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Trustees of Bricklayers & Allied Craftworkers Local 13 Defined Contribution Pension Trust for Southern Nevada v. Commercial Union Tile & Stone, Inc.

United States District Court, D. Nevada

August 4, 2017

TRUSTEES OF THE BRICKLAYERS & ALLIED CRAFTWORKERS LOCAL 13 DEFINED CONTRIBUTION PENSION TRUST FOR SOUTHERN NEVADA, et al., Plaintiffs,
v.
COMMERCIAL UNION TILE & STONE, INC., et al., Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR SUMMARY JUDGMENT (ECF NO. 54)

          ANDREW P. GORDON UNITED STATES DISTRICT JUDGE.

         On November 21, 2016, the plaintiffs filed a motion for summary judgment against defendants Commercial Union Tile & Stone, Inc.; Vegas Affordable Stone and Tile, Inc. (VAST); and Jonathan William Canja.[1] ECF No. 54. None of these defendants opposed the motion. I nevertheless must ensure the plaintiffs met their burden under Federal Rule of Civil Procedure 56 of showing no genuine fact dispute remains and they are entitled to judgment as a matter of law. See In re Rogstad, 126 F.3d 1224, 1227 (9th Cir. 1997). When, as here, “the party moving for summary judgment would bear the burden of proof at trial, it must come forward with evidence which would entitle it to a directed verdict if the evidence went uncontroverted at trial.” C.A.R. Transp. Brokerage Co. v. Darden Restaurants, Inc., 213 F.3d 474, 480 (9th Cir. 2000) (quotation omitted). “In such a case, the moving party has the initial burden of establishing the absence of a genuine issue of fact on each issue material to its case.” Id.

         The plaintiffs are collectively bargained multi-employer fringe benefit trust funds created pursuant to written declarations of trust and collective bargaining agreements between multi-employer associations and the International Union of Bricklayers and Allied Craftworkers, Local Union No. 13 (“Local 13”).[2] Defendant Commercial Union is a signatory to a collective bargaining agreement (CBA) with Local 13, pursuant to which Commercial Union agreed to make fringe benefit contributions to the plaintiffs for all hours Commercial Union's employees performed work covered by the Local 13 CBA.

         Defendant Canja was an owner and officer of Commercial Union. Canja also operated VAST, a company owned by defendant Jedediah Feller. Canja was responsible for controlling the labor relations for Commercial Union and VAST, and he was responsible for supervising the companies' employees. Commercial Union and VAST are involved in the tile and masonry industry within Local 13's jurisdiction.

         Commercial Union and VAST failed to submit timely reports or contributions to the plaintiffs, and refused to submit to audits even though the CBA allows the plaintiffs to conduct audits to ensure compliance with the CBA and with the Employment Retirement Income Security Act of 1974 (“ERISA”). Through discovery, the plaintiffs were able to conduct an audit for the period of December 1, 2014 through April 30, 2016. The audit showed Commercial Union had not made all required contributions. The plaintiffs thus demanded payment but no payments were made. This court previously ordered that the audit report “shall be accepted as fact” and Commercial Union “will not be permitted to enter a defense as to the accuracy of the audit report and auditor assumptions.” ECF No. 51 at 1.

         A. Commercial Union and Vast

         The plaintiffs submit evidence showing that Canja operated VAST as a non-union alter ego to Commercial Union. Although VAST was owned by Feller, Canja conducted all substantive operations, including signing contracts, making bids, and supervising employees. VAST and Commercial Union shared employees but VAST did not provide any pension or health care benefits for its employees. When Canja would bid on projects for the two companies, he would make Commercial Union's bid higher by forty percent or more for labor.

         Based on these facts, and as more fully set forth in the motion with citation to the supporting evidence, the plaintiffs have met their initial burden of showing that Commercial Union breached the CBA and violated 29 U.S.C. § 1145 by failing to make contributions to the plans as required under the CBA. The plaintiffs have also met their initial burden of showing that Commercial Union and VAST are alter egos. See S. Cal. Painters & Allied Trades, Dist. Council No. 36 v. Rodin & Co., 558 F.3d 1028, 1031 (9th Cir. 2009). Although the two entities do not share common ownership, they do share common management, operations, and labor relations. See Id. Additionally, the plaintiffs have presented evidence that Canja operated the two entities to avoid CBA obligations by inflating Commercial Union's bids by forty percent or more and by using the same employees to perform both companies' work. Id. at 1032.

         Because the plaintiffs bear the burden of proof on the question of alter ego, “they had the burden of establishing a prima facia case on their motion for summary judgement.” UA Local 343 United Ass'n of Journeymen & Apprentices of Plumbing & Pipefitting Indus. of U.S. & Canada, AFL-CIO v. Nor-Cal Plumbing, Inc., 48 F.3d 1465, 1471 (9th Cir. 1994). Having met that burden by presenting evidence that, if left uncontroverted, would show that Commercial Union and VAST were alter egos, “it became incumbent on [the defendants] to set forth specific facts showing that there is a genuine issue for trial.” Id. (quotation omitted). Neither Commercial Union nor VAST oppose the motion.[3] I therefore grant the plaintiffs' motion as to Commercial Union and VAST.

         Section 1132(g)(2) of ERISA provides that when an employment benefit trust obtains judgment in its favor for unpaid contributions, the court “shall” award the trust unpaid contributions, interest on the unpaid contributions, liquidated damages, and reasonable attorney's fees and costs. They are also entitled to “such other legal or equitable relief as the court deems appropriate.” 29 U.S.C. § 1132(g)(2)(E). Audit costs “are recoverable under subsection (E).” Operating Eng'rs Pension Trust v. A-C Co., 859 F.2d 1336, 1343 (9th Cir. 1988).

         The evidence in this case supports the following awards:

(a) unpaid contributions in the amount of $200, 729.76;
(b) pre-judgment interest on the unpaid contributions in the amount of $26, 824.30 through November 21, 2016; and
(c) liquidated damages in the amount of $33, 605.87.

         Additionally, the plaintiffs are entitled to reasonable attorney's fees and costs in the amount of $84, 390.37 ($75, 090.00 in fees and $9, 300.37 in costs). Finally, the plaintiffs are entitled to the audit costs in the amount of $31, 713.44.

         B. ...


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