Mid-Atlantic Regional Council of Carpenters - West Virginia District et al v. G & R Masonry, Inc.

Filing 11

MEMORANDUM OPINION AND ORDER granting plaintiffs' 5 MOTION for Default Judgment Pursuant to Rule 55(b)(2), FRCivP as more fully set forth herein. Signed by Judge John T. Copenhaver, Jr. on 8/1/2013. (cc: attys; any unrepresented party) (tmh)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF WEST VIRGINIA
AT CHARLESTON
MID-ATLANTIC REGIONAL COUNCIL
OF CARPENTERS -- WEST VIRGINIA,
DISTRICT, CARPENTERS PENSION FUND
OF WEST VIRGINIA and SCOTT BREWER,
as Trustee, CARPENTERS HEALTH FUND
OF WEST VIRGINIA and JAMES BROWN,
as Trustee and, MID-ATLANTIC REGIONAL
COUNCIL OF CARPENTERS -- WEST VIRIGNIA
JATC,
Plaintiffs,
Civil Action No. 2:12-7993

v.
G & R MASONRY, Inc.,
Defendant.

MEMORANDUM OPINION AND ORDER

Pending is the plaintiffs' motion for entry of default
judgment filed February 13, 2013.
Plaintiffs were directed following receipt of the
default judgment motion to submit further briefing.

They were

additionally directed to undertake their best efforts to assure
service of their default judgment motion and that order upon
defendant G & R Masonry’s registered agent no later than April
1, 2013.

The docket reflects that service of the foregoing
materials was accepted by the Secretary of State on April 4,
2013.

While not shown on the docket, the Secretary of State’s

website further reflects that G & R Masonry’s registered agent,
Mark Stutler, signed for the Secretary of State’s certified
mailing of the materials on April 6, 2013.

The court has

received no communication to date from G & R Masonry or Mr.
Stutler in this action.

The matter is ripe for adjudication.

I.

A.

The Parties and Their Statutory Statuses

This action was instituted pursuant to section 502(e)
of the Employee Retirement Income Security Act of 1974
(“ERISA”), as amended, 29 U.S.C. § 1132(e).

Plaintiff Mid-

Atlantic Regional Council of Carpenters -- West Virginia
District -- is a labor organization under 29 U.S.C. §152(5).

It

represents employees who are in an industry “affecting
commerce.”

See 29 U.S.C. § 152(7).
Plaintiff Carpenters Pension Fund of West Virginia

(“Pension Fund”) is an employee pension benefit plan as defined
in Section 3(2) of ERISA, 29 U.S.C. § 1002(2).

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It was

established and is maintained by employers in an industry or
activity affecting commerce and by an employee organization
representing employees in an industry or activity affecting
commerce, within the meaning of Section 4(a) of ERISA, 29 U.S.C.
§ 1003(a).
Scott Brewer is a duly appointed and authorized
Trustee of the Pension Fund, a fiduciary within the meaning of
Section 3(21)(A) of ERISA, 29 U.S.C. § 1002(21)(A), and a member
of the joint Board of Trustees of the Pension Fund.

The joint

Board of Trustees is the Plan sponsor of the Pension Fund within
the meaning of Section 3(16)(B)(iii) of ERISA, 29 U.S.C. §
1002(16)(B)(iii).
Plaintiff Carpenters Health Fund of West Virginia
(“Health Fund”) is an employee welfare benefit plan as defined
in 29 U.S.C. § 1002(1).

The Health Fund is authorized to sue in

its own name and under 29 U.S.C. §1132(d)(1).

James Brown is a

duly appointed and authorized Trustee of the Health Fund.

The

Health Fund and Pension Fund are administered in Parkersburg,
Wood County, West Virginia by its plan trustees.
The Mid-Atlantic Regional Council of Carpenters –West Virginia JATC -- (“MARCC JATC”), is a Trust Fund created

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pursuant to Section 302(c)(5) of the LMRA, 29 U.S.C. §
186(c)(5).

It is administered pursuant to a trust agreement.
Defendant G & R Masonry, Inc. (“G & R Masonry”), is a

corporation organized and existing under the laws of the State
of West Virginia.

It employs persons in this State in the

carpentry trade.

G & R Masonry is an employer as defined in

section 2(2) of the LMRA, 29 U.S.C. § 152(2).

Its activities

affect commerce within the meaning of Section 2(7) of the LMRA,
29 U.S.C. § 152(7).

Further, G & R Masonry is an employer as

defined by Section 3(5) of ERISA, 29 U.S.C. § 1002(5), in an
industry or activity affecting commerce within the meaning of
Section 3(12) of ERISA, 29 U.S.C. §1002(12).

