The opinion of the court was delivered by: Robert P. Patterson, Jr., U.S.D.J.
On June 30, 2005, the National Pension Plan ("National Plan") of the UNITE HERE Workers Pension Fund ("Fund"), an employee benefits plan, and Trustees of the Fund (collectively, "Plaintiffs"), brought a complaint against Westchester Lace & Textiles ("Westchester Lace"), Westchester Narrow Fabrics, Inc., L&G Management, CO., S&E Management, Co., Eastchester Lace & Textiles Ltd., and John Does 1-10 (collectively, "Defendants") to collect withdrawal liability, liquidated damages, interest, attorneys' fees, and costs. Pl. Complaint ¶ 1. On January 11, 2006, Plaintiffs filed a motion for summary judgment. Pl. Mem. for Summary Judgment. On January 20, 2006, Defendants filed a memorandum of law in opposition to Plaintiffs' motion for summary judgment, and filed a motion to vacate the arbitration decision which held that the Defendants' request for arbitration was not timely. Def. Mem. in Opp. to Summary Judgment; Def. Br. in Support of Mot. to Vacate. Plaintiffs' motion for summary judgment is granted and Defendants' motion to vacate the arbitration award is denied.
The following facts are taken from Plaintiffs' Local Civil Rule 56.1 Statement, and have not been disputed by Defendants by the filing of a document with a correspondingly numbered paragraph responding to each numbered paragraph of Plaintiffs' 56.1 Statement as required by Local Civil Rule 56.1.
1. The Fund is a Taft-Hartley trust fund with trustees equally represented by labor organizations affiliated with UNITE HERE (the "Union") and employers that contribute to the Fund.
2. The Fund is established and maintained pursuant to Section 302(c)(5) of the Labor Management Relations Act (the "LMRA"), 29 U.S.C. § 186(c)(5).
3. The Board of Trustees of the Fund is the plan sponsor of the National Plan, an employee pension benefit plan within the meaning of Sections 3(2) and (3) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), 29 U.S.C. §§ 1002(2) and (3), and a defined benefit plan within the meaning of Section (3)(35) of ERISA, 29 U.S.C. § 1002(35), established and maintained for the purpose of providing retirement and related benefits to eligible participants and beneficiaries.
4. The National Plan is a multiemployer plan within the meaning of Section 3(37) of ERISA, 29 U.S.C. § 1002(37).
5. The Trustees of the Fund are fiduciaries of the National Plan within the meaning of Section 3(21)(A) of ERISA, 29 U.S.C. § 1002(21)(A).
6. Westchester Lace is an employer within the meaning of Sections 3(5), (11), and (12) of ERISA, 29 U.S.C. §§ 1002(5), (11), and (12), and Section 301(a) of the LMRA, 29 U.S.C. § 185(a). Westchester Lace has its principal place of business at 3901 Liberty Avenue, North Bergen, New Jersey, 07047.
7. Westchester Lace is 100% owned by Leonard Edelson.
8. Westchester Lace, Westchester Narrow, L&G, S&E, and Eastchester are all related entities.
9. Westchester Narrow is located at 135 Maple Avenue, Milton, Pennsylvania and is 100% owned by Leonard Edelson.
10. L&G is located at 3901 Liberty Avenue, North Bergen, New Jersey, 07047 and is an affiliate of Westchester Lace. Leonard Edelson is the sole owner of L&G. L&G holds title to the real estate at which Westchester Lace operates and rents space to Westchester Lace.
11. S&E is located in Milton, Pennsylvania and is owned by Leonard Edelson. S&E holds title to the real estate at which Westchester Narrow operates, and rents space to Westchester Narrow.
12. Eastchester is located in Jiangmen, Guangdong Province, China, and is owned by Leonard Edelson.
Westchester Lace's Participation in and Withdrawal From the Fund
13. Westchester Lace participated in and contributed to the Fund's National Plan pursuant to the terms of a series of collective bargaining agreements between Westchester Lace and the Union.
14. Participating employers in the National Plan, including Westchester Lace, are bound by the terms of the National Plan and the Trust Agreement.
15. Beginning on or about October 1995 until January 2005, Westchester Lace was obligated to contribute to the National Plan for its participating employees pursuant to a series of collective bargaining agreements between Westchester Lace and the Union.
16. Westchester Lace last made contributions to the National Plan for December 2004.
17. On February 10, 2005, Westchester Lace sent the Fund a letter instructing the Fund to "remove all employees from Westchester Lace's Textiles' Pension Plan." See Feb. 10, 2005 letter, Rust Aff. Ex. C.
