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Pending, Annuity, Supplemental v. Alltek Security Systems Group, Inc.

United States District Court, D. New Jersey

December 23, 2014

IBEW LOCAL 400 WELFARE, PENSION, ANNUITY, SUPPLEMENTAL, and JOINT APPRENTICESHIP, TRAINING FUNDS, et al., Plaintiffs,
v.
ALLTEK SECURITY SYSTEMS GROUP, INC., Defendant.

OPINION & ORDER

ESTHER SALAS, District Judge.

This action comes before the Court on IBEW Local 400 Welfare, Pension, Annuity, Supplemental, and Joint Apprenticeship Training Funds' (the "Funds") and Guy Peterson's (collectively, "Plaintiffs") motion for default judgment pursuant to Federal Rule of Civil Procedure 55(b)(2). The Court has proper jurisdiction pursuant to Section 301 of the Labor Management Relation Act, 29 U.S.C. § 185. Having considered Plaintiffs' submissions, (D.E. No. 12), the Court hereby GRANTS in part and RESERVES in part Plaintiffs' motion for default judgment.

I. FACTUAL BACKGROUND

The Funds are trust funds established and maintained pursuant to the Labor Management Relations Act ("LMRA") and the Employee Retirement Income Security Act ("ERISA"). (D.E. No. 1, Complaint ("Compl.") ¶ 4). Plaintiffs allege that Guy Peterson is a trustee and fiduciary for the Funds within the meaning of ERISA, 29 U.S.C. § 1002(21)(A). ( Id. ¶ 6). Plaintiffs commenced this action on July 16, 2013, alleging that Defendant AllTek Security Systems Group, Inc., an employer, failed to remit contributions to the Funds and refused to comply with Plaintiffs' audit requests. (Compl. ¶¶ 14, 15, 18). On July 22, 2013, Plaintiffs served Defendant with a copy of the Summons and Complaint. (D.E. No. 6). The time for answering the Complaint has since expired, and as of this date, Defendant has failed to interpose an answer or otherwise respond to the Complaint.

On August 29, 2013, Plaintiffs requested the Clerk of the Court to enter default against Defendant. (D.E. No. 7). The Clerk of the Court did so the following day. (D.E. dated 8/30/2013).

On October 10, 2013, Plaintiffs filed a motion seeking default judgment against Defendant. (D.E. No. 10). In support of this motion, Plaintiffs filed three agreements: two Inside Agreements, (D.E. No. 10-4, Ex. A), and the Policy for Collection of Delinquent Contributions, (D.E. No. 10-5, Ex. B). The Inside Agreements were made between the "Monmouth-Ocean Division of the Northern New Jersey Chapter, Inc., Nation Electrical Contractors Association, Inc. (NECA) and Local Union No. 400, IBEW." (D.E. No. 10-4, Ex. A at 1). Defendant was not a signatory to the Inside Agreements. Furthermore, it was unclear whether Defendant assented to the Policy for Collection of Delinquent Contributions because the parties who signed the Policy were individually labeled as "Trustee[s]." (D.E. No. 10-5, Ex. B art. V).

Having found that Plaintiff failed to provide proof that Defendant assented to the Inside Agreements and Policy for Collection of Delinquent Contributions, the Court denied Plaintiffs' motion for default judgment. ( See D.E. No. 11, Opinion & Order at 2, 3). The Court ordered Plaintiffs to re-file their motion within thirty days and identify which provisions in the agreements Plaintiffs relied upon in their claims. ( Id. ). Additionally, the Court ordered Plaintiffs to submit proof that Defendant specifically assented to the agreements. ( Id. ).

