Trustees of the Construction Industry and Laborers Health and Welfare Trust et al v. Williams Brother, Inc.
Filing
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ORDER Granting 15 Plaintiffs' Motion for Summary Judgment. IT IS FURTHER ORDERED that the Clerk of the Court enter JUDGMENT for Plaintiffs and against Williams Brother, Inc., a Nevada Corporation, and Michael Peek, an individual, jointly and severally in the amount of $66,601. Signed by Judge Kent J. Dawson on 6/26/2013. (Copies have been distributed pursuant to the NEF - SLD)
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UNITED STATES DISTRICT COURT
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DISTRICT OF NEVADA
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TRUSTEES OF THE CONSTRUCTION
INDUSTRY AND LABORERS HEALTH
AND WELFARE TRUST, et al.,
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Plaintiffs,
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ORDER
v.
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Case No. 2:12-CV-00810-KJD-NJK
WILLIAMS BROTHER, INC., et al.,
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Defendants.
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Presently before the Court is Plaintiff’s Motion for Summary Judgment (#15). Though the
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time for doing so has passed, no response in opposition has been filed. Therefore, in accordance with
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Local Rule 7-2(d) (“LR 7-2"), and having considered the motion on the merits, the Motion for
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Summary Judgment is granted.
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I. Facts
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Plaintiffs (collectively “Trust Funds”) are fiduciaries for purposes of the Employee
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Retirement Income Security Act of 1974. The Trust Funds are ERISA employee benefit trust funds
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that provide benefits to employees. Williams Brother, Inc., is signatory to and bound by a Master
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Labor Agreement (“MLA”) between the Associated General Contractors and the Southern Nevada
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Laborers Local 872 (“Union”) as a result of a proxy agreement with the Associated General
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Contractors. The MLA incorporates by reference the Trust Agreements establishing the Trust Funds.
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The MLA and the Trust Agreements require Williams to pay employee benefit contributions
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to the Trust Funds. The Trust Funds’ independent auditor performed two separate contract
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compliance audits of Williams; each showed that Williams owed contributions to the Trust Funds.
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Plaintiffs filed a complaint on May 14, 2012 (#1) and Defendants answered on July 11, 2012
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(#8). On February 6, 2013, Plaintiffs moved for summary judgment (#15). The response was due by
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March 2, 2013. Defendants did not respond. At that time, the Magistrate Judge had granted
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Williams’ and Peek’s counsel’s Motion to Withdraw on February 26, 2013 (#19). The court ordered
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Peek to notify the court that he would either proceed in the case pro se, or that he would retain new
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counsel no later than March 26, 2013. The court indicated that if Peek failed to file such certification
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or appearance, the court would recommend that default judgment be entered against him. The court
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similarly ordered Williams, as a corporation required to be represented by counsel in federal court, to
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retain counsel and have such counsel enter a notice of appearance no later than March 26, 2013. The
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court stated that if no counsel filed a notice of appearance on behalf of Williams by that date, the
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court would recommend that default judgment be entered against Williams. No counsel filed a
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notice of appearance on behalf of Williams. Therefore, the Magistrate Judge recommended (#29)
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entry of default against Williams on April 3, 2013.
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Plaintiffs filed a Notice of Non-Opposition to Plaintiffs’ Motion for Summary Judgment
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(#28) on March 29, 2013. During a Show Cause Hearing held on April 4, 2013, the Magistrate
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Judge advised Defendant Michael Peek that he had fourteen days to respond to the Motion for
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Summary Judgment. Defendant Peek did not respond to the Motion for Summary Judgment.
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Plaintiffs filed a second Notice of Non-Opposition to Plaintiffs’ Motion for Summary Judgment
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(#31) on May 1, 2013 .
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II. Summary Judgment Standard
LR 7-2 provides that the “failure of an opposing party to file points and authorities in
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response to any motion shall constitute a consent to the granting of the motion.” Although LR 7-2
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allows the Court to grant a summary judgment motion on the basis of no response, two
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considerations impede such a swift resolution: (1) for pro se litigants, other motions or pleadings
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may be eligible to oppose this motion; and (2) a local rule must be compatible with federal law. See
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Jones v. Blanas, 393 F.3d 918, 923 (9th Cir. 2004) (citing McElyea v. Babbitt, 833 F.2d 196, 197
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(9th Cir. 1987)); Henry v. Gill Industries, Inc., 983 F.2d 943, 950 (9th Cir. 1993).
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First, although Defendant has not responded to the summary judgment motion, in evaluating
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a motion against a pro se defendant, the Court must consider all of Defendant’s “contentions offered
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in motions and pleadings, where such contentions are based on personal knowledge and set forth
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facts that would be admissible in evidence, and where [Defendant] attested under penalty of perjury
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that the contents of the motions or pleadings are true and correct.” Jones, 393 F.3d at 923 (citing
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McElyea, 833 F.2d at 197)). The only contention Defendant Peek submitted in a pro se capacity is
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his Response to Show Order and Cause. However, the contentions within Defendant Peek’s
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Response to Show Order and Cause are irrelevant to the Motion for Summary Judgment. Thus, the
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Motion for Summary Judgment is entirely unopposed.
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Second, LR 7-2 must be construed as to not conflict with federal law. Henry, 983 F.2d at
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950. Specifically, in the summary judgment context, LR 7-2 must be compatible with Rule 56. Fed.
