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BUILDING SERVICE 32B-J PENSION FUND v. VANDERVEER ESTATES

October 5, 2000

BUILDING SERVICE 32B-J PENSION FUND, ET AL., PLAINTIFFS,
V.
VANDERVEER ESTATES HOLDING, LLC., DEFENDANT.



The opinion of the court was delivered by: Sweet, District Judge.

OPINION

Building Service 32B-J Health, Pension and Annuity Funds ("Funds" or "Plaintiffs") have moved by order to show cause for a preliminary injunction pursuant to Rule 65, Fed.R.Civ.P., foreclosing defendant Vanderveer Estates Holding, LLC ("Vanderveer" or "Defendant") from disposing of assets owed to the Funds under a prior arbitration award, for an order of attachment pursuant to Rule 64, Fed.R.Civ.P. and CPLR § 6201, or in the alternative, for Vanderveer to post a million-dollar bond. Vanderveer opposes the motion. For the reasons set forth below, the motion is denied except that a bond will be required.

The Parties and Related Entities

Local 32B-32-J, Service Employees International Union, AFL-CIO ("Union") is a labor organization that represents members employed in the building service industry in metropolitan New York City.

The Funds are jointly administered, multi-employer, labor-management trust Funds based in New York City. The Funds are employee benefit plans that provide benefit coverage for participants employed by employers who are parties to collective bargaining agreements with the Union. The purpose of the Funds is to receive contributions from employers who are parties to collective bargaining agreements with the Union, to invest and maintain those monies, and to distribute pensions, health and insurance benefits, and annuity payments to eligible employees.

The Realty Advisory Board on Labor Relations, Inc. ("RAB") is a multi-employer organization which is a signatory to a series of collective bargaining agreements ("CBA") with the Union covering employees of apartment buildings in New York City.

Vanderveer is a for-profit domestic limited liability company based in New York City that owns several buildings in Brooklyn and employed workers covered by the RAB collective bargaining agreement.

Prior Proceedings

In an earlier case, the Union filed suit against Vanderveer to compel payment for back contributions for the period July 5, 1998 through September 30, 1998, arising from Vanderveer's "lockout" of 51 Union employees working at an apartment complex in Brooklyn after Vanderveer purchased that property on June 5, 1998.

The Honorable Louis L. Stanton of this District held that Vanderveer was bound by the RAB Agreement, under which it was required to submit disputes to arbitration. That decision was upheld by the Second Circuit, and Vanderveer submitted to arbitration.

On or about November 24, 1998, an arbitrator awarded the Union a total of $167,878.62 in back benefit contributions under the CBA as well as $181,200.57 in damages. Bevona v. Vanderveer Estates Holding, LLC, No. 829-I (Schecter Arb.) This award was upheld by Judge Stanton, Bevona v. Vanderveer Estates Holding, LLC, No. 98 Civ. 8689 (S.D.N.Y. Feb. 11, 1999), and summarily affirmed by the Second Circuit, Bevona v. Vanderveer Estates Holding, LLC, Nos. 98 Civ. 9529 and 99 Civ. 7049, 173 F.3d 843 1999 WL 220151 (2d Cir. April 12, 1999).

The Funds brought the instant lawsuit on January 19, 2000 pursuant to sections 502(a)(3) and 515 of the Employee Retirement Income Security Act, as amended ("ERISA") (29 U.S.C. § 1132 (a)(3) and 1145) and section 301 of the Labor Management Relations Act of 1947 (29 U.S.C. § 185). This action seeks to compel payment on $401,896.32 in benefit fund contributions claimed due for the period January 1, 1999 through January 1, 2000. (Compl. ¶ 8).

The Funds moved for summary judgment pursuant to Rule 56, Fed.R.Civ.P., on June 28, 2000. Vanderveer filed a cross-motion for summary judgment on August 4, 2000. The Funds filed a reply memorandum on August 24, 2000, at which time the motion was deemed submitted. That motion is still pending.

By order to show cause of September 14, 2000, the Funds filed the instant motion for a temporary restraining order attaching Vanderveer's assets during the pending litigation and for a preliminary injunction. Vanderveer filed a memorandum of law in opposition on September 19, 2000, and the motion was deemed fully submitted after oral argument was heard on September 20, 2000.

Background

Vanderveer is the owner of a number of residential apartment buildings in a complex named "Vanderveer Estates" at 3301 Foster Avenue, Brooklyn, New York. When it purchased those properties, Vanderveer assumed the prior owner's obligation to honor the terms and conditions of a collective bargaining agreement with the RAB, although Vanderveer itself is not a member of the RAB. The CBA requires that employers that are parties to it contribute funds to a group of union-sponsored employee benefit funds. Vanderveer has not made any such payments since purchasing the properties known as Vanderveer Estates.

Vanderveer's obligation to pay is the subject of the underlying action in this case. While the Funds allege that Vanderveer is a recidivist violator of its obligations to pay and seek to enjoin it from selling off any assets, Vanderveer contends ...


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