Board of Trustees, International Training Institute for the Sheet Metal and Air Conditioning Industry et al v. All Around Spiral, Inc.

Filing 53

MEMORANDUM OPINION. Signed by District Judge James C. Cacheris on 08/26/15. (pmil, )

IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF VIRGINIA
Alexandria Division
BOARD OF TRUSTEES,
INTERNATIONAL TRAINING
INSTITUTE FOR THE SHEET METAL
AND AIR CONDITIONING INDUSTRY,
et al.,
Plaintiffs,
v.
ALL AROUND SPIRAL, INC.,
Defendant.

)
)
)
)
)
)
)
)
)
)
)
)
)

M E M O R A N D U M

1:14-cv-782 (JCC/IDD)

O P I N I O N

This matter is before the Court on Plaintiffs’ Motion
for Summary Judgment.

[Dkt. 40.]

On August 26, 2015, after

hearing oral argument of counsel, the Court granted the motion
in part and denied it in part.

This memorandum opinion

memorializes the Court’s reasoning.
I. Background
The following facts are taken from the parties’ Local
Rule 56(B) statements and from the parties’ Joint Stipulation of
Uncontested facts.

(See Joint Stipulation of Uncontested Facts

[Dkt. 36]; see also Pls.’ Mem. [Dkt. 41] Stmt. of Facts (“SOF”)
at 2-6; Def.’s Mem. [Dkt. 48] SOF at 2-4.)

These facts are

undisputed unless otherwise indicated.
Plaintiffs are the separate and individual Boards of
1

Trustees for the International Training Institute for the Sheet
Metal and Air Conditioning Industry (“ITI”), the National Energy
Management Institute Committee (“NEMIC”), the Sheet Metal
Occupational Health Institute Trust Fund (“SMOHI”), and the
Stabilization Agreement for the Sheet Metal Industry Trust Fund
(“SASMI”) (hereinafter collectively referred to as “Plaintiffs”
or the “Funds”).1

(Joint Stip. ¶ 1.)

The Funds are comprised of

individual trustees who are fiduciaries with respect to the
Funds, as defined by section 3(21)(A) of the Employee Retirement
Income Security Act (“ERISA”), 29 U.S.C. § 1002(21)(A), and are
collectively the plan sponsors.

(Id. at ¶¶ 1-2.)

The Funds are

governed pursuant to the terms of the Trust Documents that
established the Funds.

(Greene Decl. [Dkt. 42] ¶ 6.)

The Funds

provide various benefits to eligible employees of employers who
contribute payments to the Funds.

(Id.)

administered from Fairfax, Virginia.

The Funds are

(Joint Stip. at ¶ 3.)

Defendant All Around Spiral, Inc. (hereinafter
referred to as “Defendant” or “AAS”) was an “employer” within
the meaning of section 3(5) of ERISA, 29 U.S.C § 1002(5), and 29
U.S.C. § 152(2), and was engaged in an “industry affecting
1

ITI and SASMI are jointly-trusteed trust funds created and
maintained pursuant to section 302(c) of the Labor Management
Relations Act, 29 U.S.C. § 186(c), and are “multiemployer plans”
as defined in section 3(37) of ERISA, 29 U.S.C. § 1002(37).
(Joint Stip. ¶ 4.) NEMIC and SMOHI are jointly-trusteed trust
funds created and maintained pursuant to section 302(c) of the
Labor Management Relations Act, 29 U.S.C. § 186(c). (Id.)
2

commerce,” within the meaning of sections 3(11)-(12) of ERISA,
29 U.S.C. §§ 1002(11)-(12).

(Joint Stip. ¶ 5.)

Defendant is a

New York corporation with its principal place of business in
Ronkonkoma, New York.

(Id. at ¶ 6.)

Defendant employs

employees who are represented by the Sheet Metal Workers’
International Association Local Union No. 28 (“Local Union No.
28”), a labor organization representing employees in an industry
affecting interstate commerce, for the purposes of collective
bargaining.

