United States District Court, N.D. Illinois
June 1, 2004.
TRUSTEES OF THE CHICAGO PAINTERS AND DECORATORS PENSION, HEALTH, AND WELFARE AND DEFERRED SAVINGS PLAN TRUST FUNDS Plaintiff, V. LACOSTA, Inc., an Illinois corporation Defendant
The opinion of the court was delivered by: SAMUEL DER-YEGHIAYAN, District Judge
This matter is before this court on Plaintiff Trustees of the Chicago
Painters and Decorators Pension, Health and Welfare, and Deferred Savings
Plan Trust Funds', ("Trustees") and Defendant LaCosta, Inc.'s ("LaCosta")
cross-motions for summary judgment. In addition, Trustees have filed a
motion to strike a portion of Karla Mota Johnson's Affidavit. For the
reasons stated below, we grant LaCosta's motion for summary judgment and
deny Trustees' motion for summary judgment. Additionally, Trustees' motion to strike is denied as moot.
The Chicago Painting and Decorating Contractors' Association ("Employer
Association") is a trade association of painting and decorating
contractors. Plaintiff is the trustee of the Chicago Painters and
Decorators Pension, Health and Welfare, and Deferred Savings Plan trust
funds. These trust funds are employee benefit trusts to which certain
contributions are made pursuant to collective bargaining agreements.
LaCosta is an Illinois Corporation in the business of providing painting,
janitorial, and supplemental labor services.
Trustees allege that LaCosta is a member of the Employer Association
and as a member has failed to submit to an audit or contribute to the
trust funds pursuant to the Employer Association collective bargaining
agreement ("CBA") between the Employer Association and the Painters'
District Council No. 14 ("Union"). LaCosta contends that it has not
entered into the CBA and has no obligation to submit to an audit or
contribute to the trust funds. LaCosta further contends that it merely
responded to a solicitation by the Employer Association for free
membership and filled out a one page form application entitled "Free 2001
PDCA & FCA Membership Application" ("Association Membership
LEGAL STANDARD Summary judgment is appropriate when the record reveals that there is
no genuine issue as to any material fact and the moving party is entitled
to judgment as a matter of law. Fed.R.Civ.P. 56(c). In seeking a grant
of summary judgment the moving party must identify "those portions of
`the pleadings, depositions, answers to interrogatories, and admissions
on file, together with the affidavits, if any,' which it believes
demonstrate the absence of a genuine issue of material fact." Celotex
Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quoting Fed.R.Civ.P.
56(c)). This initial burden may be satisfied by presenting specific
evidence on a particular issue or by pointing out "an absence of evidence
to support the non-moving party's case." Id. at 325. Once the
movant has met this burden, the non-moving party cannot simply rest on
the allegations in the pleadings, but, "by affidavits or as otherwise
provided for in [Rule 56], must set forth specific facts showing that
there is a genuine issue for trial." Fed.R.Civ.P. 56(e). A "genuine
issue" in the context of a motion for summary judgment is not simply a
"metaphysical doubt as to the material facts." Matsushita Elec.
Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).
Rather, a genuine issue of material fact exists when "the evidence is
such that a reasonable jury could return a verdict for the nonmoving
party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986); Insolia v. Philip Morris, Inc., 216 F.3d 596, 599 (7th
Cir. 2000). The court must consider the record as a whole, in a light
most favorable to the non-moving party, and draw all reasonable inferences
that favor the non-moving party. Anderson, 477 U.S. at 255;
Bay v. Cassens Transport Co., 212 F.3d 969, 972 (7th Cir. 2000).
Both cross motions for summary judgment concern the interpretaion of
whether or not LaCosta is bound by the CBA. Trustees' motion for summary
judgment maintains that LaCosta intended to be bound by the CBA.
LaCosta's motion for summary judgment maintains that it did not intend to
be bound by the CBA.
In discerning whether an employer is bound "through its involvement
with a multi-employer association, to collective bargaining agreements
negotiated between the association and a union", as is the case
in this matter a court must consider agency principles and in
addition determine whether the employer "manifested an unequivocal
intention" to be bound by a collective bargaining agreement. Moriarty
v. Glueckert, 155 F.3d 859, 865-66 (7th Cir. 1998).
