MO-KAN Iron Workers Pension Fund et al v. Acme Erectors, Inc. et al

Filing 30

ORDER denying 16 Motion to Dismiss for Failure to State a Claim; denying 18 Motion to Dismiss for Failure to State a Claim. Signed on 11/21/2016 by District Judge Fernando J. Gaitan, Jr. (Powers, Jo)

IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF MISSOURI
WESTERN DIVISION
MO-KAN IRON WORKERS PENSION
FUND, et al.,
Plaintiffs,
v.
ACME ERECTORS, INC.
and
HCH CONSTRUCTION, INC.,
Defendants.

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Case No. 16-0786-CV-W-FJG

ORDER
Pending before the Court are (1) Defendant Acme Erectors, Inc.’s Motion to Dismiss
Plaintiffs’ First Amended Complaint (Doc. No. 16) and (2) Defendant HCH Construction,
Inc.’s Motion to Dismiss Plaintiffs’ First Amended Complaint (Doc. No. 18). Defendant HCH
Construction has not set forth grounds for relief independent of Acme Erectors – instead,
HCH Construction has incorporated Acme Erectors’ motion, suggestions in support, and
reply suggestions. Therefore, the Court only considers Acme Erectors’ arguments below.
I.

Background
Plaintiffs filed their complaint against Acme Erectors, Inc. and HCH Construction,

Inc. on July 13, 2016. After defendants filed motions to dismiss, plaintiff filed an amended
complaint on August 24, 2016. Defendants again filed the currently-pending motions to
dismiss. Defendant Acme Erectors, Inc. has signed a collective bargaining agreement with
plaintiffs. Defendant HCH Construction has not signed a collective bargaining agreement
with plaintiffs; however, plaintiffs assert that HCH Construction has the same owners and

employs the same individuals as Acme Erectors, among other things. Plaintiffs therefore
seek to bind HCH Construction to the collective bargaining agreement signed by Acme
Erectors.
The amended complaint sets forth two claims against defendants: that the two
companies should be treated as a single employer under federal law, or that the two
companies are alter egos of each other under federal law. Defendants assert that plaintiff
has failed to plead sufficient facts as to both of these claims.
II.

Standard
When ruling a motion to dismiss, the court must accept plaintiff’s factual allegations

as true and construe them in the light most favorable to the plaintiff. Patterson Oil Co. v.
VeriFone, Inc., No. 2:15-cv-4089, 2015 U.S. Dist. LEXIS 141635, at *9 (W.D. Mo. Oct. 19,
2015) (citing Schaaf v. Residential Funding Corp., 517 F.3d 544, 549 (8th Cir. 2008)). A
pleading must contain a “short and plain statement of the claim showing that the pleader is
entitled to relief.” Fed. R. Civ. P. 8(a)(2). “The pleading standard Rule 8 announces does
not require ‘detailed factual allegations,’ but it demands more than an unadorned, thedefendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 677-678
(2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, (2007)). In order for a
claim to survive a motion to dismiss, ‘a complaint must contain sufficient factual matter,
accepted as true, to "state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal,
556 U.S. 662, 677-678 (2009). A plaintiff must plead facts which support the prima facie
elements of the claims asserted in order to avoid dismissal under Rule 12(b)(6). Parker v.
Dir. of Mental Health, No. 04-0599, 2005 U.S. Dist. LEXIS 33515, *6 (W.D. Mo. Apr. 20,
2005).
III.

