Building Service 32BJ Pension Fund v. 1180 AOA Member LLC

CourtDistrict Court, S.D. New York
DecidedJanuary 3, 2020
Docket1:18-cv-12226
StatusUnknown

This text of Building Service 32BJ Pension Fund v. 1180 AOA Member LLC (Building Service 32BJ Pension Fund v. 1180 AOA Member LLC) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Building Service 32BJ Pension Fund v. 1180 AOA Member LLC, (S.D.N.Y. 2020).

Opinion

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK -------------------------------------------------------x

BUILDING SERVICE 32BJ PENSION FUND,

Plaintiff,

-v- No. 18-CV-12226-LTS-OTW

1180 AOA MEMBER LLC, and ABC COMPANIES 1-10 (all other trades or businesses under common control with 1180 A0A MEMBER LLC),

Defendants.

-------------------------------------------------------x

MEMORANDUM OPINION AND ORDER Plaintiff Building Service 32BJ Pension Fund (“the Fund”) has moved for default judgment against Defendants 1180 AOA Member LLC (“1180 AOA”) and ABC Companies 1- 10 (“ABC Companies”), pursuant to Federal Rule of Civil Procedure 55(b)(2) and S.D.N.Y. Local Civil Rule 55.2(b), on claims arising pursuant to 29 U.S.C. § 1381 from 1180 AOA’s withdrawal from the Fund. (Docket Entry Nos. 32, 35, Motion for Def. Judgment & Memorandum of Law in Support.) 1180 AOA has not formally appeared or responded in accordance with the Federal Rules of Civil Procedure to the claims asserted by the Fund in this action. The Court has jurisdiction of this action pursuant to 28 U.S.C. §§ 1331 and 1337, 29 U.S.C. § 1132(e)(1), and 29 U.S.C. § 185(c). The Court has reviewed the Fund’s submissions carefully and, for the following reasons, grants the Fund’s unopposed motion for default judgment as to Counts One and Two, but denies the motion as to Count Three. Count Three is dismissed without prejudice. BACKGROUND The following recitation of facts is drawn from the Complaint (Docket Entry No. 1, “Complaint”), as well as from uncontroverted documentary evidence filed in support of the instant motion practice. In light of 1180 AOA’s failure to respond to the Complaint, the well- pleaded factual allegations contained therein are deemed admitted. See Fed. R. Civ. P. 8(b)(6); Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992) (“[A]

party’s default is deemed to constitute a concession of all well pleaded allegations of liability”). The Fund’s additional factual proffers in support of the instant motion are uncontroverted. (Docket Entry Nos. 33-34.) The Fund is a jointly-administered, multiemployer, labor-management trust fund that operates pursuant to multiple collective bargaining agreements as an employee benefit plan under the Employee Retirement Income Security Act (“ERISA”). (Complaint, at ¶ 4.) 1180 AOA is a New York limited liability company that previously owned a commercial building located at 1180 Avenue of the Americas in New York City (the “1180 Building”). (Id. at ¶¶ 4, 6A.) ABC Companies are alleged to be trades or businesses under common control with 1180 AOA and each other. (Id. at ¶ 6B.)

Here, the relevant collective bargaining agreement is one between the Realty Advisory Board on Labor Relations, Inc. (“RAB”), which represents employers owning commercial office buildings in New York City, and the Service Employees International Union, Local 32BJ (“Union”). (Docket Entry No. 34, Thomas Ormsby Affidavit in Support of Motion for Default Judgment, “Ormsby Affidavit,” at ¶¶ 3-4.) The collective bargaining agreement under which the Fund is currently operating (the “2016 CBA”) obligates participating employers to contribute to the Fund and is effective from January 1, 2016, to December 31, 2019. (Docket Entry No. 33, Ira Sturm Affidavit in Support of Motion for Default Judgment, “Sturm Affidavit,” Exh. E; Complaint, at ¶ 4.) 1180 AOA was a party to the 2016 CBA through representation by the RAB for that purpose. (Ormsby Affidavit, at ¶ 4, and exhibits thereto.) In February 2018, 1180 AOA sold the 1180 Building. (Complaint, at ¶ 8.) By letter dated June 12, 2018, the Fund notified 1180 AOA of its complete withdrawal from the Plan, 1180 AOA’s withdrawal liability, that a lump sum payment or monthly installment payments would be due starting on August 12, 2018, and that 1180 AOA had a right to arbitral

review of the assessment within 90 days. (Sturm Affidavit, Exh. F.) 1180 AOA failed to initiate withdrawal liability payments by August 12, 2018, and the Fund notified it of 1180 AOA’s default by letter dated September 21, 2018. (Id. at Exh. G.) 1180 AOA did not cure its default or make a timely arbitration request regarding the withdrawal liability assessment. (Complaint, at ¶¶ 11-12.) As a result, the Fund accelerated 1180 AOA’s withdrawal liability payment obligation. (Id. at ¶ 13.) The Fund’s June 12, 2018, letter also stated that all trades or businesses under common control with 1180 AOA were jointly and severally liable for the withdrawal liability. (Sturm Affidavit, Exh. F.) The Fund’s September 21, 2018, letter requested information identifying each trade or business under common control with 1180 AOA. (Id. at Exh. G;

Complaint, at ¶ 15.) 1180 AOA never responded to that request. (Complaint, at ¶ 16.) The Fund served the Summons and Complaint in this action upon 1180 AOA on January 15, 2019, by delivering it to the Office of the Secretary of State of New York. (Docket Entry No. 5.) To date, 1180 AOA has not filed a response or formally appeared.1 A certificate

1 In an unsworn letter to the Court, a law firm identifying itself as “corporate counsel” to 1180 AOA asserted that Plaintiff did not serve the Complaint properly on 1180 AOA, that 1180 AOA is not a party to the CBA, and that 1180 AOA did not receive Plaintiff’s withdrawal liability and default notices. (Docket Entry No. 21.) 1180 AOA has never appeared in this action, however, and has made no evidentiary proffers in response to the Complaint or the default judgment motion practice. of default was issued by the Clerk of Court as to 1180 AOA on February 8, 2019 (Docket Entry No. 10), and the Fund moved for default judgment on April 12, 2019 (Docket Entry No. 26), and filed and served a second set of default judgment motion papers on October 4, 2019. (Docket Entry Nos. 32-34.) DISCUSSION In determining whether to grant a motion for default judgment, courts within this

district first consider three factors: “(1) whether the defendant’s default was willful; (2) whether defendant has a meritorious defense to plaintiff’s claims; and (3) the level of prejudice the non- defaulting party would suffer as a result of the denial of the motion for default judgment.” Santana v. Latino Express Restaurants, Inc., 198 F. Supp. 3d 285, 291 (S.D.N.Y. 2016) (citation omitted); see also Guggenheim Capital, LLC v. Birnbaum, 722 F.3d 444, 455 (2d Cir. 2013) (applying these factors in review of lower court grant of a default judgment). Here, the Court finds that all three factors weigh in the Fund’s favor. First, 1180 AOA’s failure to respond to the Fund’s Complaint and failure to respond to the default judgment motion practice are indicative of willful conduct. See Indymac Bank, F.S.B. v. Nat’l Settlement Agency, Inc., No.

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Building Service 32BJ Pension Fund v. 1180 AOA Member LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/building-service-32bj-pension-fund-v-1180-aoa-member-llc-nysd-2020.