the court to resolve the question of whether CHL was in privity with Lincoln.
Under 29 U.S.C. § 1301(b)(1), members of a controlled group constitute a "single employer" and are all jointly and severally liable for the entire amount of the withdrawal liability assessment. As a creditor, the Fund is not required to sue all of the controlled group members in one action or lose its rights against unjoined parties; it may even sue each member separately if it elects to. See Central States, Southeast and Southwest Areas Pension Fund v. Lloyd L. Sztanyo Trust, 693 F. Supp. 531, 540, See also Board of Trustees of Western Conference of Teamsters Pension Trust Fund v. H. F. Johnson, Inc., 830 F.2d 1009, 1013 (9th Cir. 1987) (controlled group members discovered after Fund's unsuccessful attempts at collecting prior withdrawal liability judgment against fellow members remain jointly liable and may be sued for full amount of Fund trustee's assessment). Thus, this is not merely a supplementary action brought by the Fund to enforce the earlier judgment to which CHL was not a party: the Fund is suing CHL on the theory that it is a Lincoln Controlled Group member and is therefore jointly liable for its withdrawal assessment.
Defendant CHL's motion to dismiss Count I is denied.
II. The Fund's Summary Judgment Motion
Summary judgment "shall be rendered 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." Fed. R. Civ. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 2552-53, 91, 91 L. Ed. 2d 265 L. Ed. 2d (1986). A "genuine issue of material fact exists only where 'there is sufficient evidence favoring the nonmoving party for the jury to return a verdict for that party.'" Dribeck Importers, Inc. v. G. Heileman Brewing Co., 883 F.2d 569, 573 (7th Cir. 1989) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986)). In considering such a motion, the court must view all inferences in the light most favorable to the party opposing the motion. See Regner v. City of Chicago, 789 F.2d 534, 536 (7th Cir. 1986). Once the moving party has supported its motion, "an adverse party may not rest upon the mere allegations or denials of the adverse party's pleadings." Fed. R. Civ. P. 56(e). The adverse party's response by deposition, affidavit or otherwise, "must set forth specific facts showing that there is a genuine issue for trial." Id.
In support of its motion, the Fund offers the affidavit of Thomas J. Frawley, a withdrawal liability assessor with the Fund, and excerpts of testimony given under oath by Larry A. Hayes during a Citation To Discover Assets. The Fund further offers the minutes of the annual meeting of the board of directors of New Midland, which are signed by both Mrs. and Mr. Hayes. In response, the defendants offer nothing except their assertions and counter-allegations, and arguments against the use the Fund's submissions because they are unsuitable under Rule 56(c). The Fund also filed a Statement of Undisputed Material Facts to which defendants failed to respond. Pursuant to Local Rule 12(n), all of these material facts are deemed admitted. Because defendants have not produced any of the types of materials required by Rule 56, and the court finds the Fund's submissions to be of the type called for by that rule, defendants have failed to show the existence of any disputed material facts for which a trial would be necessary to resolve. See Atchison, Topeka and Santa Fe Railway Co. v. United Transportation Union, 734 F.2d 317, 320 (7th Cir. 1984). Therefore, the only question remaining is, on the undisputed facts is the Fund entitled to judgment as a matter of law? Inasmuch as the Fund's complaint is divided into two counts, each being based on a different legal premise and against a different defendant, this question must be answered in two parts.
A. Count I and CHL
After the Lincoln Controlled Group withdrew from the Fund, the Fund determined the amount of the Group's withdrawal liability, notified Lincoln of the schedule for liability payments and demanded payment in accordance with the schedule. See §§ 4202 and 4219(b)(1), 29 U.S.C. §§ 1382 and 1399(b)(1). Notice to one member of a controlled group of a withdrawal liability assessment constitutes notice to every member of the group. See Trustees of Chicago Truck Drivers v. Central Transport, Inc., 888 F.2d 1161, 1163 (7th Cir. 1989). Moreover, the Fund personally served Larry A. Hayes a copy of the summons and complaint in the earlier lawsuit against Old Midland and Joyce. All of these things in combination lead to the inescapable conclusion that CHL had notice of the liability assessment made against the Lincoln Controlled Group.
