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Trustees of Outstate Michigan Trowel Trades Health & Welfare Fund v. Abbott Construction

March 18, 2010

TRUSTEES OF OUTSTATE MICHIGAN TROWEL TRADES HEALTH & WELFARE FUND, ET AL., PLAINTIFFS,
v.
ABBOTT CONSTRUCTION, INC., DEFENDANT.



The opinion of the court was delivered by: Hon. George Caram Steeh

ORDER DENYING PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT [DOC. 12]

The plaintiffs are trustees of fringe benefit funds established through collective bargaining and maintained and administered pursuant to Section 302 of the Labor Management Relations Act of 1947 ("LMRA"), 29 USC §186, and the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 USC §1001, et seq. Plaintiffs have brought this action against defendant Abbott Construction to collect fringe benefit contributions plus statutory and other damages allegedly owing pursuant to the collective bargaining agreement ("CBA"), by which plaintiffs contend that Abbott Construction is bound. Plaintiffs seek to obtain payment of an indebtedness as set forth on an audit, and to compel cooperation with an updated audit. Plaintiffs filed a motion for summary judgment, and the court heard oral argument on the motion on March 17, 2010.

FACTUAL BACKGROUND

On June 21, 2001, Bruce Abbott, defendant's president, signed an acceptance of agreement by which Abbott Construction became bound to the collective bargaining agreement entered into by the Labor Relations Division of the Michigan Road Builders Association ("Road Builders Association") and the Cement Masons' International Association ("CMIA") of the United States and Canada ("initial CBA"). The initial CBA was in effect from June 1, 1998 to June 1, 2003. Abbott continued to be bound by the initial CBA, when it was renegotiated to cover the period June 1, 2003 to June 1, 2008. Each version of the initial CBA contained a termination clause which was not invoked by Abbott.

Under the terms of the Road Builders Agreement and the trust agreements incorporated therein, Abbott Construction became obligated to make fringe benefit contributions to the trust funds with respect to covered work performed by, and wages paid to, employees of Abbott Construction, and to submit their books and records for periodic inspection and audit.

On February 1, 2005, the Road Builders Association merged with the Associated Underground Contractors. On this date, the Labor Relations Division of the Michigan Infrastructure & Transportation Association ("MITA") was substituted as the contracting party in place of the Road Builders Association. (Glenn Bukoski Affidavit; Exhibit B, Substitution Agreement).

The parties disagree about whether Abbott became bound to a subsequent CBA between the Labor Relations Division of MITA and the CMIA ("subsequent CBA"). There is no evidence that Abbott received notice of the merger and substitution of associations. Nor is there any evidence that Abbott gave a power of attorney on its behalf to assent to such substitution.

Plaintiffs filed this litigation pursuant to LMRA and ERISA for breach of the fringe benefit provisions of the initial CBA and subsequent CBA, to obtain judgment against Abbott Construction incorporating the balance owing on an audited indebtedness for the period of April 2007 through September 2009 plus statutory and other damages, requiring Abbott to cooperate with an updated audit, and awarding plaintiffs additional amounts revealed by the updated audit, plus statutory and other damages. An audit revealed an indebtedness of $53,251.24 for the period of April 2007 through September 2009. This number breaks down to $47,104.60 in contributions, $4,710.46 in liquidated damages resulting from the audit and $1,436.18 in liquidated damages resulting from late payments. (Robinson Affidavit, ¶4)

Abbott Construction's documentation submitted in response to interrogatories show that it owes contributions set forth on the audit for work performed from October 2007 through December 2007 and January 2008 through March 2008 (all periods under the initial CBA). Abbott also stated that it paid contributions for Mr. Baldemar Salinas for work performed in June 2008 (period covered by subsequent CBA). The audit confirms this position. At oral argument, Abbott's counsel explained that these payments were made because Abbott was not aware of the change in associations until the filing of this litigation.

The amount of contributions at issue for the period of April 1, 2007 through May 31, 2008 is $26,866.52. The amount of contributions at issue for the period June 1, 2008 through September 31, 2009 is $20,238.08. Plaintiffs also seek liquidated damages, interest and attorney fees.

STANDARD FOR SUMMARY JUDGMENT

Federal Rule of Civil Procedure 56(c) empowers the court to render summary judgment "forthwith if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." See Redding v. St. Reward, 241 F.3d 530, 532 (6th Cir. 2001). The Supreme Court has affirmed the court's use of summary judgment as an integral part of the fair and efficient administration of justice. The procedure is not a disfavored procedural shortcut. Celotex Corp. v. Catrett, 477 U.S. 317, 327 (1986); see also Cox v. Kentucky Dept. of Transp., 53 F.3d 146, 149 (6th Cir. 1995).

The standard for determining whether summary judgment is appropriate is "'whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.'" Amway Distributors Benefits Ass'n v. Northfield Ins. Co., 323 F.3d 386, 390 (6th Cir. 2003) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986)). The evidence and all reasonable inferences must be construed in the light most favorable to the non-moving party. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Redding, 241 F.3d at 532 (6th Cir. 2001). "[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986) (emphasis in original); see also National Satellite Sports, Inc. v. Eliadis, Inc., 253 F.3d 900, 907 (6th Cir. 2001).

If the movant establishes by use of the material specified in Rule 56(c) that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law, the opposing party must come forward with "specific facts showing that there is a genuine issue for trial." First Nat'l Bank v. Cities Serv. Co., 391 U.S. 253, 270 (1968); see also McLean v. 988011 Ontario, Ltd., 224 F.3d 797, 800 (6th Cir. 2000). Mere allegations or denials in the non-movant's pleadings will not meet this burden, nor will a mere scintilla of evidence supporting the non-moving party. Anderson, 477 U.S. at 248, ...


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