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DeIanni v. Progress Printing Corp.

United States District Court, D. Colorado

September 28, 2018

ARTHUR DeIANNI, as Trustee and Chairman of the Board of Trustees of the CWA/ITU Negotiated Pension Plan, Plaintiff,



         This matter is before the Court on Plaintiff's Motion for Summary Judgment [#41][1](the “Motion”). Defendant filed a Response [#45] in opposition to the Motion, and Plaintiff filed a Reply [#46]. The Court has reviewed the Motion, Response, Reply, the entire case file, and the applicable law, and is sufficiently advised in the premises. For the reasons set forth below, the Motion [#41] is GRANTED in part and DENIED in part.[2]

         I. Background

         The material facts are largely undisputed. Plaintiff brings this action under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001-1461, as amended by the Multiemployer Pension Plan Amendments Act of 1980 ("MPPAA"), on behalf of the CWA/ITU Negotiated Pension Plan (the "Plan"). Motion [#41] at 1. Plaintiff serves as Trustee and Chairman of the Board of Trustees for the Plan, which is an "employee pension benefit plan" and "multiemployer plan" as defined in ERISA § 3(2), 29 U.S.C. § 1002(2), and ERISA § 3(37)(A), 29 U.S.C. § 1002(37)(A), respectively. Id. at 1-2; Sched. Order [#24] at 3. The Plan is administered in Colorado Springs, Colorado, and the Plan's Trustees are "fiduciaries" as defined in ERISA § 3(21), 29 U.S.C. § 1002(21). Sched. Order [#24] at 3; Motion [#41] at 2. The Plan is governed by the CWA/ITU Negotiated Pension Plan Document (the "Plan Document") which provides that delinquent contribution employers shall be liable to the Plan for interest on the amount of delinquent contributions owing, plus liquidated damages and attorneys' fees. Motion [#41] at 2; Ex. B [#41-4].[3]

         Defendant is an Illinois corporation that was an "employer" at all relevant times under ERISA § 3(5), 29 U.S.C. § 1002(5). Motion [#41] at 2; Compl. [#1] 9; Answer [#11] at 4. Defendant was a contributing employer in the Plan pursuant to a collective bargaining agreement ("CBA") with the Chicago Typographical Union No. 16/Communication Workers of America Local 14408 (the "Union") which required it to make benefit contributions on behalf of represented employees. Motion [#41] at 2; Decl. of Gapshis ¶¶ 6, 7, 9 (attached to Response [#45] at 10-11). The CBA was effective June 7, 1992, through June 6, 1995, and renewed for two or three year periods thereafter pursuant to a series of riders. Sched. Order [#24] at 4; Ex. A [#41-3] at 1. The last rider was valid through June 6, 2014. Ex. A [#41-3] at 2. The terms of the last rider required Defendant to contribute thirteen dollars and twenty cents ($13.20) to the Plan for each shift worked by an employee represented by the Union. Motion [#41] at 2; Ex. A [#41-3] at 2.

         Despite the rider's expiration on June 6, 2014, Defendant continued to submit contributions to the Plan on behalf of its covered employees until some time in 2015. Decl. of Castle ¶ 6; Decl. of Gapshis ¶ 11 (attached to Response [#45] at 11).[4] Defendant failed to submit contributions for certain months in 2015. Motion [#41] at 3. For this reason, the Plan sent Defendant a collection letter dated August 10, 2015, demanding $1, 082 in delinquent contributions with interest for the period of March through June 2015; and $54.98 in accrued interest for late payments made for the period of August 2014 through February 2015. Ex. C [#41-5]. The Plan requested that Defendant submit these amounts by August 24, 2015, which Defendant failed to do.

         By letter dated September 30, 2015, the Plan notified Defendant that due to its failure to pay contributions fro the period of March through September 2015, the Plan's Trustees had terminated Defendant's status as a “Contributing Employer, ” effective as of the letter date. Ex. D [#41-6]; Decl. of Castle [#41-1] at 11. The letter further stated that "[b]y terminating through non-payment of contributions, [Defendant] has effectively withdrawn as a contributing employer and may owe statutory withdrawal liability to the Plan in addition to the delinquent contributions and interest." Ex. D [#41-6]. After receiving the September 30, 2015 letter, Defendant made one payment of $607.20 on October 2, 2015, toward the March and April 2015 delinquency; and another payment of $384.98 on December 29, 2015, toward the September 2015 delinquency. Decl. of Gapshis ¶ 16 (attached to Response [#45] at 12).[5]

         On January 11, 2016, the Plan sent Defendant a withdrawal liability demand totaling $102, 544, to be paid in eighty quarterly installments. Ex. E [#41-7]. The letter included the liability calculation and a schedule of payments which made the first quarterly installment of $1, 693 due within sixty days. Id. The letter also notified Defendant of its rights under the MPPAA to request a review of the liability determination, identify inaccuracies in the calculation, and provide additional relevant information within ninety days. Id.; Motion [#41] at 3-4. Defendant never exercised these rights nor did it initiate arbitration to challenge the withdrawal liability determination or assessment, as required under the MPPAA.