(Pls.’s SOF ¶ 7.)

Local Union No. 28 entered into a collective
bargaining agreement (the “CBA”) with non-parties Sheet Metal &
Air Conditioning Contractors Association of New York City, Inc.
and SMACNA of Long Island, Inc., and those employers who
subscribe thereto.

(Greene Decl. ¶ 8.)

Under the CBA,

Defendant was obligated to contribute to ITI, NEMIC, and SMOHI
on behalf of Defendant’s covered employees who are employed in
any jurisdiction of Local Union No. 28.

(Id.)

The amount of Defendant’s contribution to the Funds is
calculated based on remittance reports, which must be prepared
monthly by Defendant as the contributing employer.
¶ 7.)

(Joint Stip.

Without the information contained in the remittance

reports, the Funds cannot determine (1) the amount of monthly
contributions due to the Funds and (2) an employee’s eligibility
for benefits.

(Id. at ¶ 9.)

However, because Defendant, as the
3

contributing employer, creates and prepares the monthly
remittance reports itself, the Funds must initially rely upon
the honesty and accuracy of Defendant, both in reporting the
hours worked and paid, and in reporting the contributions owed
on behalf of their employees.

(Id. at ¶ 8.)

II. Legal Standard
Summary judgment is appropriate only where, on the
basis of undisputed material facts, the moving party is entitled
to judgment as a matter of law.

See Fed. R. Civ. P. 56; Celotex

Corp. v. Catrett, 477 U.S. 317, 322 (1986).

The moving party

always bears the initial burden of “informing the district court
of the basis for its motion,” and identifying the matter “it
believes demonstrate[s] the absence of a genuine issue of
material fact.”

Celotex, 477 U.S. at 323.

Once a motion for

summary judgment is properly made and supported, the opposing
party has the burden of showing that a genuine dispute exists.
See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S.
574, 586-87 (1986); see also Ray Commc’ns, Inc. v. Clear Channel
Commc’ns, Inc., 673 F.3d 294, 299 (4th Cir. 2012) (stating the
opposing party must “come forward with specific facts showing
that there is a genuine issue for trial.”).

“[T]he non-moving

party ‘may not rest upon mere allegation or denials of his
pleading, but must set forth specific facts showing that there
is a genuine issue for trial.’”

Hughes v. Bedsole, 48 F.3d
4

1376, 1381 (4th Cir. 1995) (quoting Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 256 (1986)).
In reviewing the record on summary judgment, the Court
“must draw any inferences in the light most favorable to the
non-movant” and “determine whether the record taken as a whole
could lead a reasonable trier of fact to find for the nonmovant.”

Brock v. Entre Computer Ctrs., Inc., 933 F.2d 1253,

1259 (4th Cir. 1991) (citations omitted).

“[A]t the summary

judgment stage the judge’s function is not himself to weigh the
evidence and determine the truth of the matter but to determine
whether there is a genuine issue for trial.”
at 249.

Anderson, 477 U.S.

Where there is conflicting evidence, the court must

credit the evidence of both sides and acknowledge that there is
a genuine issue of material fact that cannot be resolved by
summary judgment.

See Tolan v. Cotton, 134 S. Ct. 1861, 1868-69

(2014) (stating that summary judgment is inappropriate where
each side has put forward competent evidence that raises a
dispute about a material fact).
III. Analysis
Defendant argues that genuine issues of material fact
exist as to the following: (1) whether Defendant is bound by a
CBA that requires Defendant to pay contributions to the Funds
(Def.’s Opp’n at 5-6); (2) at what point in time Defendant was

5

no longer required to contribute to the Funds (Id. at 6-7.); and
(3) Plaintiffs’ calculation of damages (Id. 7-8).
The Court must deny Plaintiffs’ motion for summary
judgment in part because Plaintiffs have not met their burden to
show that there is no genuine issue of material fact for trial.
In fact, a key issue remains to be decided: under what CBA was
Defendant bound, and for how long?

