 and 1451(c). Venue is proper under 29 U.S.C. ~~ 1132(e)(2),
administered

contributions.

Maryland.

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1451(d), as the NEBF is

See Bd. ofTrs .. Sheet Metal Workers' Nat 'I Pension Fund

v. McD Metals. Inc., 964 F. Supp. 1040 (E.D. Va. 1997): Trustees

(~r at. Automatic
N

Sprinkler

Indus. Pension Fund v. Best Automatic Fire Prot .. Inc.. 578 F. Supp. 94, 95 (D. Md. 1983).

4

Under ERISA, the court has discretionary
so is necessary

authority

to protect the rights of fund participants

to grant injunctive

relief when doing

Trustees C?l

and beneficiaries.

Washington Area CW'lJenters' Pension & Ret. Fund v. Mergentime COl'l).. 743 F.Supp. 422, 428
(D. Md. 1990); see Laborers' Fringe Benefit Funds-Detroit and Vicinity v. Northwest Concrete

*

& Constr .. Inc.. 640 F.2d 1350 (6th Cir. 1981); see 29 U.S.C.
injunctive

relief must show that it is in need of injunctive

to remedy the breach, and that an adequate

1 I 32(a)(3). A plaintifT requesting

or "other appropriate

remedy is otherwise

unavailable.

equitable

relief"

Phillips v. Brink's

Co.. 632 F. Supp. 2d 563, 575 (D. W.O. 2009). See also Nat'l £lec. Ben. Fund v. Landers
Entelprises. LLe, No. PWG-14-0140,
defendant
payments).
alternate

to produce

2014 WL 3510227,

its records, so plaintiff could determine

Here, Plaintiff has demonstrated
adequate

at *7 (D. Md. July I I, 2014) (ordering

remedy is available.

any delinquent

that it is in need of equitable

relief: and that no

Plaintiff submits the affidavit of Angel Losquadro,

Plaintiffs

Director of Audit and Delinquency

"(d]espite

multiple written requests,

Department.

Defendant

they are required to do so under the Collective

ECF NO.6-I.

compliance.

Losquadro

attests that

has failed to produce records for an audit," as
Bargaining

Agreements

8. Plaintiff needs this audit to ensure that there are no delinquent
other way to ensure Defendant's

contribution

Id.

and Trust Agreement.

contributions,

Id.

and has no

II. The Court will grant Plaintiffs

Partial

Motion for Default Judgment.

IV.

CONCLUSION
For the foregoing

granted against Defendant.

reasons,

Plaintiffs

Defendant

Motion for Partial Default Judgment,

ECF NO.6. is

must produce its payroll records for the period January

5

I,

2011 through December

31, 2015, to Plainti ff within 20 days of the signing of this Memorandum

Opinion and accompanying

Date: February

Order. A separate Order shall issue.

~A_

7.2018

GEORGE .I. HAZEL
United States District Judge

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