United States District Court, E.D. Wisconsin
OPERATING ENGINEERS LOCAL 139 HEALTH BENEFIT FUND, CENTRAL PENSION FUND OF THE INTERNATIONAL UNION OF OPERATING ENGINEERS AND PARTICIPATING EMPLOYERS, WISCONSIN OPERATING ENGINEERS SKILL IMPROVEMENT AND APPRENTICESHIP FUND, JOINT LABOR MANAGEMENT WORK PRESERVATION FUND, TERRANCE E. MCGOWAN, MICHAEL A. CRABTREE, and INTERNATIONAL UNION OF OPERATING ENGINEERS LOCAL 139, Plaintiffs,
DANE COUNTY CONTRACTING LLC, Defendant.
STADTMUELLER, U.S. DISTRICT JUDGE
various union representatives and entities, allege that
Defendant, a contractor, breached the parties' contracts
and violated the Employee Retirement Income Security Act of
1974 (“ERISA”), 29 U.S.C. 1132 & 1145, by
failing to pay its agreed-upon contributions to union
employee benefit plans. (Docket #1). On September 3, 2019,
Plaintiffs filed a motion for summary judgment, seeking not
only a favorable ruling on liability, but entry of judgment
for damages as well. (Docket #13). The motion is now fully
briefed, and for the reasons explained below, it must be
STANDARD OF REVIEW
Rule of Civil Procedure 56 (“FRCP”) provides that
the “court shall grant summary judgment if the movant
shows that there is no genuine dispute as to any material
fact and the movant is entitled to judgment as a matter of
law.” Fed.R.Civ.P. 56(a); see Boss v. Castro,
816 F.3d 910, 916 (7th Cir. 2016). A “genuine”
dispute of material fact is created when “the evidence
is such that a reasonable jury could return a verdict for the
nonmoving party.” Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986).
Court construes all facts and reasonable inferences in a
light most favorable to the non-movant. Bridge v. New
Holland Logansport, Inc., 815 F.3d 356, 360 (7th Cir.
2016). In assessing the parties' proposed facts, the
Court must not weigh the evidence or determine witness
credibility; the Seventh Circuit instructs that “we
leave those tasks to factfinders.” Berry v. Chi.
Transit Auth., 618 F.3d 688, 691 (7th Cir. 2010). The
non-movant “need not match the movant witness for
witness, nor persuade the court that [their] case is
convincing, [they] need only come forward with appropriate
evidence demonstrating that there is a pending dispute of
material fact.” Waldridge v. Am. Hoechst
Corp., 24 F.3d 918, 921 (7th Cir. 1994).
was a party to several collective bargaining agreements
(“CBAs”) and trust agreements with Plaintiffs
from April 1, 2018 through February 28, 2019. Those
agreements obligated Defendant to make fringe benefit
contributions to Plaintiffs. Defendant was also required to
send Plaintiffs monthly remittance reports, detailing the
work its employees performed and the wages paid for that
work. Those reports were due on the fifteenth of the month
following the month in which the work was performed. Finally,
Defendant was to deduct administrative dues from its
employees' wages and pay those to the union. If Defendant
failed to make these payments, the parties' contracts
imposed interest and liquidated damages. The agreements also
allowed Plaintiffs to collect their costs and attorneys'
fees for bringing suit to recover any amounts due.
have audited Defendant's books and records for the
relevant time period. The audit reveals that Defendant did
not make all of the required payments, and now owes
Plaintiffs for contributions, interest, liquidated damages,
costs, and attorneys' fees. Defendant admits that it owes
contributions, but objects to liability for the other sums.
Defendant maintains that Plaintiffs should have mitigated
their damages by cooperating with Defendant more closely in
obtaining lien waivers from general contractors. Defendant
claims that Plaintiffs' delays in providing information
and obtaining signatures hampered its ability to timely pay
contributions. Further, Plaintiffs were also garnishing
Defendant's earnings at the time, limiting its ability to
pay. Finally, Defendant suggests that Plaintiffs ignored its
offer to reach an agreement on paying a substantial portion
of the outstanding contributions, which would have led to
more timely payments in the future.
provides that employers are obligated to make contributions
to employee benefit plans in accordance with the agreements
governing those plans. 29 U.S.C. § 1145. If the employer
does not make the required contributions, ERISA allows the
plan administrator to bring suit and recover the unpaid
contributions, interest, attorneys' fees, and costs.
Id. § 1132(g)(2). Plaintiffs assert, and
Defendant does not dispute, that they have authority to sue
under ERISA. See Id. § 1132(a)(3). Plaintiffs
are also entitled to recover interest, liquidated damages,
fees, and costs even if the delinquent contributions were
ultimately paid prior to suit; the very lateness of the
contributions triggered these penalties and late payment
cannot erase them. Operating Eng'rs Local 139 Health
Benefit Fund v. Gustafson Constr. Corp., 258 F.3d 645,
654 (7th Cir. 2001). And obviously, when an employer incurs
ERISA liability, it will also have breached the underlying
agreements it made with the union.
does not dispute its liability under ERISA or for breach of
contract. Instead, as mentioned above, it focuses its efforts
on a reduction of the damages sought by Plaintiffs. Namely,
Defendant argues that Plaintiffs failed to mitigate their
damages. To be paid by a general contractor, Defendant needed
to obtain joint check agreements and lien waivers from
Plaintiffs. Defendant claims that Plaintiffs were slow to
sign these documents, leading to late payments to Defendant,
and in turn, a lack of funds to make contributions. Though
mentioned in its factual briefing, and not its legal
argument, Defendant also seems to contend that
Plaintiffs' ongoing garnishment further reduced the pool
of funds available for union payments.
only support for its mitigation argument is a citation to a
fourteen-year-old case from the Western District of Wisconsin
which has nothing to do with unions, contractors, and the
agreements between the two. Gilson v. Rainin Instrument,
LLC, No. 04-C-852-S, 2005 WL 955251 (W.D. Wis. Apr. 25,
2005). Instead, Defendant cites the case for the proposition
that a duty of good faith and fair dealing was implied into
the CBAs and trust agreements. Though the case did discuss
such a duty, it did so in the context of the Uniform
Commercial Code (“UCC”). Id. at *4-9.
Defendant does not suggest that the agreements at issue in
this case fall under the UCC's purview. Even if they did,
Gilson is not at all analogous to the instant case
and makes no mention of mitigation of damages.
mitigation argument is thus wholly unsupported by citation to
law. The Court cannot, and will not, construct appropriate
arguments on behalf of litigants, particularly when they are
represented. Doherty v. City of Chi., 75 F.3d 318,
324 (7th Cir. 1996). In any event, Plaintiffs note that
Seventh Circuit authority suggests that mitigation is not
available as a defense in an ERISA case. See Schleibaum
v. Kmart Corp., 153 F.3d 496, 501-02 (7th Cir. 1998).
Further, Plaintiffs state that the mitigation defense is not
well-founded in fact. They claim that Defendant itself was to
blame for any delay; Defendant's requests for lien
waivers and joint check agreements came after its
contributions were already delinquent. As to the garnishment
issue, Plaintiffs maintain that the judgment being garnished
related to a prior suit for unpaid contributions. It would be
inequitable for Defendant to use that judgment and subsequent
garnishment as ...