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Bricklayers and Allied Craftworkers Local 2, Albany, New York Pension Fund By Its v. Dibernardo Tile and Marble Co.

August 14, 2012

BRICKLAYERS AND ALLIED CRAFTWORKERS LOCAL 2, ALBANY, NEW YORK PENSION FUND BY ITS ADMINISTRATOR, STEPHEN J. O'SICK; BRICKLAYERS AND ALLIED CRAFTWORKERS LOCAL 2, ALBANY, NEW YORK HEALTH BENEFIT FUND BY ITS ADMINISTRATOR, STEPHEN J. O'SICK; BRICKLAYERS AND ALLIED CRAFTWORKERS LOCAL 2, ALBANY, NEW YORK EDUCATION & TRAINING FUND BY ITS TRUSTEES, ROBERT MANTELLO, PASQUALE TIRINO, LUKE RENNA, MICHAEL SUPRENANT, NICHOLAS TIRINO, DALE STEHLIN, THOMAS MURRAY, VIC MION, KEVIN AUGUSTINI, J. D. GILBERT, THOMAS MARINELLO AND TODD HELFRICH; BRICKLAYERS AND TROWEL TRADES INTERNATIONAL PENSION FUND BY DAVID STUPAR, EXECUTIVE DIRECTOR; AND BRICKLAYERS AND ALLIED CRAFTWORKERS LOCAL 2, ALBANY NEW YORK, AFL-CIO BY ROBERT MANTELLO, PRESIDENT, PLAINTIFFS,
v.
DIBERNARDO TILE AND MARBLE CO., INC.; AND GEORGE DIBERNARDO, JR. INDIVIDUALLY AND AS AN OFFICER OF DIBERNARDO TILE AND MARBLE CO., INC. DEFENDANTS.



MEMORANDUM-DECISION and ORDER

I. INTRODUCTION

Plaintiffs brought this suit pursuant to the Employee Retirement Income Security Act ("ERISA"), as amended, 29 U.S.C. §§ 1001 et seq. Dkt. No. 1 ("Complaint"). On December 4, 2008, a Stipulation and Order of conditional discontinuance was entered in, stating that the parties had reached a settlement agreement. Dkt. No. 28 ("Stipulation and Order"). Presently before the Court is Plaintiffs' Motion requesting that the Court: (1) reopen the case; (2) enforce a judgment against Defendant; and (3) award attorney's fees to Plaintiffs. Dkt. No. 29 ("Motion"). Defendant filed a Response to the Motion, and Plaintiffs subsequently filed a Reply to the Response. Dkt. Nos. 31 ("Response"), 32 ("Reply"). For the following reasons, the Court concludes that it lacks subject matter jurisdiction to grant Plaintiffs' requests and denies Plaintiffs' Motion without prejudice.

II. BACKGROUND

On January 11, 2008, Plaintiffs filed the instant action, alleging, inter alia, that Defendant had failed to remit fringe benefit contributions to a pension plan under ERISA. See generally Compl.; see also Dkt. No. 22 ("Amended Complaint"). The parties eventually reached a settlement agreement, and on December 4, 2008, the Court entered a Stipulation and Order of conditional discontinuance. Stipulation The Stipulation and Order did not contain the terms of the parties' agreement and contained no language incorporating any such terms. Id. Instead, the Stipulation and Order stated that "the action is settled and is conditionally discontinued without prejudice, reserving Plaintiffs' rights to reopen the action and proceed with the entry of judgment." Id. The Stipulation and Order makes mention of an agreement reached on November 10, 2008 ("the November 2008 Agreement"), but no such agreement was presented to the Court. See generally Dkt.

Almost three years later, on September 7, 2011, Plaintiffs filed the instant Motion, alleging that Defendant had failed to comply with the terms of the parties' agreement and that as a result Plaintiffs were entitled to, inter alia, liquidated damages and attorney's fees. See generally Mot.

Along with their Motion and other supporting documentation, Plaintiffs filed as "Exhibit A" what appears to be a copy of the November 2008 Agreement, signed by Defendant on November 10, 2008 and by Plaintiff Stephen J. O'Sick ("O'Sick") on April 15, 2009. Dkt. No. 29-3 ("Agreement"). The Agreement appears to lay out the terms of settlement, including provisions for the entry of a judgment and the payment of liquidated damages and attorney's fees in the event of Defendant's non-compliance or non-performance. See generally id. The Agreement also contains a provision stating that Defendant waives all defenses to the filing of the Agreement. Id. at 7.

