The opinion of the court was delivered by: THOMAS J. MCAVOY
Presently before the Court are two motions made returnable December 23, 1994. The first motion is brought by defendants William Canny and Dorothy Conlon for dismissal of the complaint pursuant to Fed. R. Civ. P. 12(b) (5) and (6). The second motion is brought by the plaintiff against all the defendants, excepting defendant Joseph Fletcher, for summary judgment made pursuant to Fed. R. Civ. P. 56.
Plaintiff Board of Trustees is the sponsor of a multiemployer pension plan covering employees in the trucking industry. The plan is established and maintained pursuant to collective bargaining agreements and Declaration of Trust between Local Union 560 and the Motor Carriers Association of North Jersey.
Canny Trucking Co., Inc. (hereinafter "Canny Trucking") was a corporation organized and existing under the laws of the State of New York. It was signatory to an agreement under which it had an obligation to make contributions to the plaintiff's Pension Fund as a participating employer. On September 21, 1987, Canny Trucking filed a petition for relief under bankruptcy laws in the United States Bankruptcy Court for the Northern District of New York. During the course of the bankruptcy proceeding, Canny Trucking
discontinued all of its operations which in turn effectuated the complete withdrawal of the company from the Pension Fund as defined in 29 U.S.C. § 1383(a).
Following this withdrawal, plaintiff imposed a withdrawal liability assessment of $ 1,221,191.00 against Canny Trucking based upon 1987 figures. This assessment was to be payable over time in 156 monthly installments. Plaintiff states that notice of the withdrawal liability assessment was properly given. Canny Trucking thereafter defaulted on its payments which resulted in the acceleration of the balance of the payments due.
Prior to April 26, 1985, all of the defendants were sole shareholders of Canny Trucking. But on the said date, defendants entered into an agreement with David Lindsey and Canny Trucking under which a portion of their shares were sold to Mr. Lindsey and the remainder were redeemed by the corporation. After this transaction, defendants no longer were shareholders in Canny Trucking.
The same defendants who were shareholders in Canny Trucking were also common owners of certain real property known as 6-18 Spring Forest Avenue in Binghamton, New York.
Plaintiff's complaint alleges that the joint ownership and leasing of the subject real property by some of the defendants constitute a "real estate leasing proprietorship and/or de facto partnership" and further that this enterprise was a "trade or business" under common ownership and control with Canny Trucking thereby triggering the "controlled group" provisions of ERISA with respect to payment of withdrawal liability assessments.
Plaintiff now seeks judgment jointly and severally against the defendants for $ 1,221,191.00 withdrawal liability assessment, together with interest, liquidated damages, and attorney's fees.
Before we delve into the pending motions, the Court will first attempt to do some house-cleaning.
Initially, the caption of this case has, as defendants, twelve parties. A closer examination of the record reveals, however, that of the twelve defendants, only six were served with a summons and complaint. These defendants are William Canny, Dorothy Conlon, Joseph Fletcher, Joseph Canny, Barbara Briggs, and Franklin Fletcher. ...