2010 D e c i sion s O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit 2-12-2010 

# Kane B ldrs Inc v

. S N J B ldg L a b ore rs P r e c e de nt i al or N on-P r e c e de nt i al : N on-P r e c e de nt i al D ocke t N o . 07-3800

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Thi s de c i sion i s br ou ght t o you for f r e e and ope n a c c e s s b y the O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit at V i l l a nova U nive r sity S choo l of L a

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w Di git al Reposit ory

. F or mor e inform at ion, p le as e c ont a ct Be n j amin . C arl s on@l a

w . vi l l a nova . e du . Re c omme nde d C it at ion
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. S N J B ld g L a bor e r s " (2010). 2010 D e cisio n s . P ape r 1903. http://d i git alc ommon s .l a

w . vi ll anova . e du/thir dc ir c uit_2010/1903NOT P RE CE DE NT I AL UN I TED STATES CO UR T OF A PP EALS F O R T H E T H IR D C IR C U IT 

### No. 07- 3800
KAN E BUI LDE RS , I NC.

v. SOU THER N N EW J ERSEY BU I LDI NG LAB OR ER' S DI STRI CT CO UN CI L; L IU N A ; A F L -C IO ( D i s t r i ctC our tN o. 04- cv- 03315) NE W J E RS E Y B UI L DI NG L AB OR E RS S T AT E WI DE BE NE F I T S F UND; T HE T RU S T E E S OF T HE NE W J E RS E Y B UI L DI NG L AB OR E RS S T AT E WI DE

B E N E FI T S FU N D S; A B C C O R PO R A T I O N 1- 25
v. KAN E BUI LDE RS , I NC. ( D i s t r i ctC our tN o. 05- cv- 01137) K a n e B u ild e rs , In c ., A ppel l ant
APP EAL F ROM THE UNI TE D ST ATE S DI S TRI CT C OURT

FOR TH E DI STRI CT O F NEW J ERSEY D i s t r i ctJ udge: H onor abl e D enni s M . C avana ugh

A r gued: J anuary12, 2010
B efor e: SC I R I C A , C hi ef J udge, B A R R Y and SM I T H , C i r cui tJ udges

( O pi ni on Fi l ed: February12, 2010)K ane Bui l der s i s a cons t ruct i on company , founded, ow ned and ope r at ed bySt ephen 1 K ane of G l ens i de, Penns y l vani a. -2- J ames A
. M at t hew s , I I I , E s q. F o x R o th sc h ild 2000 M arketSt r eet 20t h Fl oor Phi l adel phi a, PA 19103 C ouns el forA ppel l ant R aym ond G
. H ei neman, E s q. K r ol l H ei neman 9 9 W o o d A v e n u e S o u th M etr o C orpor at e C ampus I , Sui t e 307 I s el i n, N J 08830 C ouns el forA ppel l ees

OP I NI ON

B A R R Y , C i r cui tJ udge T hi s appea l i nvol ves t he D i s t r i ctC our t ’ s fac tual fi ndi ng t hatK ane Bui l der s , I nc. ( “K ane Bui l der s ”) , a Penns y l vani a cons t ruct i on company , ent er ed i nt o a J une 2000 1
co ll ec ti v e b arg ainin g ag ree m en t ( “C B A ”) w ith S o u thern N ew Jerse yB u il d ing L ab o rers D i s t r i ctC ouns el , L I U N A ( t he “U ni on”)
. T he C our tm ade the fi ndi ng aft erhear i ng t es t i m onyr el at ed t o K ane Bui l der s ’ s m ot i on fora pr el i m i naryi nj unct i on t o enj oi n t he-3-

arbi t r at i on s oughtbyt he U ni on. T he i s s ue bef or e us i s w hethert he C our terr ed i n t r eat i ng t hatfi ndi ng as a fi nal det erm i nat i on on t he mer i t s , w hi ch l ed t o j udgm ent s agai ns tK ane B u ild e rs, a n d in f

