Trustees for The Mason Tenders District Council Welfare Fund, Pension Fund, Annuity Fund, and Training Program Fund et al v. Super, LLC
Filing
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MEMORANDUM AND ORDER. For the foregoing reasons, respondent's motion to confirm arbitration (Dkt. No. 12) is GRANTED. So ordered. Granting 12 Motion to Confirm Arbitration. (Signed by Judge P. Kevin Castel on 6/22/2017) (rjm)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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TRUSTEES FOR THE MASON TENDERS
DISTRICT COUNCILWELFARE FUND,
PENSION FUND, ANNUITY FUND, and
TRAINING PROGRAM FUND, and ROBERT
BONANZA, as Business Manager of the MASON
TENDERS DISTRICT COUNCIL OF GREATER
NEW YORK,
Petitioners,
-against-
16 Civ. 6387 (PKC)
MEMORANDUM
AND ORDER
SUPER, LLC,
Respondent.
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CASTEL, District Judge:
This is an action under section 301 of the Labor Management Relations Act
(“LMRA”), 29 U.S.C. § 185, section 502(d)(1) of the Employee Retirement Income Security Act
(“ERISA”), 29 U.S.C. § 1132, and the Federal Arbitration Act (“FAA”), 9 U.S.C. § 9, to confirm
an arbitration award rendered by Joseph A. Harris on August 12, 2015 (the “Award”).
Petitioners, the Trustees for the Mason Tenders District Council Welfare, Pension, Annuity, and
Training Program Funds (the “Funds”) and Robert Bonanza, business manager and
representative for the Mason Tenders District Council of Greater New York (the “Union”), seek
to confirm the Award, which ordered respondent Super, LLC (“Super”) to pay the Funds
$200,470.73 in delinquent benefit fund contributions, union dues, and PAC contributions, as well
as interest, liquidated damages, costs, and fees for the period of May 16, 2013 through February
27, 2015. To date, Super has not opposed the petition or otherwise appeared in this action. For
the reasons set forth below, petitioners’ motion is GRANTED.
BACKGROUND
Because defendant neither appeared at the arbitration hearing nor responded to the
instant motion, the following facts are uncontested. Each of the Funds is an employee benefit
plan as defined in Section 3(3) of ERISA, 29 U.S.C. § 1002(3), and is a multiemployer plan
within the meaning of Section 3 (37)(A) of ERISA, 29 U.S.C. § 10012(37)(A). (Decl. of Haluk
Savci, December 20, 2016, Dkt. No. 14, at ¶ 3.) Super, a New Jersey limited liability company,
agreed to be bound by the terms of the Project Labor Agreement Covering Specified
Construction Work under the Capital Improvement Program for Fiscal Years 2009-2014 on
behalf of the New York City School Construction Authority (“PLA”). (Id. at Ex. 2.) Tailor
Dominguez, President of Super, signed a Sub-Contractor Affidavit of Project Labor Agreement
on April 25, 2014, stating that his company would be bound by the provisions of the PLA “with
respect to all work to be performed under the solicitation.” (Id.) The PLA obligates bound
contractors to pay benefit contributions for covered work to the Funds in accordance with the
rates set forth therein, along with collections due to several other funds, of which the Funds are
the authorized collection agent. (Id. at ¶ 10.)
Super was bound, independently of the PLA, to make these same payments
pursuant to the Trade Agreement Between the Mason Tenders’ District Council of Greater New
York and Laborers’ Local 78 of the Laborers’ International Union of North America and Super,
effective February 1, 2013, through July 30, 2015 (the “MTDC Independent Agreement”).
(Decl. of Haluk Savci, June 15, 2017, Dkt. No. 17, at ¶ 4, Ex. 1.) This agreement was signed by
Tailor Dominguez on May 16, 2013. (Id. at Ex. 1.)
