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May 7, 2004.

NEW YORK STATE TEAMSTERS CONFERENCE PENSION AND RETIREMENT FUND, by its Trustees John Bulgaro, Gary Staring, Brian R. Masterson, Daniel W. Schmidt, Michael S. Scalzo, Sr., Thomas K. Wotring, and J. Dawson Cunningham, Plaintiff,

The opinion of the court was delivered by: DAVID HURD, District Judge



  On November 3, 2003, plaintiff New York State Teamsters Conference Pension and Retirement Fund ("the Fund"), by its Trustees, filed suit against defendants Doren Avenue Associates, Inc., Express Services, LLC. ("Express" or "defendants"), and S&P Trucking, LLC ("S&P" or "defendants"), seeking pension interim withdrawal liability payments on the basis that defendants were under common control with (first cause of action) or the alter egos of (second cause of action) Howard's Express, Inc. ("Howard's"), a company that was once obligated to make pension contributions to the Fund.*fn1

  On December 19, 2003, defendants filed a motion for a preliminary injunction, seeking to halt the Fund's attempts to collect interim withdrawal liability payments pending arbitration. (Docket Nos. 8-10.) On January 27, 2004, the Fund filed a cross-motion for summary judgment, seeking an order directing defendants to make the interim payments, pursuant to Fed.R.Civ.P. 56. (Docket Nos. 16, 32.) On February 17, 2004, defendants filed a cross-motion for summary judgment, seeking dismissal of the complaint, also pursuant to Fed.R.Civ.P. 56. (Docket No. 20.) Oral argument was heard on April 7, 2004, in Utica, New York. Decision was reserved. II. BACKGROUND

  A. Summary Judgment Standard and Local Rule 7.1(a)(3)

  Summary judgment must be granted when the pleadings, depositions, answers to interrogatories, admissions and affidavits show that there is no genuine issue as to any material fact, and that the moving party is entitled to summary judgment as a matter of law. Fed.R.Civ.P. 56; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Richardson v. N.Y. State Dep't of Corr. Servs., 180 F.3d 426, 436 (2d Cir. 1999). Facts, inferences therefrom, and ambiguities must be viewed in a light most favorable to the nonmovant. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

  Once the moving party has met the initial burden of demonstrating the absence of a genuine issue of material fact, however, the nonmoving party "must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56; Anderson, 477 U.S. at 250. At that point, the nonmoving party "must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec., 475 U.S. at 386. Indeed, to withstand a summary judgment motion, the nonmoving party must demonstrate that sufficient evidence exists upon which a reasonable jury could return a verdict in its favor. Anderson, 477 U.S. at 248-49; Matsushita Elec., 475 U.S. at 587.

  Despite these obligations of the nonmoving party, "in the absence of a local rule, a district court may not grant summary judgment on the ground that the nonmovant's papers fail to cite to the record unless the parties are given actual notice of the requirement." Amnesty Am. v. Town of W. Hartford, 288 F.3d 467, 470-71 (2d Cir. 2003). The Northern District of New York provides just such a rule. Local Rule 7.1(a)(3) requires a nonmoving party to submit a mirror response to the moving party's statement of material facts, containing either an admission or denial of each allegation set forth by the moving party. "Each denial shall set forth a specific citation to the record where the factual issue arises." Loc. Rule 7.1(a)(3). A failure to comply with this requirement permits the district court to "deem admitted" the factual allegations improperly denied. Id. "Northern District courts have strictly applied Local Rule 7.1(a)(3)'s requirement." Henzel v. Delaware Otsego Corp., 285 F. Supp.2d 271, 275 (N.D.N.Y. 2003) (collecting cases); Garrett v. Reynolds, No. Civ. 9:99CV2065, available at 2003 WL 22299359, at *3 (N.D.N.Y. Oct. 7, 2003). Thus, in this district, a failure to provide specific record citations in a response to a statement of material facts is grounds for granting the moving party's summary judgment motion. See Govan v. Campbell, 289 F. Supp.2d 289, 295 (N.D.N.Y. 2003); Jones v. SmithKline Beecham Corp., No. 02-CV-1428, available at 2004 WL 569267, at *1 n. 4 (N.D.N.Y. Mar. 17, 2004).

  As noted above, both the Fund and defendants have moved for summary judgment in this case. The Fund's statement of material facts, which did not contain allegations relating to the merits of its causes of action,*fn2 and defendants' response to that statement, both contained citations to the record. Defendants' statement of material facts, which did contain allegations relating to the merits of the causes of action, also contained citations to the record. Of the 45 paragraphs in the Fund's response to this statement, 21 are conclusory denials, 16 are denied for lack of sufficient information, and none are accompanied by a record citation. Thus, per Local Rule 7.1(a)(3), the factual allegations in defendants' statement of material facts may be deemed admitted. B. Factual Background of First Cause of Action — Common Control*fn3

  To the extent the allegations relate to the ownership and control histories of Howard's, Express, and S&P, they will be deemed admitted, as even a scouring of the record reveals no factual issue.