a v o r o f th e U n io n , the N e w Je rse yB u ild in g L a b o re rs S tate w id e B e n e f its Funds a nd T rus t ees of the N ew J er s eyB ui l di ng L abor er s St at ew i de B enef i t s Funds (c o llec tiv e ly , the “ F u n d s” ), an d L o u is M o sc a , a U n io n re p re se n tativ e a n d th ird -p a rty d e f e n d a n t. I n J une 2000, M os ca a ppr oache d M ark Spencer , a K ane Bui l der s cons t ruct i on
s upervi s or , atone of K ane Bui l der s ’ s N ew J er s eycons t ruct i on s i t es , and as ked w hether K ane Bui l der s w oul d hi r e uni on w or ker s fort he pr oj ect . Spencert ol d M os ca thathe lack ed au tho ri tyto h ir e u n ion w o rke rs, an d ref erred M o sca to K an e B u il d ers’s f o u n d er, St ephen K ane. M os ca s poke t o K ane a nd, t he D i s t r i ctC our tfound, K ane t ol d M os ca that he w oul d author i ze Spenc ert o ent eri nt o t he C B A on behal f of K ane Bui l der s , a fi ndi ng that is ho tl yd ispu ted. K an e the n sp o k e to S p en ce r bytel ep h o n e a n d , there af ter, the C o u rt found, M os ca pr es ent ed Spence rw i t h a 58- page CB A , w hi ch Spence rs i gned, a fi ndi ng th a t, a g a in , is d is p u te d
. T h e C B A p ro v id e d , in tera lia , tha t K a n e B u ild e rs w o u ld h ire U n io n w o rk e rs f o r its N ew J er s eypr oj ect s and make benef i t s paym ent s on behal f of the U ni on w or ker s t o t he N ew J er s eyB ui l di ng L abor er s St at ew i de B enef i tFunds. I n M ay2004, t he U ni on di s cover ed thatK ane Bui l der s w as m anagi ng a cons t ruct i on pr oj ecti n O cea n T ow ns hi p, N ew J er s ey( t he “O cea n Pr oj ect ”) , buthad nothi r ed anyU ni on w or ker s . T he U ni on fi l edKa n e B u ild ers In c. v. S. N
. J. B u ild ingL a b o rers '

D ist
. C o u n cil

, L IU N A , A F L -C IO , 2 0 4 -3 3 1 5 (D .N .J . f

ile d J u n e 3 0 , 2 0 0 4 ). K ane Bui l der s s oughtdecl ar at or yr el i ef thati thad notent er ed i nt o t he C B A w i t h t he 3 U ni on, and i nj unct i ve r el i ef t empora r i l yand perm anent l yenj oi ni ng t he arbi t r at i on w hi ch th e U n io n h a d c o m m e n c e d
. N
. J. B ldg. Labore rs Stat ew i de Benef i t s Funds , The Trus t ees of the N
. J. B ldg. 4 Labore rs Stat ew i de Benef i t s Funds v. Kane Bui lders , I nc. , 0 5 -11 3 7 (D
. N . J. fil ed F eb rua ry 2 5 , 2 0 0 5 ). -4- a demand forarbi t r at i on agai ns tK ane Bui l der s on M ay21, 2004. T her eaf t er , K ane B ui l der s at t empt ed t o enj oi n t he arbi t r at i on bybr i ngi ng a J une 30, 2004 act i on i n t he D istri ct C o u rt(“ Kane I ”) fordecl ar at or yand i nj unct i ve r el i ef a gai ns tt he U ni on, 2 3 cl ai m i ng t hatK ane Bui l der s neverent er ed i nt o t he C B A
. O n N ovember23, 2004, t he C our thel d a hea r i ng t o deci de the pr el i m i naryi nj unct i on ( t he “H ear i ng”) , and i s s ued the pert i nen tfactual fi nd i ng s on D ecem ber 6, 20 04
. T he C ou rtfou nd t hat K ane w as a
s i gnat or yt o t he C B A and r efus ed t o enj oi n t he arbi t r at i on. I ns t ead, t he C our tor der ed K a n e B u ild e rs to p ro c e e d w ith a rb itratio n , ev e n th o u g h th e U n io n h a d n o t m o v e d to
c o m p e l th e s a m e . O n F eb rua ry2 5 , 2 0 0 5 , the F u n d s b rou g h t an a cti o n (“ Ka n e II ”) agai ns tK ane 4 B ui l der s forunpai d contr i but i ons t o cert ai n benef i t s pl ans w hi ch w er e al l egedl yt hi r dpar t ybenef

