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Central Laborers' Pension Fund, et al v. Ivy Concrete Foundations

September 29, 2011

CENTRAL LABORERS' PENSION FUND, ET AL., PLAINTIFF,
v.
IVY CONCRETE FOUNDATIONS, INC., MTI PROPERTIES LLC, MICHAEL T. IVY, INDIVIDUALLY, DEFENDANTS.



The opinion of the court was delivered by: Richard Mills, U.S. District Judge:

E-FILED

Friday, 30 September, 2011 03:45:14 PM

Clerk, U.S. District Court, ILCD

OPINION

Pending before the Court is the Plaintiffs' motion for summary judgment.

This is an action to recover employer contributions pursuant to the Employee Retirement and Income Security Act of 1974 (ERISA), as amended, specifically section 515 of ERISA, 29 U.S.C. § 1145. The Plaintiffs seek summary judgment based on the alter ego and successor liability theories alleged in their Amended Complaint.

I. BACKGROUND

The Plaintiffs, Central Laborers' Pension Fund, et al., are employee benefit funds administered pursuant to the terms and provisions of the Declarations of Trusts creating said Funds and are required to be maintained and administered in accordance with the provisions of the Labor Management Relations Act of 1947, and ERISA (as amended), 29 U.S.C. § 1001 et seq. The Central Laborers' Pension, Welfare and Annuity Funds are the collection agents for the other named Plaintiffs.

Defendant Ivy Concrete Foundations, Inc. (ICF) is an employer engaged in an industry within the meaning of ERISA, 29 U.S.C. § 1002(5), (11), (12) and (14). ICF's business address is 2901 Ridge Avenue, Springfield, Illinois 62702. Ivy Concrete Construction (ICC) was started by Defendant Michael T. Ivy in 1994 and incorporated in 1996. At the time of its incorporation, Ivy was the sole shareholder, director and officer of the corporation. ICC was a concrete contractor whose business, according to the Defendants, was limited to the installation of driveways, sidewalks and patios. The Plaintiffs dispute that the business was so limited.

The Defendants claims that in 2005, ICC ceased operations due to a lack of business. The Plaintiffs acknowledge that it ceased operations but contends this was in name only, claiming that a new business was soon formed as a continuation of ICC. ICC stopped operating at the end of 2005 and was involuntarily dissolved by the Illinois Secretary of State on August 8, 2006. The business address of ICC at the time it ceased operations was 2901 Ridge Avenue, Springfield, Illinois 62702. According to Ivy, the property located at that address also has an address of 2901 North Grand Avenue East, Springfield, Illinois. In effect, 2901 North Grand Avenue East and 2901 Ridge Avenue are two different addresses for the same property/location.

ICF was incorporated in Illinois on January 9, 2006. As he was with ICC, Mike Ivy is the sole shareholder, director, and officer of ICF. The Defendants assert this business was started in order to take advantage of the demand for the installation of concrete foundations. The Plaintiffs believe this new venture was simply a name change and the business purpose of this company was the same as its predecessor--a concrete construction contractor. The Defendants contend that the primary purpose of ICF is the installation of concrete foundations in residential property. The Plaintiffs maintain that ICF did all types of concrete work. In the concrete trade, the installation of concrete foundations in residential property is commonly referred to as "foundation work."

The Defendants contend that, due to the differing nature of the work performed by the two entities, the equipment used by ICF is different than the equipment used by ICC. The Plaintiffs claim this assertion is immaterial because of the same business purposes of the two companies. Moreover, the Plaintiffs dispute the accuracy of the assertion. The Plaintiffs dispute the Defendants' contention that the only equipment used by ICC was a "pick-up truck, a trailer and a box van and miscellaneous hand tools."

The Defendants allege that, in its first year of operation, ICF obtained the following items of equipment for use in its business operations: a 2002 Chevrolet 2-ton Dump Truck; a 1996 Ford F650 Flat Bed; a 1979 International Boom Truck; a 1999 Dodge Ram 1-Ton Truck; a complete set of 1' wall forms; a complete set of 4' wall forms; a complete set of 8' wall forms, an oil sprayer; a jackhammer; walk-behind saws; and, hammer drills. The Plaintiffs contend this assertion is immaterial because the two companies had the same business purpose. Moreover, both companies utilized heavy equipment.

The Defendants state that ICF took out its own loans to purchase equipment used in its business operations. The Plaintiffs claim that this is immaterial. Moreover, although the Plaintiffs do not dispute that ICF took out loans in its own name after it was formed, the Plaintiffs contend that several loans made in the name of ICC were never changed to reflect the cessation of business and remained in the name of the predecessor company until 2008 (for the Bobcat) and 2009 (for a Dodge truck). Similarly, the titles for both vehicles remained in the name of the predecessor company.

ICC had signed a Participation Agreement which required it to make contributions to the Plaintiffs in accordance with the terms and conditions of the Agreements and Declarations of Trusts. These Agreements and Declarations of Trusts, in pertinent part, were ...


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