UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

 

TRUSTEES OF THE IRON WORKERS LOCAL

25 PENSION FUND, et al.,

Plaintiffs,

v. Case No. 09-CV-12370-DT

CRAWFORD DOOR SALES, INC., et al., 

Defendants.

 /

ORDER GRANTING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT AND

CONVERTING APRIL 21, 2010 HEARING TO A TELEPHONE CONFERENCE

Before the court is Plaintiffs’ motion for summary judgment, filed on January 19,

2010. The matter has been fully briefed, and the court concludes a hearing is

unnecessary. See E.D. Mich. LR 7.1(e)(2). For the reasons stated below, the court will

grant the motion.

I. BACKGROUND

Plaintiffs initiated this action on June 19, 2009 under the provisions of the

Employees Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001, et

seq. Plaintiffs are funds established under and administered pursuant to § 302 of the

Labor Management Relations Act, 29 U.S.C. § 186, and ERISA. This action seeks

recovery of delinquent fringe benefits allegedly owed by Defendants to Plaintiffs on

behalf of the participants of those funds. Plaintiffs contend that Defendants owe money

to the funds based upon a contract between the Iron Workers’ Local 25 Union and

Defendant Crawford Door Sales, Inc. (“Crawford Door” or the “corporate Defendant”). 
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(Pls.’ Mot. at 1.) Plaintiffs filed this action against the corporate Defendant, Crawford

Door, as well as against two individual Defendants, William Hughes and Todd Hughes. 

Plaintiffs assert that the two individual Defendants are personally liable for the unpaid

contributions because they breached their fiduciary duties to pay those benefits. 

Discovery has now closed, and Plaintiffs seek summary judgment against the corporate

Defendant and Defendant Todd Hughes. 

Defendants do not dispute that Defendant Crawford Door entered into the

contract, or that Crawford Door owes money for delinquent fringe benefits. (Defs.’

Resp. at 1.) Defendants dispute the exact amount owed and whether Todd Hughes is

personally liable for the unpaid contributions. 

II. STANDARD

Under Federal Rule of Civil Procedure 56, summary judgment is proper when

there is no genuine issue as to any material fact and the moving party is entitled to

judgment as a matter of law. Fed. R. Civ. P. 56(c). “In deciding a motion for summary

judgment, the court must view the evidence in the light most favorable to the nonmoving party, drawing all reasonable inferences in that party’s favor.” Sagan v. United

States, 342 F.3d 493, 497 (6th Cir. 2003). “Where the moving party has carried its

burden of showing that the pleadings, depositions, answers to interrogatories,

admissions and affidavits in the record, construed favorably to the non-moving party, do

not raise a genuine issue of material fact for trial, entry of summary judgment is

appropriate.” Gutierrez v. Lynch, 826 F.2d 1534, 1536 (6th Cir. 1987) (citing Celotex

Corp. v. Catrett, 477 U.S. 317 (1986)).
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The court does not “‘weigh the evidence [to] determine the truth of the matter

but[, rather,] to determine whether there is a genuine issue for trial.’” Sagan, 342 F.3d

at 497 (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986)). The moving

party discharges its burden by “‘showing’–that is, pointing out to the district court–that

there is an absence of evidence to support the nonmoving party’s case.” Horton v.

Potter, 369 F.3d 906, 909 (6th Cir. 2004) (citing Celotex, 477 U.S. at 325). The burden

then shifts to the nonmoving party, who “must do more than simply show that there is

some metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co. v.

Zenith Radio Corp., 475 U.S. 574, 586 (1986). The non-moving party must put forth

enough evidence to show that there exists “a genuine issue for trial.” Horton, 369 F.3d

at 909 (citing Matsushita, 475 U.S. at 587). Summary judgment is not appropriate when

“the evidence presents a sufficient disagreement to require submission to a jury.” 

Anderson, 477 U.S. at 251-52.

III. DISCUSSION

A. Crawford Door

First, there is no dispute that Plaintiffs are entitled to summary judgment against

Crawford Door. Defendants acknowledge this liability in their response brief, and

counsel confirmed this on the record during a January 22, 2010 telephonic motion

hearing. Defendants, however, dispute the amount owed for the unpaid contributions.

In their opening brief, Plaintiffs state that Defendants did not pay fringe benefit

contributions from January 2009 through August 2009 in the amount of $25,556.11. 

(Pls.’ Mot. Br. at 1.) This amount is based upon an audit conducted on September 30,
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2009. (Pls.’ Ex. 4.) Plaintiffs also contend that Defendants owe $1761.22 for liquidated

damages incurred as a result of the audit. (Id.) 

