Bricklayers & Allied Craftworkers Local 2 v. Moulton Masonry & Construction, LLC, 779 F.3d 182

Background

Moulton Masonry & Construction, LLC (corporate defendant) signed a collective bargaining agreement (CBA) obligating it to remit fringe benefit contributions and payroll deductions to union-managed multiemployer funds; Duane E. Moulton (individual) was owner/officer who reported hours and dealt with auditors.
Plaintiffs (multiemployer pension/benefit funds) audited the company in 2012; Moulton was uncooperative, prompting plaintiffs to sue under ERISA for unpaid contributions and related relief.
Defendants received the complaint but failed to file a responsive pleading; the clerk entered default on April 24, 2013 after plaintiffs moved for it.
Plaintiffs moved for default judgment supported by audits, affidavits, CBA and trust documents; defendants later opposed and cross-moved to vacate default, submitting a six‑page affidavit from Moulton without documentary proof.
District court denied motion to vacate and entered default judgment for $662,135.21 (comprised of $451,300.52 contributions, $104,628.81 prejudgment interest, $99,203.93 liquidated damages, and $7,001.95 fees/costs) against both defendants; defendants appealed.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the entry of default should be vacated	Default was proper; defendants failed to timely plead	Default resulted from mistake/excusable neglect because Moulton thought audit participation sufficed	Affirmed: default was willful; defendants failed to show meritorious defense
Whether liability is established for corporate defendant under ERISA §515	Corporate defendant bound by CBA and failed to remit contributions; liable for unpaid contributions and related statutory relief	Corporate argued no evidence it received union labor payments	Affirmed: allegations and uncontested documentary evidence establish corporate liability under §1145/§1132
Whether Moulton is individually liable and under what theory	Plaintiffs: Moulton was a fiduciary who controlled payments and withheld plan assets, thus individually liable under ERISA §409	Moulton: cannot be liable individually under §515 as he did not sign CBA; disputes audit methodology	Affirmed in part: Moulton liable as ERISA fiduciary under §1109 based on allegations he controlled plan assets
Proper scope of damages against individual fiduciary	Plaintiffs sought full statutory package (contributions, interest, liquidated damages, fees) against both defendants	Moulton argued some items (liquidated damages, interest, fees) are not appropriate against an individual fiduciary absent specific findings	Vacated as to individual: award of contributions stands, but liquidated damages vacated; prejudgment interest and attorney's fees vacated for lack of district-court findings and remanded for analysis

Key Cases Cited

Enron Oil Corp. v. Diakuhara, 10 F.3d 90 (2d Cir. 1993) (establishes multi‑factor good‑cause inquiry for vacating default)
Guggenheim Capital, LLC v. Birnbaum, 722 F.3d 444 (2d Cir. 2013) (applies willfulness/meritorious‑defense/prejudice framework)
SEC v. McNulty, 137 F.3d 732 (2d Cir. 1998) (discusses willfulness standard for defaults)
Sony Corp. v. Elm State Elec., Inc., 800 F.2d 317 (2d Cir. 1986) (standard for vacating entry of default and need for facts supporting meritorious defense)
City of New York v. Mickalis Pawn Shop, LLC, 645 F.3d 114 (2d Cir. 2011) (standard of review for default-judgment liability)
Finkel v. Romanowicz, 577 F.3d 79 (2d Cir. 2009) (defines fiduciary status and duties under ERISA)
Diduck v. Kaszycki & Sons Contractors, Inc., 974 F.2d 270 (2d Cir. 1992) (liquidated damages not necessarily equitable relief under §1109)
Henry v. Champlain Enters., Inc., 445 F.3d 610 (2d Cir. 2006) (district court must articulate reasons and rate when awarding prejudgment interest under ERISA)
LoPresti v. Terwilliger, 126 F.3d 34 (2d Cir. 1997) (broad construction of ERISA fiduciary definition)