Board of Trustees, Sheet Metal Workers' National Pension Fund v. Steinbruner Heating & Cooling

Filing 22

MEMORANDUM OPINION re: Motion for Summary Judgment. (see Order for details) Signed by District Judge Claude M. Hilton on 5/25/10. (tfitz, )

IN THE FOR THE

UNITED

STATES

DISTRICT

COURT

EASTERN DISTRICT

OF VIRGINIA

Alexandria Division

A. f.-. ::.

BOARD OF TRUSTEES,
METAL WORKERS' PENSIONS FUND,

SHEET

)
) )

NATIONAL

Plaintiff,

)

v.
STEINBRUNER HEATING COOLING, &

)
) )

Civil Action No.

01:09-CV-1254

Defendant.

)

MEMORANDUM OPINION

This matter comes before the Court on Plaintiff's Motion for
Summary Judgment. Plaintiff, the Board of Trustees for the Sheet

Metal Workers'

National Pension Fund

("Fund"),

seeks a judgment

awarding withdrawal

liability under the Employee Retirement
1974 ("ERISA"), as amended by the

Income Security Act of

Multiemployer Pension Plan Amendments Act of 1980 U.S.C. §§ 1001 et seq. (1982),

("MPPAA"),

29

owed by Defendant Steinbruner

Heating & Cooling

("Steinbruner")

as a result of its complete
2008. Plaintiff also
liquidated damages

withdrawal from the Fund on January 9,
seeks interest on the withdrawal

liability,

and reasonable attorneys'

fees and costs,

pursuant to MPPAA.

Plaintiff administers the Fund at 601 North Fairfax Street

in Alexandria,

Virginia.

Defendant is incorporated under the
is 600

laws of Wisconsin, Oregon Street,

and its principal place of business Wisconsin. The Fund is

Oshkosh,

created and

maintained pursuant to Section 302 (c) Relations Act, 29 U.S.C. § 186(c),

of

the Labor Management

and it is a multiemployer
of ERISA.

pension plan within the meaning of Section 3(37)

Plaintiff

is comprised of
with respect

individual trustees who are
to the Fund, as defined in Section

"fiduciaries"

3(21)(A)

of ERISA,

and are collectively the
of

"plan sponsor"
Until

within

the meaning of

Section 4001(a)(10)(A)

ERISA.

the date

of

its withdrawal

from the Fund on or about January 9,

2008,
§

Defendant was an employer within the meaning of

29 U.S.C.

152(2)

and Section 3(5)

of ERISA,

and was engaged in an industry
and

affecting commerce,
(12) of ERISA.

within the meanings of Sections 3(11)

Until the date of

its withdrawal

from the Fund,

Defendant

employed employees represented for the purposes of collective

bargaining by Sheet Metal Workers'
Local Union No. 18

International Association
18"), a labor organization interstate

("Local Union No.

representing employees

in an industry affecting

commerce.

At all times pertinent to this action,

Defendant was

bound by a collective bargaining agreement with Local Union No.
18, under which it was required to make contributions to the Fund

on behalf of its employees who were covered by the Agreement.

The Agreement obligated Defendant to abide by the terms and

conditions of the Agreement and Declaration of Trust
Agreement")
and payments

("Trust

establishing the Fund,
to the Fund.

and to submit monthly reports

The Fund determined that on or about January 9,
Defendant effected a "complete withdrawal"

2008,

from the Fund as

defined in Section 4203 of ERISA. result of this complete withdrawal,

The

Fund determined that, incurred a

as a

Defendant

withdrawal liability to the Fund in the amount of $151,137.62,
determined under Section 4201(b)
2009,

as

of ERISA.

On or about June

19,

Defendant received a Notice and Demand for payment of

withdrawal Sections

liability issued by the Fund in accordance with and 4219(b)(1) of ERISA. This Notice and Demand liability was and a

4202(2)

for payment $151,137.62,

informed Defendant that its withdrawal payable

in 25 quarterly payments of $7,080.78, The Notice and Demand

final quarterly payment of $5,608.90.

stated the first quarterly payment was due on or before July 19,
2009.

Defendant received a letter from the Fund dated August 2009, notifying Defendant that it was delinquent

18,

in making its

first quarterly withdrawal liability payment and that it had 60
days from receipt of the letter to cure the delinquency or it
would be in default within the meaning of ERISA § 4219(c) (5) (A) .

Defendant has not made any withdrawal

liability payments

to the

Fund.

Defendant did not

request a plan sponsor review of

the

withdrawal liability assessment within the time period specified
in Section 4219(b)(2)(A) of ERISA, and did not initiate

arbitration of

the withdrawal

liability assessment within the

time period specified in Section 4221(a)(1)
precluded from doing so.

of ERISA,

and is now

Under Rule

56(c)

of

the

Federal Rules of

Civil

Procedure,

the Court must grant summary judgment

if

the moving party

demonstrates

"that there is no genuine issue as to any material

fact and that the moving party is entitled to judgment as a
matter of law." In reviewing a motion for summary judgment,

courts view the facts
party. Anderson v.

in a light most

favorable to the nonmoving
477 U.S. 242, 255

Liberty Lobby,

Inc..

