Trustees of the Local 138, 138A & 138B International Union of Operating Engineers Welfare Fund, Annuity Fund, Legal Fund, Vacation Fund, Apprenticeship Training Fund v. Sweet Hollow Management Corp.
2:19-cv-02207
E.D.N.YAug 7, 2020Background:
- Plaintiffs are trustees of multiple International Union of Operating Engineers benefit funds who sued Sweet Hollow Management Corp. for unpaid contributions under ERISA §515 and related collective-bargaining and trust agreements.
- Defendant was properly served but never answered, appeared, or otherwise defended; Plaintiffs moved for default judgment.
- The Court noted that on default it must accept well-pleaded factual allegations as true but still determine liability as a matter of law.
- Plaintiffs submitted an Administrator’s affidavit and supporting records to prove amounts owed.
- The Court found the evidence sufficient and computed damages of $82,813.22 in unpaid contributions, $5,662.09 in interest, $16,562.64 in liquidated damages (20%), $8,122.00 in attorneys’ fees, and $760.80 in costs.
- The Clerk was directed to enter judgment for those amounts, Plaintiffs were ordered to serve the order on Defendant, and the case was to be closed.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Liability: Whether default admits sufficient facts to establish liability under ERISA and the agreements | Plaintiffs alleged ERISA §515 and contractual violations; default admits allegations | No response (defaulted) | Court accepted allegations and found liability established as a matter of law (per Finkel) |
| Damages: Whether damages are proved with reasonable certainty and what amounts are recoverable | Administrator’s affidavit and records establish unpaid contributions, interest, 20% liquidated damages, attorneys’ fees, and costs | No response (defaulted) | Court awarded the specified amounts and approved fees/costs after determining proof was sufficient |
Key Cases Cited
- Finkel v. Romanowicz, 577 F.3d 79 (2d Cir. 2009) (on default, court accepts well-pleaded allegations but must still determine liability as a matter of law)
- Bricklayers & Allied Craftworkers Local 2, Albany, N.Y. Pension Fund v. Moulton Masonry & Const., LLC, 779 F.3d 182 (2d Cir. 2015) (default concedes liability but not damages)
- Cement & Concrete Workers Dist. Council Welfare Fund v. Metro Found. Contractors, Inc., 699 F.3d 230 (2d Cir. 2012) (same principle that damages are not automatically admitted on default)
- Credit Lyonnais Sec., Inc. v. Alcantara, 183 F.3d 151 (2d Cir. 1999) (court must ascertain damages with reasonable certainty)
- Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105 (2d Cir. 1997) (establishes standard for damage inquiry after default)