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April 12, 1990


The opinion of the court was delivered by: Robert P. Patterson, Jr., District Judge.


Plaintiffs ILGWU National Retirement Fund ("Fund") and two of its trustees move for summary judgment pursuant to Federal Rule of Civil Procedure 56 on its claim against defendant Smart Modes of Ca., Inc d/b/a Madison 7 ("Smart Modes") for withdrawal liability allegedly due under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001 et seq., as amended by the Multiemployer Pension Plan Amendments Act of 1980 ("MPPAA"), 29 U.S.C. § 1381, et seq., plus interest, liquidated damages, attorneys fees and costs. The Fund is a multiemployer pension plan within the meaning of 29 U.S.C. § 1002(2) and (37).


The withdrawal liability provisions of ERISA were amended by MPPAA in 1980. Under MPPAA, an employer who withdraws from a multiemployer plan, with certain exceptions not relevant here, is assessed withdrawal liability, such that the employer is required to continue funding its proportionate share of the plan's unfunded vested benefits. 29 U.S.C. § 1381, 1391. An employer completely withdraws from a plan when it either permanently ceases to have an obligation to contribute to the plan, or permanently ceases all covered operations under the plan. 29 U.S.C. § 1383. Withdrawal liability may also be imposed for partial withdrawals. 29 U.S.C. § 1381, 1385.

When an employer withdraws from a multiemployer plan, the plan sponsor must calculate the amount of withdrawal liability owed, give notice to the employer of the amount and demand payment. 29 U.S.C. § 1382. Section 1399 provides that the plan sponsor must notify an employer of the amount of its withdrawal liability and the schedule of payments "[a]s soon as practicable after an employer's complete or partial withdrawal." 29 U.S.C. § 1399(b)(1). The employer then has 90 days to ask the plan sponsor to review "any specific matter relating to the determination of the employer's liability and the schedule of payments." 29 U.S.C. § 1399(b)(2)(A)(i). Notwithstanding any request for review or demand for arbitration, withdrawal liability is payable in accordance with the schedule of payments established by the plan sponsor beginning no later than 60 days after the date of demand, 29 U.S.C. § 1399(c)(2). Upon default, the plan sponsor may require immediate payment of the outstanding amount of withdrawal liability, plus accrued interest, 29 U.S.C. § 1399(c)(5).

MPPAA requires that "[a]ny dispute between an employer and the plan sponsor of a multiemployer plan concerning a determination made under sections 1381 through 1399 of this title shall be resolved through arbitration." 29 U.S.C. § 1401(a)(1). Arbitration may be initiated within 60 days after the earlier of (1) the date the employer is notified of the plan's decision upon review, or (2) 120 days after the date the employer requests such a review. Id. If no arbitration proceeding is initiated, the plan sponsor may bring an action in state or federal court to collect the amount due and owing, 29 U.S.C. § 1401(b)(1), 1451(a), including liquidated damages, interest, costs and attorneys fees. 29 U.S.C. § 1451.


Smart Modes is a California corporation no longer in business, which had its principal place of business in Los Angeles, California. The correct name of the company is Smart Modes of Calif. Inc., and it is undisputed that Madison 7 was a separate California corporation. Smart Modes was a member of the Los Angeles Coat & Suit Manufacturers Association, a trade association which entered into collective bargaining agreements with local affiliates of the ILGWU. Jules Reinis was the president of the company. Smart Modes was obligated to contribute to the Fund on behalf of those employees covered by collective bargaining agreements negotiated and entered into by the Association and the ILGWU.

It is undisputed that Smart Modes resigned from the Association in 1978, that the collective bargaining agreement to which it was a party at that time terminated on May 31, 1979, and that, by 1979, Smart Modes had ceased all manufacturing operations. It is also undisputed, however, that the Fund continued to receive contributions from or on behalf of defendant through 1982. See Reply Affidavit of Sanford S. Stevens at ¶ 4.

By letter dated August 17, 1987, and addressed to Jules Reinis at his apartment in Los Angeles, the Fund notified defendant that the Fund had determined that Smart Modes had completely withdrawn from the Fund as of 1982, informed it that the Fund had calculated its withdrawal liability to be $150,671, set forth a payment schedule, demanded payment of the first payment, and notified it of its right to ask for review of the calculation and its right to seek arbitration. Mr. Reinis admits receiving the August 17, 1987 letter.

On October 30, 1987 the Fund gave written notice to Smart Modes that it had failed to make the required payment set forth in the August 17, 1987 letter. Smart Modes never responded to the August 17 or October 30 notices in any manner. Smart Modes never sought review by the Fund or through arbitration, and failed to make any of the scheduled payments.

  On May 6, 1988, the Fund commenced the present action, and
served the summons and complaint on Jules Reinis on May 9,
1988. The defendants answered on July 22, 1988, and some
discovery has been completed.

Summary judgment is appropriate where there is "no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). In deciding a motion for summary judgment, the "fundamental maxim" is that the court "`cannot try issues of fact; it can only determine whether there are issues to be tried.'" Donahue v. Windsor Locks Bd. of Fire Comm'rs, 834 F.2d 54, 58 (2d Cir. 1987) (quoting Heyman v. Commerce & Industry Ins. Co., 524 F.2d 1317, 1319-20 (2d Cir. 1975)). "Moreover, in determining whether a genuine issue has been raised, a court must resolve all ambiguities and draw all reasonable inferences against the moving party." Id. at 57.

In opposition to plaintiffs' motion, defendant does not raise genuine issues of material fact, but contends that plaintiffs' action is barred by the statute of limitations or the doctrine of laches, that it was not an employer on the effective date of MPPAA, and ...

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