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R. Civ. P. 56. Pursuant to Rule 56, summary judgment may be granted if “the pleadings,
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depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,
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show that there is no genuine issue as to any material fact and that the moving party is entitled to a
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judgment as a matter of law.” Fed. R. Civ. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317,
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322 (1986). The moving party bears the initial burden of showing the absence of a genuine issue of
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material fact. See Celotex, 477 U.S. at 323. And all justifiable inferences must be viewed in the
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light most favorable to the nonmoving party. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
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475 U.S. 574, 587 (1986); Anderson v. Liberty Lobby Inc., 477 U.S. 242, 255 (1986). The burden
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then shifts to the nonmoving party to set forth specific facts demonstrating a genuine factual issue for
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trial. See Fed. R. Civ. P. 56(e); Matsushita, 475 U.S. at 587. Thus, under federal law, a summary
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judgment motion cannot be granted unless the moving party meets its burden and the nonmoving
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party fails to demonstrate a genuine factual issue. A summary judgment motion “cannot be granted
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simply as a sanction for a local rule violation.” See Ghazali v. Moran, 46 F.3d 52, 54 (9th Cir.
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1995). Accordingly, the Court must consider the merits of Plaintiffs’ summary judgment motion to
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determine if it has met its burden.
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III. Analysis
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In their complaint, Plaintiffs present two claims for relief. First, Defendant Williams Brother,
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Inc., is delinquent in paying contributions owed. Second, Defendant Michael Peek breached his
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contract with Plaintiffs by failing to fulfill his obligations as a guarantor.
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A. Williams Brother, Inc., failed to pay contributions owed.
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On December 6, 2011, Defendants stipulated and agreed to the amounts owed on the first
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audit, as of that date, in a settlement agreement and stipulated consent judgment totaling $98,262
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($43,710 in unpaid contributions, $24,401 in interest, $24,401 in liquidated damages, $750 in past
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attorney’s fees, and $5,000 in future attorney’s fees). Michael Peek signed the settlement agreement
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on behalf of Williams, and also agreed to hold himself personally liable as an individual guarantor.
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The agreement specifically required additional interest at 14%. In addition, Defendants both agreed
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to liability for any additional amounts later revealed to be owed including: additional liquidated
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damages, interest, and attorney’s fees that accrue.
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Williams admits that the second audit is an accurate accounting of contributions, interest, and
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liquidated damages. Regarding the second audit, it is undisputed that contributions owed total
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$29,680. Through May 1, 2013, additional interest of $8,584 on the first audit has accrued.
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Regarding the second audit, interest had already been calculated through July 31, 2012, at $2,465,
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which was undisputed by Defendants. Through May 1, 2013, additional interest on the second audit
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of $5,829 has accrued. Therefore, total interest for the second audit equals $8,294 ($2,465 + $5,829).
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Thus, $16,878 ($8,584 + $8,294) in interest is owed above the interest included in the judgment
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previously entered against Defendants.
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The Trust Funds’ Policy, in keeping with federal law, provides liquidated damages as 20% of
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the delinquent contributions or the interest due at the Trust Funds’ rate, whichever is greater. 29
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U.S.C. § 1132(g)(2)(C). Here, 20% of the delinquent contributions on the first and second audits is
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less than the total amount of interest mentioned in the previous paragraph. Therefore, the amount
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Defendants owe for liquidated damages, in addition to the amounts included in the previous
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judgment, equals the amount Defendants owe for interest, $16,878.
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The Trust Funds are also seeking $17,923 in attorney’s fees and costs. Under federal law, the
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court shall award reasonable attorney’s fees and costs, paid by the defendant. 29 U.S.C. §
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1132(g)(2)(C). The amount is based on the normal billing rates for Brownstein Hyatt Farber
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Schreck, LLP, the law firm representing Trust Funds. The hourly rates charged are: $300.00 - 350.00
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for a Partner; $225.00 - 300.00 for an Associate; and $145.00 - 195.00 for a Paralegal.
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To date, Williams has paid $13,410 towards its debt to the Trust Funds. A third party also
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paid $1,348 towards the debt Williams owes to the Trust Funds, for total payments received of
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$14,758. Williams has not paid any other amounts that are owed.
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Defendants therefore owe the following to the Trust Funds: $29,680 (delinquent contributions
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from the second audit), + $16,878 (interest), + $16,878 (liquidated damages), + $17,923 (attorney’s
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fees and costs), - $14,758 (payments received), for a total of $66,601.
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B. Michael Peek failed to fulfill his contractual obligations as guarantor.
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Defendant Michael Peek agreed to personally guarantee the amounts owed by Williams
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Brother, Inc., and be personally liable for payment of the delinquency. Williams Brother, Inc.,
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defaulted on their obligations under the settlement agreement, and Michael Peek failed to pay the
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delinquency. Therefore, Michael Peek has breached his contractual obligations as guarantor.
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Plaintiffs have met their burden of showing a genuine absence of material fact. Defendants
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have not set forth any specific facts demonstrating a genuine factual issue for trial. Therefore, there
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are no issues of material fact that might preclude summary judgment. Defendants are jointly and
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severally liable for Williams’ delinquent contributions, interest, liquidated damages, and attorney’s
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fees and costs, in the amount of $66,601.
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IV. Conclusion
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IT IS HEREBY ORDERED that Plaintiffs’ Motion for Summary Judgment (#15) is
GRANTED;
IT IS FURTHER ORDERED that the Clerk of the Court enter JUDGMENT for Plaintiffs
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and against Williams Brother, Inc., a Nevada corporation, and Michael Peek, an individual, jointly
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and severally, in the amount of $66,601.
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DATED this 26th day of June 2013.
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_____________________________
Kent J. Dawson
United States District Judge
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