EXHIBIT 10 Proposed Order
Bryce C. Loveland, Esq., Nevada Bar No. 10132 Christopher M. Humes Esq., Nevada Bar No. 12782 William D. Nobriga, Esq., Nevada Bar No. 14931 BROWNSTEIN HYATT FARBER SCHRECK, LLP 100 North City Parkway, Suite 1600 Las Vegas, NV 89106-4614 Telephone: 702.382.2101 Facsimile: 702.382.8135 > || Email: bcloveland@bhfs.com chumes@bhfs.com wnobriga@bhfs.com Attorneys for Plaintiffs 11 BOARD OF TRUSTEES OF THE CASE NO.: 2:24-cv-00960-JCM-NJK |? | TEAMSTERS LOCAL 631 SECURITY FUND FOR SOUTHERN NEVADA; BOARD OF TRUSTEES OF THE 14 TEAMSTERS CONVENTION INDUSTRY TRAINING FUND; BOARD OF TRUSTEES FINDINGS OF FACT, OF THE TEAMSTERS LOCAL 631 CONCLUSIONS OF LAW, AND VACATION TRUST FUND ORDER GRANTING MOTION FOR 16 DEFAULT JUDGMENT Plaintiffs, ig ||*: ARATA EXPOSITIONS, INC., a Maryland corporation; AE I & D, LLC, a Maryland limited liability company,, 71 Defendants. Before the Court is Plaintiffs’, the Boards of Trustees of the Teamsters Local 631 Securit: Fund for Southern Nevada and Teamsters Convention Industry Training Fund (collectivel referred to as the “Trust Funds”) request for entry of Default Judgment against Arata Expositions Inc. (“Arata”) and AE I & D, LLC (“AE I & D”). Default having been entered agains Defendants, the Court having reviewed the Plaintiffs’ Motion, being fully advised, and goo cause appearing, the Court now makes the following findings of facts and conclusions of law.
I. Findings of fact. 1. Plaintiffs are the Trust Funds and are fiduciaries for purposes of the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001-1500. 2. Arata Expositions, Inc. and AE I & D, LLC acted as employers within the State of Nevada employing persons (“Covered Employees”) who perform work covered by a collective bargaining agreement (“CBA”) between Arata and the International Brotherhood of Teamsters Local 631 (“Union”). 3. The CBA requires Arata and AE I & D to make employee benefit contributions to the Trust Funds on behalf of its Covered Employees. 4. The Trust Funds are ERISA employee benefit trust funds that provide benefits to Covered Employees. 5. The Trust Funds are established by Trust Agreements (“Trust Agreements”). 6. Under ERISA and the Trust Agreements, Arata is obligated to make their books and records available for a contract compliance review (“Audit”). 7. Arata and AE I & D have failed to adequately respond to the Trust Funds’ requests to make their books and records available for an Audit, by failing to provide all of the needed documents to complete the Audit. 8. The Trust Funds’ governing documents provide that if Arata and AE I & D fail to make their books and records available for an Audit, the Trust Funds are permitted to presume contributions in the amount of $100,000 for each year covered by the attempted audit. 9. The Trust Funds have repeatedly requested that Arata and AE I & D make their books and records available for an Audit as required by ERISA and the Trust Agreements. 10. Arata and AE I & D have repeatedly refused to make their books and records sufficiently available for the Trust Funds to conduct an Audit. 11. Arata and AE I & D, therefore, is presumed to have failed to meet their obligations to remit employee benefit contributions to the Trust Funds as set forth in the CBA and Trust Agreements, and as required by 29 U.S.C. § 1145. 12. As a result of their delinquencies, Arata and AE I & D are liable to the Trust Funds for unpaid contributions, interest, liquidated damages, and attorneys’ fees. II. Conclusions of Law. 1. “The general rule of law is that upon default the factual allegations of the complaint, except those relating to the amount of damages, will be taken as true.” Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977) (citing Pope v. U.S., 323 U.S. 1, 12 (1944)). 2. Federal Rule of Civil Procedure 55(b)(2) permits a court to grant default judgment against a defendant who has failed to plead or defend an action. To determine whether a default judgment is appropriate, courts may consider the following factors: (1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiff's substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470, 1471-1472 (9th Cir. 1986). 