Mastropietro v. Burbank Electrical Contractor, Inc.
1:21-cv-01129-BKS-ML
N.D.N.Y.Apr 6, 2023Background
- Plaintiffs are the trustees of I.B.E.W. Local 236 Health & Benefit Fund, the Annuity Fund, and I.B.E.W. Local 236 (the Union). They sued Burbank Electrical Contractor, Inc. and Dean Burbank for failing to remit employer contributions, union dues, and J.A.T.C. payments.
- Defendants defaulted and did not answer; Plaintiffs initially moved for default judgment but the court denied without prejudice because Plaintiffs had not submitted the underlying agreements or adequate evidence of damages.
- On renewal Plaintiffs submitted the collective-bargaining Inside Agreements, Small Works Addendum, trust instruments, contribution reports for April 2019–February 2020, and audit materials covering June 15, 2015–December 31, 2018.
- The submitted agreements obligated the employer to remit specified per-hour contributions to Health/Welfare, Annuity, J.A.T.C., and to forward dues with employee authorizations; they also provide for interest on delinquencies and audit rights.
- The audit and monthly reports showed: delinquent contributions and dues for April 2019–February 2020; additional audited delinquencies for 2015–2018; and no payment or dispute from Burbank after notice. Plaintiffs sought unpaid contributions, interest, audit delinquencies, union dues, attorney’s fees, and costs.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| ERISA §515 liability for Burbank (employer) | Burbank failed to pay required contributions and interest for April 2019–Feb 2020 as shown on monthly reports and agreements | No response; previously court noted complaint lacked contractual exhibits | Court found Burbank liable for delinquent contributions and contractual interest where agreements and reports established obligation and nonpayment |
| Individual fiduciary liability of Dean Burbank under ERISA | Dean exercised control over plan assets and withheld contributions; trust documents make employer contributions plan assets when due | No response | Court held Dean a fiduciary and individually liable for delinquent contributions, interest, and related attorney fees where contributions were plan assets and Dean exercised requisite control |
| LMRA §301 liability for failure to remit union dues and J.A.T.C. contributions | Agreement required employer to deduct dues with employee authorizations and to contribute to J.A.T.C.; dues authorizations and reports show nonpayment | No response | Court held Burbank liable under LMRA for failing to remit dues and J.A.T.C. contributions for April 2019–Feb 2020 based on agreement terms and authorization cards |
| Audit-based delinquencies (2015–2018) | Audit identified additional amounts due to Funds and J.A.T.C.; Plaintiffs notified Burbank and received no dispute or payment | No response | Court awarded the audited additional amounts as they related to obligations under the agreements and audit procedures followed the contract |
| Damages, interest, fees, and costs | Plaintiffs request specified delinquent contributions, interest calculated per contract, audited amounts, union dues, attorney’s fees, and costs | No opposition; court must assess evidentiary basis for damages and reasonableness of fees | Court awarded $44,441.81 against Burbank (breakdown in opinion), $38,770.16 against Dean (jointly and severally), interest through specified date plus per diem and post-judgment interest, $3,125 fees (post-Oct 17 reconstruction allowed), and $552 costs; supplemental fee application permitted |
Key Cases Cited
- Gesualdi v. Reid, 198 F. Supp. 3d 211 (E.D.N.Y. 2016) (funds may recover delinquencies under ERISA and related law)
- In re Halpin, 566 F.3d 286 (2d Cir. 2009) (two-part test for fiduciary liability: unpaid contributions must be plan assets and defendant must exercise sufficient control)
- Cement & Concrete Workers Dist. Council Welfare Fund v. Metro Found. Contractors Inc., 699 F.3d 230 (2d Cir. 2012) (default does not admit damages; evidentiary basis required for awards)
- Stanczyk v. City of New York, 752 F.3d 273 (2d Cir. 2014) (lodestar method for attorney’s fees)
- Millea v. Metro–N. R.R. Co., 658 F.3d 154 (2d Cir. 2011) (lodestar and fee calculation principles)
- Arbor Hill Concerned Citizens Neighborhood Ass’n v. County of Albany, 522 F.3d 182 (2d Cir. 2008) (reasonable hourly rate measured by paying client standard)
- Simmons v. New York City Transit Auth., 575 F.3d 170 (2d Cir. 2009) (use of forum rates in fee awards)
- Eng’rs Joint Welfare Fund v. C. Destro Dev. Co., 178 F. Supp. 3d 27 (N.D.N.Y. 2016) (Northern District precedents on reasonable partner rates)