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January 17, 2003


The opinion of the court was delivered by: David H. Coar, United States District Judge


Plaintiffs Board of Trustees of the Masons and Plasterers Pension Fund Local 56, DuPage County, Illinois, Board of Trustees of the Brick Masons Welfare Fund of DuPage County (56), Board of Trustees of the Masons and Plasterers Pension Fund, Local Union No. 74 of DuPage County, Illinois, Board of Trustees of the Bricklayers and Allied Craftworkers Welfare Fund, Local Union No. 74 of DuPage County, Illinois, Board of Trustees of the District Council Training Center Fund, Board of Trustees of the Bricklayers and Trowel Trades International Pension Fund, and Board of Trustees of the International Masonry Institute Promotional Trust ("Plaintiffs" or "Funds"), bring an ERISA action against O'Donnell Plastering, Inc. ("O'Donnell"). Plaintiffs sue for contributions allegedly due under the collective bargaining agreements between O'Donnell and the Bricklayers and Allied Craftsmen Locals 56 and 74 (the "Union" or "Local 56/74"). Before this Court is Plaintiffs' motion for summary judgment. For the following reasons, this Court DENIES the motion.

I. Summary Judgment Standard

Summary judgment is proper "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 a judgment as a matter of law." Fed.R.Civ.P. 56(c); Kamler v. H/N Telecom. Servs., Inc., 305 F.3d 672, 677 (7th Cir. 2002). A genuine issue of material fact exists for trial when, in viewing the record and all reasonable inferences drawn from it in a light most favorable to the non-movant, a reasonable jury could return a verdict for the non-movant. Anderson v. Liberty Lobby Inc., 477 U.S. 242, 248 (1986); Fritcher v. Health Care Servs. Corp., 301 F.3d 811, 815 (7th Cir. 2002).

The movant bears the burden of establishing that no genuine issue of material fact exists. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Hedberg v. Indiana Bell Tel. Co., 47 F.3d 928, 931 (7th Cir. 1995). If the movant meets this burden, the non-movant must set forth specific facts that demonstrate the existence of a genuine issue for trial. Rule 56(e); Celotex, 477 U.S. at 324. A scintilla of evidence in support of the non-movant's position is insufficient, and the non-movant "must do more than simply show that there is some metaphysical doubt as to the material fact." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); see also Anderson, 477 U.S. at 250. Weighing evidence, determining credibility, and drawing reasonable inferences are jury functions, not those of a judge deciding a motion for summary judgment. Anderson, 477 U.S. at 255.

II. Background

The following facts are taken from the parties Local Rule 56.1 materials. Plaintiffs are a group of Funds that have been established pursuant to collective bargaining agreements between the Union and the employer association, GDCNI/CAWCC ("GDCNI"), whose member-employers authorizing GDCNI to bargain on their behalf are covered by the collective bargaining agreement with the Union. The Funds are maintained and administered in accordance with and pursuant to the provisions of the National Labor Relations Act, as amended, and other applicable state and federal laws, and also pursuant to the terms of the agreements and Declarations of Trust that establish the funds.

Defendant O'Donnell is an Illinois corporation. Geraldine O'Donnell, an authorized O'Donnell representative, contacted Trygve Espeland, Business Manager of Local 56, in April 1996 to inform him that she employed a Local 56 member. According to Geraldine O'Donnell, Espeland told her that she needed to sign a "Memorandum of Understanding" to have benefits transferred from Plasterer's Local 5 to Local 56/74 pursuant to a reciprocity agreement. On April 8, 1996, Espeland forwarded the Memorandum of Understanding to O'Donnell with a cover letter that stated in part, "Enclosed is the `Memorandum of Understanding' (the Contract)." The cover letter also contains a handwritten note stating, "Please keep a copy for your files. . . I'll send you a copy of the `Memorandum' after I've signed it." On April 15, 1996, Geraldine O'Donnell signed the Memorandum of Understanding on behalf of O'Donnell and returned it to Local 56. The document she signed states that it is a Union Agreement between O'Donnell and Bricklayers International Union Locals 56/74. O'Donnell claims it never received a copy of the Memorandum signed by the Union.

