Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-05339/USCOURTS-cand-3_05-cv-05339-3/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 28:1132 E.R.I.S.A.

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States District C

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For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

JOSE MORENO, as CHAIRMAN and

LARRY TOTTEN as CO-CHAIRMAN of

the BOARD OF TRUSTEES FOR THE

LABORERS HEALTH AND WELFARE

FUND FOR NORTHERN CALIFORNIA, et

al.,

Plaintiffs,

 v.

NEWCON CONCRETE CONSTRUCTION,

INC.,

Defendant.

 /

No. C 05-05339 CRB

ORDER GRANTING MOTION FOR

DEFAULT JUDGMENT

This is an ERISA action for delinquent contributions to a trust fund. Now before the

Court is plaintiffs’ motion for default judgment. Defendant has not answered the complaint,

has not responded to plaintiffs’ motion, and has not otherwise communicated with the Court. 

After carefully considering the papers filed by plaintiff, the Court concludes that oral

argument is unnecessary, see Local Rule 7-1(b), and GRANTS the motion for default

judgment.

BACKGROUND

A. Procedural History

Plaintiffs filed this ERISA action to recover delinquent contributions for October

through December 2004 and February through April 2005. Plaintiff also seeks liquidated

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damages and interest for those delinquent contributions as well as for late payments made

beginning in May 2003. Defendant was served with the complaint, but it has 

failed to answer or otherwise communicate with the Court. Default was entered on March

15, 2006. Plaintiffs now move for entry of default judgment. 

B. The Evidence In The Record

Defendant agreed to abide by the terms of the Laborers Master Agreement and related

trust fund agreements for contributions, interest, liquidated damages, costs and attorneys’

fees caused by breach of its obligations for payment of employer contributions. The Trust

Agreements require defendant to pay contributions to the plaintiffs on behalf of covered

workers by a date certain the following month. A contribution is considered delinquent

unless the plaintiffs receive the contribution by that date. 

The Trust Agreements provide further that the defendant shall pay interest at the rate

of one and half percent (1.5%) per month until receipt of payment, and liquidated damages at

the flat rate of $150 per month “to reflect the internal administrative costs incurred by the

trust administrators in monitoring and tracking such late contributions.” Hagan Declaration,

Exh. A, ¶ 4. 

Plaintiffs’ evidence establishes that defendant has failed to make contributions

totaling $235,108.10 for the months of October through December 2004, and February

through April 2005. Defendant also made late payments for the months of May 2003

through September 2004 and January 2005. 

DISCUSSION

ERISA provides that

[e]very employer who is obligated to make contributions to a multiemployer

plan under the terms of a collectively bargained agreement shall to the extent

not inconsistent with law, make such contributions in accordance with the

terms and conditions of such plan or such agreement.

29 U.S.C. § 1145. ERISA also authorizes an award of interest on delinquent and unpaid

contributions, as well as liquidated damages and attorneys’ fees and costs in an action for

collection of contributions. See 29 U.S.C. § 1132(g). In the Ninth Circuit, to qualify for an

award of statutory liquidated damages, unpaid contributions must exist at the time the lawsuit

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is filed. See Idaho Plumbers & Pipe Fitters Health and Welfare Fund v. United Mechanical

Contractors, Inc., 875 F.2d 212, 215 (9th Cir. 1989).

As the allegations of the complaint are accepted as true, and as the evidence

establishes that defendant owes plaintiffs a sum certain, plaintiffs’ motion for a default

judgment is GRANTED as explained below.

Plaintiffs are awarded $235,108.10 for unpaid contributions for the months of October

through December 2004 and February through April 2005. 29 U.S.C. § 1132(g)(2)(A). They

are awarded interest of $56,970.41 on these unpaid amounts. 29 U.S.C. § 1132(g)(2)(B). 

Although the Trust agreements provide for a flat fee liquidated damages amount of $150 per

month, ERISA provides for liquidated damages in an amount equal to the greater of the

interest on the unpaid contributions or the liquidated damages provided for in the parties’

agreement, provided such damages do not exceed 20 percent of the unpaid contributions. Id.

§ 1132(g)(2)(C). The 20 percent limitation applies only to contractual liquidated damages. 

Id. As the interest owed is greater than the flat fee liquidated damages, plaintiffs are

awarded $56,970.11 in liquidated damages on the unpaid contributions.

Plaintiffs are also awarded $37.095.87 in interest on the late payments made before

this lawsuit was filed, that is, late payments for the months of May 2003 through September

2004, and January 2005. They are also awarded their contractual liquidated damages of $150

per month on these late payments in the total amount of $2,550.00. They cannot recover the

statutory liquidated damages because these amounts were paid before the lawsuit was filed. 

See Idaho Plumbers & Pipe Fitters Health and Welfare Fund v. United Mechanical

Contractors, Inc., 875 F.2d at 215.

Finally, plaintiffs are awarded $564.74 in costs and $9.078.75 in attorneys’ fees. 

The Court will further issue an injunction compelling defendant to submit to an audit

of its financial records from March 2001 to the present to determine the full amount of

employer contributions. See Central States, Southeast & Southwest Areas Pension Fund v.

Central Transport, Inc., 472 U.S. 559, 571-72 & n. 12 (1985). 

CONCLUSION

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Plaintiffs’ motion for a default judgment is GRANTED in the total amount of

$398,341.28. Defendant is ordered to submit to an audit of its financial records from March

2001 to the present within 10 days of a written demand from plaintiffs.

IT IS SO ORDERED.

Dated: July 21, 2006 

CHARLES R. BREYER

UNITED STATES DISTRICT JUDGE

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