Trustees contend mat on January 3, 2001 LaCosta expressly delegated
authority to bind itself to the CBA when LaCosta's President, Kara Mota
Johnson, signed an application for membership with the Employer
Association. LaCosta contends that when it's President signed the
application for free membership with the Employer Association it did not
intend to be bound by the CBA. In Moriarty v. Pepper, 256 F.3d 554, 558 (7th Cir. 2001), an
action very similar to this case, the Seventh Circuit examined whether
the defendant, Pepper, expressly authorized an employer association to
bargain on his behalf simply because he signed the employer association's
membership application. In that case, the Seventh Circuit noted that the
application Pepper signed did not "specifically state" that he would be
delegating his bargaining rights to the association. Pepper 256
F.3d at 558. After reviewing the employer association's constitution and
application for membership, the Seventh Circuit found that Pepper's
signing of the application "did not reveal an express intention" on
Pepper's part to be bound by the employer association's collective
bargaining activities. Id.
In this case, Trustees argue that the Association Membership
Application LaCosta signed unequivocally states mat the applicant is
bound by the CBA. The last sentence of the Association Membership
Application reads as follows:
I have read, understand, and agree to abide by the
Constitution and By-Laws of the Chicago
Council/PDCA and the current Labor-Management
Agreement between Painters' District Council No.
14 and PDCA (copies available on request)
Pl.'s Ex. 3.
The court notes mat, the Association Membership Application that
LaCosta signed did not inform LaCosta that by signing the application it
would be joining a particular class of membership in the Employer
Association. It is undisputed that there are actually three classes
of membership: Active Membership, Associate Membership, and Honorary
Membership in the Employer Association. Pl.'s Rule 56.1 ¶ 44; Pl.'s
Ex. 7 § 3.01. Furthermore, the Constitution and By-Laws of the Employer Association contains separate provisions addressing and
distinguishing the different forms prescribed for applications for Active
Membership and applications for Associate Membership. Pl.'s Ex. 7 §
3.02(b), § 3.04(b). In addition, the Constitution and By-Laws of the
Employer Association provides that only "Active Members" are bound by the
CBA. Pl.'s Ex. 7 § 10.01(a).
The Association Membership Application LaCosta signed did not inform
LaCosta of the different types of membership in the Employer Association
or that by signing the application it was becoming an "Active Member" of
the Employer Association subject to the CBA. The one page free membership
application form that LaCosta signed fails to make it clear to LaCosta
whether the form is an application for Active Membership or Associate
Membership. Pl.'s Ex. 7 § 3,02(b), § 3.04(b). LaCosta was not
provided with a copy of the Constitution and By-Laws of the Employer
Association when LaCosta's President signed the Association Membership
Application. As a matter of fact, LaCosta has never been provided with a
copy of the Constitution and By-Laws of the Employer Association. As to
the Employer Association's failure in providing LaCosta with a copy of
its Constitution and By-Laws, the words "copies available on request"
appearing in parenthesis on the bottom of the one page free membership
form is insufficient and does not provide the employer with clear and
accurate information to make a sound decision on an important matter in
the nature of a binding collective bargaining agreement. The manner in
which the Employer Association solicited LaCosta to free membership in the Employer Association with the ensuing consequence
of being bound by a collective bargaining agreement borders on deception.
LaCosta could not have expressly intended to be bound by the CBA because
the Association Membership Application was deficient in that it did not
inform the applicant, LaCosta, that it was applying to become an "Active
Member" of the Employer Association and hence bound by the CBA nor did it
provide LaCosta with sufficient information to enter into a binding
collective bargaining agreement.
Therefore, Trustees have failed to establish that LaCosta's signing of
the Employer Association Application revealed an expressed intention to
be bound by the CBA.
In Glueckert, the Seventh Circuit adopted a test that is used
to determine whether an employer member is bound by a collective
bargaining agreement between the employer association and the union. 155
F.3d at 865(citing Trustees of the UIU Heath and Welfare Fund v. New
York Flame Proofing Co., 828 F.2d 79 (2nd Cir. 1987). The test set
forth in Glueckert is instructive in deciding whether the
employer member "manifested an unequivocal intention to be bound" by the
employer association's collective bargaining agreement. Id. The
Glueckert factors include: (1) whether negotiation of collective
bargaining agreements was a principal or sole activity in which the
association engaged; (2) whether it was universally known that the custom
of the association was to bind all members to the association's collective bargaining agreements; (3) whether the
individual member participated in the collective bargaining agreements;
(4) whether the individual member manifested an intent to pursue an
individual course of action regarding labor relations; (5) whether the
employer conducted itself as if it were bound to the collective
bargaining agreement. Id. at 866-67.
