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, 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, Plaintiffs,
DEPENDABLE OFFICE INSTALLATION LLC, Defendant.
HONORABLE JOHN G. KOELTL, United States District Judge,
REPORT AND RECOMMENDATION
PITMAN, United States Magistrate Judge
employer and employee trustees of multi-employer
labor-management trust funds, the trustees of a charitable
organization and a labor organization that represents
employees and a not-for-profit corporation commenced this
action to enforce an arbitration award. The arbitration award
was entered as a result of defendant's breach of a
collective bargaining agreement that required defendant to
make contributions to the funds and the charitable
organization. Defendant defaulted in the arbitration
proceeding, and the arbitrator awarded plaintiffs a total of
$1, 042, 943.46, comprised of unpaid contributions, interest,
liquidated damages, attorneys' fees, arbitrator's
fees and other items.
being duly served with the summons and complaint, defendant
failed to answer or move with respect to the complaint, and
on April 2, 2015, the Honorable John G. Koeltl, United States
District Judge, determined that plaintiffs were entitled to a
default judgment and referred the matter to me to conduct an
inquest. Pursuant to that Order of reference, I issued an
order on April 17, 2015 directing plaintiffs to make their
inquest submissions by June 16, 2015 and directing defendant
to submit any responsive materials by July 16, 2015. My April
17, 2015 scheduling Order further provided:
IF DEFENDANT (1) FAILS TO RESPOND TO PLAINTIFFS'
SUBMISSIONS, OR (2) FAILS TO CONTACT MY CHAMBERS BY July 16,
2015 AND REQUEST AN IN-COURT HEARING, IT IS MY INTENTION TO
ISSUE A REPORT AND RECOMMENDATION CONCERNING DAMAGES ON THE
BASIS OF PLAINTIFFS' 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.")
(Emphasis in original.) Although plaintiff made timely
submissions in accordance with my Order, defendant has not
made any submissions, nor has it contacted my chambers in any
way. Accordingly, I make the following report and
recommendation on the basis of plaintiffs' submissions
initial issue which is not addressed in plaintiffs'
submissions is whether proceeding by way of inquest is
appropriate. The Court of Appeals has stated that:
[D]efault judgments in confirmation/vacatur proceedings are
generally inappropriate. A motion to confirm or vacate an
award is generally accompanied by a record, such as an
agreement to arbitrate and the arbitration award decision
itself, that may resolve many of the merits or at least
command judicial deference. When a court has before it such a
record, rather than only the allegations of one party found
in complaints, the judgment the court enters should be based
on the record. It does not follow, of course, that the
non--movant can simply ignore such a motion.
D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 109
(2d Cir. 2006); accord 1199/SEIU United Healthcare
Workers East v. South Bronx Mental Health Council,
Inc., 13 Civ. 2608 (JGK), 2014 WL 840965 at *5-*6
(S.D.N.Y. Mar. 4, 2014) (Koeltl, D.J., adopting the Report
& Recommendation of Freeman, M.J.). The Court of Appeals
went on to conclude that unopposed actions to confirm or
vacate an arbitration award should be treated as unopposed
motions for summary judgment. D.H. Blair & Co. v.
Gottdiener, supra, 462 F.3d at 109-10;
accord Trustees of the New York City Dist. Council of
Carpenters Pension Fund v. Coastal Envtl. Grp., Inc., 16
Civ. 6004 (GHW), 2016 WL 7335672 at *3 (S.D.N.Y. Dec. 16,
2016) (Woods, D.J.); GE Transportation (Shenyang) Co. v.
A-Power Energy Generation Sys., Ltd., 15 Civ. 6194
(PAE), 2016 WL 3525358 at *4 (S.D.N.Y. June 22, 2016)
(Engelmayer, D.J.); Trustees for The Mason Tenders Dist.
Council Welfare Fund v. Earth Constr. Corp., 15 Civ.
3967 (RA), 2016 WL 1064625 at *3 (S.D.N.Y. Mar. 15, 2016)
given defendant's default in both the arbitration
proceeding and this proceeding, treating the inquest as an
uncontested motion for summary judgment has little practical
difference. Where a defendant defaults in both the
arbitration and confirmation proceedings,
the distinction between moving for default judgment and
moving for summary judgment in confirmation of an arbitration
proceeding is purely academic. Defendant did not contest
plaintiffs' claims during the arbitration hearing.
Therefore, the arbitrator found defendant in default, and
awarded plaintiffs damages accordingly. For the Court's
purposes, defendant never put forward a case in either the
arbitration or judicial phases of this dispute. . . . As
such, a more stringent review of plaintiffs' case under
the summary judgment standard does not improve
defendant's posi- tion; plaintiffs' claims, from the
beginning, have gone uncontested.
Trs. of Unite Here Nat. Health Fund v. New Age Intimates,
Inc., Nos. 07-CV-2892 (RRM)(CLP), 07-CV-2892 (RRM)(CLP),
2008 WL 3833841 at *4 (E.D.N.Y. Aug. 14, 2008); accord
D.H. Blair & Co. v. Gottdiener, supra, 462
F.3d at 109 ("If the non-movant does not respond [to an
action seeking confirmation of an arbitration award], its
failure to contest issues not resolved by the record will
weigh against it."); see Trustees of the Building
Trades Annuity Fund v. Professional Plumbing of
Staten Island Corp., No. CV-09-3812 (ADS)(ART), 2010 WL
6230530 at *2 (E.D.N.Y. Nov. 17, 2010); Laundry, Dry
Cleaning Workers & Allied Indus. Health Fund,
United Here! v. Jung Sun Laundry Group Corp., No.
08-CV-2771 (DLI)(RLM), 2009 WL 704723 at *3 (E.D.N.Y. Mar.