On May 22, 2014, Plaintiffs re-filed their motion for default judgment. (D.E. No. 12). In support of this motion, Plaintiffs filed the following agreements: the Inside Agreement, (D.E. No. 12-4, Ex. A); the Policy for Collection of Delinquent Contributions, (D.E. No. 12-5, Ex. B); the Agreement and Declaration of Annuity Fund Trust, (D.E. No. 12-5, Ex. E); the Welfare Fund Agreement and Declaration of Trust, (D.E. No. 12-6, Ex. F); the Pension Fund Agreement and Declaration of Trust, (D.E. No. 12-6, Ex. G) (collectively, the "Labor Agreements"); and Letters of Assent to the Inside Agreement, Outside Agreement, and Residential/Small Works Agreement, (D. E. No. 12-5, Ex. C). Plaintiffs allege that Defendant agreed to abide by the terms of the Labor Agreements and failed to comply when Plaintiffs requested an audit to determine the amount of Defendant's delinquent contributions. (D.E. No. 12-1 ¶¶ 6, 7; Compl. ¶¶ 12-15). As such, Plaintiffs have requested that the Court compel Defendant to submit to an audit, award damages in the amount of delinquent contributions due, and award reasonable attorneys' fees and costs. (Compl. at 7-8).

II. DISCUSSION

A. Plaintiffs' Standing

Before considering the merits of Plaintiffs' default judgment motion, the Court will address Plaintiffs' standing to bring a civil action. Plaintiffs allege that the Court has proper jurisdiction pursuant to Section 502 of ERISA and Section 301 of the LMRA. (Compl. ¶ 1). Although ERISA allows benefit plans to "sue or be sued as entities, " 29 U.S.C. § 1132(d)(1), the act only enables a "participant, beneficiary, or fiduciary" to bring a civil action. 29 U.S.C. § 1132(a). The Funds have not alleged that they are a participant, beneficiary, or fiduciary; rather, the Complaint alleges that "[t]he Funds bring this action on behalf of their Trustees, committee members, participants and beneficiaries...." (Compl. ¶ 8). Therefore, the Court cannot exercise jurisdiction over the Funds' ERISA claims. See Nat'l Health Plan Corp. v. Teamsters Local 469, No. 13-4084, 2014 WL 4589917, at *2 (3d Cir. Sept. 16, 2014) (stating that a fund must allege that it is a participant or beneficiary to proceed under § 1132(a)(1)); Northeast Dept. ILGWU Health & Welfare Fund v. Teamsters Local Union No. 229 Welfare Fund, 764 F.2d 147, 153 (3d Cir. 1985) (holding that jurisdiction over a suit between two ERISA plans could not be sustained under § 1132(a)(1)(B)).

The Court notes, however, that Plaintiff Peterson does have standing to bring civil action under ERISA. Plaintiffs allege that Peterson is a trustee and fiduciary for the Funds within the meaning of Section 3(21) of ERISA. (Compl. ¶ 6). As stated above, a fiduciary may bring a civil action under ERISA. See 29 U.S.C. § 1132(a). Although Plaintiff Peterson has standing, the Court declines to exercise jurisdiction under ERISA because the Funds lack of standing. The Funds shall have thirty days from the date of this Opinion and Order to establish that they have standing under ERISA. If properly established, the Court will exercise jurisdiction over Plaintiffs' ERISA claims.

With regards to the LMRA, the Court finds that Plaintiffs have standing to bring a civil action. Section 301 of the LMRA allows for "suits... between an employer and a labor organization representing employees in an industry affecting commerce...." 29 U.S.C. § 185(a). Furthermore, unlike ERISA, the LMRA does not limit the types of parties that may bring suit to enforce rights guaranteed by labor agreements. See Local 159, 342, 343 & 444 v. Nor-Cal Plumbing, Inc., 185 F.3d 978, 984 (9th Cir. 1999) ("Section 301 does not limit the parties who may bring suit so long as the object of the suit is the enforcement of rights guaranteed by an agreement between an employer and a labor organization."); Teamsters Health & Welfare Fund of Phila. v. H.P. Kanady, Inc., No. 12-1470, 2012 WL 3185952, at *2 (D.N.J. Aug. 2, 2010) (allowing a union and pension fund to bring suit for unpaid contributions under the LMRA); Int'l Ass'n of Heat & Frost Insulators & Asbestos Workers Local 42 v. S. Jersey Insulation Servs., No. 05-3143, 2007 WL 276137, at *3 (D.N.J. Jan. 26, 2007) (same). Here, ...


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