In support of the first Glueckert factor, Trustees maintain
that the principal or sole activity of the Employer Association is to
negotiate collective bargaining agreements with Labor Unions on behalf of
its contractor members. However, the Employer Association has submitted
exhibits in which the Employer Association advertises that it offers to
its members (1) Reduced Bond Requirement Offers; (2) Training Programs;
(3) Tech Information; (4) Health & Safety Programs; (5) Professional
Business Management Materials; (6) Networking Opportunities With Fellow
Contractors and Associates; and (7) Employer Association Technical
Assistance. Pl.'s Ex. 8. Therefore, the evidence does not sufficiently
establish that the negotiation of collective bargaining agreements was a
principal or sole activity in which the Employer Association in which was
In support of the second Glueckert factor, Trustees contend
that the Employer Association has been incorporated since 1934 and that
since that time the Constitution and By-Laws of the Employer Association
have made it universally known that it is the custom of the Employer
Association to bind all its members to its collective bargaining
agreements. However, it is undisputed that only Active Members of the Employer Association, and not all members are bound
by the CBA. Therefore, the evidence fails to establish that it was
universally known that the custom of the Employer Association was to bind
all members of the Employer Association to the CBA.
With respect to the third Glueckert factor, Trustees contend
that LaCosta's signature on the Application should be considered as
indicative of participating in some form of collective bargaining
agreement Trustees also state that an introductory letter and a copy of
the CBA that it sent to LaCosta also demonstrates participation in the
CBA. Trustees' assertions are without merit. LaCosta's signing of the
Association Membership Application and the subsequent receipt of an
introductory letter and copy of the CBA does not constitute participation
in a collective bargaining agreement. Trustees admit that LaCosta had no
involvement in the collective bargaining process between the Employer
Association and the Union. Pl.'s Resp. to Def.'s Rule 56.1 ¶'s 72,
73. Therefore, the evidence fails to establish that LaCosta participated
in any collective bargaining agreement.
With respect to the fourth Glueckert factor, LaCosta has
maintained and Trustees do not dispute that during the
period Trustees allege LaCosta was bound by the CBA, LaCosta provided its
employees their own independent employee benefits and continued to make
contributions to the fund of another employee association completely
separate and not associated with Employer Association. Therefore, it is
clear that LaCosta manifested an intent to pursue its own individual course of action regarding labor relations.
Finally, with respect to the fifth Glueckert factor, Trustees
contend that in the summer of 2001 they received two reports for fringe
benefits relating to LaCosta in their attempt to show that LaCosta
conducted itself as if it were bound by the CBA. LaCosta contends that it
did not submit any fringe benefit reports to the Trustees and that its
accountant, Kathleen Eremo ("Eremo"), who performed accounting for both
LaCosta and another company Bel-Rae, accidently forwarded fringe benefit
reports related to LaCosta to the Trustees. The record reflects that a
company named Bel-Rae ("Bel-Rae") is a signatory to the CBA and that
Bel-Rae's accountant, Eremo, regularly submitted fringe benefit reports
relating to Bel-Rae to the Trustees. The record further reflects that
during the summer of 2001 the Trustees had not received fringe benefit
reports relating to Bel-Rae and that Eremo who was performing accounting
services for both LaCosta and Bel-Rae had inadvertently forwarded Costa's
fringe benefit reports to the Trustees when in fact Eremo should have
forwarded the fringe benefit reports relating to Bel-Rae to the Trustees.
Trustees have not disputed LaCosta's account of events described above
and furthermore the record reflects that the same counsel who brought
suit against LaCosta in the summer of 2001 on behalf of the Trustees were
the same counsel who sent letters in August 2001 to Bel-Rae inquiring as
to Bel-Rae's failure to submit the monthly fringe benefit reports for the
summer of 2001. Trustees were fully aware of the inadvertent submission
of the fringe benefit reports by the accountant, Eremo, and there attempt at this stage of the proceedings to capitalize on an
error in order for Trustees to establish that LaCosta conducted itself as
if it was bound to the CBA is not supported by the record and is
The evidence submitted by both parties fails to establish that LaCosta
conducted itself as if it were bound by the CBA. Therefore, under the
Glueckert test and based on the above analysis we find that
LaCosta is not bound by the CBA.
The court further notes that the Association Membership Application was
both deficient and misleading. The form that the Employer Association
lured LaCosta into signing is predominantly a solicitation for a free
membership in the Employer Association and does not provide the
individual employer with sufficient information to bind such employer to
a collective bargaining agreement. A membership by an employer in an
association with resulting consequences to be bound by a collective
bargaining agreement should be based upon mutual trust and a clear
understanding of the rights and obligations of all the parties and not be
based upon vagueness, confusion, or trickery.
We find that LaCosta did not expressly or unequivocally manifest an
intent to be bound by the CBA and that there is no genuine issue of any
material fact. Furthermore, we find that no reasonable trier of fact
could conclude that LaCosta is bound by the CBA. CONCLUSION
Therefore, based upon foregoing, LaCosta's motion for summary judgment
is granted and Trustees' motion for summary judgment is denied. In
addition, Trustees' motion to strike is denied as moot.
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