Each of the Funds is administered pursuant to one or more Trust Agreements, to
which contractor signatories to the PLA are bound under Article 11, Section 2(B), including the
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Trust Funds’ arbitration procedures for allegedly delinquent contributions. (Decl. of Haluk
Savci, December 20, 2016, at ¶ 11, Ex. 2.) The MTDC Independent Agreement also binds
signatories to these Trust Agreements and arbitration procedures. (Decl. of Haluk Savci, June
15, 2017, at ¶ 4, Ex. 1.) The Trust Agreements set forth arbitration procedures and rules (the
“Arbitration Procedures”) to govern audit and delinquency disputes with employers. (Decl. of
Haluk Savci, December 20, 2016, at Ex. 4.) The Trust Agreements vest the trustees of the Funds
with the power to demand, collect, and receive employer contributions and set forth procedures
for the collection of delinquent contributions. (Id. at ¶ 12, Ex. 3.) Sections 9.8 and 9.9 of article
IX of each Trust Agreement provide that, in a successful legal action for unpaid contributions
commenced by the Funds, Super shall pay all unpaid contributions due and payable, interest on
such unpaid contributions, interest on the unpaid contributions as and for liquidated damages,
attorneys’ fees and costs of the action, and any other legal or equitable relief deemed appropriate.
(Id. at ¶ 15, Ex. 3.)
After notifying Super of delinquencies discovered in audits of the company and
unsuccessfully seeking payment, on June 30, 2015, the Funds forwarded a notice of intent to
arbitrate, together with a copy of the Arbitration Procedures, to Super. (Id. at ¶ 16-17.) The
audits were based on an examination of Super’s books and records performed by the Funds’
auditors, as authorized under the PSA and Trust Agreements. (Id.) On July 1, 2015, arbitrator
Harris sent notice to the Funds and Super scheduling an arbitration hearing for August 4, 2015.
(Id. at ¶ 18.) Super did not appear at the hearing, which accordingly proceeded as a default
hearing. (Id. at ¶ 19.) The Funds presented as evidence the audit reports prepared by the Funds’
auditors, detailing Super’s delinquent fringe benefit contributions, dues and PAC contributions,
and accrued interest. (Id. at ¶ 20.)
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Based on the evidence presented at the hearing, arbitrator Harris issued an
“Opinion and Default Award” on August 12, 2015, ordering Super to pay $200,470.73 in
delinquent contributions for fringes, dues and PAC contributions, liquidated damages, legal,
audit, and arbitration costs and fees and accrued interest. (Id. at ¶ 21, Ex. 1.) Upon receipt of the
Award, plaintiffs made a demand for payment on Super; no payments were made. (Id. at ¶ 22.)
Plaintiffs timely commenced this action on August 11, 2016. Defendant was duly
served, failed to timely answer the complaint, and has not otherwise appeared in this action.
LEGAL STANDARD
Section 301 of the LMRA “provides federal courts with jurisdiction over petitions
brought to confirm labor arbitration awards.” Local 802, Associated Musicians of Greater New
York v. Parker Meridien Hotel, 145 F.3d 85, 88 (2d Cir. 1998). Under section 9 of the FAA,
where parties have agreed that a court may enter judgment upon an award made pursuant to an
arbitration proceeding between them, any such party may apply for an order confirming the
award. 9 U.S.C. § 9. Such an application must be made within one year of the arbitrator’s
rendering of the award and, absent contractual provisions to the contrary, may be made to the
United States District Court in which the award was made. Id. 1
The Second Circuit has held that “default judgments in confirmation/vacatur
proceedings are generally inappropriate.” D.H. Blair & Co., Inc. v. Gottdiener, 462 F.3d 95, 109
(2d Cir. 2006).
The Second Circuit has held that the FAA does not apply to cases brought under Section 301 of the LMRA. CocaCola Bottling Co. of New York, Inc. v. Soft Drink & Brewery Workers Union Local 812, Int’l Bhd. Of Teamsters,
242 F.3d 52, 53 (2d Cir. 2001). Nevertheless, plaintiffs’ claims are also brought under ERISA, and the FAA may
apply to ERISA-based claims. In any event, even in cases where the FAA does not apply, federal courts may look
to it for “guidance in labor arbitration cases.” United Paperworkers Int’l Union, AFL–CIO v. Misco, Inc., 484 U.S.
29, 40 n. 9 (1987).
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Rather, the petition and accompanying record should[] be[] treated
as akin to a motion for summary judgment based on the movant’s
submissions. To be sure, the [defendants] failed to respond, but
the lack of a response does not justify a default judgment because,
even where a non-moving party fails to respond to a motion for
summary judgment, a court “may not grant the motion without first
examining the moving party’s submission to determine if it has
met its burden of demonstrating that no material issue of fact
remains for trial. If the evidence submitted in support of the
summary judgment motion does not meet the movant’s burden of
production, then summary judgment must be denied even if no
opposing evidentiary matter is presented.”
