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The New York City District Council of Carpenters Pension Fund, et al v. Metropolitan Millwork and Installations

June 5, 2012

THE NEW YORK CITY DISTRICT COUNCIL OF CARPENTERS PENSION FUND, ET AL., PLAINTIFFS,
v.
METROPOLITAN MILLWORK AND INSTALLATIONS, INC. DEFENDANT.



The opinion of the court was delivered by: Pitman, United States Magistrate Judge:

REPORT AND RECOMMENDATION

TO THE HONORABLE JESSE M. FURMAN, United States District Judge,

I. Introduction

On October 18, 2010, the Honorable Richard J. Holwell, United States District Judge, referred this matter to me to conduct an inquest concerning plaintiffs' damages and attorneys' fees in connection with their claim against defendant Metropolitan Millwork and Installations, Inc. ("Metropolitan Millwork") (Docket Item 6). The inquest was ordered as a result of Judge Holwell's Order dated September 29, 2010 noting defendant's default in this case (Docket Item 5). The matter has since been reassigned to the Honorable Jesse M. Furman, United States District Judge (Docket Item 16).

Pursuant to the Order of Reference in this case, I issued a Scheduling Order on November 4, 2010 directing plaintiffs to serve and file proposed findings of fact and conclusions of law, along with evidentiary materials supporting their claim for damages, by January 11, 2011 (Docket Item 7 at ¶ 1). My November 4, 2010 Scheduling Order further directed defendant to submit responsive materials by February 11, 2011. Specifically, my Order provided:

Defendants shall submit their response to Plain-tiff's submission, if any, no later than February 11, 2011. IF DEFENDANTS (1) FAIL TO RESPOND TO PLAINTIFF'S SUBMISSIONS, OR (2) FAIL TO CONTACT MY CHAMBERS BY FEBRUARY 11, 2011 AND REQUEST AN IN-COURT HEARING, IT IS MY INTENTION TO ISSUE A REPORT AND RECOMMENDATION CONCERNING DAMAGES ON THE BASIS OF PLAINTIFF'S WRITTEN SUBMISSIONS ALONE WITHOUT AN IN-COURT HEARING. See Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir. 1997); Fustok v. ContiCommodity Services Inc., 873 F.2d 38, 40 (2d Cir. 1989) ("[I]t [is] not necessary for the District Court to hold a hearing, as long as it ensured that there was a basis for the damages specified in a default judgment."). (Docket Item 7 at ¶ 2) (emphasis in original).

On or about January 11, 2011, plaintiffs filed a document entitled "Plaintiffs' Findings of Fact and Conclusions of Law with Respect to the Inquest on Damages" along with supporting evidentiary material (Docket Items 8 and 9).

Because defendant was represented by counsel at the time of my November 4, 2010 Scheduling Order, a copy of the Order was sent directly to counsel of record via this Court's Electronic Case Filing ("ECF") system. I received a letter from defendant's counsel dated February 11, 2011, however, in which counsel represented that although he received plaintiffs' submission concerning damages on January 13, 2011, neither he nor Metropolitan Millwork had received the Scheduling Order until February 9, 2011 (Docket Item 10). As a result, defendant's counsel requested an extension of time in which to make a responsive submission. I granted this application, and on March 22, 2011, defendant submitted a document entitled "Defendant's Finding of Fact [sic] and Conclusions of Law with Respect to the Inquest on Damages" along with supporting evidentiary material (Docket Item 12). Defendant's counsel also filed a Notice of Appearance in this action dated March 23, 2011 (Docket Item 13).

Neither party has requested a hearing on the issue of damages. Accordingly, on the basis of the Complaint and the parties' written submissions, I respectfully recommend that the Court make the following findings of fact and conclusions of law. I further recommend that the Court (1) treat plaintiffs' motion for default judgment as one for summary judgment, (2) confirm the arbitration award, (3) deny plaintiffs' application for attor- neys' fees incurred in this action, but allow them 30 days to submit contemporaneous time records supporting their fee application and (4) award plaintiffs $60.00 for costs.

II. Findings of Fact

A. The Collective

Bargaining Agreement

1. At issue in this action is a collective bargaining agreement ("Agreement") between the District Council of New York and Vicinity of the United Brotherhood of Carpenters and Joiners of America ("Union") and Metropolitan Millwork (Complaint, dated June 30, 2010 ("Compl.") (Docket Item 1), ¶ 1).*fn1

B. The Parties

2. Plaintiffs*fn2 are comprised of (1) jointly administered, multi-employer Taft-Hartley Benefit Funds ("Benefit Funds") which are established and maintained pursuant to the Labor Management Relations Act ("LMRA"),*fn3 29 U.S.C. § 186(c)(5), (2) not for profit corporations and (3) labor organizations within the meaning of the National Labor Relations Act ("NLRA"), 29 U.S.C. § 152(5) (Compl. at ¶ 5).

3. With respect to the Benefit Funds, Frank Spencer and Paul O'Brien were fiduciaries of the funds at all relevant times within the meaning of the Employment Retirement Income Security Act ("ERISA"), 29 U.S.C. §§ 1002(21) and 1132 (Compl. at ¶ 5). The Benefit Funds provide "health, medical and related welfare benefits, pension and other benefits to eligible participants and beneficiaries on whose behalf they receive contribu-tions from numerous employers pursuant to collective bargaining agreements between the employers and the Union" (Compl. at ¶ 6, citing 29 U.S.C. § 1002(1), (3)).

4. Plaintiff the New York City and Vicinity Carpenters Labor-Management Corporation is a New York not-for-profit corporation (Compl. at ¶ 8).

5. The Union is a labor organization, as well as the certified bargaining representative for certain employees of defendant (Compl. at ¶ 7).

6. Defendant is a New York corporation with its principal place of business at 239 Trade Zone Drive, Ronkonkoma, New York 11779 (Compl. at ¶ 9). Defendant is an employer within the meaning of ERISA, 29 U.S.C. § 1002(5) (Compl. at ¶ 10).

C. The Arbitration Award

7. The Union and defendant were parties to the Agreement, which, by its terms, became effective on July 1, 2001 (Plaintiffs' Findings of Fact and Conclusions of Law with Respect to the Inquest on Damages, dated Jan. 11, 2011 ("Pls.' Findings of Fact and Conclusions of Law") (Docket Item 8), ¶ 1; see also Ex. A to Declaration of Andrew Grabois, dated Jan. 11, 2011 ("Grabois Decl.") (Docket Item 9), 1).

8. Article XIX of the Agreement ("Expiration Clause") provided that, upon expiration of the Agreement and absent written notice by either party, the Agreement would automatically renew for one-year intervals (Pls.' Findings of Fact and Conclusions of Law at ¶ 1; see also Ex. A to Grabois Decl. at 60).

9. Article XV of the Agreement ("Fringe Benefit Funds") provided that (1) upon the request of the Trustees of the Benefit Funds ("Trustees"), defendant would make available all of its books and records necessary for an audit and (2) any disputes between the parties would be submitted to final, binding arbitration (Pls.' Findings of Fact and Conclusions of Law at ¶ 2; see also Ex. A to Grabois Decl. at 37-38, 44-46).

10. A dispute arose between the parties during the pendency of the Agreement when the Trustees requested that defendant make its books and records available for the purpose of an audit and defendant failed to comply with this request (Pls.' Findings of Fact and Conclusions of Law at ¶ 3; see also Ex. A to Compl. at 5-6).

11. Pursuant to the Agreement, the dispute concerning defendant's books and records was submitted to arbitration (Pls.' Findings of Fact and Conclusions of Law at ...


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