         Defendant did not submit the first quarterly payment within sixty days. Decl. of Castle ¶ 14. On May 4, 2016, the Plan notified Defendant “that if the failure to pay is not cured within sixty (60) days, the [Defendant] will be in default, and the full amount of the withdrawal liability shall become immediately due and owing.” Ex. F [#41-8]. Defendant did not make any payment within the sixty-day cure period that ended on July 3, 2016. Decl. of Castle ¶ 16.[6]

         Plaintiff filed this lawsuit on March 23, 2017. See Compl. [#1]. He has asserted two claims on behalf of the Plan: (1) collection of unpaid employee benefit contributions in the amount of $1, 346.40 (“Claim One”); and (2) collection of unpaid withdrawal liability in the amount of $100, 851 (“Claim Two”). Id. ¶¶ 15-30. In the present Motion [#41], Plaintiff asserts that there is no genuine issue of material fact regarding either Claim One or Claim Two because the material facts are undisputed: in sum, that Defendant was obligated under ERISA and the MPPAA to submit employee benefit contributions and withdrawal liability payments to the Plan and failed to do so. Thus, Plaintiff argues, the Court is required to find that the Plan is entitled to judgment in its favor as to both claims as a matter of law. Defendant does not appear to dispute any material fact or raise any new facts that would foreclose summary judgment. Instead, Defendant argues that it is not legally obligated to pay these amounts based on the undisputed record before the Court.

         II. Standard of Review

         The purpose of a motion for summary judgment pursuant to Fed.R.Civ.P. 56 is to assess whether trial is necessary. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Pursuant to Fed.R.Civ.P. 56(a), summary judgment should enter if the pleadings, the discovery and disclosure materials on file, and any affidavits show “that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” An issue is genuine if the evidence is such that a reasonable jury could resolve the issue in favor of the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A fact is material if it might affect the outcome of the case under the governing substantive law. Id.

         The burden is on the movant to show the absence of a genuine issue of material fact. Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 670-71 (10th Cir. 1998) (citing Celotex, 477 U.S. at 323). When the movant does not bear the ultimate burden of persuasion at trial, the “movant may make its prima facie demonstration [of the absence of a genuine issue of material fact] simply by pointing out to the [C]ourt a lack of evidence for the nonmovant on an essential element of the nonmovant's claim.” Id. at 671. If the movant carries the initial burden of making a prima facie showing of a lack of evidence, the burden shifts to the nonmovant to put forth sufficient evidence for each essential element of his claim such that a reasonable jury could find in his favor. See Anderson, 477 U.S. at 248; Simms v. Okla. ex rel. Dep't of Mental Health & Substance Abuse Servs., 165 F.3d 1321, 1326 (10th Cir. 1999). The nonmovant must go beyond the allegations and denials of his pleadings and provide admissible evidence, which the Court views in the light most favorable to him. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 (1970); Panis v. Mission Hills Bank, N.A., 60 F.3d 1486, 1490 (10th Cir. 1995) (citing Celotex, 477 U.S. at 324). Conclusory statements based merely on conjecture, speculation, or subjective belief are not competent summary judgment evidence. Bones v. Honeywell Int'l, Inc., 366 F.3d 869, 875 (10th Cir. 2004). The nonmoving party's evidence must be more than “mere reargument of [his] case or a denial of an opponent's allegation” or it will be disregarded. See 10B Charles Alan Wright, et al., Federal Practice and Procedure § 2738 at 356 (3d ed. 1998).

         Only documents that meet the evidentiary requirements of Fed.R.Civ.P. 56 may be considered for purposes of summary judgment. Rule 56(c) provides that:

(1) A party asserting that a fact cannot be or is genuinely disputed must support the assertion by:
(A) citing to particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers, or other materials[.] . . .
(3) Materials Not Cited. The court need consider only the cited materials, but it may consider other materials in the record.
(4) Affidavits or Declarations. An affidavit or declaration used to support or oppose a motion must be made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant or declarant is competent to testify on the matters stated.

Fed. R. Civ. P. 56(c)(1)-(4).