In support of their motion

for summary judgment, Plaintiffs attached a CBA.
Ex. B.)

(Greene Decl.,

The CBA states it is effective September 15, 2011 and

terminated July 31, 2014.

(Id. at 1.)

There is no signatory

page attached to the CBA, nor does the CBA list any of the
employers to which it applies.

Therefore, the Court has no way

to determine whether Defendant is bound by this CBA.2

Defendant

has “show[n] that the materials cited do not establish the
absence . . . of a genuine dispute[.]”
56(c)(1)(B).

See Fed. R. Civ. P.

Accordingly, summary judgment must be denied for

this reason alone.

2

In their reply brief, Plaintiffs cite to the deposition of
Sharon Kern (“Kern”), president of AAS, in which she allegedly
admits the CBA provided in support of Plaintiffs’ motion is the
CBA to which they were bound as well as Defendant’s answer
admitting the same. (Pls.’ Reply [Dkt. 49] at 6.) A review of
those materials does not show that such an admission was made.
As discussed infra, AAS does not dispute that it was bound by a
CBA; the question is by what CBA was it bound. Kern’s
deposition and Defendant’s answer do not admit that the CBA
submitted is, in fact, the CBA in question, nor is there
anything from the face of the CBA that would allow the Court to
conclude that this is the relevant CBA.
6

Additionally, Plaintiffs have not established that
there is no genuine issue of material fact as to the period of
time they are entitled to receive contributions from Defendant.
Plaintiffs seek contributions to the Funds from the second week
of January 2014 through December 2014.

(Green Decl. ¶ 15.)

Defendant does not dispute that it was bound by a CBA to make
contributions to the Funds and does not dispute the amounts
Plaintiffs seek for September 2013 through January 2014.
(Def.’s Opp’n at 6.)

Therefore, the Court granted partial

summary judgment on this basis in the amount of $5,372.40 for
this time period only.

However, Defendant disputes that it owes

any payments after January 2014.

(Id.)

The CBA Plaintiffs

provided was effective only through July 31, 2014.
Decl., Ex. B.)

(Green

Defendant has also produced a July 20, 2014

letter sent from SASMI stating that Defendant’s status as a
SASMI contributing employer was terminated effective August 1,
2014.

(Milman Decl. [Dkt. 48-1], Ex. B, at 1.)

Therefore,

there is a genuine issue of material fact as to when Defendant’s
obligations under the CBA terminated.3

3

Defendant argues that it is not liable for any contributions
after the second week of January since Local 28 pulled all
manpower from Defendant in January 2014. (Def.’s Opp’n at 6.)
In support, they attach a bulletin sent to Local 28 Contractors
stating that all Local 28 manpower had been removed from
Defendant. (Milman Decl., Ex. A.) As the Court understands,
Defendant argues that it had no responsibility to continue
making contributions to the funds after the second week of
7

Finally, summary judgment must also be denied because
Plaintiffs did not quantify the alleged contributions after
January of 2014 by any identifiable measure.4

Plaintiffs demand

$22,806.89 from the second week of January 2014 through December
2014.

(Pls.’ Mem. in Supp. at 5.)

The payroll records they

have submitted in support of this claim are from January 1, 2014
through May 19, 2015 for approximately fifty-eight employees.
(Naji Decl. [Dkt. 43], Ex. B.)

However, Plaintiffs do not

detail how the delinquent contributions were calculated or for
which employees.

(See Greene Decl. ¶¶ 14-15.)

In reply, Plaintiffs argue that because Defendant did
not submit remittance reports to the Funds for all of 2014
(excluding the first week of January) and Defendant only
provided yearly payroll reports in discovery, Plaintiffs cannot
break down the contributions by month.

(Pls.’ Reply at 8.)