The total amount owed by Defendants has been reduced by a subsequent

payment from a surety bond. Specifically, Crawford Door maintained a wage and

welfare surety bond with Western Surety, which expired on April 15, 2009. (Pls.’ Mot.

Br. at 2.) After Plaintiffs made a claim, Western Surety paid Plaintiffs $14,889.16. (Id.) 

Plaintiffs assert that the amount of the bond was applied as follows: $12,581.66 toward

the fringe benefits owed, and $2,307.50 for attorney fees and costs incurred by Plaintiffs

for efforts to collect the fringe benefit contributions. (Id. at 2-3.) Thus, Plaintiffs argue

that they are entitled to $14,735.67. This amount is calculated based on the $25,556.11

owed, minus $12,581.66 taken from the Western Surety Bond, plus $1761.22 owed for

liquidated damages. (Id. at 3.)

Defendants do not dispute that Crawford Door owes delinquent benefit

contributions, but argue that the actual amount owed, after the bond credit, is only

$10,665.75. (Defs.’ Resp. at 2.) Defendants first assert that the total amount owed is

$25,554.91, rather than the $25,556.11 claimed by Plaintiffs. (Defs.’ Resp. at 1.) Not

only is this an immaterial dispute, amounting to a difference of only $1.20, but

Defendants have failed to support this assertion with any documentation or explanation. 

The court will therefore reject Defendants’ figure and accept Plaintiffs’ figure as

materially undisputed.

Next, Defendants “deny the claim of liquidated damages in that no any [sic]

accounting information provided as to the claimed amount.” (Defs.’ Resp. at 1.) 

Defendants do not provide any further argument as to why they should not be liable for
1

As with liquidated damages, the collective bargaining agreement and surety

bond contract allow for liquidated damages. (Pls.’ Ex. 3 at 23; Pls.’ Ex. 7.) 

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liquidated damages. Plaintiffs, however, attached to their motion for summary judgment

relevant documentation supporting this amount. The audit report itself specifically lists

$1761.22 as the amount owed for liquidated damages. (Pls.’ Ex. 4.) The relevant

collective bargaining agreement provides for liquidated damages. (Pls.’ Ex. 3 at 23.) 

The terms of the surety bond also contemplate liquidated damages. (Pls.’ Ex. 7.) The

court thus finds that Defendants have failed to identify a genuine issue of material fact

as to this issue, and Plaintiffs are entitled to $1761.22 in liquidated damages.

Finally, Defendants argue that the entire amount collected on the surety bond

should have been applied to the total amount owed for fringe benefit contributions,

rather than partially for attorney fees. Defendants, again, provide no reasoned

explanation for this argument. On the other hand, Plaintiffs point out that the surety

bond expired in April 2009, and thus can only be utilized to pay for the fringe benefit

contributions owed for January - March, 2009. (Pls.’ Reply at 3; Pls.’ Ex. 7.) The

documentation attached to Plaintiffs’ motion details that the amount owed for this time

period is $12,581.66, which is the exact amount sought by Plaintiffs to be applied

toward the total amount due. (Pls.’ Ex. 3.) Plaintiffs have also attached to their reply

brief a letter sent by Western Surety to Plaintiffs’ counsel indicating that the fringe

benefits owed from the surety bond amounts to $12,581.66, with the remaining amount

to be applied to attorney fees. (Pls.’ Reply Ex. 18.)1

 Based upon this documentation,

and in the absence of any competing evidence or substantial argument from
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Defendants, the court finds that Plaintiffs correctly reduced the total amount owed by

$12,581.66, rather than $14,889.16 as Defendants suggest. 

Accordingly, the court finds that Plaintiffs’ motion for summary judgment should

be granted as to the corporate Defendant in the amount of $14,735.67. The court finds

that Defendants have failed to identify a triable issue of fact with respect to this amount

and Plaintiffs are entitled to the total amount sought as a matter of law.

B. Todd Hughes

Plaintiffs also seek a judgment against Todd Hughes, individually, for the amount

of unpaid contributions. Plaintiffs contend that Todd Hughes is a fiduciary regarding

plan assets and that he breached his fiduciary duties when he did not pay the fringe

benefit contributions to the funds when they were owed. Plaintiffs argue that this breach

of his fiduciary duties make him personally liable as a matter of law.

Defendants acknowledge that Todd Hughes is a Vice President of Crawford

Door, but claim that he is not a fiduciary. Instead, Defendants assert that Todd Hughes

is only a 2.5% owner of Crawford Doors, and he was not a signatory to the collective

bargaining agreement. (Defs.’ Resp. at 5.) Further, Defendants contend that even if

Todd Hughes is a fiduciary, personal financial liability cannot be imputed to him. (Id. at

7.) The court disagrees.

