United States District Court, S.D. New York
TRUSTEES OF THE NEW YORK CITY DISTRICT COUNCIL OF CARPENTERS PENSION FUND, WELFARE FUND, ANNUITY FUND, AND APPRENTICESHIP, JOURNEYMAN RETRAINING, EDUCATIONAL AND INDUSTRY FUND, et al.,
ANTHONY RIVARA CONTRACTING, LLC, Respondent. Petitioners,
OPINION & ORDER
PAUL A. ENGELMAYER, District Judge.
On March 14, 2014, the Trustees of the New York City District Council of Carpenters Pension Fund, Welfare Fund, Annuity Fund, and Apprenticeship, Journeyman Retraining, Educational, and Industry Fund; the Trustees of the New York City Carpenters Relief and Charity Fund; the New York City and Vicinity Carpenters Labor Management Corporation; and the New York City District Council Carpenters (collectively, "petitioners") commenced this action to confirm an arbitration award ("Award") issued against respondent Anthony Rivara Contracting, LLC ("Rivara"). Dkt. 2 ("Petition"). This action was filed under Section 502(a)(3) of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1132(a)(3); Section 301 of the Labor Management Relations Act of 1947 ("LMRA"), 29 U.S.C. § 185; and Section 9 of the Federal Arbitration Act ("FAA"), 9 U.S.C. § 9. Petitioners also seek interest plus attorney's fees and costs incurred during this proceeding.
The Petition was served on Rivara on March 27, 2014. Dkt. 3. On April 10, 2014, the Court directed Rivara to file its opposition by May 22, 2014, a deadline later extended to June 27, 2014. Dkt. 4, 12. To date, Rivara has not opposed the Petition or otherwise appeared in this action.
For the following reasons, the Award is confirmed, and petitioners' requests for interest and attorney's fees and costs are granted.
Since at least February 24, 2010, Rivara has been a member of the General Contractors Association of New York ("GCA"). Dkt. 10 ("Declaration") Ex. A. As a member of the GCA, Rivara must comply with a collective bargaining agreement (the "Agreement") executed by various labor organizations. Declaration Ex. A, C. Under the Agreement, Rivara was required to contribute to certain fringe benefit funds for every hour its covered employees worked. See Agreement at 31-32. To ensure compliance, the Agreement authorized those funds to audit Rivara's books and records. Id. at 36. If Rivara failed to comply with an audit request, a policy incorporated by reference in the Agreement authorized the fringe benefit funds to estimate Rivara's delinquent contributions based on the company's past remittances. See Declaration Ex. D ("Collection Policy") at 6-7; Agreement at 32 ("The Employer will comply with procedures established by the Benefit Fund Trustees to assure that the employee receives the benefit contribution..."). A dispute arose when Rivara failed to remit $362, 385.13 in contributions identified as delinquent during an audit conducted by petitioners. Petition ¶¶ 12-13.
Article XI, Section 11 of the Agreement contains an arbitration clause stating that "either party may seek arbitration" to resolve "any dispute or disagreement." Agreement at 39. A separate section on "disputes" contains stronger language compelling arbitration: it states that any dispute not resolved through the labor organizations' internal grievance procedure " shall be submitted to arbitration." Id. at 13 (emphasis added). The arbitration clause further provides that the arbitrator's award "shall be final and binding" and "shall be wholly enforceable in any court of competent jurisdiction." Id. at 39. Under the Agreement, if court proceedings are later instituted to collect delinquent contributions to fringe benefit funds, the employer must pay the unpaid contributions plus "interest on the unpaid contributions determined at the prime rate of Citibank plus 2%, " "liquidated damages of 20% of the amount of the unpaid contribution, " and "reasonable attorney's fees and costs of the action." Id. at 35-36.
Pursuant to the Agreement, petitioners submitted the dispute to arbitration. Petition ¶ 14. On January 24, 2014, arbitrator Roger Maher held a hearing. See Petition Ex. A ("Award") at 1. Despite having received notice of the arbitration, Rivara did not appear or request an adjournment. Id. at 2. The arbitrator accordingly found Rivara in default, and heard evidence submitted by petitioners. Id.
On January 31, 2014, the arbitrator issued an Opinion and Default Award. See Award at 1. Based on the "substantial and credible evidence" petitioners had presented, the arbitrator found that Rivara was bound by the Agreement effective April 27, 2010, and had failed to permit petitioners' auditors to examine the corporate books and records for the period between June 29, 2011, and September 23, 2013. Id. at 2. The arbitrator awarded a principal amount of $362, 385.13 - the auditors' estimated amount of delinquent contributions - plus interest at the rate of 5.25% to accrue from the date of the Award, liquidated damages, Promotional Funds, attorney's fees, arbitrator's fees, and costs, for a total of $461, 991.73, excluding interest. Id. at 3. To date, Rivara has not paid the Award. Petition ¶ 17.
On March 14, 2014, petitioners filed their Petition (styled as a Complaint) to confirm the arbitration Award. Dkt. 2. Petitioners seek a judgment confirming the Award, a sum of $461, 991.73, interest on the $362, 385.13 in delinquent contributions, and attorney's fees and costs incurred in this action. Petition ¶¶ (1)-(4). Rivara was served on March 27, 2014, Dkt. 3, and received notice of the present action on four other occasions, Dkt. 5, 7, 11, 13. On April 10, 2014, the Court issued an order construing the Complaint as an unopposed motion for summary judgment and directing Rivara to submit any opposition by May 22, 2014, later extended to June 27, 2014. Dkt. 4, 12. Rivara failed to appear or otherwise respond to any of petitioners' submissions. The petition remains unopposed.
A. Applicable Legal Standards
The FAA provides a "streamlined" process for a party seeking a "judicial decree confirming an award." Hall St. Assocs. L.L.C. v. Mattel, Inc., 552 U.S. 576, 582 (2008). "Normally, confirmation of an arbitration award is a summary proceeding that merely makes what is already a final arbitration award a judgment of the court, and the court must grant the award unless the award is vacated, modified, or corrected." D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 110 (2d Cir. 2006) (citations omitted). But "[a]rbitration awards are not self-enforcing." Id. at 104 (citation omitted). Rather, "they must be given force and effect by being converted to judicial orders by courts." Id.
Review of an arbitral award by a district court "is severely limited' so as not unduly to frustrate the goals of arbitration, namely to settle disputes efficiently and avoid long and expensive litigation." Salzman v. KCD Fin., Inc., No. 11 Civ. 5865 (DLC), 2011 WL 6778499, at *2 (S.D.N.Y. Dec. 21, 2011) (quoting Willemijn Houdstermaatschappij, BV v. Standards Microsystems Corp., 103 F.3d 9, 12 (2d Cir. 1997)). Indeed, "an arbitration award should be enforced, despite a court's disagreement with it on the merits, if there is a barely colorable justification for the outcome reached.'" Landy Michaels Realty Corp. v. Local 32B-32J, ...