Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_06-cv-02700/USCOURTS-cand-5_06-cv-02700-0/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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United States District Court

For the Northern District of California

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-06-02700 RMW

MAG

United States District Court

For the Northern District of California

E-FILED on 2/22/07

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.

ANDERSON AUDIO VISUAL - SAN

FRANCISCO, INC., a California Corporation,

Defendant.

No. C-06-02700 RMW

ORDER GRANTING IN PART

APPLICATION FOR DEFAULT JUDGMENT

[Re Docket No. 15]

Plaintiffs filed the present action on April 20, 2006 and the complaint was served on October

11, 2006. No response or appearance has been made by Anderson Audio Visual – San Francisco,

Inc. ("Anderson") and, on December 17, 2006, default was entered against Anderson. Plaintiffs now

apply for default judgment against Anderson. Anderson did not file any opposition. The court

heard oral argument on the motion on Friday, February 16, 2007. No appearance was made by

Case 5:06-cv-02700-RMW Document 30 Filed 02/22/07 Page 1 of 7
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 Plaintiffs did not submit a copy of the 9th District Sound & Communications Agreement. In

addition, the submitted version of Addendum No. 2 is an unexecuted version.

ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-06-02700 RMW

MAG 2

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

judgment. 

I. BACKGROUND

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

collective bargaining agreement covering certain of its employees. FAC ¶¶ 5-6. 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. Id. ¶¶ 3, 6; Amended 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. Id. ¶ 6. Pursuant a letter of

assent signed October 25, 2001, Anderson is subject 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")

negotiated on its behalf by the Northern California Chapter Alameda County Branch National

Electrical Contractors Association, Inc. See FAC, Ex. A. According to Addendum 2, these

agreements bind Anderson to pay, inter alia, pension benefits and health and welfare benefits in

accordance with the provisions of the applicable trust agreement for each fund. FAC, Ex. A at 30,

33.1

 Addendum 2 appears to expire November 30, 2006. Id. at 1.

On December 29, 2006, Andersen submitted transmittals regarding contributions for the

months of March 2005 through June 2006. Amended Decl. of Sandy Stephenson Supp. Mot.

Default J. ("Stephenson Decl.") at 2:3-5. However, Anderson has not submitted any payments for

the months of March 2006 through July 2006. Id. Plaintiffs filed a complaint on April 20, 2006

seeking contributions for March 2005 through June 2006 and liquidated damages for allegedly late

payments for the months of February 2004 through January 2005.

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-06-02700 RMW

MAG 3

II. ANALYSIS

Plaintiffs seek damages as follows:

Delinquent Fringe Benefits: $49,937.52

Liquidated Damages at 10%: 4,993.75

Unpaid liquidated damages

 from prior late payments: 1,906.42

Prejudgment Interest at 8%: 2,343.30

Attorney's Fees: 3,363.75

Attorney's Costs: 494.80

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

$63,039.54

A. Delinquent Contributions

Plaintiffs seek past fringe benefit contributions of $49,937.52. Stephenson Decl. at 3:6-7. 

Plaintiffs compute this amount based on transmittals submitted by Anderson on December 29, 2006

for the months of March 2005 through June 2006. Id. at 3:3-5, Ex. 1. This court has jurisdiction

over amounts an employer has contractually "promised" to pay. Laborers Health & Welfare Trust

Fund for N. Cal. v. Advanced Lightweight Concrete Co., 484 U.S. 539, 548-49 (1988). An

employer's contractual obligation ceases when it "it permanently ceases to have an obligation to

contribute under the plan, or . . . permanently ceases all covered operations under the plan." Id. at

546 n.10 (citing 29 U.S.C. § 1383(a)). Based on the declarations submitted by plaintiffs, which

attach the transmittals submitted by Anderson to defendants for the period in question, the court is

satisfied that Anderson has a continued contractual obligation to make contributions under the

collective bargaining agreement for the period in question. 

B. Liquidated Damages

Plaintiffs seek liquidated damages based on the delinquent contributions for March 2005

through June 2006 as well as for allegedly late payments for the months of February 2004 through

January 2005. Under the Employee Retirement Income Security Act of 1974 (ERISA), the trustees

of a plan may bring action in federal district court pursuant to ERISA § 502 against an employer

who is delinquent in meeting their contractual obligations. Laborers Health & Welfare Trust Fund

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-06-02700 RMW

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for N. Cal., 484 U.S. at 546-47; see 29 U.S.C. §§ 1132, 1145. ERISA § 502(g)(2) creates a "special

remedy against employers who are delinquent in meeting their contractual obligations that . . .

includes a mandatory award of prejudgment interest plus liquidated damages in an amount at least

equal to that interest, as well as attorney's fees and costs." Id. at 547. Section 502(g)(2) provides in

relevant part:

In any action under this title by a fiduciary for or on behalf of a plan to enforce

section 515 of this title in which a judgment in favor of the plan is awarded, the court

shall award the plan-

(A) the unpaid contributions,

(B) interest on the unpaid contributions,

(C) an amount equal to the greater of-

(i) interest on the unpaid contributions, or

(ii) liquidated damages provided for under the plan in an amount not in excess of 20

percent (or such higher percentage as may be permitted under Federal or State law) of

the amount determined by the court under subparagraph (A),

(D) reasonable attorney's fees and costs of the action, to be paid by the defendant.

