Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_07-cv-00576/USCOURTS-cand-5_07-cv-00576-1/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:185 Employee Pension Plan

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United States District Court

For the Northern District of California

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-07-00576 RMW

MAG

United States District Court

For the Northern District of California

E-FILED on 9/28/07

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

NORTHERN CALIFORNIA-NORTHERN

NEVADA SOUND AND

COMMUNICATIONS EMPLOYEE BENEFIT

TRUST FUNDS; DOUG LUNG AND BOB

TRAGNI AS TRUSTEES OF THE

NORTHERN CALIFORNIA-NORTHERN

NEVADA SOUND AND

COMMUNICATIONS DISTRICT NO. 9

HEALTH AND WELFARE TRUST FUND,

Plaintiffs,

v.

WIRELESS COMMUNICATIONS

UNLIMITED, a California Corporation doing

business as EAGLE ENVIRONMENTAL

CONSTRUCTION,

Defendants.

No. C-07-00576 RMW

ORDER GRANTING APPLICATION FOR

DEFAULT JUDGMENT

[Re Docket No. 15]

Plaintiffs filed the present action on January 29, 2007 and the complaint was served on May

3, 2007. No response or appearance has been made by Wireless Communications Unlimited d/b/a

Eagle Envrionmental Construction ("Eagle"). On June 6, 2007, default was entered against Eagle. 

Plaintiffs now apply for default judgment against Eagle. Eagle did not file any opposition. The

court heard oral argument on the motion on Friday, September 28, 2007. No appearance was made

Case 5:07-cv-00576-RMW Document 20 Filed 09/28/07 Page 1 of 5
United States District Court

For the Northern District of California

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-07-00576 RMW

MAG 2

by defendant. For the reasons set forth below, the court grants plaintiffs' application for default

judgment. 

I. BACKGROUND

Plaintiffs have sued defendant Eagle for failure to pay employee benefits pursuant to a

collective bargaining agreement covering certain of its employees. These employee benefits were to

be paid on a monthly basis into certain Northern California-Northern Nevada Sound and

Communications Employee Benefit Trust Funds no later than the fifteenth day of each month

following the month for which payment is made. Decl. Bob Tragni Supp. Mot. Default J. ("Tragni

Decl.") ¶ 3. The amounts to be submitted are based on the number of hours worked by the

employees covered by a collective bargaining agreement. Compl. ¶ 6. According to defendants,

Eagle is subject under a collective bargaining agreement to the 9th District Sound &

Communications Agreement covering California, Oregon, Nevada, and Washington, and the

Northern California & Northern Nevada Addendum No. 2 Sound & Communications Agreement

("Addendum 2"). See id., Ex. 1. Pursuant to Addendum 2, these agreements bind Eagle to pay,

inter alia, pension benefits and health and welfare benefits in accordance with the provisions of the

applicable trust agreement for each fund. Id. , Ex. 1 at 30, 33.

On March 5, 2006, Eagle submitted transmittals regarding contributions for the months of

October 2006 through January 2007. Decl. of Melanie Houston Supp. Mot. Default J. ("Houston

Decl.") at 2:2-10; Decl. of Sue Campbell Supp. Mot. Default J. ("Campbell Decl.") ¶ 4. These

payments were late and, according to plaintiffs, under the trust agreement provisions require Eagle

to pay liquidated damages of 10% and interest of 8% on the delinquent amounts. Eagle also

allegedly failed to report two projects it worked with two different general contractors: (1) the Cal

State University Hayward project and (2) the Ascend School project (collectively, "the unreported

projects"). Plaintiffs determined that the total due on the Cal State University Hayward project was

$26,843.68 but settled with the general contractor for $17,778.62. Plaintiffs determined that the

total due on the Ascend School project was $7,678.36 but settled with the general contractor for that

project for $3,194.44. Both settlements have been paid by the respective general contractors, but

plaintiffs now seek liquidated damages and interest on these delinquent payments from Eagle.