Id. at 109-10 (quoting Vermont Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241, 244 (2d
Cir. 2004)) (emphasis in original). Accordingly, the Court treats the Fund’s motion as an
unopposed motion for summary judgment to confirm an arbitration award.
Summary judgment may not be granted unless the movant “shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment as a matter of
law.” Rule 56(a), Fed. R. Civ. P. A dispute about a fact is material if it “might affect the
outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
248 (1986). A dispute about a material fact is genuine “if the evidence is such that a reasonable
jury could return a verdict for the nonmoving party.” Id.
The burden of demonstrating the absence of an issue of material fact rests on the
moving party, and the Court must view all facts in the light most favorable to the non-moving
party. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Sista v. CDC Ixis N. Amer., Inc.,
445 F.3d 161, 169 (2d Cir. 2006). Nonetheless, in the case of a motion to confirm an arbitration
award, the burden is not difficult to meet: confirmation of an arbitral award is generally “a
summary proceeding that merely makes what is already a final arbitration award a judgment of
the court, and the court must grant the award unless the award is vacated, modified, or
corrected.” D.H. Blair, 426 F.3d at 110 (internal quotation marks and citation omitted).
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“The court’s function in confirming or vacating an arbitration award is severely
limited.” Willemijn Houdstermaatschappij, BV v. Standard Microsystems Corp., 103 F.3d 9, 12
(2d Cir. 1997). “The arbitrator’s rationale for an award need not be explained, and the award
should be confirmed if a ground for the arbitrator’s decision can be inferred from the facts of the
case.” D.H. Blair & Co., 462 F.3d at 110 (internal quotation marks omitted). “Only a barely
colorable justification for the outcome reached by the arbitrators is necessary to confirm the
award.” Id. (internal quotation marks omitted).
ANALYSIS
Applying the foregoing principles, petitioners have adequately demonstrated that
there is no genuine issue of material fact precluding summary judgment confirming all portions
of the Award. Through their documentary submissions and declaration, petitioners have proven
the existence of an agreement to arbitrate between the Funds and Super. (Decl. of Haluk Savci,
December 20, 2016, at Exs. 2, 4; Decl. of Haluk Savci, June 15, 2017, at Ex. 1.) The PSA was in
effect for fiscal years 2009-2014 or through the completion of the work program, and the MTDC
Independent Agreement was effective February 1, 2013, through July 30, 2015. (Decl. of Haluk
Savci, December 20, 2016, at Ex. 2; Decl. of Haluk Savci, June 15, 2017, at Ex. 1.) The PSA
and MTDC Independent Agreement expressly incorporate the Trust Agreements which contain
Arbitration Procedures. (Id.) The Trust Agreements permit representatives of the Funds to audit
employers, to file enforcement actions to recover any delinquencies, and to recover unpaid
contributions, interest, liquidated damages, lawyers’ fees, costs, and expenses. (Decl. of Haluk
Savci, December 20, 2016, at Ex. 4.) The Arbitration Procedures specifically apply to disputes
between the Funds and an employer involving payroll audits and/or claims for delinquent
contributions that are referred to arbitration pursuant to the Trust Agreement. (Id.)
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Petitioners have demonstrated that they complied with their obligations under the
PSA, MTDC Independent Agreement, Trust Agreements, and Arbitration Procedures, sending
defendant notice of the deficiencies claimed, an audit detailing the amounts due, and a demand
for payment. (Id. at Ex. 5.) Petitioners further sent Super notice of their intent to arbitrate, and
the arbitrator subsequently provided Super with notice of the hearing date. The arbitrator’s
decision found delinquencies in the amount of contributions for fringes, union dues, and PAC
contributions due during the period of May 16, 2013 through February 27, 2015. (Id. at Ex. 1)
The decision further found all amounts claimed by petitioners to be supported by the PLA. (Id.)
The arbitrator based his decision on the payroll audit supporting the amount of the award and
related documentary evidence. (Id.) In short, the arbitrator provided more than the “barely
colorable justification” required to support the outcome of the arbitration. D.H. Blair & Co., 462
F.3d at 110.
Petitioners have met their burden of proving that no genuine issue of material fact
exists. Accordingly, the Court confirms the arbitration award of $200,470.73 plus interest
accruing at the statutory rate from the date of the August 12, 2015 award.
CONCLUSION
For the foregoing reasons, respondent’s motion to confirm arbitration (Dkt. No.
12) is GRANTED.
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SO ORDERED.
Dated: New York, New York
June 22, 2017
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