18. Based on this information, and on the cessation of Westchester Lace's contributions, the Fund determined that Westchester Lace completely withdrew from the National Plan in January 2005.
19. By letter dated February 15, 2005, the Fund sent to Westchester Lace a request for information about Westchester Lace, including information about its financial condition and corporate structure, and demanded a response within thirty days pursuant to Section 4219(a) of ERISA, 29 U.S.C. § 1399(a). See Feb. 15, 2005 letter, Rust Aff. Ex. D.
20. The Fund routinely sends such requests for information to employers that have withdrawn so that the Fund can fulfill its fiduciary obligations to collect withdrawal liability.
21. By letter dated February 28, 2005, the Fund notified Westchester Lace that the Fund determined that Westchester Lace had completely withdrawn from the Fund, and demanded payment of withdrawal liability in the estimated amount of $485,521.00 pursuant to a quarterly payment schedule. Feb. 28, 2005 letter, McMurdy Cert. Ex. B.
22. Westchester Lace did not provide the Fund with information requested in the Fund's February 15, 2005 letter within thirty days.
23. Despite numerous demands by the Fund and Fund counsel in the weeks following the February 15 and 28 letters, Westchester Lace maintained that it did not have to provide the Fund with any of the requested information.
24. In or about April 2005, the Fund's actuary completed the National Plan's actuarial valuation for the plan year ending September 30, 2004, and was able to calculate Westchester Lace's final withdrawal liability amount.
25. By letter dated April 21, 2005, the Fund notified Westchester Lace that its final withdrawal liability amount equals $410,867.00, and demanded payment in quarterly installments, with the first installment payment of $13,703.00 due by May 15, 2005. See Apr. 21, 2005 letter, McMurdy Cert. Ex. D.
Westchester Lace's Default and the Fund's Acceleration of its Withdrawal Liability
26. Westchester Lace failed to pay the Fund its first quarterly installment of $13,703.00 on or before May 15, 2005.
27. By letter dated May 18, 2005, the Fund notified Westchester Lace that it failed to remit its first quarterly installment payment due on May 15, 2005, and demanded payment within sixty days.
28. The Fund Manager learned from a local Union representative that the National Labor Relations Board had ordered Westchester Lace to make whole certain former employees for losses suffered due to Westchester Lace's unfair labor practices. The local Union representative estimated that the amount of backpay owed to these employees was approximately $1.2 million.
29. The Fund Manager learned that Westchester Lace's owner, Leonard Edelson, was trying to sell the building in which Westchester Lace operated.
30. Based on this information, Westchester Lace's refusal to provide the Fund with the information it requested in the Fund's February 15, 2005 letter, and Westchester Lace's failure to pay its first withdrawal liability payment on a timely basis, the Fund Manager determined on July 7, 2005 that Westchester Lace lacked creditworthiness and demonstrated a substantial likelihood that it would be unable to pay its withdrawal liability, declared Westchester Lace in default, and accelerated its withdrawal liability payments pursuant to the terms of the National Plan and ERISA.
31. Section 19.5 of the National Plan provides that the Fund Manager may declare an employer in default of its withdrawal liability, inter alia, upon a determination that the employer demonstrates a substantial likelihood it will be unable to pay its withdrawal liability.
32. On June 8, 2005, the counsel for the Fund sent counsel for Westchester Lace a letter, notifying Westchester Lace that the Fund had accelerated Westchester Lace's withdrawal liability pursuant to Section 4219(c)(5) of ERISA and Section 19.5 of the National Plan due to its determination that Westchester Lace demonstrated a substantial likelihood it would be unable to pay its withdrawal liability. The Fund demanded full and immediate payment of Westchester Lace's outstanding withdrawal liability of $410,867.00 no later than June 13, 2006. See June 8, 2005 letter, Jan. 11, 2006 Spivack Aff. Ex. J.
33. Westchester Lace failed to pay the full accelerated amount demanded by the Fund by June 13, 2005. Instead, Westchester Lace paid only $13,703.00 to the Fund.
34. Westchester Lace refused to provide any of the requested information until June 13, 2005, 118 days following the Fund's original request, and only after the Fund accelerated Westchester Lace's withdrawal liability.
35. On June 13, 2005, Westchester Lace provided counsel for the Fund an incomplete response to the Fund's February 15, 2005 request for information. Westchester Lace, inter alia, failed to provide information ...