Reed v. Insituform Technologies, Inc.

994 F. Supp. 2d 1022, 2014 WL 359333, 198 L.R.R.M. (BNA) 2420, 2014 U.S. Dist. LEXIS 12893
CourtDistrict Court, D. Minnesota
DecidedFebruary 3, 2014
DocketCivil No. 12-89 (DWF/LIB)
StatusPublished
Cited by4 cases

This text of 994 F. Supp. 2d 1022 (Reed v. Insituform Technologies, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Reed v. Insituform Technologies, Inc., 994 F. Supp. 2d 1022, 2014 WL 359333, 198 L.R.R.M. (BNA) 2420, 2014 U.S. Dist. LEXIS 12893 (mnd 2014).

Opinion

MEMORANDUM OPINION AND ORDER

DONOVAN W. FRANK, District Judge.

INTRODUCTION

This matter is before the Court on cross-motions for summary judgment. [1024]*1024Defendant, Insituform Technologies, Inc. (“Insituform” or “Defendant”) moves for summary judgment. (Doc. No. 33.) Plaintiffs, Gary Reed and Tom Vevea, as Trustees of the Minnesota Laborers Health and Welfare Fund and Minnesota Laborers Pension Fund; James Brady and Keith Kramer, as Trustees of the Minnesota Laborers Vacation Fund; Gary Reed, as Trustee of the Construction Laborers’ Education, Training, and Apprenticeship Fund of Minnesota and North Dakota; and Dan Olson and Chris Born, as Trustees of the Minnesota Laborers Employers Cooperation and Education Trust; and each of them successors (together, “Plaintiffs”) also move for summary judgment and have also filed an amended motion for summary judgment. (Doc. Nos. 27 & 47). Defendant has further moved to strike Plaintiffs’ amended motion for Summary Judgment (Doc. No. 52) and Plaintiffs’ reply memorandum (Doc. No. 57). For the reasons set forth below, the Court denies Defendant’s motion for summary judgment, grants in part and denies in part Plaintiffs’ motion for summary judgment, and denies Defendant’s two motions to strike.

BACKGROUND

Plaintiffs are the trustees for certain fringe benefit funds (the “Funds”). Defendant is a Missouri corporation that specializes in the rehabilitation and protection of pipeline systems and does business in Minnesota. (Doc. No. 38, Gouy Aff. ¶ 3.) The fringe benefits at issue in this case are outlined in the collective bargaining agreements for “Minnesota Highway, Railroad and Heavy Construction in Minnesota” and are between relevant contractors and unions. (Doc. No. 20, Lessard Aff. ¶ 2, Exs. A-D.) There are two CBAs: a 2005-2008 CBA (the “First CBA”) and a 2008-2010 CBA (the “Second CBA”) (collectively, the “CBAs” or the “Agreements”). (Id.) Defendant executed the First CBA on April 27, 2006, and the Second CBA on March 4, 2009. (Lessard Aff. ¶ 2, Exs. A-B.)

Under these CBAs, Defendant is obligated to pay fringe benefit contributions to the Funds as outlined in the Agreements. Article 22 of both CBAs is titled “Fringe Benefits” and outlines the parties’ obligations with respect to fringe benefits. (Lessard Aff. ¶ 2, Exs. C, D.) Specifically, Article 22 provides for fringe benefits to be paid each month “for each hour worked by all Employees covered by this Agreement.” (Id.) Article 22 also states that fringe benefit requirements apply to employees “REGARDLESS OF WHETHER OR NOT SUCH EMPLOYEES ARE MEMBERS OF THE UNION.” (Lessard Aff. ¶ 2, Exs. C, D at § 5(i) (emphasis in original).) Article 22 of the Second CBA requires Defendant to “accurately report all hours worked by each Employee covered by this Agreement,” and also requires the following:

[That Defendant] maintain adequate records to identify the type of work being performed by its Employees to allow the Funds to determine whether the Employer is accurately reporting hours to the Funds. If the Employer fails to maintain satisfactory records from which the type of work being performed by an individual may reasonably be determined, the Employer will be held liable for all of the hours worked by that individual for whom the Employer is unable to produce satisfactory records verifying the type of work being performed by that individual.