“All Around has, or should have, the information needed to
provide a breakdown by employee.”

(Id.)

If that is the case,

then, Plaintiffs should have obtained such information in

January because Local 28 no longer worked for it, yet it never
explicitly makes that argument or cites any legal authority in
support. Regardless, Defendant has shown there is a genuine
issue of material fact with respect to the date its obligations
to the funds terminated because the CBA does not show that
Plaintiffs are entitled to payments through December 2014.
4
Defendant also claims it is “judgment proof” because it does
not have enough assets to cover any purported liability. This
is also at issue and not ripe for determination on summary
judgment.
8

discovery so they could successfully meet their burden on
summary judgment.

Plaintiffs argue that they have “wide

discretion” to determine contributions owed in the absence of
required remittance reports.

(Pls.’ Reply at 9.)

The cases

they cite in support, however, are distinguishable in two
respects.
First, the cases involved default judgments, where the
court does not have the benefit of a full record to determine
damages.

See Int’l Painters & Allied Trades Indus. Pension Fund

v. 3 R Painting and Contracting Co., Inc., No. RDB–12–272, 2013
WL 424694, at *4 (D. Md. Jan. 31, 2013) (stating the “default
judgment is appropriate when the adversary process has been
halted because of an essentially unresponsive party.”) (citation
and internal quotation marks omitted); Bd. of Trustees, Sheet
Metal Workers’ Nat. Pension Fund v. 5 Star Washer Serv.,Inc.,
No. 1:11cv0331, 2011 WL 5190852, at *4 (E.D. Va. Sept. 14,
2011).

Second, the discretion afforded to plaintiffs is not

unbounded.

In both 3 R Painting and 5 Star Washer, the fund

administrators detailed the process by which they estimated
contributions, which included some estimation based on
previously filed reports.

See 3 R Painting, 2013 WL 424694, at

*5 (noting amount of unpaid contributions calculated by
averaging the three months of contributions prior to the first
month in which no report is received); 5 Star Washer, 2011 WL
9

5190852, at *4 (noting delinquent contributions calculated by
assuming covered employees worked the same amount of hours as
the last month a report was submitted by defendant).
Here, Plaintiffs provide no detail as to how they
calculated the alleged delinquent contributions beyond stating
they “us[ed] payroll records provided to the Funds” by
Defendant.

(Green Decl. ¶ 14.)

Therefore, there is a genuine

issue of material fact as to the accuracy of the claimed
contributions.

See Trustees of the Plumbers and Gasfitters

Local 5 Ret., Savings Fund v. Conditioned Air Sys., Inc., Civil
No. CCB–12–730, 2014 WL 1292105, at *11 (D. Md. Mar. 28, 2014)
(“Defendants claim plaintiffs are not entitled to summary
judgment because the plaintiffs have failed to identify which
estimating method they used and how they calculated the claimed
amounts, thus creating a genuine dispute as to the accuracy of
the estimations.

The court agrees that the defendants have

raised a genuine dispute of fact as to the accuracy of the
estimations[.]”).
Accordingly, the Court must deny the motion for
summary judgment in part because there are genuine issues of
material fact as to the CBA that binds Defendant, for what
period of time Defendant was bound, and as to the accuracy of
the claimed contributions.

In its opposition, Defendant asks

for mediation of this dispute, which counsel confirmed during
10

the hearing.

(Def.’s Opp’n at 8.)

The Court believes this

dispute is ripe for a settlement conference and will direct the
parties to schedule a settlement conference with the Magistrate
Judge assigned to this case, mindful that the trial date is
quickly approaching.
IV. Conclusion
For the foregoing reasons, the Court granted in part
and denied in part Plaintiffs’ Motion for Summary Judgment.
An appropriate Order shall issue.

August 26, 2015
Alexandria, Virginia

/s/
James C. Cacheris
UNITED STATES DISTRICT COURT JUDGE

11