B.

The Collective Bargaining Agreement

G & R Masonry was a member of the Kanawha Valley
Builders Association.

It was signatory and subject to a

collective bargaining agreement with the Mid-Atlantic Regional
Council of Carpenters -- West Virginia District.

The collective

bargaining agreement provides for the rates of pay, wages, hours
of employment and other conditions of employment for employees
of G & R Masonry.

The collective bargaining agreement provides

for certain authorized deductions to be made from the employee

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wages.

G & R Masonry has not been remitting some or all of

these deductions.
The collective bargaining agreement further provides
for the participation by G & R Masonry employees in the Pension
Fund, Health Fund, and MARCC JATC Trust Agreement.

The

Agreement and Declaration of Trust creating and governing the
Pension Fund and Health Fund provides that an employer which
executes a writing evidencing its participation thereby assumes
and shall be bound by all of the obligations imposed by the
Agreement and Declaration of Trust.

The Agreement and

Declaration of Trust creating and governing the Pension Fund and
Health Fund provides for the payment of contributions by G & R
Masonry on behalf of each of its employees covered by the
collective bargaining unit.

C.

The Complaint

Count One seeks delinquent contributions to the MidAtlantic Regional Council of Carpenters -- West Virginia
District for 2010 through 2012, along with interest in an amount
to be determined.

Neither the complaint nor the default

judgment motion specify the amounts due and owing for these
particular delinquent contributions.

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There is thus no basis

upon which the court can enter default judgment as to these
unknown amounts.
Count Two seeks delinquent contributions to the
Pension Fund for 2010 through 2012.

An audit conducted for

plaintiffs puts the principal amount due the Pension Fund at
$26,051.92, with $11,262.23 due and owing for the period June 1
to December 31, 2011, and $14,789.69 due and owing for the
period January 1 through August 31, 2012.

Count Three seeks

delinquent contributions for the Health Fund.

An audit

conducted for plaintiffs reveals that the Health Fund is owed
the principal sum of $25,292.02, with $10,691.63 due and owing
for the period June 1 to December 31, 2011, and $14,600.39 due
and owing for the period January 1 through August 31, 2012.
Count Four seeks delinquent contributions to the MARCC JATC
Trust Agreement, which an audit reveals to total $1,667.50, with
$612.90 due and owing for the period June 1 to December 31,
2011, and $1,054.60 due and owing for the period January 1
through August 31, 2012.

These sums aggregate $53,011.44.

Interest is sought on all principal amounts due on Counts Two
through Four.
Certain allegations of the complaint discuss the
interest and liquidated damages to which plaintiffs assert they
are entitled:
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11. Section 502(g) of ERISA . . . requires the Court
to award liquidated damages of up to twenty percent
(20%) as provided under the terms of an agreement, in
addition to the amount of unpaid contributions,
interest, reasonable attorneys’ fees and costs when
judgment is entered in favor of an employee benefit
plan for unpaid contributions. In the absence of a
liquidated damages provision in an agreement, Section
502(g)(2) . . . authorizes an award equal to the
amount of interest, which is in addition to all other
amounts awarded. . . .
12. The Agreement and Declaration of Trust creating
and governing the Pension Fund and Health Fund
provides for interest on delinquent contributions to
be calculated at the legal rate of interest in the
State of West Virginia.
13. The payment of liquidated damages to the Pension
Fund is governed by Section 502(g)(2) . . . which
requires an award equal to the amount of interest.
(Compl. ¶¶ 11-13 (emphasis added)).

The “legal rate of interest

in the State of West Virginia” is construed as referring to the
statute prescribing interest on judgments and decrees, namely,
West Virginia Code section 56-6-31.

Generally, that rate has

been set at 7%, which is specified annually by the Supreme Court
of Appeals of West Virginia in compliance with the statute.
Sup. Ct. of Apps. Admin. Ord. at 1 (Jan. 2, 2013).

See

This is the

same rate that has been in effect since at least January 1,
2010.
The statute contains additional language, however, for
setting the interest rate for obligations based upon a written
agreement.

In that instance, the statute directs that “the

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obligation shall bear a prejudgment interest at the rate set
forth in the written agreement until the date the judgment or
decree is entered and, thereafter, the judgment interest rate
shall be the same rate as provided for in this section.”

W. Va.

Code § 56-6-31.
The complaint aggregates the principal sum sought from
G & R Masonry at $53,011.44 for contributions due and owing for
the years of 2010 through 2012 for the Pension Fund, Health Fund
and MARCC JATC Trust Agreement.