Under ERISA, a fiduciary owes certain duties to the plan, and if he breaches

those duties he is personally liable:

Any person who is a fiduciary with respect to a plan who breaches any of

the responsibilities, obligations, or duties imposed upon fiduciaries by this

subchapter shall be personally liable to make good to such plan any

losses to the plan resulting from each such breach, and to restore to such

plan any profits of such fiduciary which have been made through use of
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assets of the plan by the fiduciary, and shall be subject to such other

equitable or remedial relief as the court may deem appropriate, including

removal of such fiduciary.

29 U.S.C. § 1109(a). The Sixth Circuit has stated:

“Under ERISA § 404, a fiduciary owes strict duties to a plan and its

participants.” Bridges v. Am. Elec. Power Co., Inc., 498 F.3d 442, 444

(6th Cir. 2007). Pursuant to this provision, a fiduciary must discharge his

duties “solely in the interest of the participants and beneficiaries” and act

with “the care, skill, prudence, and diligence . . . [of] a prudent man.” 29

U.S.C. 1104(a)(1)(B); see also Gregg v. Transp. Workers of Am. Int'l., 343

F.3d 833, 840-41 (6th Cir. 2003). A fiduciary that fails to comply with

these standards may be held personally liable to the plan under § 409 for

any resulting losses. Bridges, 498 F.3d at 444. For a fiduciary to be held

liable, however, he must have been acting in a fiduciary capacity when

taking the challenged action. Hamilton v. Carell, 243 F.3d 992, 998 (6th

Cir. 2001).

Pfahler v. Nat’l Latex Prods. Co., 517 F.3d 816, 829-30 (6th Cir. 2007) (footnote

omitted).

Under ERISA, “a person is a fiduciary with respect to a plan to the extent . . . he

exercises any discretionary authority or discretionary control respecting management of

such plan or exercises any authority or control respecting management or disposition of

its assets.” 29 U.S.C. § 1002(21)(A)(I). The relevant regulations provide that “plan

assets” include “amounts (other than union dues) that a participant or beneficiary pays

to an employer, or amounts that a participant has withheld from his wages by an

employer, for contribution or repayment of a participant loan to the plan, as of the

earliest date on which such contributions or repayments can reasonably be segregated

from the employer’s general assets.” 29 C.F.R. § 2510.3-102(a) (emphasis added). 

Thus, under ERISA, a person is a fiduciary to the extent he exercises any control

over plan assets, and plan assets include amounts that are owed in fringe benefit
2

As “support” for any and all factual statements asserted in the response brief,

Defendants counsel attached an “affidavit,” purportedly “signed” by Todd Hughes,

stating that he would attest to “the truth of the facts stated within this response.” (Defs.’

Resp. at 10.) The court rejects this affidavit for many reasons. It is not validly signed or

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contributions. Indeed, “[j]udges in this district have repeatedly held that contributions

are plan assets as soon as they are due and owing.” Plumbers Local 98 Defined Ben.

Pension Fund v. M & P Master Plumbers of Michigan, Inc., 608 F. Supp. 2d 873, 877

(E.D. Mich. 2009) (citing Trustees of Mich. Regional Council of Carpenters Employee

Benefits Fund v. Accura Concrete Walls, Inc., 408 F. Supp. 2d 370, 371 (E.D. Mich.

2005), Iron Workers Local No. 25 Pension Fund v. McGuire Steel Erection, Inc., 352 F.

Supp. 2d 794, 805 (E.D. Mich. 2004), Operating Engineers' Local 324 Fringe Benefit

Funds v. Nicolas Equip., LLC, 353 F. Supp. 2d 851, 854 (E.D. Mich. 2004)); see also

LoPresti v. Terwilliger, 126 F.3d 34, 39 (2d Cir. 1997) (money withheld from employees’

paychecks for deposit into pension fund was a plan asset); United States v. Grizzle, 933

F.2d 943, 946-48 (11th Cir. 1991) (money withheld for deposit into vacation fund was a

plan asset); Iron Workers Local No. 25 Pension and Ben. Funds v. Steel Enterprises,

