UI.

Under Count Lf of the amended complaint, a basis of liability for the individual defendants
could only arise under 29 U.S.C. § 1145.7 Under Section 1145, only an “employer who is obligated
to make contributions to a multiemployer plan under the terms of the plan or under terms of a
collectively bargained agreement” faces liability.

Therefore, we must first determine whether Ms. Partipilo is an “employer” under 29 U.S.C.
§ 1145. “The term ‘employer’ means any person acting directly as an employer, or indirectly in the
interest of an employer, in relation to an employce benefit plan.” 29 U.S.C. § 1002(5). In their
amended complaint, the Funds have alleged not that Ms. Partipilo is an employer, but rather that
“Maria Partipilo is an employee, officer and owner of F & V" (Am, Compl., at 5). “Congress did
not intend through Section 1145 to upset the gencral rule that individuals are not liable for corporate
debt.” Sullivan v. Cox, 78 F.3d 322, 325 (7 Cir. 1996). In fact, “{cJourts routincly rebuff efforts
to collect pension debts from managers unless the officer or investor would be liable under state law
— in other words, unless courts would ‘picrce the corporate veil.” Levit v. Ingersoll Rand Financial
Corp., 874 F.2d 1186, 1194 (7" Cir. 1996).

Consequently, for Ms. Partipilo to face individual liability under Section 1145, she must face
some liability under state law.
Under Ilinois law, it is a well-cstablished principle that a corporation is
separate and distinct as a legal entity from its shareholders, directors, and
officers . . . Under the Illinois alter ego doctrine, courts will pierce the

corporate veil only when plaintiff shows that: (1) “the corporation was so
controlled and manipulated that it had become a mere instrumentality of

729 U.S.C. § 185 and 29 U.S.C. § 1132, which the Funds also cite, only provide the Funds the right to suc, and
delineate what damages are recoverable. ‘They do not sct forth who properly may be sued as defendants,

4


U.

The relevant allegations set forth in the Funds’ amended complaint, which we will take as
true for purposes of ruling on this motion, are as follows. Since June 30, 1975, F & V has been
required to make periodic contributions to the Cement Masons Pension Funds on behalf of its
employces pursuant to collective bargaining agreements (Am. Compl, at 3). Beginning on
January 1, 1998 and continuing through the filing date of the amended complaint (November 18,
2003), F & V has failed to make some of the contributions required by the collective bargaining
agreement (/d.). Maria Partipilo, along with the other two individual defendants, allegedly
“controlled the actions of F & V and were at all times aware of the wrongful conduct of the
company” (/d. al 5). These individual defendants allegedly engaged “in a scheme and or conspiracy
to deprive the finds of required contributions and or their conscious and knowing involvement in
submitting false contribution reports to the funds.” (/d. at 5).

Specifically, the Funds allege that Ms. Partipilo, and the other two individual defendants,
made false statements of material facts to the Funds by: (1) concealing the existence of “side jobs”;
(2) concealing wage payments to employees; (3) falsely reporting employees as laid off to collect
unemployment benefits; and (4) knowingly under-reporting fringe benefit reports (/d. at 5-6).
Accordingly, the Funds claim that “[b]y reason of the aforesaid the Individually Named Defendants
are also aller egos of the Company and liable in their individual capacities for all the actions of the

company” (/d. at 6).


another” and (2) “recognition of a separate corporate identity would sanction
a fraud or promote injustice.”

Classic Fire & Marine [Insurance Co. y, Illinois Insurance Exchange, 1997 U.S. Dist. LEXIS 19524,
at *15 (N.D. Ill, December 2, 1997). Factors to be considered in determining the first element
include “(1) madequate capitalization; (2) failure to issue stock; (3) failure to observe corporate
formalities; (4) nonpayment of dividends; (5) msolvency of the debtor corporation at the relevant
time; (6) non-functioning of other officers or directors; (7) absence of corporate records; and (8)
whether the corporation is an insignificant vencer for the operation of dominate shareholders.” NPF
WL, Inc. v, Sotka, No. 99 C 7966, 2000 WL 574527, at *7 (N.D. TI. May 10, 2000).

