United States District Court, D. Maryland, Southern Division
TRUSTEES OF THE NATIONAL AUTOMATIC SPRINKLER INDUSTRY WELFARE FUND, et al., Plaintiffs,
DEGREE FIRE PROTECTION, INC., Defendant.
J. HAZEL UNITED STATES DISTRICT JUDGE
April 20, 2018, Plaintiffs Trustees of the National Automatic
Sprinkler Industry Welfare Fund, Trustees of the National
Automatic Sprinkler Local 669 UA Education Fund, Trustees of
the National Automatic Sprinkler Industry Pension Fund, and
Trustees of the International Training Fund (collectively,
“The Funds”) brought this action against
Defendant Degree Fire Protection, Inc. pursuant to the
Employee Retirement and Income Security Act of 1974
(“ERISA”), 29 U.S.C. §§ 1132(a)(3),
1132(a)(3), 1145, and the Labor-Management Relations Act, 29
U.S.C. § 185(a), to recover amounts owed to the funds
under the terms of a Collective Bargaining Agreement
(“CBA”). ECF No. 1. The Clerk has entered
default, ECF No. 8, and Plaintiffs have moved for a default
judgment. ECF No. 7. No. hearing is necessary. See
Loc. R. 105.6 (D. Md. 2016). For the following reasons,
Plaintiffs' Motion for Default Judgment is granted.
Funds are multiemployer employee benefit plans as defined in
29 U.S.C. § 1002(3). ECF No. 1 ¶ 2. The Funds are
established and maintained in accordance with their
respective Agreements and Declarations of Trust. Id.
The Funds are administered in Maryland, while Defendant is
incorporated in Ohio. Id. ¶¶ 2-3.
Defendant operates as a contractor or subcontractor in the
sprinkler industry, and at all times relevant to this action
was an employer “in an industry affecting
commerce” as defined by ERISA, 29 U.S.C. §§
1002(5), (9), (11), (12) and (14), the Labor Management
Relations Act, 28 U.S.C. §§ 142(1), (3) and 152(2),
and the Multi-Employer Pension Plan Amendments of 1980, 29
U.S.C. § 1001(a). Id. ¶ 3.
allege that Defendants are bound by the terms of the CBA with
the Road Sprinkler Fitters Local Union No. 669 (“Local
669”). Id. ¶ 4. The CBA required
Defendant “to pay to the Plaintiff Funds certain sums
of money for each hour worked by employees of Defendant
covered by the [CBA].” Id. ¶ 5.
Specifically, the CBA bound Defendants to the Funds'
Trust Agreements and the Guidelines for Participation in the
NASI Funds (the “Agreements”). Id.
¶ 7. Defendants were also obligated to “submit
report forms” to Plaintiffs. Id. ¶ 8;
see also ECF No. 7-8 at 22-23.
allege that Defendants failed to make contributions in the
amount of $4, 540.24 for the month of August, 2017, and
initially alleged that Defendants both failed to make
contributions and submit report forms for the months of
September, 2017 through February, 2018. ECF No. 1
¶¶ 8, 12; ECF No. 7-3 ¶¶ 8-9. Since the
filing of this lawsuit, however, Defendants have submitted
the remittance reports to Plaintiffs, who have submitted a
sworn affidavit stating that the Defendant owes contributions
to the Funds in the amount of $23, 930.23 for those months.
ECF No. 7-3 ¶ 8.
Agreements also provide for liquidated damages in the amount
of 20% of the total delinquent amount, ECF No. 1 ¶ 13,
and interest at the rate provided in 29 U.S.C. §
1132(g), id. ¶ 14.
STANDARD OF REVIEW
defendant's default does not automatically entitle the
plaintiff to entry of a default judgment: rather, that
decision is left to the discretion of the court.”
Choice Hotels Int'l, Inc. v. Savannah Shakti
Corp., No. DKC-11-0438, 2011 WL 5118328 at * 2 (D. Md.
Oct. 25.2011). Although “[t]he Fourth Circuit has a
‘strong policy' that ‘cases be decided on
their merits, '” id. (citing United
States v. Shaffer Equip. Co., 11 F.3d 450, 453 (4th
Cir.1993)), “default judgment may be appropriate when
the adversary process has been halted because of an
essentially unresponsive party[.]” Id.
default, the well-pled allegations in a complaint as to
liability are taken as true, although the allegations as to
damages are not.” S.E.C. v. Lawbaugh, 359
F.Supp.2d 418, 422 (D. Md. 2005). The pleadings in the
complaint must constitute a legitimate cause of action, as
analyzed under the Iqbal/Twombley pleading standard.
Baltimore Line Handling Co. v. Brophy, 771
F.Supp.2d 531, 544 (D. Md. 2011). That is, the
“complaint must contain sufficient factual matter,
accepted as true, ‘to state a claim to relief that is
plausible on its face.'” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Plaintiffs
must “provide sufficient detail” to show “a
more-than-conceivable chance of success on the merits.”
Upstate Forever v. Kinder Morgan Energy Partners,
887 F.3d 637, 645 (4th Cir. 2018) (citing Owens v. Balt.
City State's Attorneys Office, 767 F.3d 379, 396
(4th Cir. 2014)).
pleadings in the complaint constitute a legitimate cause of
action, the Court must make an independent determination of
damages. See Agora Fin., LLC v. Samler, 725
F.Supp.2d 491, 494 (D. Md. 2010). In doing so, the Court need
not “accept factual allegations regarding damages as
true.” Id. The Court may not, however, enter a
default judgment that differs “in kind from, or exceed
in amount, what is demanded in the pleadings.”
ERISA, “[e]very employer who is obligated to make
contributions to a multiemployer plan under the terms of the
plan or under the terms of a collectively bargained agreement
shall . . . make such contributions in accordance with the
terms and conditions of such plan or agreement.” 29
U.S.C. § 1145. Plaintiffs have plausibly alleged that
Defendants were bound by the terms of the CBA with Local 669
and by the Funds' Agreements, that these agreements
required monthly contributions for any hours worked by
covered employees, and that Defendants failed to make those
payments. See ECF No. 7-3. Therefore, Plaintiff
plausibly alleges that Defendants have violated ERISA.
have submitted a sworn affidavit stating that remittance
reports submitted by Defendants state that they owe $23,
930.23 for the months of August, 2017 through February, 2018.
ECF No. 7-3 ¶ 8. The interest owed on these unpaid
contributions, calculated at a rate of 12% per annum through
August 30, 2018, amounts to $2, 100.22, and continues to
accrue through the date of payment. See ECF No.
7-13. Liquidated damages, calculated at a rate of 20% of the
unpaid contributions, amount to $4, 786.05. Plaintiffs have
also submitted an affidavit from their attorneys, swearing
that they have spent a total of 9.25 hours to bring this
action, at a rate of $310.00 per hour for attorney time and
$122.00 per hour for paralegal time, for a total of $1,
222.50. ECF No. 7-14 ¶¶ 3, 5. These rates are
within the local guidelines and are reasonable. See
Loc. R. App. B (D. Md. July 1, 2016). Plaintiff's
affidavit also ...