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Trustees of the Chicago Regional Council of v. Mcgreal Construction Company

January 31, 2012

TRUSTEES OF THE CHICAGO REGIONAL COUNCIL OF CARPENTERS PENSION FUND, ET AL., PLAINTIFFS,
v.
MCGREAL CONSTRUCTION COMPANY, DEFENDANT.



The opinion of the court was delivered by: Charles P. Kocoras, District Judge:

MEMORANDUM OPINION

This case comes before the Court on the motion of Plaintiffs Trustees of the Chicago Regional Council of Carpenters Pension Fund, Chicago Regional Council of Carpenters Welfare Fund, and Chicago Regional Council of Carpenters Apprentice and Trainee Program Fund (collectively, "Trust Funds") for summary judgment pursuant to Federal Rule of Civil Procedure 56. For the reasons stated below, the motion is granted as to liability.

BACKGROUND*fn1

The Trust Funds filed this action under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1132, seeking to collect delinquent contributions, liquidated damages, interest, and attorney's fees from Defendant McGreal Construction Company ("McGreal").

The Trust Funds receive contributions from employers pursuant to a collective bargaining agreement between the employers and the Chicago Regional Council of Carpenters, successor of the Chicago and Northeast Illinois District Council of Carpenters, (the "Union"). The collective bargaining agreement requires employers to pay to the Trust Funds contributions for covered work and dues that were withheld from each covered employee's wages. According to the collective bargaining agreement, if an employer fails to pay contributions in a timely manner, the employer is liable for the unpaid contributions, reasonable attorney's fees, and liquidated damages as set forth in the trust agreements.

According to the Agreement and Declaration of Trusts for the Trust Funds (the "Trust Agreements"), employer contributions are delinquent if not received on or before the fifteenth day of the month. In addition to the delinquent contribution, the employer will owe liquidated damages in the amount of 1.5% per month on the remaining accounts receivable balance. If the account is placed for collection, the employer is also liable for reasonable attorney's fees, court fees, audit fees, and other reasonable costs incurred in the collection process.

Pursuant to the collective bargaining agreement and Trust Agreements, an employer must complete a monthly reporting form specifying the contributions and dues owed to the Trust Funds. Each month, the employer submits the completed and signed contribution report to the Trust Funds with the appropriate payment. By signing the monthly report, the employer certifies that the report is accurate and complete, and that the employer agrees to be bound by the collective bargaining agreement and the Trust Agreements. The monthly report states that it is due on or before the fifteenth of every month and that late payments will be charged 1.5% per month, compounded, as liquidated damages.

McGreal, an employer engaged in an industry affecting commerce, entered into an agreement with the Union, binding itself to the provisions of several collective bargaining agreements from July 15, 1985, to the present. The collective bargaining agreements require McGreal to pay fringe benefit contributions to the Trust Funds.

Between May 2009 and March 2011, McGreal sporadically failed to timely pay contributions. As a result, the Trust Funds claim that McGreal owes liquidated damages totaling $11,888.24. Additionally, for November 2010 through March 2011, McGreal owes delinquent contributions. In total, the Trust Funds claim McGreal owes $35,310.15 for unpaid contributions, liquidated damages, and interest.

LEGAL STANDARD

Summary judgment is appropriate when the pleadings, discovery materials, disclosures, and affidavits demonstrate no genuine issue of material fact, such that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a); Protective Life Ins. Co. v. Hansen, 632 F.3d 388, 391-92 (7th Cir. 2011). A genuine issue of material fact exists when, based on the evidence, a reasonable jury could find in favor of the non-moving party. Van Antwerp v. City of Peoria, Ill., 627 F.3d 295, 297 (7th Cir. 2010). A court construes all facts and draws all reasonable inferences in favor of the non-moving party. Smith v. Hope Sch., 560 F.3d 694, 699 (7th Cir. 2009).

DISCUSSION

The Trust Funds move for summary judgment regarding McGreal's liability for delinquent contributions, liquidated damages, interest, reasonable attorney's fees, and other reasonable costs incurred in the collection process. McGreal contests the Trust Funds' right to recover for delinquent contributions and liquidated damages.

McGreal first argues that the Trust Funds' complaint fails to state a claim for delinquent contributions from November 2010 through March 2011 because the Trust Funds did not expressly allege that McGreal failed to pay contributions. When determining whether a plaintiff states a plausible claim for relief, the court construes the allegations in the plaintiff's favor and draws all reasonable inferences in favor of the plaintiff. Hentosh v. Herman M. Finch Univ. of Health Scis./The Chi. Med. Sch., 167 F.3d 1170, 1173 (7th Cir. 1999). The Trust Funds allege that McGreal must submit monthly reports and concurrently pay contributions. The Trust Funds also allege that McGreal breached certain agreements by failing to submit monthly reports from November 2010 through March 2011. From these allegations, the Court can reasonably infer that McGreal did not pay the contributions without submitting the monthly reports stating ...


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