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)

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND SOlltltem Divisio/l NATIONAL ELECTRICAL BENEFIT FUND, * * Plaintiff, v. Case No.: G.JH-17-857 * EGF ELECTRICAL INCORPORATED * * Defendant. * * * * * * * * * MEMORANDUM * EGF Electrical Incorporated Income Security Act of 1974 ("ERISA"), Amendments Act of 1980,29 * * * 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. * 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 6

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