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Trustees of B.A.C. Local 4 Pension Fund v. Danaos Group LLC

United States District Court, D. New Jersey

July 31, 2019

TRUSTEES OF THE B.A.C. LOCAL 4 PENSION FUND, TRUSTEES OF THE NEW JERSEY B.A.C. ANNUITY FUND, TRUSTEES OF THE NEW JERSEY B.A.C. HEALTH FUND, TRUSTEES OF THE NEW JERSEY BM&P APPRENTICE AND EDUCATION FUND, TRUSTEES OF THE BRICKLAYERS & TROWEL TRADES INTERNATIONAL PENSION FUND, AND TRUSTEES OF THE INTERNATIONAL MASONRY INSTITUTE, Plaintiffs,
v.
DANAOS GROUP LLC, Defendant.

          OPINION

          HON. MADELINE COX ARLEO UNITED STATES DISTRICT JUDGE.

         This matter comes before the Court upon application by Plaintiffs Trustees of the B.A.C. Local 4 Pension Fund, Trustees of the New Jersey B.A.C. Annuity Fund, Trustees of the New Jersey B.A.C. Health Fund, Trustees of the New Jersey BM&P Apprentice and Education Fund, Trustees of the Bricklayers & Trowel Trades International Fund, and Trustees of the International Masonry Institute (collectively “Plaintiffs”) for an entry of default judgment against Defendant Danaos Group LLC (“Danaos” or “Defendant”) pursuant to Federal Rule of Civil Procedure 55(b)(2). ECF No. 6. For the reasons set forth herein, Plaintiffs' Motion is GRANTED.

         I. BACKGROUND

         Plaintiffs are the employer and employee trustees of various labor-management trust funds (the “Funds”). Compl. ¶¶ 4-12. The Funds are organized and operated pursuant to trust agreements and various collective bargaining agreements. Id. Defendant Danaos is a corporation organized and established under the laws of New Jersey with a principal place of business located in Fort Lee, New Jersey. Id. ¶ 10.

         Danaos was party to a collective bargaining agreement (the “CBA”) with the B.A.C. Administrative District Council of New Jersey (the “Union”). Id. ¶ 11. The CBA provided that Danaos would make specified contributions to the Funds, id. ¶ 12, and make its books and records open for verification, id. ¶ 13. An audit of Danaos' books and records (the “Audit”) revealed that Danaos failed to make its required contributions to the Funds for the period of January 1, 2016 through December 31, 2016. Id. ¶ 14.

         On November 1, 2018, Plaintiffs filed a complaint against Danaos in this Court. Compl. ¶ 1. The Complaint consists of one count against Defendant for delinquent contributions in violation of the Employee Retirement Income and Security Act (“ERISA”) of 1974, 29 U.S.C. § 1145. Id. ¶¶ 17-18. Danaos has not responded to Plaintiffs' Complaint. Default was duly noticed by the Clerk of the Court against Danaos on December 12, 2018 for its failure to plead or otherwise defend this action. Docket Entry dated December 12, 2018. Plaintiffs now request that the Court enter default judgment against Danaos. ECF No. 6.

         II. LEGAL STANDARD

         The Court has the discretion to enter a default judgment, but a decision on the merits is preferred. Animal Sci. Prods., Inc. v. China Nat'l Metals & Minerals Imp. & Exp. Corp., 596 F.Supp.2d 842, 848 (D.N.J. 2008). Before entering a default judgment, the Court must determine: (1) whether there is sufficient proof of service; (2) whether a cause of action was sufficiently stated; and (3) whether default judgment is proper. Paniagua Grp., Inc. v. Hosp. Specialists, LLC, 183 F.Supp.3d 591, 599 (D.N.J. 2016); Teamsters Health & Welfare Fund of Phila. & Vicinity v. Dubin Paper Co., No. 11-7137, 2012 WL 3018062, at *2 (D.N.J. July 24, 2012). To determine whether a default judgment is proper, the Court must consider and make “explicit factual findings” on three factors: (1) whether the plaintiff will be prejudiced if default judgment is not granted; (2) whether the defendant has a meritorious defense; and (3) whether the defendant's delay was the result of culpable misconduct. Chanel, Inc. v. Gordashevsky, 558 F.Supp.2d 532, 537 (D.N.J. 2008). While the Court must accept the factual allegations of the Complaint as true, damages must be proved. DirecTV Inc. v. Pepe, 431 F.3d 162, 165 n.6 (3d Cir. 2005).

         III. ANALYSIS

         A. Jurisdiction and Service

         The Court has subject matter jurisdiction over this action pursuant to the Labor-Management Relations Act (“LMRA”), 29 U.S.C. § 185; ERISA, 29 U.S.C. §§ 1132(e)(2) and (f); and as a federal question under 28 U.S.C. § 1331. Venue is proper in this district pursuant to 29 U.S.C. § 185 and 29 U.S.C. § 1132(e)(2).

         The Court must first find that Danaos was properly served. Teamsters Health, 2012 WL 3018062, at *2. A corporation may be served by “delivering a copy of the summons and of the complaint to an officer, a managing agent or general agent, or any other agent authorized by appointment or by law to receive service of process.” Fed.R.Civ.P. 4(h)(2).

         Defendant Danaos is a corporation. Compl. ¶ 10. The docket reflects that Danaos's managing agent accepted service on November 9, 2018. Pls.' Aff. of Service, ECF No. 4. Therefore, the Court finds that Defendant was properly served.

         B. ...


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