International Union of Operating Engineers Local 98 Health and Welfare Fund et al v. S&R Corporation

Filing 48

Judge Michael A. Ponsor: MEMORANDUM AND ORDER entered. As follows: For the reasons stated in the attached memo and order, Defendants Motion to Dismiss or Stay (Dkt. No. 11 ) is hereby DENIED, and Plaintiffs Motion to Strike (Dkt. No. 24 ) is hereb y ALLOWED. These rulings leave before the court PlaintiffsMotion for Partial Summary Judgment (Dkt. No. 31 ). Lengthier discussion will be necessary to rule on this motion, and the court has issued a separate order with regard to discussions that, in the courts view, might properly lead to resolution of this dispute. In any event, a further memorandum will issue on this motion in a short time. It is So Ordered. See the attached order for complete details. (Lindsay, Maurice)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS

INTERNATIONAL UNION OF
OPERATING ENGINEERS LOCAL 98
HEALTH AND WELFARE FUND,
ET AL.,
Plaintiffs
v.
S&R CORPORATION,
Defendant

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C.A. No. 12-cv-30192-MAP

MEMORANDUM AND ORDER REGARDING
DEFENDANT’S MOTION TO DISMISS OR STAY,
AND PLAINTIFFS’ MOTION TO STRIKE
(Dkt. Nos. 11 & 24)
September 30, 2013
PONSOR, U.S.D.J.
This is an action arising under the Employee Retirement
Income Security Act of 1974 as amended (“ERISA”), 29 U.S.C.
§§ 1001 et seq., and under Section 301(a) of the LaborManagement Relations Act of 1947 as amended (“LMRA”), 29
U.S.C. § 185(a).

Plaintiffs have brought the lawsuit based

upon Defendant’s conceded refusal to produce certain
unredacted books and records to permit an audit.

The

lawsuit also seeks monetary damages if the audit, after
complete production of records, reveals delinquencies on the
part of Defendant.
Defendant has filed a Motion to Dismiss or to Stay

(Dkt. No. 11), and Plaintiffs have filed a Motion to Strike
(Dkt. No. 24) and a Motion for Partial Summary Judgment
(Dkt. No. 31).

Counsel appeared before this court for

argument on these motions on September 24, 2013.
With regard to the Motion to Dismiss or Stay, and the
Motion to Strike, a lengthy discussion is not necessary.
First, dismissal or a stay pending arbitration would
clearly be improper under the Supreme Court’s decision in
Schneider Moving & Storage Company v. Robbins, 466 U.S. 364
(1984).

Justice Powell in that decision directly addressed

the question of whether trustees of multi-employer trust
funds could seek judicial enforcement of the trust terms
against a participating employer without first submitting
the matter to arbitration.

Writing for a unanimous court,

Justice Powell held that submittal to arbitration was not
required.

In this case, the record is clear that the

lawsuit was properly authorized.

The suggestion that the

trustees somehow were misled is simply not supported by the
record.

On the contrary, the record confirms that

authorization for the lawsuit was voted on by the entire
Board of Trustees; upon reconsideration, that authorization
was never rescinded.

Given this, the Schneider case clearly

bars any dismissal or stay pending arbitration.
With regard to the Motion to Strike, the court’s ruling
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is also obvious.

Regardless of his relationship with

Plaintiffs’ clients Donald Mason and Janet Callahan,
pursuant to Rule 4.2 of the Massachusetts Rules of
Professional Conduct, it was improper for Defendant’s
attorney to discuss the case with them and to obtain, ex
parte, affidavits to submit that were contrary to
Plaintiffs’ position.

To the extent that Defendant’s

counsel wished to obtain facts that were supportive of
Defendant’s case, he had an obligation to notify Plaintiffs’
counsel and, if appropriate, notice the depositions of these
parties.

Moreover, it emerged during oral argument that

serious questions existed with regard to the authority of
Mason and the actual knowledge of Callahan, issues that
would have been ventilated during proper discovery
procedures.

Under these circumstances, the Motion to Strike

will be allowed.

This ruling, of course, adds further

strength to the court’s denial of Defendant’s Motion to
Dismiss or Stay since, without the affidavits, any
conceivable question with regard to the authorization of
this lawsuit disappears.
For the foregoing reasons, Defendant’s Motion to
Dismiss or Stay (Dkt. No. 11) is hereby DENIED, and
Plaintiffs’ Motion to Strike (Dkt. No. 24) is hereby
ALLOWED.

These rulings leave before the court Plaintiffs’
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Motion for Partial Summary Judgment (Dkt. No. 31).
Lengthier discussion will be necessary to rule on this
motion, and the court has issued a separate order with
regard to discussions that, in the court’s view, might
properly lead to resolution of this dispute.

In any event,

a further memorandum will issue on this motion in a short
time.
It is So Ordered.
/s/ Michael A. Ponsor
MICHAEL A. PONSOR
U. S. District Judge

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