3. As to the first factor, the Trust Funds will suffer prejudice if default judgment is not entered because they “will likely be without other recourse for recovery if default judgment is not entered in their favor.” Tr. of the Bricklayers & Allied Craftworkers Local 13 Defined Contribution Pension Trust for S. Nev. v. Tile Concepts, Inc., No. 2:16-cv-01067-GMN-GWF, 2016 WL 8077987 (D. Nev. Dec. 7, 2016) (citing Liberty Ins. Underwriters, Inc. v. Scudier, 53 F.Supp.3d 1308, 1318 (D. Nev. July 8, 2013)) (internal quotation marks omitted). Defendants have failed to meet their obligations to remit employee benefit contributions and have failed to participate in both of their respective audits. Both employers also refused to participate or otherwise defend themselves in this action as required by relevant case law. Therefore, because the Trust Funds will have no recourse against them unless default judgment is granted, the first Eitel factor favors the entry of default judgment. 4. The second and third Eitel factors address the merits and sufficiency of a plaintiff’s claim. Eitel, 782 F.2d at 1471–72. The undisputed facts in this case demonstrate that both employers failed to meet their obligations to provide requested documents as required under the CBAs and Trust Agreements to which Defendants are bound. As a result, both employers are liable to the Trust Funds for unpaid contributions, interest, liquidated damages, and attorneys’ fees. See 29 U.S.C. § 1132(g)(2). As discussed in Part II(A) herein, as a result of having default entered against them, both employers have admitted these facts, which should be taken as true. The second and third Eitel factors favor the entry of default judgment. 5. The fourth Eitel factor concerns the damages at stake in the case. The damages in this case are reasonable and well-documented, based on an the Trust Funds’ governing documents and the calculations performed within the Motion for Default Judgment. Moreover, the damages in this case are also dictated by statute. ERISA states that, in cases like this one, courts shall award unpaid contributions, interest on the unpaid contributions, liquidated damages, reasonable attorney’s fees and the costs of the action, and other legal or equitable relief that the court determines appropriate. 29 U.S.C. § 1132(g)(2). This factor also favors the entry of default judgment. 6. Regarding the fifth Eitel factor, there is no possibility of dispute concerning the material facts. Because both employers have had a default entered against them, the allegations in the complaint are deemed admitted and taken as true. Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977) (cit
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EXHIBIT 10 Proposed Order
Bryce C. Loveland, Esq., Nevada Bar No. 10132 Christopher M. Humes Esq., Nevada Bar No. 12782 William D. Nobriga, Esq., Nevada Bar No. 14931 BROWNSTEIN HYATT FARBER SCHRECK, LLP 100 North City Parkway, Suite 1600 Las Vegas, NV 89106-4614 Telephone: 702.382.2101 Facsimile: 702.382.8135 > || Email: bcloveland@bhfs.com chumes@bhfs.com wnobriga@bhfs.com Attorneys for Plaintiffs 11 BOARD OF TRUSTEES OF THE CASE NO.: 2:24-cv-00960-JCM-NJK |? | TEAMSTERS LOCAL 631 SECURITY FUND FOR SOUTHERN NEVADA; BOARD OF TRUSTEES OF THE 14 TEAMSTERS CONVENTION INDUSTRY TRAINING FUND; BOARD OF TRUSTEES FINDINGS OF FACT, OF THE TEAMSTERS LOCAL 631 CONCLUSIONS OF LAW, AND VACATION TRUST FUND ORDER GRANTING MOTION FOR 16 DEFAULT JUDGMENT Plaintiffs, ig ||*: ARATA EXPOSITIONS, INC., a Maryland corporation; AE I & D, LLC, a Maryland limited liability company,, 71 Defendants. Before the Court is Plaintiffs’, the Boards of Trustees of the Teamsters Local 631 Securit: Fund for Southern Nevada and Teamsters Convention Industry Training Fund (collectivel referred to as the “Trust Funds”) request for entry of Default Judgment against Arata Expositions Inc. (“Arata”) and AE I & D, LLC (“AE I & D”). Default having been entered agains Defendants, the Court having reviewed the Plaintiffs’ Motion, being fully advised, and goo cause appearing, the Court now makes the following findings of facts and conclusions of law.
