United States District Court, S.D. New York
September 29, 2005.
LOCAL 46 METALLIC LATHERS UNION AND REINFORCEMENT IRONWORKERS OF NEW YORK CITY AND VICINITY, Plaintiff,
V.V.W. REBAR CORP., Defendant.
The opinion of the court was delivered by: KEVIN FOX, Magistrate Judge
REPORT AND RECOMMENDATION
TO THE HONORABLE ROBERT L. CARTER, UNITED STATES DISTRICT JUDGE
Plaintiff, Local 46 Metallic Lathers Union and Reinforcing
Ironworkers of New York City and Vicinity ("Local 46") brought
this action against V.V.W. Rebar Corporation ("VVW") pursuant to
section 301 of the Labor Management Relations Act ("LMRA"),
29 U.S.C. § 185, to compel compliance with the parties' collective
bargaining agreement ("Agreement") and the decision of an
arbitration panel convened, pursuant to dispute resolution
provisions in the Agreement, to hear and determine disputes
arising out of the Agreement.
Upon VVW's failure to file an answer or otherwise respond to
the Complaint, Local 46 requested that a default judgment be
entered against VVW and that the plaintiff have judgment against
the defendant in the amount of $273,328.12, together with
interest, attorney's fees and costs. Thereafter, your Honor
referred the matter to the undersigned to conduct an inquest and
to report and recommend the amount of damages, if any to be
awarded against VVW. The Court directed Local 46 to serve and file proposed findings
of fact and conclusions of law, and an inquest memorandum setting
forth its proof of damages, costs of this action, and its
attorney's fees. The Court also directed VVW to serve and file
any opposing memoranda, affidavits and exhibits, as well as any
alternative findings of fact and conclusions of law it deemed
appropriate. VVW did not file any papers in opposition to Local
Local 46's submissions aver that it is entitled to $273,328.12,
together with interest, attorney's fees in the amount of
$2,400.00, and costs in the amount of $225.00. For the reasons
that follow, I recommend that Local 46 be awarded $273,328.12,
post-judgment interest, and costs in the amount of $225.00.
When a defendant defaults in an action, by failing to plead or
otherwise defend against a complaint, the defendant is deemed to
have admitted every well-pleaded allegation of the complaint
except those relating to damages. See Cotton v. Slone,
4 F.3d 176, 181 (2d Cir. 1993); Greyhound Exhibitgroup, Inc. v.
E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992). In
addition, the plaintiff is entitled to all reasonable inferences
from the evidence presented. See Au Bon Pain Corp. v. Artect,
Inc., et al., 653 F.2d 61, 65 (2d Cir. 1981). Based upon the
submissions made by the plaintiff, the complaint filed in the
instant action, and the Court's review of the entire court file
in this action, the following findings of fact are made:
Local 46 is a labor organization within the meaning of section
2(5) of the National Labor Relations Act ("NLRA"),
29 U.S.C. § 152(5). See Complaint, ¶ 4. VVW is a corporation and an
employer within the meaning of the NRLA, 29 U.S.C. § 152(2).
Id., ¶ 5. Local 46 represents certain employees of VVW for
collective bargaining purposes. Id., ¶ 4. Local 46 and VVW executed and placed into effect a collective bargaining agreement
covering the period July 1, 2002, through June 30, 2005. The
Agreement governed wages, hours, and working conditions of the
VVW employees. See Affidavit of Richard Markowitz In Support
Default Judgment ("Markowitz Aff."), Exhibit A. The Agreement
contains provisions for resolving all disputes between the
parties arising out of the employment and collective bargaining
relationship. Id. Pursuant to Article X of the Agreement, a
Trade Board of the Cement League is charged with hearing all
complaints involving the general enforcement of the Agreement
between the Local 46 and VVW. Id.
On June 19, 2003, the Local 46's Business Manager/Financial
Secretary, Robert A. Ledwith ("Ledwith"), notified the Cement
League of Local 46's desire to convene a Trade Board hearing
based on allegations of multiple violations of the Agreement that
were occurring at VVW's Track 9A job site, which is located at
JFK Airport. See Plaintiff's Memorandum of Law in Support of
Inquest ("Pl.'s Mem."), at 4. As a result of Local 46's
allegations, a Trade Board hearing was held on June 30, 2003.
During the Trade Board hearing, Ledwith presented the following
evidence: (a) Local 46's letter notifying VVW of eight contract
violations; (b) a list of architects, engineers and various
contractors working at the job site; (c) documentation of the
hourly and daily wages of Local 46's members, during the relevant
time period; (d) VVW's weekly contributions to Local 46; (e) a
list of persons employed at the job site who were not Local 46
members; and (f) various drawings of the pertinent construction
project. See Complaint, Exhibit A, Minutes of Trade Board
Meeting. Based on the drawings, two contractors estimated that
the amount of steel used at the job site would require that work
be performed between 646 and 693 "man-days." Id. As a result of VVW's contract violations, Local 46 estimated that its
members suffered a minimum of $273,328.12 in lost wages and
fringe benefits, based on an estimated 646 man-days of work.
