United States District Court, E.D. Michigan, Southern Division
Trustees of the Tile, Marble, and Terrazzo Industry Insurance Fund; Tile, Marble, and Terrazzo Industry Pension Fund, et al., Plaintiffs,
Livonia Tile & Marble, Inc. and Ronald E. McKendrick, Defendants.
STEVEN WHALEN U.S. MAGISTRATE JUDGE.
ORDER REGARDING PLAINTIFFS' MOTION FOR DEFAULT
JUDGMENT  AND CLOSING CASE
J. TARNOW SENIOR UNITED STATES DISTRICT JUDGE.
a collection of jointly trusteed funds in the Tile, Marble,
and Terrazzo industry (collectively “the Funds”),
established under and administered pursuant to provisions of
the Labor Management Relations Act (“LMRA”), 29
U.S.C. § 186, and the Employee Retirement Income
Security Act (“ERISA”), 29 U.S.C. §§
1132 and 1145, filed a Complaint [Dkt. 1] on December 2, 2016
against Defendants Livonia Tile & Marble, Inc.
(“LTM”) and Ronald E. McKendrick. Plaintiffs
allege a violation of ERISA and Collective Bargaining
Agreements (“CBA”) under 29 U.S.C. § 1145;
violation of Michigan Building Contract Fund Act, M.C.L.
§ 570.151, et seq.; breach of fiduciary duties
under 29 U.S.C. §§ 1145, 1104, and 1109; and state
and common law conversion. Plaintiffs seek, among other
things, entry of judgment in the amount of $14, 725.76 (a
combination of delinquent fringe benefit contributions and
liquidated damages); an order directing Defendants to produce
the books and records of LTM for the updated audit period of
July 2015 through the present; and a judgment against
Defendants for all amounts found owing by such updated
audit. Since the commencement of this lawsuit,
the above-named defendants have not retained counsel; no
Notice of Appearance by an attorney has been filed on behalf
of these Defendants, nor have they attempted to participate
in the proceedings in any way.
16, 2017, the Court entered an Order for Plaintiffs to Show
Cause  why the case should not be dismissed for a failure
to prosecute. Plaintiffs timely responded on June 29, 2017
. Plaintiffs informed the Court that although the parties
attempted to resolve the matter informally, settlement
discussions were ultimately unsuccessful. Plaintiffs
thereafter filed a request for Clerk's Entry of Default
as to all Defendants , which was entered on June 29, 2017
[11-12]. See Fed. R. Civ. P. 55(a) (“When a
party against whom a judgment for affirmative relief is
sought has failed to plead or otherwise defend, and that
failure is shown by affidavit or otherwise, the clerk must
enter the party's default.”). Plaintiffs
subsequently filed this Motion for Default Judgment  on
July 21, 2017.
are entitled to default judgment against the Defendants.
Generally, “[u]pon a party's default, the
well-pleaded allegations of the complaint related to
liability are taken as true.” IBEW Local 648
Pension Plan v. Butler County Elec., 2011 WL 3652487, at
*3 (S.D. Ohio July 22, 2011); see also Antoine v. Atlas
Turner, Inc., 66 F.3d 105, 110-11 (6th Cir. 1995).
as true the facts set forth in the complaint, Defendants
violated their contractual and statutory obligations by
failing to make fringe benefit contributions and assessments
due on behalf of all employees covered under the CBA. LTM
also used the funds intended for fringe benefit contributions
for purposes other than to pay the amounts owed to the Funds
and their participants. In addition, Defendant McKendrick
breached his fiduciary duties by failing to act solely in the
interests of the participants. He also fraudulently and
purposefully avoided paying required fringe benefit
contributions to the Funds by converting monies paid to LTM
for his personal use and/or use by LTM. Because of
Defendants' failures, Plaintiffs have suffered
significant financial losses.
have failed to plead or otherwise defend on Plaintiffs'
claims and are therefore liable on each count set forth in
the complaint. Under ERISA, if judgment is awarded in favor
of a plan in a suit brought on behalf of the plan pursuant to
29 U.S.C. § 1145, 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 ...