I. Findings of fact. 1. Plaintiffs are the Trust Funds and are fiduciaries for purposes of the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001-1500. 2. Arata Expositions, Inc. and AE I & D, LLC acted as employers within the State of Nevada employing persons (“Covered Employees”) who perform work covered by a collective bargaining agreement (“CBA”) between Arata and the International Brotherhood of Teamsters Local 631 (“Union”). 3. The CBA requires Arata and AE I & D to make employee benefit contributions to the Trust Funds on behalf of its Covered Employees. 4. The Trust Funds are ERISA employee benefit trust funds that provide benefits to Covered Employees. 5. The Trust Funds are established by Trust Agreements (“Trust Agreements”). 6. Under ERISA and the Trust Agreements, Arata is obligated to make their books and records available for a contract compliance review (“Audit”). 7. Arata and AE I & D have failed to adequately respond to the Trust Funds’ requests to make their books and records available for an Audit, by failing to provide all of the needed documents to complete the Audit. 8. The Trust Funds’ governing documents provide that if Arata and AE I & D fail to make their books and records available for an Audit, the Trust Funds are permitted to presume contributions in the amount of $100,000 for each year covered by the attempted audit. 9. The Trust Funds have repeatedly requested that Arata and AE I & D make their books and records available for an Audit as required by ERISA and the Trust Agreements. 10. Arata and AE I & D have repeatedly refused to make their books and records sufficiently available for the Trust Funds to conduct an Audit. 11. Arata and AE I & D, therefore, is presumed to have failed to meet their obligations to remit employee benefit contributions to the Trust Funds as set forth in the CBA and Trust Agreements, and as required by 29 U.S.C. § 1145. 12. As a result of their delinquencies, Arata and AE I & D are liable to the Trust Funds for unpaid contributions, interest, liquidated damages, and attorneys’ fees. II. Conclusions of Law. 1. “The general rule of law is that upon default the factual allegations of the complaint, except those relating to the amount of damages, will be taken as true.” Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977) (citing Pope v. U.S., 323 U.S. 1, 12 (1944)). 2. Federal Rule of Civil Procedure 55(b)(2) permits a court to grant default judgment against a defendant who has failed to plead or defend an action. To determine whether a default judgment is appropriate, courts may consider the following factors: (1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiff's substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470, 1471-1472 (9th Cir. 1986). 3. As to the first factor, the Trust Funds will suffer prejudice if default judgment is not entered because they “will likely be without other recourse for recovery if default judgment is not entered in their favor.” Tr. of the Bricklayers & Allied Craftworkers Local 13 Defined Contribution Pension Trust for S. Nev. v. Tile Concepts, Inc., No. 2:16-cv-01067-GMN-GWF, 2016 WL 8077987 (D. Nev. Dec. 7, 2016) (citing Liberty Ins. Underwriters, Inc. v. Scudier, 53 F.Supp.3d 1308, 1318 (D. Nev. July 8, 2013)) (internal quotation marks omitted). Defendants have failed to meet their obligations to remit employee benefit contributions and have failed to participate in both of their respective audits. Both employers also refused to participate or otherwise defend themselves in this action as required by relevant case law. Therefore, because the Trust Funds will have no recourse against them unless default judgment is granted, the first Eitel factor favors the entry of default judgment. 4. The second and third Eitel factors address the merits and sufficiency of a plaintiff’s claim. Eitel, 782 F.2d at 1471–72. The undisputed facts in this case demonstrate that both employers failed to meet their obligations to provide requested documents as required under the CBAs and Trust Agreements to which Defendants are bound. As a result, both employers are liable to the Trust Funds for unpaid contributions, interest, liquidated damages, and attorneys’ fees. See 29 U.S.C. § 1132(g)(2). As discussed in Part II(A) herein, as a result of having default entered against them, both employers have admitted these facts, which should be taken as true. The second and third Eitel factors favor the entry of default judgment. 