However, VVW reported only three man-days of work to Local 46.
Id. At the conclusion of the hearing, the Trade Board found by
a unanimous vote, that VVW owed Local 46 $273,328.12. Id. Under
the terms of the Agreement, the decision of the Trade Board was
final and binding on the parties. See Pl.'s Mem. at 5. VVW did
not attend the Trade Board hearing or seek to vacate or otherwise
challenge judicially the decision of the Trade Board. See id.
VVW has failed to comply with the Trade Board decision. See
id. Local 46 filed this action to compel compliance with the
Agreement and the decision of the Trade Board.
III. CONCLUSIONS OF LAW
Review of Arbitration Awards
The Federal Arbitration Act ("FAA"), 9 U.S.C. § 1 et seq.,
permits federal courts to confirm arbitration awards. In
pertinent part FAA provides the following:
If the parties in their agreement have agreed that a
judgment of the court shall be entered upon the award
made pursuant to the arbitration, and shall specify
the court, then at any time within one year after the
award is made any party to the arbitration may apply
to the court so specified for an order confirming the
award, and thereupon the court must grant such an
order unless the award is vacated, modified, or
corrected. . . . If no court is specified in the
agreement of the parties, then such application may
be made to the United States court in and for the
district within which such award was made. Notice of
the application shall be served upon the adverse
party, and thereupon the court shall have
jurisdiction of such party as though he had appeared
generally in the proceeding.
9 U.S.C. § 9.
"The confirmation of an arbitration award is a summary
proceeding that merely makes what is already a final arbitration
award a judgment of the court." Florasynth, Inc. v. Pickholz,
750 F.2d 171, 176 (2d Cir. 1984) (citation omitted). Thus, "the
showing required to avoid summary confirmation is high." Ottley v. Schwartzberg,
819 F.2d 373, 376 (2d. Cir. 1987) (citing National Bulk Carriers, Inc. v.
Princess Mgmt. Co., 597 F.2d 819, 825 (2d Cir. 1979) ("only
`clear evidence of impropriety' justifies denial of summary
confirmation") (quoting Andros Compania Maritima S.A. v. Marc
Rich & Co., A.G., 579 F.2d 691, 702 [2d Cir. 1978]).
Under FAA an arbitration award may only be vacated in four
circumstances. 9 U.S.C. § 10 explains that:
[T]he United States court in and for the district
wherein the award was made may make an order vacating
the award upon the application of any party to the
arbitration (1) where the award was procured by
corruption, fraud, or undue means; (2) where there
was evident partiality or corruption in the
arbitrators, or either of them; (3) where the
arbitrators were guilty of misconduct in refusing to
postpone the hearing, upon sufficient cause shown, or
in refusing to hear evidence pertinent and material
to the controversy; or of any other misbehavior by
which the rights of any party have been prejudiced;
or (4) where the arbitrators exceeded their powers,
or so imperfectly executed them that a mutual, final,
and definite award upon the subject matter submitted
was not made.
9 U.S.C. § 10(a).
Additionally, arbitration awards made in manifest disregard of
law may not be confirmed by the courts. See Duferco Int'l
Steel Trading v. T. Klaveness Shipping A/S, 333 F.3d 383, 388
(2d Cir. 2003).
Local 46 and VVW agreed to settle "all disputes" arising under
the Agreement through arbitration. See Markowitz Aff., Exhibit
A. In compliance with the provisions of the Agreement, Local 46
presented its dispute, arising under the collective bargaining
agreement, before the Trade Board. VVW did not attend the Trade
Board hearing or challenge the Trade Board's decision. See
Pl.'s Mem, at 5. Moreover, VVW has not appeared in this action
and has not paid any portion of the award to Local 46. Id.
No evidence is before the Court that supports vacating the
arbitration panel's determination. Therefore, the decision of the Trade Board should
be confirmed and Local 46 should be permitted to recover damages
in the amount of $273,328.12.
Once a federal court confirms an arbitration award, the
judgment has the same effect as any judgment rendered by the
court and is "`governed by statutory post-judgment interest
rates.'" Carte Blanche (Singapore) Pte., Ltd. v. Carte Blanche
Int'l, Ltd., 888 F.2d 260, 269 (2d Cir. 1989) (quoting Parsons
& Whittemore Ala. Mach. and Servs. Corp. v. Yeargin Constr. Co.,
744 F.2d 1482 (11th Cir. 1984). Under 28 U.S.C. § 1961, "interest
shall be allowed on any money judgment in a civil case recovered
in a district court." 28 U.S.C. § 1961(a). Interest is calculated
from the date of the entry of judgment, at a rate equal to the
weekly average one-year constant maturity Treasury yield, as
published by the Board of Governors of the Federal Reserve
System, for the calendar week proceeding the date of the
judgment. See id. Therefore, VVW is entitled to post-judgment
interest at the rate prescribed by statute.