29 U.S.C. § 1132(g)(2). The agreement of one of the funds at issue, the IBEW/NECA Sound and

Communications Health and Welfare Trust Fund ("Health & Welfare Trust Fund") provides for

liquidated damages at 10% and interest at 8%. FAC, Ex. B at 10-11. As noted above, ERISA

permits liquidated damages of up to 20% or a higher rate as may be permitted by law. The court is

satisfied that 10% is an appropriate rate for determination of liquidated damages in this case. 

Therefore, liquidated damages in the amount of 10% of the delinquent contributions amount of

$49,937.52 shall be awarded for the period of March 2005 through June 2006.

Plaintiffs additionally request payment for unpaid liquidated damages for the period from

February 2004 through January 2005. 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)). Although

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 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-06-02700 RMW

MAG 5

they set forth that they seek liquidated damages for the period between February 2004 and January

2005 in their complaint and the declarations supporting their motion for default judgment, plaintiffs

do not state any factual basis for entitlement to liquidated damages for this period, instead

generically stating that "past due liquidated damages are due for the months of February, March,

April, September, October, November and December 2004 and January 2005." Stephenson Decl. at

2:8-12; see also Tragni Decl. ¶ 3; FAC ¶ 11. Thus, the court declines to award liquidated damages

for the period between February 2004 and January 2005.

C. Prejudgment Interest

Plaintiffs seek prejudgment interest on the delinquent fringe benefits (March 2005 through

June 2006) at an annual rate of 8% for the period from May 1, 2006 to December 1, 2006. Suppl.

Decl. Sue Campbell Supp. Mot. Default J. ("Suppl. Campbell Decl.") at 3:6-10. Plaintiffs ask for

interest of $2,343.30 for that period. 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%. FAC, Ex. B at 10-11. The court concludes that 8% is an

appropriate prejudgment interest rate.2

D. Attorney's Fees and Costs

Plaintiffs' counsel seeks attorney's fees of $3,363.75 for a total of 14.25 hours plus 3 hours to

prepare the default judgment. Suppl. Campbell Decl. at 1:24-26. The court has reviewed the billing

statements submitted by plaintiffs' counsel. The court finds counsel's billing rate and the billed

hours and costs reasonable and awards attorney's fees of $3,363.75 (17.25 x 195) and costs of

$494.80. 

There appears to have been confusion between the amount of delinquent of payments owed

by the present defendant, Anderson Audio Visual – San Francisco, Inc., and that owed by a similarly

named party, Anderson Audio Visual – Berkeley ("Anderson – Berkeley"). Stephenson Decl. at

1:27-2:2 ("I previously submitted a declaration of the amount of the delinquency. That declaration

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-06-02700 RMW

MAG 6

was incorrect. I mistakenly calculated the delinquency of another contract with a similar name as

the Defendant, 'Anderson Audio Visual – Berkeley'."). In light of this confusion, this court reminds

plaintiffs' counsel that if she also represents plaintiffs with respect to Anderson – Berkeley and

intends to seek attorney's costs and fees with regard to that entity, she should ensure that her billing

slips and costs records accurately permit her differentiate between the present defendant and

Anderson – Berkeley.

III. ORDER

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

Audio Visual – San Francisco, Inc. and in favor of plaintiffs. Plaintiffs are entitled to an award of

delinquent benefits contributions for the months of March 2005 through April 2006, totaling

$49,937.52, and liquidated damages for such delinquent contributions at a rate of 10%, or $4,993.75. 

As requested by plaintiffs, the court grants plaintiffs interest on the delinquent contributions in the

amount of $2,343.30. Plaintiffs have not shown a factual basis for their claim to unpaid liquidated

damages for late contributions for the months of February 2004 through January 2005, therefore the

court declines to award the additional liquidated damages sought for that period. Plaintiffs' counsel

is entitled to attorney's fees of $3,363.75 and costs of $494.80.

DATED: 2/21/07

RONALD M. WHYTE

United States District Judge

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ORDER GRANTING IN PART APPLICATION FOR DEFAULT JUDGMENT—No. C-06-02700 RMW

MAG 7

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: 2/22/07 /s/ MAG

Chambers of Judge Whyte

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