It further seeks as follows:

That judgment be entered against G & R Masonry for
liquidated damages due on the delinquent contributions
owed for the years 2010 through 2012, in an amount
equal to interest;
That judgment be entered against G & R Masonry in the
amount of all unpaid contributions that accrue
subsequent to the filing date of this complaint and
prior to entry of judgment, together with interest at
the legal rate in the State of West Virginia, from the
date such contributions are due and owing until the
date of judgment, and liquidated damages equal to the
amount of interest awarded.
(Compl. Wherefore clause).
In their April 1, 2013, brief in support, however, the
plaintiffs recite the material terms of the applicable
collective bargaining agreement, which in turn references
controlling trust agreements and attached collection procedures
for delinquent employers.

Those delinquent employer procedures

provide pertinently as follows:
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Any employer delinquent with regard to required
contributions shall pay in addition to such
delinquencies, interest at the rate of 1 1/2% of the
contribution due for each and every month that such
employer shall remain delinquent, plus liquidated
damages in the amount of 10% of the delinquent
contribution amount together with all necessary costs
and attorney fees necessitated in collecting such
delinquencies.
(Ex. 3 at 2, Br. in Supp.).
Additionally, in their motion for default judgment,
they assert that the amount of delinquent contributions “to
date” has increased by $630.20 to $53,641.64.

They also seek

post-judgment interest, reasonable attorney fees and costs.

An

affidavit attached to the motion for default judgment
establishes the amount of attorney fees and costs as,
respectively, $1,350.00 and $473.04, bringing the total recovery
sought through the filing of the motion for default judgment,
exclusive of interest and liquidated damages, to $55,464.68.

II.

A.

Governing Standard

When a party moves for a default judgment, Federal
Rule of Civil Procedure 55(b) authorizes a district court to
“conduct hearings or make referrals” in order to, inter alia,
“determine the amount of damages[,] establish the truth of any
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allegation by evidence[,] or investigate any other matter.” Fed.
R. Civ. P. 55(b)(2)(B)-(D).

While “unliquidated damages

normally are not awarded without an evidentiary hearing,” James
v. Frame, 6 F.3d 307, 310 (5th Cir. 1993), the court is
authorized to proceed without a hearing when a sum certain or
uncontested amount is at issue.

See Insurance Services of

Beaufort, Inc. v. Aetna Cas. and Sur. Co., 966 F.2d 847, 853
(4th Cir. 1992) (“[U]nder rule 54, a default judgment may not be
entered without a full hearing unless the damages are liquidated
or otherwise uncontested.”).
The court has reviewed the audits and accompanying
audit letters attached to the complaint and motion for default
judgment.

Counsel for plaintiffs avers the documents to be true

and accurate copies of the original audits and accompanying
audit letters.

(See Aff. of Mark W. Carbone ¶ 8).

It is,

accordingly, ORDERED that the plaintiffs’ default judgment
motion be, and hereby is, granted as more fully set forth below.
The plaintiffs are entitled to the unpaid
contributions sought through the date of the filing of their
default judgment motion, namely, $53,641.64.

The amount of

liquidated damages is 10% of this sum, or $5,364.16.

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Inasmuch as the plaintiffs have not tendered the
monthly interest calculations specified in the delinquent
employer procedures, the court calculates the 1.5% monthly, or
18% annual, interest rate on the total delinquent contributions
for Counts Two, Three, and Four from the end, respectively, of
the two audit periods, namely June 1 through December 31, 2011,
and January 1 to August 31, 2012, to the date of the
accompanying Judgment, which is August 1, 2013, as follows:
Pension, Health and MARCC JATC Delinquent Contributions for
June 1 through December 31, 2011, with 19 months of interest:
$11,262.23 + $10,691.63 + $612.90 = $22,566.76
$22,566.76 x .015 x 19 = $6,431.53 interest
Pension, Health and MARCC JATC Delinquent Contributions for
January 1 through August 31, 2012, with 11 months of interest:
$14,789.69 + $14,600.39 + $1,054.60 = $30,444.68
$30,444.68 x .015 x 11 = $5,023.37 interest
This results in a total interest obligation of $11,454.90. As
noted, the attorney fees and costs amount to $1,823.04,
resulting in the following total award:
Delinquent contributions

$53,641.64

Liquidated damages

5,364.16

Prejudgment interest

11,454.90

Attorney fees and costs

1,823.04

TOTAL

$72,283.74

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The Clerk is directed to transmit a copy of this
written opinion and order to counsel of record and any
unrepresented parties.

Counsel for the plaintiffs is

additionally directed to serve the written opinion and order
upon Mr. Stutler.
ENTER: August 1, 2013

John T. Copenhaver, Jr.
United States District Judge

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