         III. Analysis

         As mentioned above, Plaintiff moves for summary judgment on both claims asserted against Defendant. Claim One seeks to collect from Defendant $1, 346.40 in unpaid employee benefit contributions for the period of May 2015 through August 2015, plus interest and liquidated damages pursuant to 29 U.S.C. §§ 1132(g)(2), 1145. Claim Two seeks to collect from Defendant $100, 851 in unpaid withdrawal liability under the MPPAA, plus interest and liquidated damages pursuant to 29 U.S.C. §§ 1399(c)(5), 1401(b)(1), 1132(g)(2). As to both claims, Plaintiff seeks attorneys' fees and costs pursuant to 29 U.S.C. § 1132(g)(2). Plaintiff bears the burden of proof on both claims at trial. Accordingly, he bears the burden to come forward with sufficient evidence to establish a prima facie case as to both claims.

         A. Claim One - Delinquent Contributions

          Plaintiff argues that the Plan is entitled to collect $1, 346.40 in unpaid employee benefit contributions, plus interest and liquidated damages, from Defendant as a matter of law because it is undisputed that Defendant failed to pay contributions in that amount for the period of May 2015 through August 2015. In response, Defendant argues that the CBA's expiration on June 6, 2014 relieved Defendant of any obligation to pay those contributions and, even if it did not, those contributions have since been paid.

         1. Subject Matter Jurisdiction

         The Court sua sponte raises the issue of subject matter jurisdiction. “[I]t has long been recognized that a federal court must, sua sponte, satisfy itself of its power to adjudicate in every case and at every stage of the proceeding.” Shaw v. AAA Engineering & Drafting Inc., 138 Fed.Appx. 62, 67 (10th Cir. 2005) (citing State Farm Mut. Ins. Co. v. Narvaez, 149 F.3d 1269, 1270-71 (10th Cir. 1998)). “If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action.” Fed.R.Civ.P. 12(h)(3).

         It is well established that “[t]he party invoking federal jurisdiction bears the burden of establishing such jurisdiction as a threshold matter.” Radil v. Sanborn W. Camps, Inc., 384 F.3d 1220, 1224 (10th Cir. 2004). Plaintiff cites to ERISA § 502(e)(1), 29 U.S.C. § 1132(e)(1), and ERISA § 502(f), 29 U.S.C. § 1132(f), as the jurisdictional bases for its delinquent contribution claim to enforce ERISA § 515, 29 U.S.C. § 1145. Compl. [#1] ¶ 2. Although ERISA § 502 does grant federal district courts exclusive jurisdiction over civil actions brought by a multiemployer plan's fiduciary to collect delinquent contributions under ERISA § 515, jurisdiction may be precluded where, as is here, the contributions sought are for periods after a collective bargaining agreement has expired. See 29 U.S.C. §§ 1132(e)(1), 1132(f), 1145, In Laborers Health and Welfare Trust Fund for Northern California v. Advanced Lightweight Concrete Co., Inc., 484 U.S. 539 (1988), the United States Supreme Court interpreted ERISA §§ 502 and 515 to grant federal courts exclusive jurisdiction only when the dispute concerns “promised contributions” owed under an effective collective bargaining agreement. The Court reached this interpretation by first noting that an employer who is party to a collective bargaining agreement may have two distinct legal obligations to contribute to a pension plan: (1) a contractual duty imposed by the terms of the agreement, and (2) a statutory duty imposed by the National Labor Relations Act (NLRA), 29 U.S.C. § 141, et seq. Advanced Lightweight, 484 U.S. at 541. Unlike the contractual duty, which extinguishes by expiration of the agreement, the statutory duty may extend beyond expiration where "an employer's failure to honor the terms and conditions of an expired collective-bargaining agreement pending negotiations on a new agreement constitutes bad faith bargaining in breach of sections 8(a)(1), 8(a)(5) and 8(d) of the [NLRA]." Id. at 544 n.6 (quoting NLRB v. Katz, 369 U.S. 736, 743 (1962)). Because, "[a]s a general rule, federal courts do not have jurisdiction over activity that is arguably subject to § 7 or § 8 of the NLRA, [ ] they must defer to the exclusive competence of the National Labor Relations Board [(NLRB) in those matters]." Id. at 543 n.4 (quoting Kaiser Steel Corp. v. Mullins, 455 U.S. 72, 83 (1982)) (internal quotation marks omitted).

         ERISA § 515 provides:

Every employer who is obligated to make contributions to a multiemployer plan under the terms of the plan or under the terms of a collectively bargained agreement shall, to the extent not inconsistent with law, make such contributions in accordance ...

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