Jefferson Tile Co. v. Colorado Tile, Marble & Terrazzo Workers Health, Welfare & Pension Funds, Nos. 6 & 85

797 F. Supp. 857, 1992 U.S. Dist. LEXIS 13597
CourtDistrict Court, D. Colorado
DecidedAugust 28, 1992
DocketCiv. A. Nos. 86-K-2609, 87-K-66 and 88-K-1604
StatusPublished

This text of 797 F. Supp. 857 (Jefferson Tile Co. v. Colorado Tile, Marble & Terrazzo Workers Health, Welfare & Pension Funds, Nos. 6 & 85) is published on Counsel Stack Legal Research, covering District Court, D. Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Jefferson Tile Co. v. Colorado Tile, Marble & Terrazzo Workers Health, Welfare & Pension Funds, Nos. 6 & 85, 797 F. Supp. 857, 1992 U.S. Dist. LEXIS 13597 (D. Colo. 1992).

Opinion

ORDER ON AMOUNTS DUE

KANE, Senior District Judge.

This matter is before me for a determination of the amount of interest, liquidated damages, costs and attorney fees to be awarded to the defendants, the trustees of the Colorado Tile, Marble & Terrazzo Workers Health, Welfare and Pension Funds Nos. 6 & 85 (“Trustees”). The facts of these consolidated cases are set forth in my May 22, 1992 order, in which I ruled in favor of the Trustees and against the plaintiff, Jefferson Tile Co., Inc. on several dis-positive motions.

In the May 22 order, I requested the Trustees to provide the name and address of the payee of the funds held in the court’s registry and to submit “an affidavit setting forth the amount of liquidated damages, interest, expenses of collection, court costs, audit fees and reasonable attorney fees claimed in the Delinquent Contribution Action and Withdrawal Liability Actions.” (Order at 18.) The Trustees filed their submission of amounts due on June 5, 1992. Jefferson Tile timely objected to the submission, and the matter was set for hearing. The Trustees have filed a response to Jefferson Tile’s objection.

I. Damages in the Delinquent Contribution Action.

Jefferson Tile does not dispute that the Trustees are entitled to payment of the amounts deposited in the court’s registry. It contests the award of statutory interest, liquidated damages, costs and attorney fees, however. It asserts that such an award is improper because (1) no judgment was ever entered in favor of the Trustees in the Delinquent Contribution Action, (2) the Trustees waived their claim to interest, liquidated damages and penalties by entering into the Joint Stipulation, and (3) Jefferson Tile’s deposit of the disputed sums [859]*859into the court’s registry while these cases were pending precludes such an award.

Section 502(g)(2) of ERISA provides:

In any action under this subchapter by a fiduciary for or on behalf of a plan to enforce section 1145 of this title in which a judgment in favor of the plan is awarded, the court shall award the plan—
(A) the unpaid cpntributions,
(B) interest on the unpaid contributions,
(C) an amount equal to the greater of—
(i) interest on the unpaid contributions, or
(ii) liquidated damages provided for under the plan in an amount not in excess of 20 percent (or such higher percentage as may be permitted under Federal or State law) of the amount determined by the court under subparagraph (A),
(D) reasonable attorney’s fees and costs of the action, to be paid by the defendant, and
(E) such other legal or equitable relief as the court deems appropriate.

29 U.S.C. § 1132(g)(2) (emphasis added). The Tenth Circuit has held that an award of these items is mandatory when there is a judgment in favor of a plan. Trustees of the Colo. Statewide Ironworkers (Erector) Joint Apprenticeship & Training Trust Fund v. A & P Steel, Inc., 824 F.2d 817, 818 (10th Cir.1987).

Jefferson Tile’s first argument is that there is no “judgment in favor of the plan” in the Delinquent Contribution Action upon which to base an award of penalties, costs and attorney fees. The May 22 order addressed the merits of the Trustees’ motion to dismiss the Declaratory Judgment Action and their motion for summary judgment in the Withdrawal Liability Action. Other motions were dismissed as moot. Although there were no dispositive motions relating to the Delinquent Contribution Action before the court, I held that the primary issue of Jefferson Tile’s liability for delinquent contributions was rendered moot by the company’s agreement to the Joint Stipulation. Judgment in favor of the Trustees on the Delinquent Contribution action is implicit. For that reason, I ordered an accounting of interest, liquidated damages, costs and attorney fees in that action. To the extent the May 22 order is ambiguous as to judgment in favor of the Trustees in the Delinquent Contribution Action, that ambiguity can be correctéd now.

Jefferson Tile’s second argument is that the Trustees waived any claim to statutory damages by entering into the Joint Stipulation. No language in the Joint Stipulation addresses this issue. The Joint Stipulation provides only that all fringe benefit contributions that Jefferson Tile deposited in the court’s registry are to be paid to the Trustees, regardless of the outcome of the Declaratory Judgment Action, in exchange for the Trustees’ agreement not to suspend benefits of Jefferson Tile employees. Contractual waiver of rights in a stipulation or settlement agreement must be clear and unequivocal. There is no evidence that the Trustees intended to waive recovery of statutory amounts by entering into the Joint Stipulation.

Finally, Jefferson Tile claims that it cannot be held liable for statutory damages because it paid the fund contributions into the court’s registry while these cases were pending. It relies on Michigan Carpenters Council v. C.J. Rogers, Inc., wherein the Sixth Circuit disagreed with a majority of cases holding that an employer cannot escape liability for statutory penalties by paying the disputed amounts after commencement of a suit to recover delinquent contributions. See 933 F.2d 376, 388-89 (6th Cir.) (statutory damages apply only to contributions unpaid at the date of judgment, not filing), cert. denied, — U.S. —, 112 S.Ct. 585, 116 L.Ed.2d 610 (1991). Compare Idaho Plumbers & Pipefitters Health & Welfare Fund v. United Mechanical Contractors, Inc., 875 F.2d 212, 215 (9th Cir.1989) (statutory award applicable to contributions unpaid as of date suit commenced); Carpenters Amended & Restated Health Benefit Fund v. John W. Ryan Constr. Co., 767 F.2d 1170, 1174 (5th [860]*860Cir.1985); Board of Trustees v. Udovch, 771 F.Supp. 1044, 1047 (N.D.Cal.1991); Carpenters Health & Welfare Fund v. Building Tech, Inc., 747 F.Supp. 288, 296 (E.D.Pa.1990).

Although the Tenth Circuit has not taken a position on this issue, its statement in A & P Steel that an award of these amounts is mandatory when there is a judgment in favor of the plan, see 824 F.2d at 818, indicates that it would follow the majority position. Accordingly, Jefferson Tile should be required to pay the statutory amounts claimed, despite its deposits into the court’s registry.1

II. Damages in the Withdrawal Liability Action.

Jefferson Tile’s central argument with respect to the request for damages in the Withdrawal Liability Action is that an award is discretionary, not mandatory. Jefferson Tile relies on Malden Mills Industries v. ILGWU National Retirement Fund, 766 F.Supp.

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797 F. Supp. 857, 1992 U.S. Dist. LEXIS 13597, Counsel Stack Legal Research, https://law.counselstack.com/opinion/jefferson-tile-co-v-colorado-tile-marble-terrazzo-workers-health-cod-1992.