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Pension v. Ramco Solutions

United States District Court, Third Circuit

August 26, 2013

LABORERS INTERNATIONAL UNION OF NORTH AMERICA LOCAL NO. 199 WELFARE, PENSION, APPRENTICESHIP & TRAINING, ANNUITY and LABORERS-EMPLOYERS COOPERATIVE EDUCATION TRUST FUNDS OF DELAWARE, INC., and LABORERS INTERNATIONAL UNION OF NORTH AMERICA, LOCAL 199, Plaintiffs,
v.
RAMCO SOLUTIONS, Defendant.

OPINION

ROBERT B. KUGLER, District Judge.

This matter comes before the Court upon the motion of Plaintiffs Laborers International Union of North America Local No. 199 Welfare, Pension, Apprenticeship & Training, Annuity and Laborers-Employers Cooperative Education Trust Funds of Delaware Inc. and Laborers International Union of North America Local No. 199's ("Plaintiffs"). Plaintiffs have asserted claims against Ramco Solutions ("Defendant") for unpaid fringe benefit contributions, unpaid union dues, and liquidated damages pursuant to Sections 502 and 515 of the Employee Retirement Income Security Act of 1974, as amended, ("ERISA"), and Section 301 of the Labor Management Relations Act of 1947, as amended ("LMRA"). See 29 U.S.C. §§ 1132 and 1145; 29 U.S.C. § 185. Plaintiffs now move for default judgment, pursuant to Federal Rule of Civil Procedure 55, and seek payment for unpaid contributions, attorney's fees, and costs. For the reasons stated herein, the Court will grant Plaintiffs' motion and enter judgment against Defendant in the amount of $5, 508.84.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY[1]

Plaintiff Laborers International Union of North America, Local No. 199 Welfare, Pension, Apprenticeship, Vacation, Apprenticeship and Training, Annuity and Laborers-Employers Cooperative Education Trust Funds ("Funds") are jointly-administered multi-employer benefit funds pursuant to § 302 of the LMRA and 3(37)(A) of ERISA. Compl. ¶ 3. Plaintiff Laborers International Union of North America, Local 199 ("Local 199") is a labor organization within the meaning of § 2(5) of the National Labor Relations Act ("NLRA") and an employee organization within the meaning of § 3(4) of ERISA. Id. at ¶ 4. The Funds' offices are located in Delaware, and Local 199's principal place of business is in Delaware. Id. at ¶¶ 4-5. Defendant is a New Jersey corporation with its principal place of business in New Jersey. Defendant is an employer within the meaning of § 3(5) of ERISA that is engaged in an industry affecting commerce within the meaning of §301 of the LMRA and § 152(2) of the NLRA. Id. at ¶ 5.

Defendant agreed to be bound by the terms of a collective bargaining agreement (the "Agreement") between Local 199 and the Delaware Contractors Association. Compl. ¶ 6. The Agreement set forth various terms and conditions of employment for Defendant's employee laborers. Id. Specifically, the Agreement provided that Defendant must make timely contributions to the Funds on a monthly basis and submit timely monthly contribution report forms to the Funds' administrator. Id. The Agreement also required Defendant to withhold union dues and contributions to the Delaware Laborers Political League ("DELPL") and the Vacation Fund from laborers' wages, and compel any laborer employee to join the Union within seven (7) days after the date of hire. Id. According to the Agreement, contributions and contribution report forms not received by the fifteenth day of the month would be subject to a ten percent (10%) liquidated damages charge. Id. at ¶¶ 8, 41.

Plaintiffs filed suit against Defendant on August 29, 2011, alleging breach of the collective bargaining agreement based on Defendant's failure to make contributions and failure to withhold and transmit monthly union dues and contributions. Compl. ¶¶ 28-50. Plaintiffs also allege violations of ERISA due to Defendant's failure to make contributions and failure to pay liquidated damages. Id. In the Complaint, Plaintiffs sought overdue benefit fund contributions, overdue contribution reports, liquidated damages, and litigation costs. Pl.'s Mot. Def. J. at ¶ 3.

Defendant was served on September 6, 2011. Id. at ¶¶ 5-6. After Defendant failed to respond to Plaintiffs' Complaint, and at Plaintiffs' request, the Clerk of Court entered default on November 4, 2011. Id. at ¶ 7. On July 16, 2012, the Court dismissed the case based on the parties' agreement to settle. Id. at ¶ 8. When the parties failed to consummate the settlement, however, the dismissal was vacated, and the case was reopened on September 28, 2012. Id. at ¶

9. Plaintiffs filed the instant motion for default judgment on December 7, 2012. Id. at ¶ 17.

II. DISCUSSION AND ANALYSIS

Federal Rule of Civil Procedure 55(b)(2)[2] allows the Court, upon a plaintiff's motion, to enter default judgment against a defendant that has failed to plead or otherwise defend a claim for affirmative relief. While the decision to enter default judgment is left principally to the discretion of the district court, there is a well-established preference in this Circuit that cases be decided on the merits rather than by default whenever practicable. Hritz v. Woma Corp., 732 F.2d 1178, 1180-81 (3d Cir. 1984). Consequently, the Court must address a number of issues before deciding whether a default judgment is warranted in the instant case. If it finds default judgment to be appropriate, the Court's next step is to determine a proper award of damages.

A. Appropriateness of Default Judgment

i. The Court's Jurisdiction

First, the Court must determine whether it has both subject matter jurisdiction over Plaintiffs' cause of action and personal jurisdiction over Defendant. U.S. Life Ins. Co. in City of New York v. Romash, No. 09-3510, 2010 WL 2400163 at *1 (D.N.J. June 9, 2010). Verifying the Court's jurisdiction is of particular concern where, as here, the defaulting party has failed to make any sort of appearance or submit any responsive communication to the Court. In this case, Plaintiffs allege that Defendant's conduct violates ERISA and the LMRA. The Court therefore has federal question subject matter jurisdiction over Plaintiffs' claims. See 28 U.S.C. § 1331. In addition, the Court exercises personal jurisdiction ...


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