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United Food and Commercial Workers Unions v. Magruder Holdings, Inc.

United States District Court, D. Maryland, Southern Division

March 27, 2019

UNITED FOOD AND COMMERCIAL WORKERS UNIONS AND PARTICIPATING EMPLOYERS PENSION FUND AND ITS TRUSTEES, Plaintiffs,
v.
MAGRUDER HOLDINGS, INC., et al., Defendants.

          MEMORANDUM OPINION

          GEORGE J. HAZEL UNITED STATES DISTRICT JUDGE

         Magruder Holdings, Inc. (“Magruders”) was a grocery chain that, before it went out of business, was a contributing employer to the United Food and Commercial Workers Pension Fund (the “Fund”). Because Magruders has no assets to cover its withdrawal liability pursuant to the Multiemployer Pension Plan Amendments Act (“MPPAA”), the Fund now seeks to recover from Fanaroff & Steppa, LLC (“F&S”), and Bedrock Asset Management, LLC (“Bedrock”), two real estate investment companies that allegedly share ownership interests with Magruders. The claim is brought under the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended by the MPPAA, 29 U.S.C. §§ 1001, et seq. (1982). The parties have submitted cross-motions for summary judgment. See ECF Nos. 39, 42, 44, 49. No. hearing is necessary. See Loc. R. 105.6 (D. Md. 2016). For the following reasons, Plaintiffs' Motions for Summary Judgment, ECF Nos. 42, 48, are denied. Defendants' Motions for Summary Judgment, ECF Nos. 39, 44, are denied. The interim Motions to Seal, ECF Nos. 43, 50, 54, are preliminarily denied, and the documents will be unsealed in 14 days absent a showing of good cause.[1]

         I. BACKGROUND

         Louis Fanaroff founded Magruders, a chain of grocery stores in the Washington, D.C. metropolitan area, with his brother-in-law Stanford Steppa on November 27, 1985. ECF Nos. 42-21 at 3, 42-23 at 3.[2] Steven Fanaroff, Debby Bortnick, Wendy Ravick, and Sonia Polsky (collectively, “the Siblings”) are the sibling children of Louis Fanaroff (now deceased) and the nephews and nieces of Stanford Steppa. ECF No. 40 ¶ 32. Stanford is married to Elaine Steppa, Steven is married to Susan Fanaroff, Debby is married to Gary Bortnick, and Sonia Polsky is married to Mark Polsky; Wendy Ravick is unmarried. Id; see also ECF No. 42-24 at 11.

         The United Food and Commercial Workers (“UFCW”) represented workers at Magruders, see ECF No. 42-23 at 3, who had negotiated benefits provided by the Fund, to which Magruders became a contributing employer. ECF Nos. 42-1 ¶ 7, 44-1 at 7. But when Magruders went out of business in 2013, it ceased contributing to the Fund. ECF No. 44-1 at 7-8. Magruders forfeited its charter with the State of Maryland on October 3, 2014. ECF No. 42-22 at 2.

         On May 3, 2013, the Fund's Trustees issued a withdrawal liability demand to Magruders, requiring it to furnish “a complete list of the owners, and percentage of ownership” of Magruders. ECF No. 42-2 at 3. On May 23, 2013, the Fund received a letter from Gary Bortnick, Magruders' Vice President and Chief Operating Officer, stating that the owners of Magruders and their respective ownership percentages were:

. Stanford Steppa: 20.0006%
. Elaine Steppa: 20.0006%)
. Sonia and Mark Polsky as tenants in the entirety: 1.7663%
. Mark Polsky: 0.9909%
. Sonia Polsky: 12.6667%
. Debby and Gary Bortnick as tenants in the entirety: 1.7663%
. Gary Bortnick: 0.9909%
. Debby Bortnick: 12.6667%
. Steven and Susan Fanaroff as tenants in the entirety: 1.7663%
. Steven Fanaroff: 12.6667%
. Susan Fanaroff: 0.9909%
. Wendy Ravick: 13.1969%
. The Irrevocable Inter Vivos Trust f/b/o The Ravick Children: ...

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