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United States District Court

For the Northern District of California

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-07-00576 RMW

MAG 3

II. ANALYSIS

Plaintiffs seek damages as follows:

Liquidated Damages at 10%: 3,959.67

Prejudgment Interest at 8%: 1,237.94

Attorney's Fees: 9,418.50

Attorney's Costs: 1,032.00

----------------

$15,648.11

A. Liquidated Damages

Pursuant to the collective bargaining agreement between plaintiffs and defendant, liquidated

damages are due for delinquent fringe benefits in the amount of 10% of the amount owed. Eagle

submitted delinquent fringe benefit payments for the months of May 2005 through January 2007, but

because these payments were late, it incurred the 10% liquidated damage penalty. Plaintiffs request

payment for unpaid liquidated damages for the period from May 2006 through January 2007 as well

as liquidated damages on the settlements collected from the general contractors on the two

unreported projects. Notably, with respect to the unreported projects, plaintiffs seek liquidated

damages of 10% of the settlement amount, rather than the amount originally determined to be owed

by Eagle. 

When entering default judgment, the court must determine what violations, if any, arise from

the well-pled allegations of the complaint. The court need not make detailed findings of fact in the

event of a default judgment. Adriana Int'l Corp. v. Thoeren, 913 F.2d 1406, 1414 (9th Cir. 1990). It

must, however, make particularized findings as to damages. Id. The "general rule is that upon

default, allegations of the complaint are accepted as true except as to damages." Id. (citing Geddes

v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977)). Based on the declarations submitted by

defendants, it appears that the liquidated damages are owed under the terms of the trust and that

plaintiffs have correctly assessed 10% liquidated damages on the delinquent payments made by

Eagle and on the reduced amounts paid in settlement by the general contractors on the Cal State

University Hayward and Ascend projects. 

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United States District Court

For the Northern District of California

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1

 I.R.C. § 6621(g)(2) generally provides that the quarterly interest rate for underpayment is the

federal short-term rate for the first month of that quarter plus three percentage points. Applying

I.R.C. § 6621(g)(2), the annual interest rate would be approximately 8%.

ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-07-00576 RMW

MAG 4

B. Prejudgment Interest

Plaintiffs seek prejudgment interest on the delinquent payments at an annual rate of 8%. 

Campbell Decl. ¶ 10. Plaintiffs ask for interest of $1,237.97. ERISA provides that interest on

unpaid contributions shall be determined by using the rate provided for in the plan or, if none, the

rate prescribed under I.R.C. § 6621(g)(2). 29 U.S.C. § 1132(g)(2). The Health & Welfare Trust

Fund agreement provides for interest at an annual rate of 8%. Houston Decl., Ex. 1 at 10-11. The

court concludes that 8% is an appropriate prejudgment interest rate.1

C. Attorney's Fees and Costs

Plaintiffs' counsel seeks attorney's fees of $9,418.50 for a total of 45.3 hours plus 3 hours to

prepare the default judgment. Campbell Decl. ¶ 2. The court has reviewed the billing statements

submitted by plaintiffs' counsel. Although originally concerned that the amount of attorney's fees

was over double the amount of damages and interest sought and that the costs requested seemed

high, it appears that the additional attorney's fees were incurred seeking settlement of the fringe

benefit amounts for the Cal State University Hayward and Ascend projects and the additional costs

were incurred attempting to serve Eagle. The court finds counsel's billing rate and the billed hours

and costs reasonable and awards attorney's fees of $9,418.50 (48.3 x $195) and costs of $1,032.00. 

III. ORDER

For the foregoing reasons, the court hereby enters judgment against defendant Wireless

Communications Unlimited d/b/a Eagle Environmental Construction and in favor of plaintiffs. 

Plaintiffs are entitled to an award of liquidated damages for delinquent contributions at a rate of

10%, or $3,959.67. As requested by plaintiffs, the court grants plaintiffs interest on the delinquent

contributions in the amount of $1,237.94. Plaintiffs' counsel is entitled to attorney's fees of

$9,418.50 and costs of $1,032.00.

DATED: 9/28/07

RONALD M. WHYTE

United States District Judge

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United States District Court

For the Northern District of California

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-07-00576 RMW

MAG 5

Notice of this document has been electronically sent to:

Counsel for Plaintiffs:

Sue Campbell suecampbell@att.net 

Counsel for Defendants:

(no appearance)

Counsel are responsible for distributing copies of this document to co-counsel that have not

registered for e-filing under the court's CM/ECF program.

Dated: 9/28/07 /s/ MAG

Chambers of Judge Whyte

Case 5:07-cv-00576-RMW Document 20 Filed 09/28/07 Page 5 of 5