(Lessard Aff. ¶ 2, Ex. D at §§ 2(a) & 5(g).) Under Article 22, “[t]he Employer shall maintain adequate records from which the Funds may determine whether Employees worked outside the scope of the Agreement,” and “[t]here shall be no requirement that Employees sent to work outside [1025]*1025the scope of this Agreement be paid fringes, nor shall the Employer be required to duplicate fringe contributions.” (Lessard Aff. ¶ 2, Ex. D at § 4.)

In July 2011, the Trustees requested payroll and employment records from Defendant for an audit covering the time period of January 1, 2009 through June 30, 2011 (“Audit Period”). (Lessard Aff. ¶ 4, Ex. E.) In response to the request, on August 18, 2011, Defendant provided the following: W-2s for 2009 and 2010; historical payroll registers for Minnesota employees for the Audit Period; Federal 940s for 2009 and 2010; monthly remittance reports for the Audit Period; and Minnesota Unemployment Wage Report summaries for 2009, 2010, and first quarter 2011. (Id.; Doc. No. 37, Wall Aff. ¶¶ 3-5.) Minnesota Unemployment Wage Report summaries included total wages paid, but did not include individual employee hours. (Lessard Aff. ¶ 5.) No records included descriptions of the type of work performed. (Lessard Aff. ¶¶ 5-8 & Ex. G.)

After reviewing the above-documents, Plaintiffs’ auditor concluded that Defendant had underreported hours for five employees for the Audit Period and sent a bill to Defendant. The employees for whom Plaintiffs allege Defendant underreported hours were initially hired by Defendant as Laborers and were then promoted to salaried supervisory positions at some time prior to or during the Audit Period. (See Doc. No. 31, Court Aff. ¶ 13, Exs. A-F.) Salaried supervisory positions are referred to by Defendant as “Superintendents.” A Superintendent is typically a job-site supervisor and is tasked with ensuring project quality and completion. (Gouy Aff. ¶ 4.) Defendant generally performs its work with crews of approximately five or six crew members who travel to different job sites and who are supervised by and report to a Superintendent. (Gouy Aff. ¶¶ 3-5.) One employee, Charles Huesman, was further promoted to “General Superintendent” in January 2011. (Doc. No. 40, Huesman Aff. ¶¶ 7-8.) General Superintendents oversee multiple crews and also have hiring and firing responsibilities. (Gouy Aff. ¶ 5.)

Specifically, the Trustees sought contributions for the following individuals and time periods: (1) Bruce White (promoted to Superintendent in May 2009) from June 2009 through December 2009; (2) Charles Huesman (promoted to Superintendent in August 2010) from August 2010 through June 2011; (3) Brandon Meyer1 (promoted to Superintendent in January 2011) from March 2011 through June 2011, and August and September 2010; (4) Patrick Hillan (promoted to Superintendent in July 2010) from August 2010 through June 2011; and (5) Terry Fedder (promoted to Superintendent in November 2010) from November 2010 through June 2011. (Lessard Aff. ¶ 5, Ex. G; Wall Aff. ¶¶ 5-7, 10.)

It is not disputed that these employees performed work covered by the CBAs while they were Laborers and that Defendant did report hours and submit fringe benefit contributions for those employees. (See Court Aff. ¶ 13, Exs. A-F.) Defendant did not track and report hours for these employees once they became Superintendents or General Superintendents, believing they were statutorily exempt from contributions as supervisors. (Gouy Aff. ¶ 7.) The employees relevant to this case testified that, once they become Superintendents or General Superintendents, ten to fifty percent of their work involved the same types of work they had performed as [1026]*1026Laborers. (See Court Aff. ¶ 13, Exs. AF.) According to the Trustees, to identify the underreported hours for these five employees, the auditor compared total hours worked for all employees with hours reported to the Trustees. (Lessard Aff. ¶ 6.)

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994 F. Supp. 2d 1022, 2014 WL 359333, 198 L.R.R.M. (BNA) 2420, 2014 U.S. Dist. LEXIS 12893, Counsel Stack Legal Research, https://law.counselstack.com/opinion/reed-v-insituform-technologies-inc-mnd-2014.