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Cooney v. Trustees of Will County Carpenters, Pension Fund

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

November 21, 2016

JOHN P. COONEY, Plaintiff,


          John Robert Blakey United States District Judge

         This matter concerns payments made on behalf of Plaintiff John P. Cooney (“Plaintiff”) to Defendant Trustees of Will County Carpenters, Local 174, Pension Fund (the “Fund”). In his Second Amended Complaint [78], Plaintiff alleges that the Fund and its Trustees[1] impermissibly converted these payments in violation of Illinois state law. Plaintiff further alleges that the Fund, its Trustees, and its Lawyers[2] “conspired with each other to have the Fund retain and convert the contributions made” on his behalf. Id. ¶ 38. The Fund and the Trustees collectively moved to dismiss [80], while the Lawyers filed a separate (albeit similar) motion. [83] at 2-7. For the reasons explained below, Defendants' motions to dismiss are granted.

         I. Background [3]

         From January 6, 2004 to October 31, 2008 (“the Relevant Period”), Plaintiff served as in-house legal counsel for Avenue Inc. and Avenue Premier Carpentry and Siding Contractors, Inc. (collectively, “Avenue”). [78] ¶¶ 7, 17. Avenue was a signatory employer with the Chicago Regional Council of Carpenters (“Regional Council”) through a Collective Bargaining Agreement (“CBA”) between the Regional Council and the Residential Construction Employers Council. Id. ¶ 8. Under the CBA, Avenue was obligated to make monthly payments on behalf of its employees within the bargaining unit to the Fund. Id. ¶ 9. During the Relevant Period, Avenue did in fact make benefit payments on Cooney's behalf worth $66, 921.60 (the “Disputed Monies”). Id. ¶ 15.

         On December 10, 2008, the Fund-through its Lawyers-sent a letter to Plaintiff declaring that the contributions made on his behalf “did not involve bargaining unit work, ” such that Plaintiff and his dependents were “ineligible for benefits, ” including but not limited to receipt of the Disputed Monies. Id. Ex. 1. On February 11, 2009, the Lawyers sent additional correspondence to Plaintiff, explaining: “You are neither performing bargaining unit work nor are you covered under the collective bargaining agreement. You are not now, nor never have been, eligible to participate in the Will County Carpenters Local 174 Pension Plan or Welfare Plan.” Id. Ex. 2. Plaintiff made several demands contesting Defendants' determination and requesting tender of the Disputed Monies. Id. ¶ 23. When those efforts failed, he filed this lawsuit. Id.

         In his initial Complaint, Plaintiff brought claims for conversion and conspiracy under Illinois state law. [1] at 4-5. This Court dismissed that Complaint without prejudice, finding that because Plaintiff's claims “would require analysis and interpretation of the terms of the CBA and the Fund, ” both claims were “completely” preempted by 29 U.S.C. § 1132 (“ERISA § 502”).[4] [53] at *8. At that time, Plaintiff did not provide the Court with the terms of the Fund itself, so the Court accepted as true Plaintiff's allegation that he was a participant in the Fund.

         Plaintiff then filed his First Amended Complaint, wherein he reiterated his state law theories and brought new claims for conversion under 28 U.S.C. § 1103(c)(2)(A)(ii) and breach of fiduciary duty under 29 U.S.C. § 1109. [57] at 6-10. At that point, the Court was able to reference the terms of the Fund, and pursuant to that same language, the Court found that Plaintiff did not qualify as a “participant” under 29 U.S.C. § 102(7). [77] at 6. The Court dismissed Plaintiff's federal claims in light of that determination. Id. at 6-7. The Court further ruled that because Plaintiff was not a “participant, ” his state law claims were not in fact “completely” preempted under ERISA § 502. Id. at 7. However, the Court reserved judgment as to whether Plaintiff's state law claims for conversion and conspiracy were still subject to dismissal pursuant to the “conflict preemption” language of 29 U.S.C. § 1144 (“ERISA § 514”).

         In response to the Court's ruling, Plaintiff filed his Second Amended Complaint [78], which only contains his claims for conspiracy and conversion. Defendants' motions to dismiss [80, 83] that Second Amended Complaint are now fully briefed and ripe for adjudication.

         II. Legal Standard

         To survive Defendants' motions under Federal Rule of Civil Procedure 12(b)(6), the Complaint must “state a claim to relief that is plausible on its face.” Yeftich v. Navistar, Inc., 722 F.3d 911, 915 (7th Cir. 2013). A “claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. This Court must construe the Complaint in the light most favorable to Plaintiff, accept as true all well-pleaded facts, and draw all reasonable inferences in his favor. Id.; Long v. Shorebank Dev. Corp., 182 F.3d 548, 554 (7th Cir. 1999). Statements of law, however, need not be accepted as true. Yeftich, 722 F.3d at 915. Rule 12(b)(6) limits this Court's consideration to “allegations set forth in the complaint itself, documents that are attached to the complaint, documents that are central to the complaint and are referred to in it, and information that is properly subject to judicial notice.” Williamson v. Curran, 714 F.3d 432, 436 (7th Cir. 2013).

         III. Analysis

         Plaintiff's only pending claims are for conversion (against the Fund and the Trustees) and conspiracy (against the Fund, the Trustees, and the Lawyers). [78] at 7-8. Plaintiff's conversion claim is explicitly brought pursuant to “Illinois common law”; it is unclear whether Plaintiff is attempting to ground his conspiracy claim in state or federal law. Id. In either event, both claims are dismissed with prejudice, as more fully explained below.

         A. Conflict Preemption Under ERISA

         ERISA § 514 preempts state law claims “insofar as they . . . relate to any employee benefit plan.” 29 U.S.C. § 1144 (emphasis added). Courts ascribe a common-sense meaning to this provision, such that a state law claim “relates to a benefit plan . . . if it has a connection with or reference to such a plan.” Metro. Life Ins. Co. v. Massachusetts, 471 U.S. 724, 739 (1985) (internal quotation omitted); see also Rice v. Panchal, 65 F.3d 637, 645 (7th Cir. 1995) (ERISA § 514 preempts “state ...

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