i ci ar i es of the C B A
. T he C our tcons ol i dat ed Ka n e I and Ka n e II on M ar ch 5, 2 0 0 5 . O n J ul y27, 2005, K ane Bui l der s fi l ed a thi r d- par t ycompl ai ntagai ns tt he U ni on and M os ca, al l egi ng t hat , “t o t he ext entt hatK ane i s found t o have be en a pa r t yt o t heI tappea r s t hatno form al j udgm entw as ent er ed aga i ns tK ane Bui l der s i n favorof 5 M o sca an d the U n ion w ith resp ec t t o K an e B u il d er’s third-p artyco m p lai n t, b u t th e C o u rt appar ent l ydet erm i ned thatt hos e cl ai m s , w hi ch al s o nece s s ar i l ydepende d upon t he f in d in g s m a d e f

o llo w in g th e p re lim in a ryin ju n c tio n h e a rin g , h a d b e e n re so lv e d w h e n it admi ni s t r at i vel yt erm i nat ed the ca s e on A ugus t21, 2007. -5- C B A an d li ab le t o the F u n d s fo r be n ef itco n tr ibu ti o n s, the U n ion an d it s ag en t, M o sca , are l i abl e overt o i tforvar i ous r eas ons ar i s i ng outof the eve nt s of J une 2000. ” ( K ane B ui l der s B r . at28. ) K ane Bui l der s al l eged thati tw as i nduced t o ent ert he C B A byfr aud,
an d , in p arti cu lar, that M o sca d ec eive d S p en ce r byp rese n ti n g h im o n lyw ith the s ign ature p a g e o f th e C B A a n d tellin g “ M r. S p e n c e r th a t h e w a s o n lyb e in g a sk e d to sig n p a yro ll document s fort he s i ngl e l abor erand nota col l ect i ve bar gai ni ng agr eement . ” ( K ane B u il d ers B r. at 30
. ) A ft ert he J anuary12, 2007 arbi t r at i on hear i ng ( w hi ch K ane Bui l der s di d notat t end
o rp a r t i c i p a t e i n ) , t h e a rb i t r a t o ri s s u e d a n a wa r d o f $ 5 3 , 5 5 8 i n f

a v o ro f t h e Un i o n . On A u g u st 21 , 2 0 0 7 , the D istri ct C o u rtissue d an o p inion co n firm ing the a rbitrati o n aw ard ( di s pos i ng of the Ka n e I iss u e s), a n d e n ter e d su m m a ryju d g m e n t ag a in st K a n e B u ild e rs, in favorof the Funds , on bot h l i abi l i t yand damages i n t he amountof $2, 071, 366. 43 ( di s pos i ng of the Ka n e II i s s ues )
. T he j udgm ent s i n Ka n e I and Ka n e II coul d nothave b e e n e n ter e d w ith o u t ad o p tin g th e h o tlyd isp u ted f a c tu a l f in d in g s a t issu e in th is a p p e a l. 5 T h e D is tr ic t C o u rt h a d ju ri s d ic tio n u n d e r 2 8 U .S .C . § 1 3 3 1 a n d 2 9 U .S .C . § 1 8 5 (a ). W e have j ur i s di ct i on under28 U
. S. C
. § 1291. “W hen r evi ew i ng a di s t r i ctcour t ' s or der confi r m i ng an arbi t r at i on aw ar d, w e r evi ew t he di s t r i ctcour t ' s fi ndi ngs of fa ctforcl earT h e p a rties a tten d e d a p re trial c o n f e re n c e o n N o v e m b e r 1 1 , 2 0 0 4 b e f o re M a g istra te 6 J udge M ark Fal k w her e theyagr eed t o appea rfora s t atus confe r ence on D ece m ber15, 2004 and t o compl et e di s coverybyFebruary8, 2005. T he D i s t r i ctC our ti s s ued a pr e- t r i al sch ed u li n g o rde r on Jan u ary1 2 , 2 0 0 7 , an d the p arti es su b m itted tri al brief s in F eb rua ry 2007. -6- err or and it s l egal conclusi on s de novo
. ” C ent ur y I ndem
. C o. v. C er t ai n U nder w r i t ers at Ll oyd' s , London , 5 8 4 F .3 d 5 1 3 , 5 2 1 (3 d C ir . 2 0 0 9 ). K a n e B u ild e rs a rg u e s th a t th e D istric t C o u rt p ro v id e d in a d e q u a te n o tice o f its in ten tio n to tre a t th e p re lim in a ryin ju n c tio n h e a rin g a s a f

