Wisconsin Electrical Employees Health and Welfare Plan v. KMS Electric LLC, 2:14-cv-00521

Background

Plaintiffs (multi-employer ERISA benefit Funds) sued KMS Electric, LLC for failing to make contractually required contributions under a collective bargaining agreement (CBA). Plaintiffs seek relief under ERISA § 515 and the Funds’ trust agreements.
Plaintiffs moved for summary judgment; KMS filed a one-day-late response that failed to follow local rules and later sought leave to file a supplemental response three months after the deadline.
KMS is a manager-managed Wisconsin LLC. Kenneth Grandow signed a Letter of Assent on behalf of KMS, describing himself as "owner," and later (over a year later) signed other documents as "manager."
The key factual disputes concern whether Grandow had actual or apparent authority to bind KMS to the CBA when he signed the Letter of Assent, and alternatively whether KMS’s conduct (e.g., contributions or other acts) manifested acceptance of the CBA.
The Funds’ submissions lacked record support for some assertions (e.g., that KMS made contributions), and the Funds did not establish as a matter of law that KMS was bound to the CBA.
Court denied KMS’s motion to file a supplemental response (no excusable neglect) but accepted KMS’s initial response; court denied plaintiffs’ motion for summary judgment.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether court should allow KMS to file supplemental summary-judgment response	Funds argued KMS’ late filing was minor and should be considered	KMS argued initial deficiencies warranted a late supplement and asked leave to file	Denied: KMS failed to show excusable neglect for three-month delay though court considered the initial response despite procedural defects
Whether Grandow’s signature bound KMS to the CBA via actual authority	Funds contended Grandow’s signature bound KMS for ERISA purposes regardless of his authority	KMS argued Grandow lacked actual authority as only managers may bind a manager-managed LLC under Wisconsin law	Denied for plaintiff: disputed fact whether Grandow had actual authority; plaintiffs did not establish actual authority as a matter of law
Whether Grandow had apparent authority to bind KMS	Funds suggested his title/position supported belief he had authority	KMS argued no facts show principal-caused appearance of authority or KMS acquiescence	Denied for plaintiff: plaintiffs failed to show basis for belief or principal conduct creating apparent authority
Whether KMS’s conduct separately bound it to the CBA (acceptance by conduct)	Funds claimed KMS made some contributions and otherwise manifested assent	KMS disputed or record lacked proof of such conduct; plaintiffs provided no admissible record support	Denied for plaintiff: plaintiffs failed to present admissible, undisputed evidence of conduct manifesting acceptance

Key Cases Cited

Pioneer Investment Services Co. v. Brunswick Associates Ltd. Partnership, 507 U.S. 380 (1993) (excusable neglect is an equitable, fact-specific standard)
Anderson v. Liberty Lobby, 477 U.S. 242 (1986) (summary-judgment standard: genuine dispute of material fact)
Harrington v. City of Chicago, 433 F.3d 542 (7th Cir. 2006) (parties must seek extensions; lateness responsibility)
Bordelon v. Chicago School Reform Bd. of Trustees, 233 F.3d 524 (7th Cir. 2000) (district courts may require strict compliance with local summary-judgment rules)
Ammons v. Aramark Uniform Services, Inc., 368 F.3d 809 (7th Cir. 2004) (substantial compliance not equivalent to strict compliance for local rules)
Sullivan v. Cox, 78 F.3d 322 (7th Cir. 1996) (authority to bind employer under state law can create genuine issues in ERISA cases)
Operating Engineers Local 139 Health Benefit Fund v. Gustafson Construction Corp., 258 F.3d 645 (7th Cir. 2001) (employer bound by agent signature or conduct)
Bricklayers Local 21 v. Banner Restoration, Inc., 385 F.3d 761 (7th Cir. 2004) (employer can be bound by conduct; signature not prerequisite)