Discussion
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A. Single Employer Liability
Defendants argue that plaintiffs have not pled facts showing that a “single employer”
relationship exists between them; instead, defendants argue that plaintiffs offer mere
conclusions.
Under the single employer doctrine, two or more related
enterprises are treated “as a single employer for purposes of
holding the enterprises jointly to a single bargaining obligation
or for the purpose of considering liability for any unfair labor
practices.” Kansas City S. Transp. Co., Inc. v. Teamsters Local
Union #41, 126 F.3d 1059, 1062 (8th Cir. 1997) (citing Iowa
Exp. Distribution, Inc. v. N.L.R.B., 739 F.2d 1305, 1310 (8th Cir.
1984)). The Eighth Circuit has adopted a four-part test to
determine whether two corporate entities should be viewed as
a single employer of the plaintiff under the LMRA. Pulitzer Pub.
Co. v. N.L.R.B., 618 F.2d 1275, 1278-1279 (8th Cir. 1980). See
also Radio & Television Broad. Technicians Local Union 1264
v. Broad. Serv. of Mobile, Inc., 380 U.S. 255, 256 (1965);
Russom v. Sears, Roebuck & Co., 415 F. Supp. 792, 796-797
(E.D. Mo. 1976), aff’d sub nom. 558 F.2d 439 (8th Cir. 1977).
These factors include: 1. Interrelation of operations, 2.
Centralized control of labor relations, 3. Common management,
and 4. Common ownership or financial control. Radio &
Television Broad. Technicians Local Union 1264 v. Broad. Serv.
of Mobile, Inc., 380 U.S. at 256. “No one of these factors is
controlling nor need all criteria be present; single employer
status is a factual question that ultimately depends upon all the
circumstances of the individual case.” Id.
Int'l Ass'n of Bridge v. Acme Erectors, Inc., No. 16-0488-CV-W-REL, 2016 WL 6089748,
at *4–5 (W.D. Mo. Oct. 17, 2016).
In their amended complaint, plaintiffs allege that defendants are a single employer
in that:
(a) Defendants Acme Erectors, Inc. and HCH Construction, Inc.
share common ownership in that the owners of both Defendants
have a family relationship and reside at the same residence and
the owners and corporate officers of Acme Erectors and HCH
Construction are married to one another; (b) HCH Construction,
Inc. and Acme Erectors, Inc. share common management; (c)
Defendant HCH Construction, Inc. and Defendant Acme
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Erectors, Inc. share tools and equipment; (d) upon information
and belief Defendant HCH Construction, Inc. and Defendant
Acme Erectors, Inc. share employees; (e) Defendant HCH
Construction, Inc. and Defendant Acme Erectors, Inc. currently
share the same or have shared the same principal place of
business and/or share the same plant and/or business offices;
(f) upon information and belief Defendant HCH Construction,
Inc. and Defendant Acme Erectors, Inc. share customers; (g)
upon information and belief Defendants share centralized
control of labor operations in that the Acme Erectors, Inc.
controls and directs HCH Construction, Inc.; (h) as a result of
common ownership, HCH Construction, Inc. is aware of Acme
Erectors, Inc.’s obligations to the Plaintiff Funds; (i) the
Defendants share interrelation of operations in that both
Defendants are engaged in structural steel erection and related
construction, share or have shared the same business address,
share tools and equipment, share management personnel,
serve the same construction markets in Missouri, share
customers and share employees.
Amended Complaint, Doc. No. 14, ¶ 13. The Court finds that this pleading is sufficient
under the Federal Rules of Civil Procedure, and denies the motion to dismiss. Defendants
have been given fair notice of the basis for plaintiff’s single employer claim, and Iqbal and
Twombly did not eliminate notice pleading or pleading on information and belief.
Defendants’ motion to dismiss the single employer claim is therefore DENIED.
B. Alter Ego Claim
Similarly, defendants argue that plaintiffs have failed to plead facts demonstrating
that HCH Construction, Inc. is the alter ego of Acme Erectors, Inc.
The alter ego doctrine developed under the National Labor
Relations Act, 29 U.S.C. §§ 151 et seq., focuses “on the
existence of a disguised continuance of a former business entity
or an attempt to avoid the obligations of a collective bargaining
agreement.” Greater Kansas City Laborers Pension Fund v.
