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Trustees of Cement Masons' Union Local 780 Benefit Funds v. J.H. Reid General Contractor

United States District Court, D. New Jersey

December 17, 2018

TRUSTEES OF THE CEMENT MASONS' UNION LOCAL 780 BENEFIT FUNDS, Plaintiff
v.
J.H. REID GENERAL CONTRACTOR, Defendant.

          OPINION

          WILLIAM J. MARTINI, U.S.D.J.

         THIS MATTER comes before the Court upon Plaintiff the Trustees of the Cement Masons' Union Local 780 Benefit Funds' Motion for Default Judgment, ECF No. [6] (“Motion”), filed on September 13, 2018. Defendant J.H. Reid General Contractor (“J.H. Reid” or “Defendant”) has not responded to the Motion. For the reasons set forth below, Plaintiff's Motion is GRANTED.

         I. FACTUAL BACKGROUND

         The Trustees of the Cement Masons' Union Local 780 Benefit Funds (“Local 780” or “Plaintiff”) initially filed the complaint in this action, ECF No. [1] (“Complaint”), against J.H. Reid on August 2, 2018. ECF No. [1]. Plaintiff alleges that over the course of several years J.H. Reid employed cement masons of Local 780. Id. ¶ 12. Based on Local 780's collective bargaining agreement, J.H. Reid was required to make certain contributions to Local 780's multi-employer benefit plans under ERISA (collectively, the “Funds”). ECF No. [1] ¶¶ 4-5, 12-13. According to the Complaint, in 2017 Local 780's independent auditor concluded that J.H. Reid was delinquent as to certain required contributions. Id. ¶ 15. On April 1, 2017, Local 780 sent a letter to J.H. Reid demanding payment of the delinquent funds plus additional damages and interest, totaling $94, 170.27. Id. To date, J.H. Reid has not cured any of the delinquent payments. Id. ¶ 17. Based on these facts, Local 780 brings claims against J.H. Reid for violations of ERISA and breach of fiduciary duty.

         II. THE INSTANT MOTION

         After Local 780 served J.H. Reid on August 9, 2018, ECF No. [4], and J.H. Reid failed to timely appear, respond, or otherwise defend this action, Plaintiff filed a request for entry of default by the Clerk of Court on September 4, 2018. ECF No. [5]. Default was entered the following day, and Plaintiff subsequently filed the instant Motion on September 13, 2018. ECF No. [6].

         In the Motion, Plaintiff requests that the Court enter default judgment against Defendant in the amount of $97, 939.77 comprised of delinquent contributions and statutory penalties, attorneys' fees, and costs as follows:

• $94, 170.27 in unpaid contributions, interest, liquidated damages, and audit fees;
• $3, 290.00 in attorneys' fees; and
• $479.50 in costs.

Id. at 7. Defendant has not responded to the Motion.

         III. LEGAL STANDARD

         Under Federal Rule of Civil Procedure 55, a district court may enter default judgment against a party who has failed to plead or otherwise respond to the action filed against him. Fed.R.Civ.P. 55(b)(2). To obtain a default judgment, a plaintiff must first request entry of default by the Clerk of Court under Fed.R.Civ.P. 55(a). Nationwide Mutual Ins. Co. v. Starlight Ballroom Dance Club, Inc., 175 Fed. App'x 519, 521 n.1 (3d Cir. 2006). Once default is entered, a plaintiff seeking default judgment must then file a motion with the district court requesting entry of default. Id.

         A plaintiff, however, is not entitled to entry of default judgment as of right. Hritz v. Woma Corp., 732 F.2d 1178, 1180 (3d Cir.1984). Rather, entry of such a judgment is in the discretion of the district court. Id. First, the court must determine whether “the unchallenged facts constitute a legitimate cause of action” so that default judgment would be permissible. DirecTV, Inc. v. Asher, No. 03-1969, 2006 WL 680533, at *1 (D.N.J. Mar.14, 2006) (citing Charles A. Wright, 10A Federal Practice and Procedure § 2688, at 58-59, 63 (3d ed.1998)). If default judgment is permissible, then the court weighs three factors to determine whether default judgment is appropriate: “(1) prejudice to the plaintiff if default is denied, (2) whether the defendant appears to have a litigable defense, and (3) whether defendant's delay is due to culpable conduct.” Chamberlain v. Giampapa, 210 F.3d 154, 164 (3d Cir. 2000) (citing $55, 518.85 in U.S. Currency, 728 F.2d ...


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