in a l trial o n th e m e rits. R u le 6 5 (a)(2) o f th e F ed era l R u les o f C ivil P roc ed u re, pro v ides in p erti n en t part, that “[ b ]ef o re
oraft ert he comm ence m entof the hea r i ng of an a ppl i cat i on fora pr el i m i naryi nj unct i on, t he courtm ayor dert he tr i al of the ac t i on on t he mer i t s t o be adva nced a nd cons ol i dat ed
w ith th e h e a rin g o f

th e a p p lica tio n . . . ” H o w e v e r, “a d istric t co u rt sh o u ld n o t co n so lid a te
a h e a rin g f

o r p re lim in a ryre lief

w ith a trial o n th e m e rits u n les s th e c o u rt h a s g iv e n b o th par t i es cl earand unambi guous not i ce of i t s i nt entt o do s o. ” A n d e rs o n v . D a v ila , 125 F. 3d 1 4 8 , 1 5 7 (3 d C ir . 1 9 9 7 ) ( in te rn a l q u o ta tio n s o m itte d ). H er e, t he D i s t r i ctC our tdi d notpr ovi de anynot i ce of i t s i nt ent i on t o combi ne the h ea ri n g fo r pre li m inaryreli ef w ith a tri al on the m erit s. Ind ee d , ev en af ter th e C o u rt i s s ued i t s fi ndi ngs and deni ed the pr el i m i naryi nj unct i on, t he ca s e appe ar ed t o be hea ded f o r tria l. A s c o u n se l f

o r K a n e B u ild e rs p o in ts o u t, “th e p ro c e e d in g s w h ich c o n tin u e d in 6 t he D i s t r i ctC our taft erD ece m ber2004 w er e thos e pr efa t or yt o t he ul t i m at e tr i al on t he
m er i t s . . . W hatel s e coul d t heyhave be en?” ( K ane Bui l der s B r . at32. ) T he C our terr edT hathavi ng been s ai d, w e not e thatK ane, w hos e companyhad neve rent er ed i nt o a 7 col l ect i ve bar gai ni ng agr eement , w as atno t i m e gi ven a c opyof the purpor t ed agr eement n o r e v e n g iv e n a c o p yto re a d
. I n deci di ng t hi s cas e, w e do notr el yon t he i nfor m at i on t hats ur fac ed dur i ng or al 8 ar gum entaboutM os ca, t he U ni on’ s keyw i t nes s att he pr el i m i naryi nj unct i on hear i ng, w ho w as char ged w i t h, and pl eade d gui l t yt o, fr aud as par tof a c as e br oughti n t he E a s te rn D is tr ic t o f

N e w Y o rk a g a in s t th e G a m b in o c ri m e f a m ily. See U

ni t ed Stat es v. A g a te, e t a l. , N o. 08- 76 ( E . D . N . Y . )
. A l t hough w e ar e t echni cal l yr emandi ng “forfur t her pr ocee di ngs , ” w e ful l yr ecogni ze the s i gni fi canc e of thi s new devel opm entgi ven the c ri tic a l im p o rt a n c e o f

M o s c a to th e U n io n ’s c a s e a n d th e F u n d s ’ c la im f o r b e n e f its
. -7- b y f a i l i n g t o p r o v i d e n o t i c e t o K a n e B u i l d e r s t h a ti tw o u l d n o th a v e t h e o p p o r tu n i t y,
w hi ch i tr eas onabl yexpec t ed, t o fur t herdevel op i t s cas e. B e c a u se w e f

in d th a t th e D istric t C o u rt e rre d in p ro v id in g in a d e q u a te n o tice o f its i n t e n t i o n t o c o mb i n e t h e p r e l i mi n a r yi n j u n c t i o n h e a r i n g wi t h a f i n a l t r i a l o n t h e me r i t s , we d o n o t re a c h a n o th e r im p o rta n t q u e stio n : w h e th e r th e C o u rt’s f a c tu a l f in d in g s w e re c lea rly
err on eou s. 7 I V . C oncl us i on W e w i l l vaca t e the J udgm ent s dat ed A ugus t20, 2007 and Sept ember21, 2007, and
r emand forfur t herpr ocee di ngs noti ncons i s t entw i t h t hi s O pi ni on. 8