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Trustees of Heat & Frost Insulators & Allied Workers Local 47 Retirement Trust Fund v. International Insulation Fabricators, Inc.

United States District Court, W.D. Michigan, Southern Division

January 19, 2017

TRUSTEES OF THE HEAT AND FROST INSULATORS AND ALLIED WORKERS LOCAL 47 RETIREMENT TRUST FUND, et al., Plaintiffs,
v.
INTERNATIONAL INSULATION FABRICATORS, INC. and ROBERT S. RUELL, Defendants.

          OPINION

          RAY KENT United States Magistrate Judge.

         This is an action to enforce collection of delinquent fringe benefit contributions pursuant to 29 U.S.C. § 1145 and 29 U.S.C. § 1132(g)(2). Compl. (docket no. 1, PageID.3, 5-6). This matter is now before the Court on plaintiffs' motion for partial summary judgment (docket no. 27) and defendants' motion for summary judgment (docket no. 30).

         Plaintiffs are the Heat and Frost Insulators and Allied Workers Local 47(sometimes referred to as the “Union” and “Local 47”), and the Trustees of the following funds: Heat and Frost Insulators and Allied Workers Local 47 Retirement Trust Fund; Heat and Frost Insulators and Allied Workers Local 47 Welfare Fund; Heat and Frost Insulators and Allied Workers Local 47 Construction Industry Advancement Fund; Heat and Frost Insulators and Allied Workers Local 47 Joint Apprenticeship Trust Committee; Heat and Frost Insulators and Allied Workers Labor Management Cooperative Trust (collectively referred to as the “Funds”). Defendants are International Insulation Fabricators, Inc. (sometimes referred to by the parties as “IIF” or “IIFI”), and Robert S. Ruell (“Ruell”), identified as the President, Secretary, Treasurer and Director of IIF. See Compl. at PageID.2-3.

         Plaintiffs bring this action pursuant to § 1145, which provides that:

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 with the terms and conditions of such plan or such agreement.

29 U.S.C. § 1145.

         In addition, § 1132(g) provides in pertinent part that:

(2) In any action under this subchapter by a fiduciary for or on behalf of a plan to enforce section 1145 of this title in which a judgment in favor of the plan is awarded, the court shall award the plan --
(A) the unpaid contributions,
(B) interest on the unpaid contributions,
(C) an amount equal to the greater of --
(i) interest on the unpaid contributions, or
(ii) liquidated damages provided for under the plan in an amount not in excess of 20 percent (or such higher percentage as may be permitted under Federal or State law) of the amount determined by the court under subparagraph (A),
(D) reasonable attorney's fees and costs of the action, to be paid by the defendant, and
(E) such other legal or equitable relief as the court deems appropriate.

29 U.S.C. § 1132(g)(2).

         Plaintiffs have moved for partial summary judgment (docket no. 27), in which they seek an order as to liability, damages for the period of April 2014 through December 31, 2014 in the amount of $41, 728.33, audit fees of $904.13, interest, and attorney's fees. Plaintiffs' Brief (docket no. 27, PageID.80). If this relief is granted, plaintiffs would proceed to trial to determine the amount of contributions owed to them for the period beginning January 1, 2015. Id.

         Plaintiffs' claims arise from IIF's obligations as set forth in one or more collective bargaining agreements (CBAs) between Local 47 and the Master Insulators Association (sometimes referred to as the “Association”). According to plaintiffs, “[d]efendants do not dispute the audit calculations; their sole defense to this lawsuit is that IIF was no longer obligated to contribute to the Plaintiff Funds after sending its March 28, 2014 letter advising of an intent ‘to terminate its contract' with Local 47.” Id. at PageID.84. Plaintiffs further state that the narrow legal dispute to be resolved in this case and in their motion is:

Did IIF have the legal authority to terminate its obligations under the CBA it conceded was fully in force on March 28, 2014 simply by sending a letter of intent? The answer is, unquestionably, “No”.

Id. (emphasis omitted). Plaintiffs contend that defendant Ruell, while not the employer, is personally liable for the amount owed by IIF because the contributions became assets of the Funds when due, and “that individuals such as Defendant Ruell who have discretionary authority over plan assets are fiduciaries regarding those assets.” Id. at PageID.90.

         In their motion for summary judgment, defendants contend that they were not bound by any written agreement following the expiration of the July 10, 2010 CBA and that they have no further obligation to make any contributions after June 30, 2013 beyond those already made. Defendants' Motion for summary judgment (docket no. 30). For their part, defendants state that issue as follows:

Where defendant, International Insulation Fabricators, Inc., is not a member of an employer association, did not sign the March 1, 2013 CBA, and did not authorize any other party to sign a CBA on its behalf, is defendant obligated to make contributions to the plaintiffs['] funds?
Answer: No.

         Defendants' Brief (docket no. 31, PageID.208) (emphasis and uppercase lettering omitted).

         II. Legal Standard

         “The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Rule 56 further provides that “[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; or
(B) showing that the materials cited do not establish the absence or presence of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact.

         Fed. R. Civ. P. 56(c)(1).

         In Copeland v. Machulis, 57 F.3d 476 (6th Cir. 1995), the court set forth the parties' burden of proof in a motion for summary judgment:

The moving party bears the initial burden of establishing an absence of evidence to support the nonmoving party's case. Once the moving party has met its burden of production, the nonmoving party cannot rest on its pleadings, but must present significant probative evidence in support of the complaint to defeat the motion for summary judgment. The mere existence of a scintilla of evidence to support plaintiff's position ...

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