Trustees of the Plumbers & Pipefitters National Pension Fund v. Plumbing Services, Inc.
791 F.3d 436
| 4th Cir. | 2015Background
- PSI (Plumbing Services, Inc.), an Alabama plumbing contractor, signed a 1998 Letter of Assent by which its sole shareholder agreed that PSI would be bound by the Multiemployer Association–Union collective bargaining agreement and would make contributions to the Plumbers and Pipefitters National Pension Fund; PSI contributed from 1998 until March 10, 2011.
- PSI sent a March 10, 2011 letter terminating its relationship with the Union; contributions ceased 60 days later; PSI ceased business in summer 2011 and a related entity, PSI Mechanical (same sole shareholder), was incorporated and continued similar work.
- The Fund assessed PSI with withdrawal liability of $188,685, alleging continued performance in the bargaining jurisdiction and common-control status with PSI Mechanical; PSI objected but refused to answer Fund questionnaires and never demanded arbitration.
- The Fund sued in the Eastern District of Virginia to collect withdrawal liability, interest, liquidated damages, and fees; district court denied defendants’ personal-jurisdiction and venue challenges, granted the Fund summary judgment, and entered judgment for ~$247,013.21.
- On appeal, Defendants contended lack of personal and subject-matter jurisdiction, improper venue, and that no enforceable obligation bound PSI to contribute (invalid Letter of Assent); the Fourth Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction | ERISA authorizes venue and nationwide service where plan is administered (Virginia); valid service obtained | Defendants are Alabama-only, so Virginia courts lack contacts; constitutional due process violated | Affirmed: nationwide service under ERISA permits jurisdiction absent Fifth Amendment showing of exceptional hardship; defendants failed to meet heavy burden |
| Transfer of venue (§1404) | Eastern District of Virginia is plaintiff's chosen forum; ERISA gives special weight to plan-admin forum; limited need for witnesses | Alabama forum is more convenient; all events occurred in Alabama | Affirmed: plaintiff's forum choice and ERISA venue weight, lack of needed witnesses, and insufficient showing of inconvenience; no abuse of discretion denying transfer |
| Subject-matter jurisdiction | Claim is for withdrawal liability under ERISA (§1451/§1145); federal courts have jurisdiction to collect withdrawal liability | Claim is really a postcontract contributions/unfair labor practice issue for the NLRB | Affirmed: withdrawal-liability actions are within ERISA federal jurisdiction and distinct from NLRB remedies for postcontract bargaining disputes |
| Enforceability of obligation / entitlement to summary judgment | Letter of Assent plus 13 years of contributions and successor-employer attribution establish a valid obligation; PSI is an "employer"; PSI waived arbitration by not demanding it; Fund gave proper notice | Letter of Assent vague or not read; cannot be bound to successor agreements; no valid contract; factual disputes preclude summary judgment | Affirmed: federal (labor/ERISA) law governs formation; Letter of Assent binds to current and successor agreements; conduct adopting agreement (long-term contributions) confirms assent; common-control treats PSI and PSI Mechanical as single employer; plaintiff proved notice and entitlement to judgment |
Key Cases Cited
- Pension Benefit Guar. Corp. v. R.A. Gray & Co., 467 U.S. 717 (establishes withdrawal liability concept and statutory framework)
- Borden, Inc. v. Bakery & Confectionary Union & Indus. Int’l Pension, 974 F.2d 528 (withdrawal liability apportions unfunded obligations)
- ESAB Grp., Inc. v. Centricut, Inc., 126 F.3d 617 (nationwide service under federal statute and due-process limits)
- Denny’s, Inc. v. Cake, 364 F.3d 521 (standard for Fifth Amendment challenge to nationwide service)
- International Shoe Co. v. Washington, 326 U.S. 310 (minimum contacts doctrine; distinguished here)
- Advanced Lightweight Concrete Co. v. Laborers Health & Welfare Trust Fund, 484 U.S. 539 (limits §1145 action to collection of promised contributions; distinguishes postcontract NLRB claims)
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment burden-shifting)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (nonmoving party must show genuine factual dispute)
- DelCostello v. Int’l Bhd. of Teamsters, 462 U.S. 151 (need for national uniformity in federal labor-law processes)
- Industrial TurnAround Corp. v. NLRB, 115 F.3d 248 (letter of assent can bind employer to agreements, including successors)
- Chi. Truck Drivers v. El Paso Co., 525 F.3d 591 (proof required to enforce withdrawal-liability award following notice)