Superior General Contractors, Inc., 104 F.3d 1050, 1055 (8th
Cir. 1997) (quoted case omitted); see also Trustees of the
Graphic Commc'ns Int'l Union Upper Midwest v. Bjorkedal, 516
F.3d 719, 727 n. 2 (8th Cir. 2008) (citing cases); Greater St.
Louis Const. Laborers Welfare Fund v. Mertens Plumbing and
Mechanical, Inc., 552 F.Supp.2d 952 (E.D. Mo. 2007). “The
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essential inquiry under the alter ego analysis is ‘[w]hether there
was a bona fide discontinuance and a true change of ownership
... or merely a disguised continuance of the old employer.’” Iowa
Express Distr., Inc. v. N.L.R.B., 739 F.2d 1305, 1310 (8th Cir.
1984) (quoting Southport Petroleum Co. v. N.L.R.B., 315 U.S.
100, 106 (1942)).
“In determining whether two business entities are alter egos, ...
courts consider a variety of factors, including whether the two
entities have substantially identical management, business
purpose, operation, equipment, customers, supervision, and
ownership.” Midwest Precision Heating and Cooling, Inc. v.
N.L.R.B., 408 F.3d 450, 458 (8th Cir. 2005) (cited case omitted).
In the alter ego analysis, “one of the most important [factors] is
the existence of continued control or ownership by the owner of
the discontinued company.” Iowa Express Distr., Inc. v.
N.L.R.B., 739 F.2d at 1310 (cited case omitted). Another key
factor is “whether a motive for the new entity's taking over of the
operations of the old entity was to evade responsibilities under
the Act and whether dealings between the two entities were at
arm's length.” Midwest Precision Heating and Cooling, Inc. v.
N.L.R.B., 408 F.3d at 458-459 (cited case omitted). This test is
flexible, so the lack of any particular factor does not preclude a
finding of alter ego status. Id. at 459 (citing N.L.R.B. v.
Campbell-Harris Elec., Inc., 719 F.2d 292, 296 (8th Cir. 1983)
(affirming NLRB finding that ownership and management of first
company, a two-man partnership, was substantially identical to
that of second company, a sole proprietorship)); Greater St.
Louis Const. Laborers Welfare Fund v. Mertens Plumbing and
Mechanical, Inc., 552 F. Supp.2d at 955.
Int'l Ass'n of Bridge v. Acme Erectors, Inc., No. 16-0488-CV-W-REL, 2016 WL 6089748, at
*3 (W.D. Mo. Oct. 17, 2016).
Defendants argue that plaintiffs have not pled a factual basis for their alter ego
theory. However, plaintiffs have pled, upon information and belief, the following in their
amended complaint:
(a) Defendant HCH Construction, Inc. shares ownership with
Acme Erectors, Inc.; (b) Defendant HCH Construction, Inc. and
Defendant Acme Erectors share common management; (c)
Defendant HCH Construction, Inc. and Defendant Acme
Erectors share tools and equipment; (d) upon information and
belief Defendant HCH Construction, Inc. and Defendant Acme
Erectors share employees; (e) upon information and belief
Defendant HCH Construction, Inc. and Defendant Acme
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Erectors share customers; (f) HCH Construction is controlled by
Acme Erectors in that the two entities currently share the same
or have shared the same principal place of business and/or
share the same plant and/or business offices; (g) upon
information and belief, the management and ownership of
Acme Erectors controls and directs the business operations of
HCH Construction; (h) Acme Erectors and HCH Construction
perform the same type of structural steel construction business,
(i) HCH Construction was formed to avoid the collective
bargaining obligations of Acme Erectors.
Doc. No. 14, ¶ 24. These facts are sufficient to support a claim under an alter ego theory.
See Midwest Precision Heating and Cooling, Inc. v. N.L.R.B., 408 F.3d 450, 458 (8th Cir.
2005). Accordingly, defendants’ motions to dismiss are DENIED on the alter ego theory as
well.
IV.

Conclusion
Therefore, for the foregoing reasons, (1) Defendant Acme Erectors, Inc.’s Motion to

Dismiss Plaintiffs’ First Amended Complaint (Doc. No. 16) and (2) Defendant HCH
Construction, Inc.’s Motion to Dismiss Plaintiffs’ First Amended Complaint (Doc. No. 18) are
DENIED.

IT IS SO ORDERED.
Date: November 21, 2016
Kansas City, Missouri

S/ FERNANDO J. GAITAN, JR.
Fernando J. Gaitan, Jr.
United States District Judge

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