Raines et al v. PRO-TEC Industrial Services, Inc. et al

Filing 48

FINDINGS OF FACT, CONCLUSIONS OF LAW AND ORDER FOR ENTRY OF JUDGMENT AGAINST INDUSTRIAL PLANT MAINTENANCE SERVICES, INC.: 1. Plaintiffs' Motion for Entry of Judgment Against Defendant Industrial Plant Maintenance Services, Inc., a/k/a IPMS is GRANTED. 2. Judgment in the amount of $523,423.99 shall be entered against Defendant Industrial Plant Maintenance Services, Inc., a/k/a IPMS in favor of Plaintiffs (Written Opinion). Signed by Judge Susan Richard Nelson on 8/22/13. (LPH)

UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
__________________________________
Civil File No. 12-1922 SRN/JJK
John Raines and Tim McGough, as Trustees of
the Twin City Carpenters Pension Master Trust
Fund, and each of their successors,
Plaintiffs,
FINDINGS OF FACT,
CONCLUSIONS OF LAW, AND
ORDER FOR ENTRY OF JUDGMENT
AGAINST INDUSTRIAL PLANT
MAINTENANCE SERVICES, INC., A/K/A IPMS

vs.

PRO-TEC Industrial Services, Inc. and
Industrial Plant Maintenance Services, Inc.,
a/k/a IPMS,
Defendants.
____________________________________
This matter was heard before the undersigned on July 25, 2013. Amanda R.
Cefalu of Anderson, Helgen, Davis & Nissen, PA, appeared for and on behalf of the
Plaintiffs. There was no appearance on behalf of the Defendant Industrial Plant
Maintenance Services, Inc., a/k/a IPMS.
FINDINGS OF FACT
1.

Plaintiffs filed a Summons and Complaint in this matter on August 6, 2012.

Defendant PRO-TEC Industrial Services, Inc. (hereinafter Pro-Tec) was served on
August 13, 2012 and Defendant Industrial Plant Maintenance Services, Inc., a/k/a IPMS
(hereinafter IPMS) was served on August 14, 2012.
2.

Defendant IPMS filed an Answer to the Complaint on August 31, 2012.

Defendant Pro-Tec failed to file and serve a response or Answer to the Complaint.

3.

The Application for Entry of Default against Defendant Pro-Tec and

Affidavit of Amanda R. Cefalu in support of the Application for Entry of Default were filed
with the Court on September 12, 2012. The Clerk’s Entry of Default was entered on
September 13, 2012. Judgment was entered against Defendant Pro-Tec on January
24, 2013 in the amount of $523,423.99.
4.

On February 6, 2013, Plaintiffs filed a Motion to Compel Discovery against

IPMS, seeking certain business records relating to the claims asserted against IPMS in
this matter. See (Court Docket Nos. 26-30). On the same date, Michael Brutlag, counsel
for IPMS filed a Motion to Withdraw from representation IPMS.
5.

On February 6, 2013, attorney Michael Brutlag filed an Affidavit stating

that it had advised IPMS of the consequences of failing to answer discovery, and also
the consequences of having Mr. Brutlag’s firm withdraw as counsel. See (Court Docket
No. 35, p. 2). After being advised of the consequences of defaulting, IPMS informed Mr.
Brutlag that the company had made the decision not defend against this litigation.
6.

On February 21, 2013, the parties attended a hearing upon counsel’s

Motion to Withdraw as counsel for IPMS. The Honorable Magistrate Judge Jeffrey J.
Keyes granted Mr. Brutlag’s Motion to Withdraw, and ordered the Clerk of Court to mail
of copy of the Minute Order relating to his ruling to IPMS. In his Minute Order, the
Magistrate Judge stated the following: “Defendant Industrial Plant Maintenance
Services, Inc. is a corporation and a corporation may not proceed pro se in this district.”
Magistrate Judge Keyes urged IPMS “to obtain new counsel, and to notify the Court of

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such once counsel is obtained. Failure to do so, if this case is not stayed pending
bankruptcy proceedings, may result in judgment against it.”
7.

Plaintiffs also served IPMS with the Minute Order issued by Magistrate

Judge Keyes on February 28, 2013.
8.

To date, IPMS has failed to retain counsel, and is therefore in default.

9.

Plaintiffs are trustees and fiduciaries of the Twin City Carpenters Pension

Master Trust Fund (hereinafter Fund). The Fund is a multi-employer plan as defined by
29 U.S.C. § 1002(37), established to provide pension benefits to employees performing
covered work.
10.