The Funds’ amended complaint fails to plead any allegations which satisfy the two elements
required to picrce the corporate veil, The last paragraph of Count Tll simply states “[b]y reason of
the aforesaid the Individually Named Defendants are also alter egos of the Company and liable in
their individual capacities for all the actions of the Company (Am. Compl., at 6), The “aforesaid”
allegations almost exclusively pertain to alleged conduct by Ms. Parlipilo (and others) directed at
the Funds (Jd., {] 8, 13-18), While plaintiffs also allege that Ms. Partipilo “controlled the actions
of F & V and [was] at all times aware of the wrongful conduct of the company” (/d., 12), that is the
kind of barebones, conclusory allegation that has been found insufficient to stale an alter ego claim
even under the liberal notice pleading requirements of Federal Rule of Civil Procedure 8(a). See
NPF WL, 2000 WL 574527, at *7-8; see also Northwestern Corp. v. Gabriel Mfr. Co, Inc., No. 95
C 2004, 1996 WL 732519, at *10-11 (N.D. Ill. Dec. 18, 1996). A fortiori, this allegation falls far
short of the kind of specificity required by Federal Rule of Civil Procedure 9(b), which at Icast one

court in this district has applied to alter ego claims. See Typographics Plus, Inc. v. LM. Estrada &


Minute Order Form (06/97)

United States District Court, Northern District of Mlinois

eof . i ; ‘ Sitting Jud; er
sere Magia Judge Sidney 1 Schenkier than signed Judge
CASE NUMBER 02 C 3979 DATE 4/5/2004
CASE Trst Cement MaPenFd, et al. vs. F&V Cement Constr., Inc., et al.
‘TITLE

[in the following bus (a) indicate the party filing the motion, c.g., plaintiff, defendant, 3rd party plaintiff, andl (b) state briefly the nature
of the motion being presented. |

MOTION:

DOCKET ENTRY:

() oO Filed motion of [ use listing in “Motion” box above.]

(2) oO Brief in support of motiondue

(3) D Answer briefto motiondue___. Reply to answer brief due__

(4) Oo Ruling/Hearing on setfor_____at

(5) qo Status hearing[held/continued to] [set for/re-set forlon set for at

(6) Oo Pretrial conference[held/continued to] [set for/re-set for]on__—_set for at__
(7) ao Trial[set for/re-set for] on __ at.

(8) oO (BenchyJury trial) (Hearing] held/continued to at_

(9) oO This case is dismissed | with/without] prejudice and without costs[by/agreement/pursuant to]

COPRCP4(m) Local Rule 41.1 OFRCP41(a)(1) COFRCP41(a)(2).

(0) ML (Other docket entry} Enter Memorandum Opinion and Order. For the reasons stated in the attached
Memorandum Opinion and Order, defendant Maria Partipilo’s motion to dismiss without prejudice Count
I of the amended complaint (doc. # 32) against her is granted.

Ye, FAQ.

ql) @f [For further detail sce order altached to the original minute order.]

No notices required, advised in open court,

No notices tequired. number of notices

APR 07 2004

ate docketed,

VY | Notices mailed by judge’s stati,

Notified counsel by telephone,

Dacketing to mail notices.

Mail AQ 450 form. were

docketiny députy initials

Copy to judge/magistrate judge.

(ate mile not
courtroom Segre

mn deputy's
initials

Date/time received in
central Clerk's Office ing deputy nti



Co., Inc., No. 98 C 886, 2000 U.S. Dist. LEXIS 10351, at *13 (N.D. TIL. July 14, 2000 (D. J.
Williams).
CONCLUSION
For the foregoing reasons, defendant Maria Partipilo’s motion to dismiss without prejudice
Count III of the amended complaint (doc. # 32) against her is granted.