5. The fourth Eitel factor concerns the damages at stake in the case. The damages in this case are reasonable and well-documented, based on an the Trust Funds’ governing documents and the calculations performed within the Motion for Default Judgment. Moreover, the damages in this case are also dictated by statute. ERISA states that, in cases like this one, courts shall award unpaid contributions, interest on the unpaid contributions, liquidated damages, reasonable attorney’s fees and the costs of the action, and other legal or equitable relief that the court determines appropriate. 29 U.S.C. § 1132(g)(2). This factor also favors the entry of default judgment. 6. Regarding the fifth Eitel factor, there is no possibility of dispute concerning the material facts. Because both employers have had a default entered against them, the allegations in the complaint are deemed admitted and taken as true. Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977) (citing Pope v. U.S., 323 U.S. 1, 12 (1944)). Therefore, the fifth Eitel factor also favors the entry of default judgment. 7. The sixth Eitel factor demonstrates that excusable neglect is not a factor here. The Complaint was filed on May 23, 2024 See ECF No. 1. A Summons was issued to both employers on the same day. See ECF No. 3. On July 30, 2024, the registered agent of both employers accepted service of the Complaint. See ECF Nos. 4 and 5. Despite this service, neither employer filed an Answer. The Trust Funds were then forced to file Motions for Entry of Clerk’s Default on September 5, 2024. See ECF Nos. 6 and 7. Both employers again failed to respond, which led to their failure to adequately plead or otherwise defend the suit, resulting in the entry of default on September 24, 2024. See ECF No. 8. In short, there is no evidence that either employer’s default was the result of excusable neglect. The sixth Eitel factor favors the entry of a default judgment. 8. The seventh and final Eitel factor also weighs in favor of entering default judgment. Despite the general policy that cases “should be decided on the merits whenever reasonably possible,” Eitel, 782 F.2d at 1472, when defendants fail to answer the complaint, a decision on the merits is “impractical, if not impossible.” Anzalone, 2018 WL 3004664 *7 (citing PepsiCo v. Cal. Sec. Cans, 238 F.Supp.2d 1172, 1177 (C.D. Cal. Dec. 27, 2002). “Thus, the preference to decide a case on the merits does not preclude a court from granting default judgment.” PepsiCo, 238 F. Supp.2d at 1177 (citing Kloepping v. Fireman’s Fund, No. C 94- 2684 TEH, 1996 WL 75314 (N.D. Cal. Feb. 13, 1996)) (internal quotation marks omitted). The Trust Funds have no recourse to obtain relief other than bringing this suit. Therefore, this factor also weighs in favor of the entry of a default judgment. 9. The damages set forth by the Trust Funds’ and their corresponding calculations are supported by the Trust Agreements, the Trust Funds’ Collection Policy, and 29 U.S.C. 1132(g)(2). / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / 1 IT IS HEREBY ORDERED that judgment is entered against Defendant Arata fo 2 delinquent employee benefit contributions ($349,986), liquidated damages ($184,266), interes 3 ($184,266), audit fees ($480) and attorneys’ fees ($11,721) for a total of $730,719. Post-judgmen 4 interest shall be set at 18%, in accordance with the Trust Funds’ Collection Policies an 5 Procedures. 6 IT IS FURTHER ORDERED that judgment is entered against Defendant AE I & D 7 for delinquent employee benefit contributions ($524,979), liquidated damages ($406,426) 8 interest ($406,426), audit fees ($375) and attorneys’ fees ($11,721) for a total of $1,349,927 Q || Post-judgment interest shall be set at 18%, in accordance with the Trust Funds’ □□□□□□□□□□ 10 Policies and Procedures. 11
3 DATED May 21, 2025.
Se 14
16 CB. f tte J Atala, 17 i “ UNITED STATES DISTRICT COURT JUDGE 18 19 Respectfully submitted by: BROWNSTEIN HYATT FARBER SCHRECK, LLP
1 /s/ Christopher M. Humes Christopher M. Humes, Esq., Nevada Bar No. 12782 22 William D. Nobriga, Esq., Nevada Bar No. 14931 100 North City Parkway, Suite 1600 23 Las Vegas, Nevada 89106-4614 Attorneys for Plaintiffs 25 26 27 28