The Fund for which Plaintiffs are Trustees is maintained by the Union and

employers for the benefit of workers pursuant to a Collective Bargaining Agreement.
11.

Plaintiffs are responsible for determining and collecting withdrawal liability

amount from employers who have entered into a Collective Bargaining Agreement with
the Union, and then either “(1) permanently [cease] to have an obligation to contribute
under the plan, or (2) permanently [cease] all covered operations under the plan.” 29
U.S.C § 1383(a).
12.

Defendant Pro-Tec agreed to be bound to a Collective Bargaining

Agreement (hereinafter CBA) with the Independent Millwright Contractors Association of
Southern Minnesota, Western Wisconsin, and South Dakota and the Millwright and
Machinery Erectors Local #548, and the North Central States Regional Council of
Carpenters (f/k/a Lakes and Plains Regional Council of Carpenters and Joiners).

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13.

On or about December 31, 2008, Defendant Pro-Tec permanently ceased

all covered operations under the Fund. Pursuant to ERISA Section 4203(a), 29 U.S.C.
§ 1383(a), Defendant Pro-Tec completely withdrew from the Fund.
14.

The Fund Actuary calculated Defendants’ withdrawal liability. On April 9,

2010, the Fund sent a letter to Defendants demanding payment for withdrawal liability in
the amount of $472,235.00, payable in eight quarterly payments, with the first seven
payments in the amount of $63,606.00 and the eighth and final payment in the amount
of $43,873.00. In that same letter, the Fund demanded that Defendants commence
quarterly payments on June 7, 2010.
15.

Defendant Pro-Tec failed to submit the first payment due under the

installment plan on June 7, 2010.
16.

On July 13, 2010, the Fund notified Defendant Pro-Tec that they were

delinquent on the payment schedule, and provided Defendants with notice that the Fund
would accelerate the entire balance due if the default was not cured. Defendants did
not cure the default.
17.

Defendant Pro-Tec has failed to remit any of the installment payments

18.

Plaintiffs asserted, in the Complaint, that IPMS was an entity under

due.

“Common control” with PRO-TEC and should be treated as a single employer and
jointly liable for employer withdrawal liability owed by PRO-TEC pursuant to ERISA
§4001, 29 U.S.C. §1301(b)(1).

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19.

Upon information and belief, Defendant PRO-TEC and Industrial Plant

Maintenance Services, Inc., a/k/a IPMS (“IPMS”) are all entities owned and effectively
controlled by Robert D. O’Connell.
20.

Mr. Robert D. O’Connell is the owner of Defendant PRO-TEC Industrial

Services. PRO-TEC Industrial Services is operated out of 12858 Exhall Avenue, Hugo,
MN 55038. Upon information and belief, Industrial Plant Maintenance Services, Inc.
(IPMS) is also operated out of 12858 Exhall Avenue, Hugo, MN.
21.

To date, the Plan has not received a response or any communication from

IPMS in response to the Complaint filed in this action.
22.

The Trust Agreement entitles the Plaintiffs to liquidated damages and to

their reasonable attorney fees and costs of this action.
CONCLUSIONS OF LAW
1.

Defendant Industrial Plant Maintenance Services, Inc., a/k/a IPMS, is in

default because it is an unrepresented corporation. Ackra Direct Marketing Corp. v.
Fingerhut Corp., 86 F.3d 852, 857 (8th Cir. 1996).
2.

At all relevant times, IPMS was an entity under “common control” with

PRO-TEC and is therefore treated as a single employer and jointly liable for employer
withdrawal liability owed by PRO-TEC pursuant to ERISA § 4001, 29 U.S.C. §
1301(b)(1).
3.

Defendant Industrial Plant Maintenance Services, Inc., a/k/a IPMS is liable

to the Plaintiffs in the amount of $472,235.00 for employer withdrawal liability and
$47,223.50 for liquidated damages.
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4.

Defendant Industrial Plant Maintenance Services, Inc., a/k/a IPMS is liable

for Plaintiffs’ attorney fees and costs in the amount of $3,965.49.

ORDER
IT IS ORDERED:
1.

That Plaintiffs’ Motion for Entry of Judgment Against Defendant Industrial

Plant Maintenance Services, Inc., a/k/a IPMS is GRANTED.
2.

That judgment in the amount of $523,423.99 shall be entered against

Defendant Industrial Plant Maintenance Services, Inc., a/k/a IPMS in favor of Plaintiffs.
LET JUDGMENT BE ENTERED ACCORDINGLY.

Dated: August 22, 2013

BY THE COURT:
s/Susan Richard Nelson
The Honorable Susan Richard Nelson
United States District Court Judge

137868

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