Defendant filed a Response to the Motion, primarily relying on New York state contract law and arguing that the liquidated damages that Plaintiffs had requested amounted to an impermissible penalty. Response at 1-2. In their Reply, Plaintiffs quote language from the Agreement and argue that Defendant is obligated to pay liquidated damages and comply with the terms of the Agreement. See generally Reply.

III. LEGAL STANDARD

"The district courts of the United States . . . are 'courts of limited jurisdiction. They possess only that power authorized by Constitution and statute.'" Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552 (2005) (quoting Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)). For a matter to properly be before a federal court, that court must have both subject matter and personal jurisdiction. Even if the parties themselves have not raised the issue, jurisdiction is a threshold issue which that a court must address and may raise sua sponte. See, e.g., Gonzalez v. Thaler, 132 S. Ct. 641, 648 (2012); Henderson ex rel. Henderson v. Shinseki, 131 S. Ct. 1197, 1202 (2011) ("[F]ederal courts have an independent obligation to ensure that they do not exceed the scope of their jurisdiction, and therefore they must raise and decide jurisdictional questions that the parties either overlook or elect not to press"); Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 107 (2d Cir. 1997). If a federal court lacks subject matter jurisdiction, it must dismiss the action. See FED. R. CIV. P. 12(h)(3); Arbaugh v. Y & H Corp., 546 U.S. 500, 514 (2006); Durant, Nichols, Houston, Hodgson & Cortese-Costa, P.C. v. Dupont, 565 F.3d 56, 62-63 (2d Cir. 2009).

IV. DISCUSSION

A. Jurisdiction

In this case, no party has questioned the Court's jurisdiction. See Mot., Resp., Reply. However, mindful of its "independent obligation to ensure that [it does] not exceed the scope of [its] jurisdiction," the Court addresses the issue of its subject matter jurisdiction sua sponte. Henderson, 131 S.Ct. at 1202. Therefore, the Court must apply Kokkonen to determine if the Court has authority to enforce the settlement agreement, or if such enforcement is properly the province of another court or the subject of another action.

An action seeking to enforce a settlement agreement "is more than just a continuation or renewal of [a] dismissed suit, and hence requires its own basis for jurisdiction." Kokkonen, 511 U.S. at 378. It is "well-settled" that a district court may "exercise ancillary jurisdiction to enforce a settlement agreement only if the dismissal order expressly retained jurisdiction over that particular agreement, or incorporated it into the order." State Street House, Inc. v. New York State Urban Development Corp., 75 F. App'x 807, 810 (2d Cir. 2003) (citing Herrick Co., Inc. v. SCS Communications, Inc., 251 F.3d 315, 327 (2d Cir. 2002) and Scelsa v. City University of New York, 76 F.3d 37, 41 (2d Cir. 1996) (underlying action based on federal claim jurisdiction)); see also Kokkonen, 511 U.S. at 378. A "judge's mere awareness and approval of the terms of the settlement agreement do not suffice to make them part of his order." Kokkonen, 511 U.S. at 381; see also Scelsa, 76 F.3d at 41 ("The mere reference in the order to the Agreement does not incorporate the Agreement into the order") (citing Miener v. Missouri Dep't of Mental Health, 62 F.3d 1126, 1128 (8th Cir. 1995)). Further, in Kokkonen, the Supreme Court emphasized the distinction between a new action to enforce a settlement agreement and "merely reopening . . . the dismissed suit," recognizing that enforcement of a settlement agreement posed more jurisdictional concerns and required an independent basis for jurisdiction. Kokkonen, 511 U.S. at 381.

Even if a dismissal order does not explicitly state that a court retains jurisdiction over a claim and does not explicitly incorporate the terms of the settlement agreement into the order, a federal court may still decide a motion to reopen a case and enforce a settlement agreement if an independent basis for jurisdiction exists. Id. at 382; see also Burke v. Lash Work Environments, Inc., 408 F. App'x 438, 439-41 (2d Cir. 2011);*fn1 ...


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