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Board of Trustees of Automobile Mechanics'local No. 701 Union and Industry Welfare Fund v. Beland & Wiegers Enterprises, Inc.

United States District Court, N.D. Illinois, Eastern Division

August 21, 2014

BOARD OF TRUSTEES OF THE AUTOMOBILE MECHANICS' LOCAL NO. 701 UNION AND INDUSTRY WELFARE FUND; and BOARD OF TRUSTEES OF THE AUTOMOBILE MECHANICS' LOCAL NO. 701 UNION AND INDUSTRY PENSION FUND, Plaintiffs,
v.
BELAND & WIEGERS ENTERPRISES, INC., an Illinois corporation, DANIEL J. BELAND, an individual, and BERNARD WIEGERS, an individual, Defendants.

MEMORANDUM OPINION & ORDER

JOAN B. GOTTSCHALL, District Judge.

Plaintiffs Board of Trustees of the Automobile Mechanics' Local No. 701 Union and Industry Welfare Fund and Board of Trustees of the Automobile Mechanics' Local No. 701 Union and Industry Pension Fund filed an amended complaint against defendants Beland & Wiegers Enterprises, Inc. (B&W); Daniel J. Beland; and Bernard Wiegers, alleging breach of contract and withdrawal liability arising under the Employee Retirement Income Security Act (ERISA).

Now before the court is the plaintiffs' motion for summary judgment against B&W and Beland. On December 12, 2013, the court set a briefing schedule on the motion, with responses due January 15, 2014. On January 13, 2014, the court granted the defendants' motion for an extension of time to February 14, 2014, to file its response.[1] Plaintiffs had no opposition to the extension and the court granted the motion. But over six months after the new deadline passed, the defendants have still filed no response. For the reasons detailed below, the motion for summary judgment is granted in part and denied in part.

I. BACKGROUND FACTS

Northern District of Illinois Local Rule 56.1(a) requires parties moving for summary judgment to submit a statement of material facts. Local Rule 56.1(b)(3)(C) provides: "All materials set forth in the statement required of the moving party will be deemed to be admitted unless controverted by the statement of the opposing party." The plaintiffs filed a Local Rule 56.1 Statement of Material Facts (ECF No. 24), and the defendants have not disputed the facts in that statement. Accordingly, the court deems those facts admitted, and the facts that follow are taken primarily from the plaintiffs' statement. See J&J Sports Prods., Inc. v. Perez, No. 12 C 8256, 2014 WL 3805818, at *1 (N.D. Ill. Aug. 1, 2014). Nevertheless, the court "must still construe those facts in the light most favorable to the defendants as well as draw all reasonable inferences in their favor." Id. (citing Keeton v. MorningStar, Inc., 667 F.3d 877, 884 (7th Cir. 2012)).

Defendant B&W entered into a collective-bargaining agreement (CBA) with the Automobile Mechanics' Local Union No. 701 on or about May 28, 2010. B&W agreed to be bound by the provisions of the Agreements and Declarations of Trust (Trust Agreements) which created the Automobile Mechanics' Local Union No. 701 and Industry Pension Fund and the Automobile Mechanics' Local No. 701 Union and Industry Welfare Fund (collectively, Funds).

Pursuant to the CBA and the Trust Agreements, B&W was required to make monthly reports of the number of weeks worked by covered employees and pay contributions to the Funds for each week that a covered employee performs any work at the negotiated rate set forth in the CBA. The monthly reports and contributions during all times relevant were due on or before the 10th day of the calendar month following the calendar month during which the work was performed. Under the terms of the Trust Agreements, contributing employers that fail to submit payment of contributions by the due date are responsible for paying liquidated damages of 10% of any amount unpaid, plus any reasonable attorney's fees and costs of maintaining suit.

B&W failed to submit payment of contributions and surcharges to the Funds for the months of September and October 2012 in the amount of $5, 020.50. As a result of unpaid contributions and surcharges, B&W incurred liquidated damages of $502.45.

On September 19 or 20, 2012, B&W ceased all covered work. On March 14, 2013, the Pension Fund's counsel sent a notice and demand for payment of withdrawal liability in the amount of $261, 052 to B&W. The notice and demand for payment enclosed a payment schedule in accordance with 29 U.S.C. § 1399, pursuant to which B&W was required to make twenty-six quarterly payments in the amount of $12, 104 each followed by a final payment in the amount of $8, 996 to pay off its withdrawal liability. The first quarterly payment was due on April 1, 2013. After B&W failed to make its first quarterly payment on April 1, 2013, the Pension Fund sent B&W a notice to cure its default. B&W failed to submit payment of any of its quarterly installments.

Daniel Beland is the sole owner of B&W. At the time of B&W's withdrawal from the Pension Fund, Beland owned the property located at 11625 South Ridgeland, Alsip, Illinois. Before cessation of covered operations, B&W operated out of that property. Neither B&W nor Beland requested a review of the withdrawal liability assessment pursuant to 29 U.S.C. § 1399(c)(2) or initiated arbitration to challenge the plaintiffs' withdrawal liability assessment pursuant to 29 U.S.C. § 1401.

Pursuant to the Pension Benefit Guaranty Corporation's website, the interest rate for overdue or defaulted withdrawal liability has been 3.25% since January 1, 2012. Interest on the unpaid withdrawal liability in the amount of $261, 052 from April 1, 2013 through November 30, 2013 at a rate of 3.25% equals $5, 709.93. The Pension Fund Trust Agreement provides that withdrawal liability payments "not received before the expiration of said period shall be assessed liquidated damages of at least ten percent (10%) of the monies due per month." (Agm't & Decl. of Trust 9-10, ECF No. 24-3.) Liquidated damages at 10% of $261, 052 would be $26, 105.20.

The Pension Fund Trust Agreement also states: "Employers shall be liable to the Trustees for all costs, expenses and attorney's fees... incurred by them in enforcing any obligation of Employers created by this Trust Agreement or any bargaining agreement, including, without limitation, the duty to furnish records to the Trustees to determine the Employer's compliance with said obligations." ( Id. at 14-15.) As of November 27, 2013, the Plaintiffs have expended $8, 043.51 in attorney's fees and costs.

II. LEGAL STANDARD

Summary judgment is appropriate when the movant shows there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56; Smith v. Hope Sch., 560 F.3d 694, 699 (7th Cir. 2009). The court ruling on the motion construes all facts and makes all reasonable inferences in the light most favorable to the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Summary judgment is appropriate when the nonmoving party cannot establish an ...


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