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BUILDING SERVICE 32B-J PENSION F. v. VANDERVEER ESTE. HLD.

November 21, 2000

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



The opinion of the court was delivered by: Robert W. Sweet, U.S. District Judge.

OPINION

The Parties and Related Entities

Local 32B-J, Service Employees International Union, AFLCIO ("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 employs workers covered by the RAB collective bargaining agreement.

Prior Proceedings

The prior proceedings in this case are set forth in a prior opinion, Building Service 32B-J Health Fund v. Vanderveer Estates Holding, LLC, 115 F. Supp.2d 459 (S.D.N.Y. 2000), familiarity with which is assumed.

Briefly, this case seeks 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. In a previous action in this District, the Honorable Louis L. Stanton held that Vanderveer was bound by the RAB Agreement, under which it was required to submit disputes to arbitration. See No. 98 Civ. 4232 (LLS), Order of Oct. 22, 1998. Vanderveer submitted to arbitration, and in November of 1998 was ordered to pay the Union a total of $167,878.62 in back benefit contributions under the CBA as well as $181,200.57 in damages. 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. 7048 (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 ("LMRA"), 29 U.S.C. § 185, seeking to compel payment on $598,263.96 in benefit fund contributions claimed due for the period January 1, 1999 through June 30, 2000, as well as liquidated damages.

The Funds moved for summary judgment on June 28, 2000. Vanderveer filed its opposition and a cross-motion for summary judgment on August 4, 2000. The Funds filed a reply memorandum on August 24, 2000, and the motion was deemed fully submitted after oral argument on September 6, 2000.

Facts

Each of the Funds operates under its own Trust Agreement pursuant to ERISA, and all three Trust Agreements contemplate that employers will contribute pursuant to the terms of collective bargaining agreements with the Union. Vanderveer is not a signatory to the Trust Agreements. The Health Fund Trustee Agreement provides that trustees have "the power to demand, collect and receive Employer Contributions," Def. Ex. 1 ¶ 28(A), as well as to construe the terms of the Trust Agreement and the Plan, and to resolve "any disputed matter" that arises. Def. Ex. 1 ¶¶ 7(B), 15(b). The Trustees' decisions are to be "binding and conclusive upon all parties and persons." Id. In addition, "any owner of a member-building of the RAB . . . may participate in the Fund . . . whether or not any of such employees is covered by a collective bargaining agreement between such Employer and the Union." Def. Ex. 1 ¶ 6(b)(i).

The Pension Fund Trust Agreement specifically empowers its Trustees to accept and receive employer contributions, as well as to "do all acts whether or not expressly authorized herein, which the Trustees may deem necessary to accomplish the general objectives of maintaining the Fund solely in the interests of the participants and beneficiaries." Def. Ex. 2 ¶¶ 6(a), 11(b).

The Annuity Fund Trust Agreement specifically contemplates that non-member employers will nonetheless be bound by collective bargaining agreements to contribute to the Fund. The Agreement provides that non-party employers who are bound by collective bargaining agreements shall become parties to the Trust Agreement by executing a written acceptance of its terms. Def. Ex. 3. Art. III § 1. However, the Trust Agreement nonetheless applies to "any Employers" — whether or not they become parties to the Trust Agreement — who are bound to contribute to the Fund pursuant to collective bargaining agreements. Def. Ex. 3, p. 1; Art. 1 § 1(c) (defining covered "Employers" as "employers who are obligated to make payment to the TRUST created by this Agreement by a Collective Bargaining Agreement with the Union. . . ."). Trustees are empowered to "enforce the payment of contributions to the Annuity Fund by Employers" and to "receive Employer contributions," Def. Ex. 3, Art. V §§ 1(w), (x), as well as "to do all acts whether or not expressly authorized herein" in the interests of the Fund, Def. Ex. 3, Art. IX § 3. Employers are required to contribute to the Annuity Fund as per the terms of the collective bargaining agreements. Def. Ex. 3, Art. VIII §§ 1, 2.

In prior actions, Vanderveer has been found to be (1) bound by a collective bargaining agreement with the Funds; (2) under a contractual obligation to pay benefit contributions to the Funds, a multi-employer plan; and (3) ...


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