Despite sufficient notice, neither CHL nor any other Lincoln Controlled Group member initiated arbitration to dispute the assessment made against them. Under § 4221(a)(1), 29 U.S.C. § 1401(a)(1), "any dispute between an employer and the plan sponsor of a multiemployer plan concerning a determination made under sections 4201 through 4219 of this title . . . shall be resolved through arbitration." If the proper parties do not initiate arbitration in time, "the amounts demanded by the plan sponsor . . . shall be due and owing on the schedule set forth by the plan sponsor." 29 U.S.C. § 1401(b)(1). Because CHL did not request arbitration within the time limit set forth in 29 U.S.C. § 4201(a)(1), "it has waived any defenses it may have raised. Inasmuch as Congress made it mandatory to resolve withdrawal liability disputes between an employer and the plan sponsor through arbitration . . . [CHL] cannot bypass arbitration and litigate a defense to a withdrawal liability claim." Robbins v. Chipman Trucking, Inc., 866 F.2d 899, 902 (7th Cir. 1988) (citation omitted). Moreover, even if CHL had not waived its defenses by failing to arbitrate, it would not alter the outcome of this opinion. CHL apparently does not dispute that it is a member of the Lincoln Controlled Group. The only defense CHL raises to plaintiffs' claim is that it should have been sued along with Old Midland and Joyce in the earlier proceeding and, therefore, the present action is barred by res judicata. And the court has already rejected that argument for reasons delineated above. See Discussion, Part I.
Therefore, the court grants the Fund's motion for summary judgment against CHL on Count I.
B. Count II and New Midland
The Fund seeks to hold New Midland liable for the Lincoln Controlled Group withdrawal assessment on a "successor liability" theory. The Supreme Court has held that whether a new employer is the successor of an old employer depends on whether there is a "substantial continuity" between the two businesses. See Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 43, 107 S. Ct. 2225, 2236, 96 L. Ed. 2d 22 (1987):
This approach, which is primarily factual in nature and is based upon the totality of the circumstances of a given situation, requires that . . . the new company has "acquired substantial assets of its predecessor and continued, without interruption or substantial change, the predecessor's business operations." Under this approach, the [court] examines a number of factors: whether the business of both employers is essentially the same; whether the employees of the new company are doing the same jobs in the same working conditions under the same supervisors; and whether the new entity has the same production process, produces the same products, and basically has the same body of customers.
Id. (citations omitted); see also Upholsterer's Int'l Union Pension Fund v. Artistic Furniture of Pontiac, 920 F.2d 1323, 1329 (7th Cir. 1990).
The successor liability doctrine is an exception to the general common law rule that "'a corporation that merely purchases for cash the assets of another corporation does not assume the seller corporation's liabilities.'" Artistic Furniture, 920 F.2d at 1325 (quoting Travis v. Harris Corp., 565 F.2d 443, 446 (7th Cir.1977)). Successor liability was first developed in the context of the National Labor Relation Act and was subsequently extended to actions brought under 42 U.S.C. § 1981, Title VII, and, most importantly for the purposes of this case, the MPPAA. See e.g., Golden State Bottling Co. v. NLRB, 414 U.S. 168, 182 n. 5, 94 S. Ct. 414, 424 n. 5, 38 L. Ed. 2d 388 n. 5 (1973) (NLRA); Musikiwamba v. ESSI Inc., 760 F.2d 740, 746 (7th Cir. 1985) (Section 1981); Wheeler v. Snyder Buick, Inc, 794 F.2d 1228 (7th Cir. 1986) (Title VII); Artistic Furniture, 920 F.2d at 1327 (MPPAA). In applying successor liability to an action seeking recovery of delinquent multiemployer pension fund contributions, the Seventh Circuit found the doctrine
to be appropriate in those cases where the vindication of an important federal statutory policy has necessitated the creation of an exception to the common law rule, where the successor has had prior notice of the liability in question, and where there has existed sufficient evidence of continuity of operations between the predecessor and successor.