16, 2009). Accordingly, the issue to be resolved here is
whether, based on the uncontested submissions before me,
there is a genuine issue of material fact.
the facts "in the light most favorable" to
defendant, Tolan v. Cotton, 134 S.Ct. 1861, 1866
(2014), and "resolv[ing] all ambiguities and draw[ing]
all permissible factual inferences in favor of"
defendant, Johnson v. Killian, 680 F.3d 234, 236 (2d
Cir. 2012), I find that there is no genuine issue as to the
facts set forth below.
addition, after applying the law to the facts, I respectfully
recommend that (1) judgment be entered in favor of plaintiffs
in the amount of $1, 042, 943.46 with interest at the rate of
5.25% from October 28, 2014 to the present; (2) plaintiffs be
awarded attorneys' fees in the amount of $8, 115.00 and
(3) that plaintiffs be awarded costs in the amount of
Findings of Fact
Plaintiffs Trustees of the New York City District Council of
Carpenters Pension, Welfare Annuity, Apprenticeship,
Journeyman retraining and Educational Industry Funds (the
"ERISA Funds") are employer and employee trustees
of multiemployer labor-management trust finds organized and
operated in accordance with the Employee Retirement Income
Security Act of 1974, 29 U.S.C. §§ 1001 et
seq. ("ERISA"). The Trustees are fiduciaries
within the meaning of Section 2(21) of ERISA, 29 U.S.C.
§ 1002(21). The ERISA Funds maintain their principal
place of business at 395 Hudson Street, New York, New York
10014 (Declaration of Luke Powers, dated June 16, 2015
(Docket Item ("D.I.") 19) ("Powers
Decl.") ¶ 3).
Plaintiffs Trustees of the New York City District Council of
Carpenters Relief and Charity Fund ("Charity Fund")
(the ERISA Funds and the Charity Fund collectively are
referred to herein as the "Funds") are Trustees of
a charitable organization established under section 501(c)(3)
of the Internal Revenue Code, 26 U.S.C. § 501(c)(3). The
Charity Fund maintains its principal place of business at 395
Hudson Street, New York, New York 10014 (Powers Decl. ¶
Plaintiff the New York City District Council Carpenters (the
"Union") is a labor organization that represents
employees in an industry affecting commerce within the
meaning of section 501 of the Labor Management Relations Act
("LMRA"), 29 U.S.C. § 142, and is the
certified bargaining representative for certain employees of
the Defendant (Powers Decl. ¶ 5).
Plaintiff New York City and Vicinity Carpenters
Labor-Management Corporation is a New York not-for-profit
corporation (Powers Decl. ¶ 6).
Dependable Office Installation LLC ("Dependable")
is a corporation organized under the laws of New Jersey.
Dependable is an employer within the meaning of Section 3(5)
and 515 of ERISA, 29 U.S.C. §§ 1002(5) and 1145,
and is an employer in an industry affecting commerce within
the meaning of Sections 301 and 501 of the LMRA, 29 U.S.C.
§§ 185, 142. Dependable maintains its principal
place of business at 55 Elm Hill Road, Clifton, New Jersey
07055 (Powers Decl. ¶ 7).
March 15, 2011, Dependable executed an Independent Building
Agreement (the "CBA") with the Union (Powers Decl.
¶ 8 & Ex. A thereto).
CBA required Dependable to make specified contributions to
the Funds in connection with all work performed within the
trade and geographical jurisdiction of the Union (Powers
Decl. ¶ 9 and Ex. A thereto at Art XV, § 1). The
contributions were based on the number of hours that workers
spent performing work within the trade and geographical
jurisdiction of the Union.
CBA required Dependable to submit to audits of its books and
records to verify that it made all required contributions to
the Funds (Powers Decl. ¶¶ 9, 10 and Ex. A thereto
at Art XV, § 1).
CBA provided that "[i]t shall be a violation of this
Agreement for any signatory Employer to fail to furnish
proper records when requested, for the purpose of completing
an audit" (Powers Decl. Ex. A at Art XV, § 1).
CBA provided that if the Funds commence proceedings before an
arbitrator to collect delinquent contributions, and the
arbitrator renders an award in favor of the Funds, the
arbitrator shall be empowered to award such interest,
liquidated damages and/or costs as may be applicable under
the CBA and the Declaration of Trust establishing the Funds
(Powers Decl. Ex. A at Art XV, § 6).
the Funds are required to institute litigation to recover
delinquent contributions, the CBA provides that the Funds are
entitled to recover: (1) the unpaid contributions; (2)
interest from the due dates of the unpaid contributions
through the date of judgment, calculated at Citibank's
prime rate plus 2%; (3) liquidated damages; (4) reasonable
attorneys' fees and (5) such other legal or equitable
relief as the Court deems appropriate (Declaration of
Christopher Ozard, dated June 15, 2015 (D.I. 20) ("Ozard
Decl.") Ex. B thereto at § V).
CBA further bound Dependable to the terms and conditions of
the Collection Policy promulgated by the Funds (Powers Decl.
Ex. A at Art XV, § 3).
Collection Policy provides that if Dependable refused to make
its books and records available for audit, the Funds could
determine the existence and amount of a delinquency through a
prescribed method (Ozard Decl. ¶ 4 & Ex. B thereto
at § V, ¶ 12).
Collection Policy provides that the Funds may estimate a
delinquency by comparing the average of the four highest
consecutive weeks to each week within the requested audit
period. If Dependable's actual contributions were less
than the contributions that would have been due based on the
average of the four highest consecutive weeks, the difference
constituted a delinquency (Ozard Decl. Ex. B § IV,
Collection Policy further provides that "[a]
determination [of estimated principal] under [the Collection
Policy] shall constitute presumptive evidence of