Trustees of Teamsters Union No. 142 Pension Fund v. AJ & S Trucking, Inc.

992 F. Supp. 2d 870, 2014 WL 222101
CourtDistrict Court, N.D. Indiana
DecidedJanuary 21, 2014
DocketCause No. 2:13-CV-162 RLM
StatusPublished

This text of 992 F. Supp. 2d 870 (Trustees of Teamsters Union No. 142 Pension Fund v. AJ & S Trucking, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Trustees of Teamsters Union No. 142 Pension Fund v. AJ & S Trucking, Inc., 992 F. Supp. 2d 870, 2014 WL 222101 (N.D. Ind. 2014).

Opinion

[874]*874 OPINION and ORDER

ROBERT L. MILLER, JR., District Judge.

This cause is before the court on two motions: defendant AJ & S Trucking, Inc. is seeking a preliminary injunction against the Trustees of Teamsters Union No. 142 Pension Fund (Pension Fund) enjoining assessment of withdrawal liability, and third-party defendant Teamsters Union Local No. 142 (Local 142) is asking that the third-party complaint of AJ & S be dismissed. A hearing on both motions was held on December 18, 2013. Based on a review of the parties’ submissions and arguments, the court concludes that both motions must be denied.

I. Background

AJ & S, a trucking company located in Whiting, Indiana, has been a party to a collective bargaining agreement with Local 142 since 2000. As a member of Local 142, AJ & S paid employee contributions into the Pension Fund until problems arose in April 2013 relating to contract negotiations (or non-negotiations) with Local 142.

The Pension Fund alleges in its complaint and in Count 1 of its amended complaint that Local 142 notified AJ & S on April 5, 2013 that, effective that date, Local 142 would no longer represent AJ & S’s employees. The Fund says this notification effectuated AJ & S’s complete withdrawal from the Pension Fund during the plan year ending June 30, 2013. The Pension Fund says that as a result of AJ & S’s withdrawal, a withdrawal liability assessment of $1.2 million was made against AJ & S. The Pension Fund notified AJ & S of the assessment and of the company’s obligation to begin making quarterly payments on May 1, 2013. When AJ & S made no payments, the Pension Fund demanded the full assessment amount and, on May 14, the Fund filed suit in this court pursuant to 29 U.S.C. § 1132(a)(3), (e)(1), and (f); 29 U.S.C. §§ 1381-1461; and 29 U.S.C. § 301(a).

The Pension Plan added claims and parties to this action in its amended complaint, which was filed after the pending motions became ripe. The Pension Fund claims in Count 2 of the amended complaint that a payroll audit for the period July 1, 2008 through September 30, 2012 shows that AJ & S owes, but hasn’t paid, moneys to the Pension Fund and other union entitles due to past reporting errors by AJ & S. The Pension Funds also named Great American Insurance Company as a defendant in Count 3 of the amended complaint, alleging that Great American had wrongfully failed to pay the Pension Fund’s bond claim. The claims in Counts 2 and 3 of the amended complaint aren’t at issue in today’s motions.

AJ & S’s third-party complaint against Teamsters Union Local 142 alleges that Local 142 breached the CBA by repudiating the agreement illegally. AJ & S maintains Local 142’s April 5, 2013 notice to the company that the union was disclaiming any interest in representing AJ & S employees was untimely under Article 30 of the CBA and 29 U.S.C. § 158(d)(1), so, AJ & S says, all parties are still bound by the terms of the current CBA and any future CBA negotiated between Local 142 and members of the Four County Highway Contractors, of which AJ & S is a member. AJ & S claims it has suffered and will continue to suffer loss of sales, contracts, profits, and good will based on Local 142’s unlawful conduct.

II. Facts

AJ & S was a principal negotiator and signatory of the 2010 CBA, entitled “Articles of Agreement for General Construction of Heavy Highway Projects for Lake and Porter Counties, Indiana, and Calumet [875]*875City, Illinois,” between the Union (Teamsters Union Local No. 142) and the Employer (defined as “those members of the Four County Highway Contractors Group who have assigned their bargaining rights to The Group and those individual employers who, although not having assigned their bargaining rights to The Group, have agreed to become signatory to this Agreement”). AJ & S is a member of the Four County Highway Contractors (The Group).

Article 30 of the CBA, entitled “Contract Duration” and referred to as the “evergreen clause,” reads as follows:

This Agreement shall become effective June 1, 2010, and shall continue in full force and effect until May 31, 2013, and will continue thereafter unless notice is given in writing by either party sixty (60) days prior to May 31, 2013, or sixty (60) days prior to May 31st of any year thereafter and shall remain in full force and effect until superseded by a New Agreement.

The preface to the CBA states that all parties have “mutually understood and agreed” that all provisions of the Agreement are “binding upon the parties to the Agreement during the terms of this Agreement and any renewal period thereof.” By letter dated March 1, 2013, Local 142 sent the following notice to members of The Group, including AJ & S: “Re: Negotiation Notice of the Articles of Agreement. Please accept this letter as official notification that we desire to open for negotiation the Union Agreement now in effect between your firm and Teamsters Local Union No. 142. Please have your authorized representative contact Mitch Sawochka ... with available dates in order to mutually set the time to commence such negotiations.” Members of The Group, including AJ & S, tendered to Local 142 a document entitled “Multi-Employer Bargaining Agreement,” dated March 16, informing Local 142 that all members of The Group were agreeing to enter into negotiations on the CBA.

On March 25, Richard Knipp, Secretary-Treasurer of Local 142, sent a letter to Keith Rose, Chairman of The Group, informing him that Local 142 “does not consent to AJ & S Trucking, Inc. joining in on multi-employer bargaining. We intend to deal with AJ & S Trucking, Inc. separately.” Mr. Knipp didn’t send a copy of that letter to AJ & S.

Keith Rose forwarded Mr. Knipp’s letter to AJ & S Trucking President Annette Perz on March 28 and informed her that he had discussed the matter with counsel, who Mr. Rose said explained to him that “the members of a bargaining group are subject to ‘mutual agreement’ between the Union and the contractor group. Therefore, according to [counsel], Local 142 is within their legal rights with their request/position.”

On April 4, AJ & S submitted a request to Local 142 for a list of union members from which AJ & S could hire drivers for an upcoming contract. AJ & S says that tendering such a request was the parties’ regular practice under paragraph 26 of the CAB. Local 142 responded to AJ & S via letter from Richard Knipp, dated April 5, saying that “effective immediately, Teamsters Local Union No. 142 has chosen to ‘disclaim any interest’ in further representing employees at AJ & S Trucking, Inc.” Local 142 sent further correspondence to AJ & S — from Jay Smith, Fund Manager, dated April 17, 2013 — addressing the “complete withdrawal of AJ & S Trucking from the Teamsters Union No. 142 Pension Fund during the plan year ending June 30, 2013.” Mr.

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Bluebook (online)
992 F. Supp. 2d 870, 2014 WL 222101, Counsel Stack Legal Research, https://law.counselstack.com/opinion/trustees-of-teamsters-union-no-142-pension-fund-v-aj-s-trucking-inc-innd-2014.