  Howard's was a an employer required to contribute to the Fund. At all times relevant to this case, Philip Boncaro, Sr. and Samuel Boncaro, Jr. each owned a 50% interest in the voting shares of Howard's, as well as an aggregate 89.6% interest in the nonvoting shares. Their sons, Philip Boncaro, Jr. and Samuel Boncaro, III, owned no interest in Howard's voting shares, and an aggregate 3.4% interest in the non-voting shares. Howard's assets have since been purchased by an unrelated company.

  Express, formed August 23, 2000, under the laws of New York, was a limited liability company engaged in the freight brokerage business. At all times relevant to this case, five individuals had equal 20% ownership interests in Express: (1) Philip Boncaro, Sr.; (2) Samuel Boncaro, Jr.; (3) Philip Boncaro, Jr.; (4) Samuel Boncaro, III; and (5) Edward Haddad. Express's assets have since been acquired by the same company that purchased the assets of Howard's.

  S&P, formed October 1, 1999, under the laws of Pennsylvania, is a limited liability company engaged in the cartage business, picking up and delivering cargo primarily in eastern Pennsylvania. At all times relevant to this case, Philip Boncaro, Jr. and Samuel Boncaro, III had equal 50% ownership interests in S&P. No other individual had ownership or voting interests in the company.*fn4

  On March 31, 2003, Howard's filed for bankruptcy protection. Effective the next day, therefore, it completely ceased operations covered under the Fund. On June 9, 2003, the Fund, through its Executive Administrator, see infra note 5, wrote letters to defendants, and defendant Doren Avenue Associates, Inc., informing them that they were among the "several non-bankrupt entities" that the Fund had determined were "affiliated" with Howard's and therefore responsible for the withdrawal liability caused by the cessation of covered operations. (Docket No. 10, Exs. B, C.) Howard's withdrawal liability was over $11 million. The letters demanded that defendants either pay that lump sum within 60 days, or 65 monthly installments in excess of $216,000 each and a final payment of over $100,000, in order to satisfy the withdrawal liability. The letters set forth a payment schedule, and demanded an initial payment by August 9, 2003. To date, neither defendant has made any withdrawal liability payments.

  On September 5, 2003, defendants timely requested that the Fund review its determination that they were responsible for the withdrawal liability payments, providing the sponsor with a detailed analysis of why neither could be "employers" under "common control" with Howard's for the purpose of assuming its liability. It does not appear as though the Fund responded to these requests. This action was commenced on November 3, 2003, and the motions followed. On January 29, 2004, two days after the Fund cross-moved for summary judgment and well after defendants moved for a preliminary injunction, defendants filed a demand for arbitration, asking the arbitrator to make a "[f]inding of no obligation for the withdrawal liability" assessed in the notice from the Fund sponsor. (Docket No. 32, App., Ex. B.)

  C. Factual Background of Second Cause of Action — Alter Ego

  To the extent the allegations in defendants' statement of material facts relate more to the Fund's alter ego claim, it is not necessary to deem them admitted. To be sure, most of the citations in defendants' statement of material facts are to affidavits of individuals connected in some way to Howard's, Express, and S&P. Nevertheless, aside from a few citations to exhibits that are either unpersuasive, not placed into proper context, or alone incapable of creating a triable issue of fact, the Fund has submitted no evidence to rebut these factual allegations. Defendants' allegations and the Fund's assertions, the latter of which have been gleaned not from its response to the statement of material facts but from a scouring of the record, will be outlined in more detail in Section B(2) of the DISCUSSION, infra. Moving for summary judgment in the absence of any discovery necessary to rebut defendants' affidavits and other evidence was a gamble the Fund chose to take.


  A. Jurisdictional Issue

  Before determining whether this is the proper forum in which to address the merits of the Fund's claims, and, in particular, whether defendants are employers responsible for the interim withdrawal liability payments, it is helpful to outline the statutory framework of the Multiemployer Pension Plan Amendments Act, 29 U.S.C. § 1381 et seq. ("MPPAA"), under which the Fund purports to assert its claims. 1. Statutory Framework

  The MPPAA amended ERISA because of Congressional concern that "existing legislation did not adequately protect plans from the adverse consequences that resulted when individual employers terminated their participation in, or withdrew from, multiemployer plans." Doherty v. Teamsters Pension Trust Fund, 16 F.3d 1386, 1388 (3d Cir. 1994). Under the statute, an employer which permanently ceases covered operations under a pension plan into which it is required to contribute is subject to "withdrawal liability," in an amount equal to its share of the unfunded vested benefits owed to individuals by the fund at the time of withdrawal. 29 U.S.C. § 1381, 1383(a). After an employer withdraws from a plan, the plan sponsor is vested with the authority to determine the amount of withdrawal liability. Id. §§ 1382, 1391.

  The plan sponsor must then notify the withdrawing employer of the liability, set a payment schedule, and formally demand payment. Id. §§ 1382(2), 1399(b)(1).*fn5 Within 90 days of receiving the notice, the employer may request a review of the sponsor's determination of liability or the payment schedule. Id. § 1399(b)(2)(A). Either side may thereafter initiate arbitration proceedings within 60 days of the earlier of: (1) the date on which the employer was notified of the sponsor's withdrawal liability determination and demand for payment, or (2) 120 days after the date of the employer's request for review. Id. § 1401(a)(1). Should the employer fail to ...

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