According to Plaintiffs, O'Donnell, by signing the Memorandum of Understanding, is bound to the collective bargaining agreement between Locals 56 and 74 and GDCNI. Per paragraph 4 of the Memorandum of Understanding, also known as the "Evergreen Clause," the April 15, 1996 agreement rolled over, which means that Defendant is bound to all successive agreements since April 15, 1996.*fn1 The June 1, 1993 collective bargaining agreement was effective from June 1, 1993 through June 30, 1997; the July 1, 1997 collective bargaining agreement was effective from July 1, 1997 through June 30, 2001; and the July 1, 2000 Memorandum of Understanding Adopting the Former Collective Bargaining Agreement is effective from July 1, 2000 through June 30, 2004 (collectively the "successive agreements").

Paragraph 5 of the Memorandum of Understanding states:

The Employer agrees to pay the amounts of the contributions which it is bound to pay to the several fringe benefit funds described in the Association Agreement and agrees to and is hereby bound by and considered to be a party to the agreements and declarations of trust creating each of said trust funds, together with any restatements or amendments thereto which have been or may be adopted, as if it had been a party to and signed the original copies of the trust instruments. The Employer ratifies and confirms the appointment of each of the employer trustees, who shall, together with their successor trustees designated in the manner provided in the agreements and declarations of trust, and, where applicable, jointly with an equal number of trustees representing employees, carry out the terms and conditions of the trust instruments.
According to provisions in the successive agreements:
The employer shall contribute the amounts specified per hour for work performed by all employees covered by this Agreement, which amounts shall be used for the purpose of the particular fund in accordance with the agreement and declaration of trust establishing each such fund . . .
GDCNI bargains contracts with Plasterers Locals 56 and 74 for its member employers that have given their authorization to bargain. O'Donnell joined GDCNI on February 23, 1999. On June 14, 2000, the Executive Director for GDCNI forwarded to Locals 56 and 74 a list of contractors who have assigned their bargaining rights for the purpose of negotiation with the Union. O'Donnell is listed as a contractor.*fn2 Plasterers Union Local 5 filed a petition for a National Labor Relations Act Section 9(a) election in Case Number 13 RC 20542 before the National Labor Relations Board ("NLRB"), seeking to solely represent the plasterer employees at O'Donnell. Geraldine O'Donnell was a party to the NLRB proceeding and Locals 56/74 intervened as an interested party. At the hearing, Geraldine O'Donnell admitted she signed the Memorandum of Understanding, and her attorney had no objections when the hearing officer stated on the record: "The Employer for the Association and the Intervener are parties to an 8-F agreement expiring on June 30, 2004 . . ." Defendant contends that any stipulation made at the NLRB hearing was for the sole purpose of conducting an election for O'Donnell's plasterers to choose either Local 56/74 or Plasterers Local 5 Union as their bargaining representative. Local 56/74 lost the election on April 24, 2001, which precipitated this lawsuit. In the six years that Plaintiffs claim they had an agreement with O'Donnell, they never audited it. Local 5 Union audited O'Donnell three times during that six-year period and found that no money was owed.

Local 56/74 never requested a Wage and Fringe Benefit Bond from O'Donnell, nor did it request proof of Workman's Compensation or Liability Insurance. The Union never sent O'Donnell Wage/Fringe Benefit Rates. Further, the Union never sent O'Donnell monthly contribution reports for the period of 1996 through April 2001, and O'Donnell never received correspondence by phone, mail, or fax from April 1996 until the letter dated April 2, 2001, which was after the NLRB election.*fn3 From January 2001 through June 2001, O'Donnell filed fringe benefit report forms and made payments to Plaintiff Funds as required by the collective bargaining agreements. The report forms, which were unsigned, state: "I hereby certify the above is a true and complete report of all hours worked by the Plasterers and Apprentices during the month. In accordance with the obligations assumed by me to the Fringe Benefit Funds of Local #74, I enclose payment as indicated to the left."

Geraldine O'Donnell gave Plaintiffs a list of all projects performed in DuPage County by O'Donnell where the company did not pay the benefits to Plaintiffs as required under the alleged Union contract. From April 1996 through April 2001, Defendant did not pay benefits for 1814 hours of potentially covered work performed. Pursuant to a fringe benefit audit covering the period of April 15, 1996 through April 30, 2001, O'Donnell failed to make $12,265.48 of the contributions ...

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