ENTER:

MO z AQL

SIDNEY I. SCHENKIER
United vr sf Magistrate Judge

Dated: April 5, 2004


IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TLLINOIS
FASTERN DIVISTON

TRUSTEES OF THE CEMENT MASONS
FUND, LOCAL 502; TRUSTEES OF THE
CEMENT MASONS INSTITUTE OF
CHICAGO, ILLINOIS; TRUSTEES OF
THE CEMENT MASONS SAVINGS
FUND, LOCAL 502; and TRUSTEES OF
THE CEMENT MASONS APPRENTICE
EDUCATION AND TRAINING FUND,
LOCAL 502,

ere)
APR 07 200%

)

)

)

)

)

)

)

)

)

)

Plaintiffs, )

,) No, 02 € 3979

VS. )

J Magistrate Judge Schenkier

F & V CEMENT CONTRACTORS, )

INC., an Illinois corporation, and )

FRANK PARTIPILO, individually; and )

BERNARDINA BARBENETE, individually; )

and MARIA PARTIPILO, individually, )
)
)

Defendants.

MEMORANDUM OPINION AND ORDER'

This matter comes before the Court on a motion by individual defendant Maria Partipilo
pursuant to Fed.R.Civ.P. 12(b)(6). The plaintiffs (collectively the “Funds”) have brought this action
under the Employment Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1132, 1145, and
the Taft Hartley Act, 29 U.S.C. § 185, against corporate defendant I & V Cement Contractors, Inc.
(“F & V”) and individual defendants Frank Partipilo, Berardina Barbenete, and Maria Partipilo.

In their thrce-count amended complaint, the Funds seek an order requiring the corporate and

‘Pursuant to 28 U.S.C. § 636(c), all parties to this case have voluntarily consented to have a United States
Magistrate Judge conduct all proceedings in this case, including the entry of final judgment (see doc. ## 20, 21, 22, 42,

: M4


individual] defendants to submit an audit of their books and to pay all unpaid contributions (as well
as attommeys’ fees and costs). Count JII of the amended complaint alleges that all three individual
defendants engaged in a “fraud to avoid payment of contributions to the funds” (Am. Compl., at 5).

Ms. Partipilo has moved to dismiss Count Ill of the Funds’ amended complaint, which is the
only count that pertains to her (doc. #32). For the reasons set forth bclow, Ms, Partipilo’s motion
to dismiss is granted.

IL.

The purpose of a motion to dismiss under Fed.R.Civ,P. 12(b)(6) is to test the sufficiency of
the complaint, not to decide its merits. Gibson v. Chicago, 910 F.2d 1510, 1520 (7" Cir. 1990),
When ruling on a motion to dismiss, a court assumes that all well-picd allegations arc true and draws
all reasonable inferences in the light most favorable to the moving party. Henderson v, Sheahan, 196
F.3d 839, 845 (7" Cir. 1999), cert. denied, 530 U.S. 1244 (2000).

Although it is oflen said that a claim may be dismissed only if, as a matter of law, “it is clear
that no relief could be granted under any sct of facts that could be proved consistent with the
allegations,” Neitzke v. Williams, 490 U.S. 319, 327, 104 L. Bd. 2d 338, 109 §.Ct. 1827 (1989)
(quoting Hishon y, King & Spalding, 467 U.S. 69, 73, 81 L. Ed. 2d 59, 104 S.Ct. 2229 (1984)), the
Seventh Circuit has observed that this maxim “has never been taken literally.” Kyle v. Morton Ligh
School, 144 F.3d 448, 455 (7 Cir, 1998) (quoting Sutliff, Inc. y, Donovan Companies, Inc, 727 F.2d
648, 654 (7" Cir. 1984)), Rather, the complaint must state cither direct or inferential allegations
conceming all of the material elements necessary for recovery under the relevant legal theory.

Chawla v. Klapper, 743 F. Supp. 1284, 1285 (N_D. IIT. 1990).

w