Flynn, John v. Dick Corp

481 F.3d 824, 375 U.S. App. D.C. 328, 41 Employee Benefits Cas. (BNA) 1398, 181 L.R.R.M. (BNA) 2673, 2007 U.S. App. LEXIS 6398, 2007 WL 817389
CourtCourt of Appeals for the D.C. Circuit
DecidedMarch 20, 2007
Docket05-7187
StatusPublished
Cited by31 cases

This text of 481 F.3d 824 (Flynn, John v. Dick Corp) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Flynn, John v. Dick Corp, 481 F.3d 824, 375 U.S. App. D.C. 328, 41 Employee Benefits Cas. (BNA) 1398, 181 L.R.R.M. (BNA) 2673, 2007 U.S. App. LEXIS 6398, 2007 WL 817389 (D.C. Cir. 2007).

Opinion

Opinion for the court filed by Circuit Judge HENDERSON.

KAREN LeCRAFT HENDERSON, Circuit Judge.

The appellants, John Flynn (Flynn) et al., trustees of the Bricklayers & Trowel Trades International Pension Fund (IPF or the Fund), sued Dick Corporation (Company) under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001 et seq., seeking employee benefit contributions, id. § 1145, based on the Company’s construction projects in Florida. In response, Dick Corporation challenged its liability under a Florida collective bargaining agreement (CBA), claimed that the requested contributions violated the Labor Management Relations Act (LMRA), 29 U.S.C. § 186, and asserted that the IPF failed to exhaust required arbitration procedures. The district court agreed that no Florida CBA bound the Company and that the requested contributions violated the LMRA, granting summary judgment to Dick Corporation. Thereafter, the IPF filed a motion for reconsideration, which the district court granted in part — recognizing a genuine issue of material fact as to the existence of a valid Florida CBA — but it reaffirmed its conclusion that the contributions violated the LMRA and thus affirmed its grant of summary judgment to the Company. The Fund appeals. We reverse the district court, concluding that the requested contributions are valid under the LMRA, and remand for further proceedings.

I.

The factual history of this contract dispute is cumbersome but essential to a proper understanding of the issues raised on appeal. In 2002, Dick Corporation, a Pennsylvania-based construction company, became the general contractor on two construction projects in Florida. The Company decided to subcontract the craft-work involved in the Florida projects. Its chosen subcontractors, like all of the subcontractors submitting bids on the two projects, did not employ members of the International Union of Bricklayers and Allied Craftworkers (BAC). In the past, however, the Company had used its own employees to perform the type of work it subcontracted on the two projects. Its employees were members of local bricklayer unions, including BAC Local 1 of Northern New England, with which the Company had a CBA. Under the CBA, it paid employee benefit contributions into the Fund, thereby entitling its employees to benefits under the Fund. See Second Decl. of David F. Stupar, Exs. 3 & 4, reprinted in Joint Appendix (JA) at 540, 542.

In December 1989 the Company signed an Independent Agreement (1989 IA) with the local BAC affiliates in eastern Massachusetts, agreeing “to be bound by all the terms and conditions of the effective Collective Bargaining Agreement and any ... successor agreements.” Independent Agreement Between Dick Corp. and Dist. Council of E. Mass. Bricklayers & Allied Craftsmen Local Unions (Dec. 1, 1989) ¶ 1, reprinted in JA at 11. The CBA referenced in the 1989 IA was executed in August 1989 (1989 CBA). 1 Similarly, in *827 September 2000, Dick Corporation signed another Independent Agreement (2000 IA), this time with the local BAC affiliate in western Massachusetts. See Independent Agreement Between Dick Corporation and Bricklayers & Allied Craftwork-ers Local 1 Mass., reprinted in JA at 71-74. The 2000 IA bound the Company to a CBA executed in 1992 (1992 CBA) and any successor CBA. Eventually, the 1989 CBA referenced in the 1989 IA was succeeded by an August 2002 CBA (August 2002 CBA) with the local BAC affiliate in eastern Massachusetts, while the 2000 CBA tied to the 2000 IA was succeeded by a September 2002 CBA (September 2002 CBA). 2

Both successor CBAs — the August 2002 CBA and the September 2002 CBA — contain a “traveling contractor’s clause,” which requires that a signatory employer with “any work [covered by the CBA] to be performed outside of the geographic area” of the CBA and “within the geographic area covered by an Agreement with another affiliate of [the BAC] ... abide by the full terms and conditions of the Agreement in effect in the job site area.” JA 195, § 10; see also JA 410, art. I-D. Pursuant to both clauses, the IPF sued the Company for failure to make employee contributions consistent with the terms of a Florida CBA between the local BAC in the area of Dick Corporation’s Florida projects and the local employers of BAC members in that area. See Flynn v. Dick Corp., 384 F.Supp.2d 189, 192 (D.D.C.2005). The Fund claimed that the traveling contractor’s clauses bound Dick Corporation to the Florida CBA and, accordingly, the Fund charged the Company with violating the Florida CBA’s subcontracting clause, which prohibits signatory employers from using non-union subcontractors for work performed within the area covered by the Florida CBA. See Pis.’ Mot. for Summ. J. at 13-14. Dick Corporation, the Fund asserted, was “barred from evading this contribution obligation through the use of non-union subcontractors.” Id.

Following discovery, the district court granted the Company’s motion for summary judgment. See Dick Corp., 384 F.Supp.2d at 203. 3 The district court found that the plain language of the September 2002 CBA’s traveling contractor’s clause unambiguously bound Dick Corporation to any Florida CBA (between local BAC affiliates and local employers of BAC members) that was in existence in the area — and at the time — of the Company’s projects. Id. at 196-99. The district court *828 then concluded that there was no valid CBA in existence in Florida obligating Dick Corporation to pay employee benefits into the Fund under a traveling contractor’s clause. Id. at 199-202. First, the court determined that the document the Fund submitted as the applicable Florida CBA did not constitute an enforceable agreement because it lacked provisions covering wages and contract duration. Id. at 200. Instead, the court said, the document constituted only a standard form or draft agreement, “completed and made enforceable only with the addition of an addendum detailing benefit payments and contractual ratification by real parties.” Id. “By design, therefore, the Florida CBA [was] not an agreement in effect (namely, a legally binding agreement), but merely provide[d] a framework for one.” Id.

In addition, the district court found that the LMRA precluded the contributions the Fund sought. See id. at 200-02. First, the skeletal nature of the agreement submitted by the Fund failed to provide the “detailed basis” required for lawful contributions from an employer to a trust fund under section 302(c)(5)(B) of the LMRA. See id. at 200-01; 29 U.S.C. § 186(c)(5)(B).

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481 F.3d 824, 375 U.S. App. D.C. 328, 41 Employee Benefits Cas. (BNA) 1398, 181 L.R.R.M. (BNA) 2673, 2007 U.S. App. LEXIS 6398, 2007 WL 817389, Counsel Stack Legal Research, https://law.counselstack.com/opinion/flynn-john-v-dick-corp-cadc-2007.