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Operating Engineers Local No 101 v. McClan Construction, LLC

United States District Court, W.D. Missouri, Western Division

November 19, 2019




         Plaintiffs are five employer benefit funds (the “Funds”), [1] a trustee of the Funds, and the labor organization representing the employees in the Funds. In June 2019, Plaintiffs filed suit against Defendant, seeking damages arising from Defendant's failure to make appropriate fringe benefit contributions to the Funds on behalf of its employees. Plaintiffs argue Defendant's failure breached a settlement agreement formerly agreed to by the parties.

         Now before the Court is Plaintiffs' motion for default judgment (Doc. 6). It is GRANTED.


         Defendant employs Union members who perform work covered by various collective bargaining agreements (“CBAs”). Under the CBAs, the Defendant is required to: 1) contribute fringe benefits-various sums per hour for each employee covered by the CBAs; 2) submit regular written reports listing the name of each employee, the hours worked, and the amounts contributed for each employee; 3) allow the Funds' trustees to inspect and make copies of Defendant's records pertaining to the employees' compensation and hours worked; and 4) pay Union dues. Defendant is also obligated to pay liquidated damages, interest, audit costs, and reasonable attorneys' fees and costs to enforce payments.

         An audit conducted in 2018 revealed that Defendant had underreported hours and failed to remit contributions to the Funds from January 2015 to November 2017. Although this was a breach of §§ 502 and 515 of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1132 and 1145 and § 301 of the Labor Management Relations Act (LMRA), 29 U.S.C. § 185, the parties reached a settlement agreement in which Defendant agreed to pay a total of $60, 736.62 for unpaid benefits for the period from January 2015 to June 2018. This amount constituted delinquent contributions, liquidated damages, interest, and fees owed. Defendant made some initial payments, but soon started submitting untimely payments. By January 2019, Defendant had stopped making payments altogether. Ultimately, Defendant paid $38, 261.42 in settlement installment payments and another $5, 292.60 from a prepayment balance.

         Accordingly, Plaintiffs filed this lawsuit in federal court. Defendant was served on June 24, 2019, but failed to participate in this action, so the clerk entered default against it. Plaintiffs then filed the instant motion for default judgment. Defendant did not respond.

         Standard of Review

         Once a defendant is in default, a court may enter a default judgment against that party. Fed.R.Civ.P. 55(b)(2). In considering a motion for default judgment, the court takes as true all allegations in the complaint that relate to liability. Murray v. Lene, 595 F.3d 868, 871 (8th Cir. 2010). The court does not take as true conclusions of law or factual allegations relating to damages. Id. The plaintiff must prove allegations pertaining to the amount of damages “to a reasonable degree of certainty.” St. Louis-Kansas City Carpenters Reg'l Council v. Joseph Constr., Inc., No. 4:16- CV-00929-AGF, 2016 WL 6524342, at *2 (E.D. Mo. Nov. 3, 2016). A plaintiff may prove damages by an affidavit and supporting documentation. See H&R Block Enters. LLC v. Ascher, No. 4:15-cv-00178-SRB, 2015 WL 5008996, at *4 (W.D. Mo. Aug. 20, 2015) (“Affidavit evidence is sufficient to support an award of damages for purposes of a default judgment.”).


         The Court finds that Defendant breached the settlement agreement-as well as violated ERISA and the LMRA-by failing to pay the full $60, 736.62 it owed to the Funds for delinquent contributions. Although Defendant paid some amount due under the settlement agreement, it still owes the Funds $17, 182.60 for delinquent contributions, liquidated damages, interest, and fees.[2]Further, after Defendant breached the settlement, Plaintiffs performed another audit of the Funds and found additional delinquent contributions in the amount of $34, 893.77, which includes delinquent contributions, liquidated damages, and interest. Thus, the Court finds Plaintiffs have proven that judgment should be entered against Defendant for $52, 076.37.

         Additionally, Plaintiffs seek attorneys' fees and costs of $2, 519.25 for the work done in this case. The Court must determine that the fees are reasonable. Greater Kansas City Laborers Pension Fund v. Thummel, 738 F.2d 926, 931 (8th Cir. 1984). That determination is within the district court's discretion. Id.

         Here, Plaintiffs' counsel's affidavit calculates fees of $2, 019.25, representing 8.3 hours of attorney's time billed at $205 per hour, as well as 3.1 hours for paralegal services billed at $102.50 per hour. Costs, including the $400 filing fee and the $100 service of process fee, total $500. The Court finds, considering the amounts involved ...

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