(1986).

Once a motion for summary judgment is properly made and
the opposing party then has the burden of showing that

supported,

a genuine dispute as to any material fact does exist.
Elec. Indus. Co.. Ltd. v. Zenith Radio Corp., 475 U.S.

Matsushita
574, 586-

87

(1986).

The mere existence of some alleged factual dispute

between the parties will not defeat an otherwise properly

supported motion for summary judgment;

the requirement is that

there be no genuine issue of material fact.
at 248. "Rule 56 (e)
and by

Anderson.

477 U.S.

requires the nonmoving party to go beyond
[her] own affidavits, or by the

the pleadings

'depositions,

answers to interrogatories,

and admissions on

file,'

and designate

'specific

facts

showing that

there

is

a

genuine issue
317, 324

for trial.'"

Celotex Corp.

v.

Catrett.

477 U.S.

(1986).

Any dispute between an employer and a multiemployer pension
plan, such as the Fund, concerning the determination of

withdrawal liability under ERISA must be resolved through
arbitration.
Inc.. 946

See 29 U.S.C.
1063

§§

1401{a)(l);
1991).

McDonald v.

Centra

F.2d 1059,

(4th Cir.

By failing to timely

request arbitration,
assessed by the Fund,

the withdrawal
became fixed,

liability of Defendant,
due, and owing.

as
§

29 U.S.C.

1401(b)(1).

Moreover,

the

Fund is entitled to payment of the
liability because

entire outstanding amount of withdrawal

Defendant

is

in default within the meaning of 29 U.S.C.

§

1399(c)(5)

and 29 C.F.R.

4219.31(b),

for failing to timely cure

its delinquency. Defendant argues, among other things, that summary judgment

should not be granted because of a previous Wisconsin state court

ruling,

which held Defendant liable for delinquent contribution
2005

payments to the pension fund for the period of December 1,
to December 31, 2007. Defendant's argument lacks merit

because

ERISA contains

separate causes of action for the collection of

delinquent monthly contributions,
ERISA, and the

which arise under Title I of
liability, which arise

collection of withdrawal

out of Title

IV of ERISA.

Withdrawal

liability is a distinct

cause of action under ERISA that only arises after an employer withdraws Fund, from a pension plan. Defendant's withdrawal from the did

and subsequent obligation to pay withdrawal
after January 9, 2008,

liability,

not occur until

nearly a year after

the

period in which Defendant was held liable
fund contributions.

for delinquent pension

Defendant was

signatory and bound by the 18,

collective under which it was

bargaining agreement with Local Union No.

required to make contributions to the Fund on behalf of
employees who were covered by the Agreement.

its

That Agreement

obligated Defendant to abide by the

terms and conditions of the
Fund and to Fund

Agreement and Declaration of Trust establishing the submit monthly reports and payments to the Fund.

The

determined that on or about January 9,
"complete withdrawal"
of ERISA, 29 U.S.C. §

2008,

Defendant effected a

from the
13 83.

Fund,

as defined in Section 4203
as a result

The

Fund determined that

of

this complete withdrawal,

Defendant

incurred withdrawal

liability to the Fund in the amount of $151,137.62,
under Section 4219(b)(l) of ERISA, 29 U.S.C. §

as determined

1381(b).
employer is

Under ERISA Section 502(g)(2),

a delinquent

liable not only for delinquent contributions but damages, interest, and attorneys'
fund is

liquidated in the event
to recover the

fees and costs
file

that a multiemployer

required to

suit

contributions.

29 U.S.C.

§

1132(g)(2).

An award of

interest,

liquidated damages

and attorneys'

fees

and costs

is mandatory

under ERISA.
successful attorneys'

Id;

see McDonald at
to

1065

(w[W]hen a fund is
contributions Under the

in a suit fees

recover delinquent

are mandatory not discretionary.").

Fund's Trust Agreement,
accrues at the rate of

interest on unpaid withdrawal
8.5% per annum

liability

(0.0233% per day,

compounded daily).

As of May 21,

2010,

the accumulated interest
to $10,775.81. The

on the unpaid withdrawal

liability amounts

Fund also

is entitled to liquidated damages

in the amount equal

to the greater of
or 20 percent of § 1132(g)(2).

interest on the delinquent withdrawal
the delinquent withdrawal Defendant is liable liability.

liability
29 U.S.C.

Thus,

for

liquidated damages the Fund is entitled

in the amount of to the the attorneys' collection of
Id.

$30,227.52.

Additionally, that it has

fees and costs

incurred in pursuing liability owed by

the delinquent withdrawal

Defendant.

For the reasons
Judgment

stated above,

Plaintiff's Motion for Summary
shall issue.

should be GRANTED.

An appropriate Order

/s/

Claude M. Hilton

United States District Judge

Alexandria,

May

2£~, 2010

Virginia