Generally, attorney's fees are not recoverable in an action to
confirm an arbitration award. However, a court, in the exercise
of its inherent equitable powers, may award attorney's fees when
a party to an arbitration has, without justification, refused to
abide by an arbitrator's decision. See International Chemical
Workers Union (AFL-CIO), Local No. 227 v. BASF Wyandotte Corp.,
774 F.2d 43, 47 (2d Cir. 1985). Since, VVW has failed to comply
with the decision of the Trade Board, without justification, and
has failed to appear in this action, without justification, Local
46 may recover its reasonable attorney's fees and costs.
In determining appropriate attorneys' fees, a court may apply a
"lodestar" method, through which the court multiplies "the `number of hours reasonably
expended on the litigation' by `a reasonable hourly rate.'" Mtr.
of Arbitration Between P.M.I. Trading Ltd. v. Farstad Oil, Inc.,
160 F. Supp. 2d 613, 614-15 (S.D.N.Y. 2001) (quoting Hensley v.
Eckerhart, 461 U.S. 424, 433, 103 S. Ct. 1933, 1939 ).
"The court must consider the normal hourly rate for an attorney
in the same community with the same experience and training, as
well as the number of hours which reasonably should be required
to prosecute the claim. Id. at 615. Moreover, a party seeking
an award of attorney's fees must support the request with
contemporaneous time records that show, "for each attorney, the
date, the hours expended, and the nature of the work done." New
York State Ass'n for Retarded Children, Inc. v. Carey,
711 F.2d 1136, 1154 (2d Cir. 1983). Attorney fee applications that do not
contain such supporting data "should normally be disallowed."
Id. at 1154.
In prosecuting this action against VVW, Local 46 engaged the
services of the law firm of Markowitz & Richman. Richard H.
Markowitz, Esq. ("Markowitz"), a partner with the law firm
submitted an affidavit setting forth: (a) a summary of the number
of hours he devoted to this action and the nature of the work he
performed; and (b) the billing rate at which he performed legal
services for Local 46. See Markowitz Aff., Exhibit B. The
affidavit indicates that Markowitz spent twelve hours, at an
hourly rate of $200.00, reviewing the case file; preparing the
complaint; communicating with his client; and preparing the
default judgment documents. However, Markowitz failed to submit
to the Court his contemporaneous time records that detail the
date, hours expended, and the specific nature of the work
performed on each date. The Court finds that Markowitz's
affidavit also fails to provide the Court with any information
about his professional experience, so that the Court might assess
whether it supports the rate of compensation Markowitz commanded. Since Local 46 did not provide
the requisite supporting data that would permit its attorney fee
application to be evaluated thoroughly, it should be disallowed.
See New York State Ass'n for Retarded Children,
711 F.2d at 1154. Markowitz's affidavit indicates that Local 46 incurred
$225.00 in costs for court filing fees and for serving process.
The Court finds that it is reasonable and appropriate for Local
46 to recover its costs.
For the reasons set forth above, the Court recommends an award
to Local 46 of: (a) $273,328.12 plus post-judgment interest, in
an amount to be calculated by the Clerk of Court in accordance
with 28 U.S.C. § 1961; and (b) costs in the amount of $225.00.
Plaintiff shall serve defendant with a copy of this Report and
Recommendation and submit proof of service to the court.
V. FILING OF OBJECTIONS TO THIS REPORT AND RECOMMENDATION
Pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal
Rules of Civil Procedure, the parties have ten (10) days from
service of the Report to file written objections. See also
Fed.R.Civ.P. 6. Such objections, and any responses to
objections, shall be filed with the Clerk of Court, with courtesy
copies delivered to the chambers of the Honorable Robert L.
Carter, United States District Judge, 500 Pearl St., Room 2220,
New York, New York 10007, and to the chambers of the undersigned,
40 Centre St., Room 540, New York, New York 10007. Any requests
for an extension of time for filing objections must be directed
to Judge Carter. FAILURE TO FILE OBJECTIONS WITHIN TEN (10) DAYS
WILL RESULT IN A WAIVER OF OBJECTIONS AND WILL PRECLUDE APPELLATE
REVIEW. See Thomas v. Arn, 474 U.S. 140 (1985); IUE AFL-CIO Pension Fund v. Herrmann, 9 F.3d 1049,
1054 (2d Cir. 1993); Frank v. Johnson, 968 F.2d 298, 300 (2d
Cir. 1992); Wesolek v. Candair Ltd., 838 F.2d 55, 57-59 (2d
Cir. 1998); McCarthy v. Manson, 714 F.2d 234, 237-38 (2d Cir.
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