The opinion of the court was delivered by: BUCKLO
Plaintiffs, Chicago District Council of Carpenters pension Fund, Chicago District Council of Carpenters Welfare Fund, Chicago and Northeast Illinois District Council of Carpenters Apprentice and Trainee Program Fund, and their respective trustees (collectively, "the Funds"), filed suit on May 2, 1995, seeking to examine the books of the defendants, Michael Cotter d/b/a American Underground Engineering and American Underground Engineering, Inc., in order to assess the appropriate ERISA plan contributions. Defendants did not answer or otherwise plead to this complaint and therefore on August 23, 1995, I entered a default judgment against them, ordering them to allow the Funds to examine their books within fourteen days and then make the necessary contributions to the Funds. When defendants did not do so, the Funds filed a Motion for Rule to Show Cause. In response, Mr. Cotter filed this Motion Under Rule 60(b) to Vacate Judgment and Terminate Hearing on Plaintiff's [sic] Motion for Rule to Show Cause.
For the reasons stated below, Mr. Cotter's motion is denied in so far as it seeks to avoid complying with the ordered audit.
American Underground Engineering, Inc. ("American, Inc.") was incorporated on May 15, 1979 with Mr. Cotter as corporate president. On April 6, 1989, Mr. Cotter signed, on behalf of American, Inc., a Collective Bargaining Agreement ("the CBA") with the Chicago and Northeast Illinois District Council of Carpenters. Pursuant to the CBA, American, Inc. agreed to make contributions to the plaintiffs, multiemployer benefit funds, based upon the number of hours worked by bargaining unit employees. American, Inc. also agreed to submit reports to the Funds and open its records to the Funds as necessary, so that the Funds could assess the appropriate contributions.
On November 3, 1989, American, Inc. filed a Chapter 11 bankruptcy petition. On January 7, 1992, American Inc.'s Plan of Reorganization ("the Plan") was confirmed by the bankruptcy court. In December of 1993, the Funds filed suit seeking to compel American, Inc. to comply with the CBA and submit to an audit of its books and records for the period of May, 1991 to the present. Because the time period specified in that complaint included time prior to the Plan confirmation, the Funds voluntarily dismissed their suit upon learning of American, Inc.'s bankruptcy. The Funds then requested Mr. Cotter to voluntarily submit to an audit only for the time period from the plan confirmation to the present. When he did not do so, the Funds filed this suit, seeking relief under Section 502 of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132, and Section 301 of the Taft-Hartley Act, 29 U.S.C. § 185.
To vacate a default judgment under Rule 60(b), the defendants must show (1) good cause for its default, (2) quick action to correct it, and (3) a meritorious defense to the action. Pretzel & Stouffer v. Imperial Adjusters, Inc., 28 F.3d 42, 45 (7th Cir. 1994). Mr. Cotter
makes several arguments in order to establish a meritorious defense. Each will be discussed in turn.
A. Statute of Limitations & Jurisdiction
Mr. Cotter contends that this suit is barred by the statute of limitations. ERISA does not contain a statute of limitations for benefit actions filed under Section 502, and therefore courts borrow the most analogous state statute of limitations. See Jenkins v. Local 705 Intern. Broth. of Teamsters, 713 F.2d 247, 251 (7th Cir. 1983). The Seventh Circuit mandates the use of the Illinois statute of limitations for written contracts when fund trustees seek delinquent employer contributions owed to a multiemployer benefit fund. See Central States, Southeast and Southwest Areas Pension Fund v. Jordan, 873 F.2d 149 (7th Cir. 1989). The statute of limitations in Illinois for a breach of a written contract is ten years. 735 ILCS 5/13-206. This suit is therefore timely.
Mr. Cotter also argues that this suit should have been brought before the National Labor Relations Board ("NLRB"), and I therefore have no jurisdiction over it. In support of this argument, he cites Laborers Health & Welfare Trust Fund for Northern California v. Advanced Lightweight Concrete Co., 484 U.S. 539, 98 L. Ed. 2d 936, 108 S. Ct. 830 (1988). In Laborers, the defendant employer stopped making contributions to the plaintiff pension funds after the collective bargaining agreement expired and the employer had reached impasse with the union. The pension funds brought suit, alleging that the employer's decision to discontinue its contributions was a unilateral change in the terms and conditions of employment and therefore constituted a breach of its duty to bargain in good faith under section 8(a)(5) of the National Labor Relations Act ("NLRA"). Id. at 542. The Court held that only the NLRB, and not the district court, had jurisdiction to hear the suit. Id. at 553.
In reaching this conclusion, the Court held that Section 502 applies only to the collection of already "promised contributions." It does "not confer jurisdiction on district courts to determine whether an employer's unilateral decision to refuse to make postcontract contributions constitutes a violation of the NLRA." Id. at 549 (emphasis added). In this case, the Funds seek contributions under the terms of an existing collective bargaining agreement. The Funds, therefore, need not go to the NLRB for relief. See, e.g., Scarfi v. Bright Star Industries, Inc., 779 F. Supp. 687, 689 (E.D.N.Y. 1992) (exercising jurisdiction over a suit for contributions pursuant to a "still-effective contract").
B. The Effect of the Bankruptcy
Mr. Cotter argues that this action is barred by the doctrine of res judicata. He claims that the bankruptcy court already rejected a claim for contribution brought by the Funds and therefore this suit is barred. The Funds correctly note, however, that the present action concerns only the time period extending from the Plan confirmation to the present. Because there is no "identity of the cause of action," res judicata does not apply. Prochotsky v. Baker & McKenzie, 966 F.2d 333, 334 (7th Cir. 192).