Inc., No. 07-CV-10882, 2009 WL 3645633, at *4 (E.D. Mich. Oct. 30, 2009). These

cases “universally treat delinquent payments to ERISA funds as de facto

mismanagement of plan assets.” Plumbers Local 98 Defined Benefits Pension Fund.,

608 F. Supp. 2d at 877. 

 Under this case law, the undisputed evidence before the court reveals that Todd

Hughes is a fiduciary and he breached his obligations when he failed to make the fringe

benefit contributions when they were owed. Contrary to counsel’s assertion in the

response brief,2

 Todd Hughes testified during his deposition that he is a 5% owner of
notarized; instead, counsel has placed an “/s/” before both Todd Hughes name and the

generic “name” of “Notary Public.” The court does not accept electronic signatures for

affiant’s signatures, nor for the signature of an unnamed notary public. Moreover, the

court does not accept affidavits which merely incorporate a brief by reference, without

detailing the specific facts to which the affiant is attesting. Finally, to the extent the

“affidavit” contradicts any of Todd Hughs previous testimony, a party may not create a

genuine issue of material fact by filing an affidavit that “essentially contradicts his

previous deposition testimony” after a motion for summary judgment has been filed.

Penny v. United Parcel Serv., 128 F.3d 408, 415 (6th Cir. 1997). 

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Crawford Door. (T. Hughes Dep. at 6, Pls.’ Ex. 6 at 6.) He further testified that he

shares responsibility for day-to-day decision making for Crawford Door with his brother,

but that he makes more of the decisions. (Id. at 7.) He, rather than his brother, is

“basically” responsible for ”oversee[ing] the day-to-day operation and sell[ing] service

and replacement.” (Id. at 11.) He also testified that he is the person who “does things

like hiring and firing employees.” (Id.) Defendant Todd Hughes also stated that he has

“the decision-making power at Crawford Door Sales on whether to pay fringe benefit

contributions” and that no one shares that responsibility with him. (Id. at 23.) He and

his brother can both, individually, sign checks on behalf of Crawford Door. (Id.) He

testified that Crawford Door received business income during the period of January to

August 2009, and had business expenses for the same period. (Id. at 24.) While,

Hughes stated that his company paid certain business expenses for that time period,

(id. at 25-26, 29-30), he admitted that Crawford Door owes fringe benefit contributions

for January 2009 through August 2009, (id. at 18). Hughes also testified that there was

not anything about the audit or the auditor’s work product that he thought was wrong. 

(Id. at 20.)
3

Defendants appear to argue that because they did not co-mingle funds, and

there is no evidence of liability under an alter-ego theory, the court should not pierce the

corporate veil and impute liability on Todd Hughes. This argument, however, misses

the mark. As Chief Judge Rosen has explained, “a veil-piercing determination . . . is

unnecessary where the language of the statute imposing liability on ERISA fiduciaries,

29 U.S.C. § 1109(a), clearly indicates that once an officer of a corporation is deemed to

be a fiduciary, he may be held personally liable for any damages caused by his breach

of trust.” Plumbers Local 98 Defined Benefits Pension Fund, 608 F. Supp. 2d at 880

n.3.

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Todd Hughes thus made the relevant day-to-day decisions, including which

business expenses to pay or not pay, and he admits that he did not make the fringe

benefit contributions. Thus, Todd Hughes “exercised control respecting disposition of

plan assets, held those funds as a fiduciary, and under 29 U.S.C. § 1104(a)(1), was

required to discharge his duty ‘solely in the interest of the participants and beneficiaries

of the Funds.’” Plumbers Local 98 Defined Benefits Pension Fund., 608 F. Supp. 2d at

880 (quoting 29 U.S.C. § 1104(a)(1)(A) and citing United States v. Panepinto, 818 F.

Supp. 48, 52 (E.D.N.Y.1993) (holding that defendants’ failure to make required

contributions constituted exercise of control over the disposition of employee welfare

benefit plan assets under ERISA)). Because Todd Hughes was a fiduciary, and did not

pay the owed contributions, he breached his fiduciary duties as a matter of law and,

under ERISA, he is personally liable for the unpaid contributions owed to the funds. Id.3

The court will thus grant Plaintiffs’ motion for summary judgment as to both the

corporate Defendant as well as to Todd Hughes.

IV. CONCLUSION

IT IS ORDERED that Plaintiffs’ motion for summary judgment [Dkt # 23] is

GRANTED. Summary judgment will be awarded in favor of Plaintiffs and against
4

Plaintiffs did not move for summary judgment against Defendant William Hughes

and the claims against him will therefore be set for trial at the next available trial date. 

S:\Cleland\JUDGE'S DESK\C3 ORDERS\09-12370.IRONWORKERS.SJ.Fiduciary.chd.wpd

11

Defendant Crawford Door Sales and Todd Hughes in the amount of $14,735.67. 

Judgment will issue at the conclusion of this litigation.4

IT IS FURTHER ORDERED that the April 21, 2010 motion hearing is

CONVERTED into a telephone conference. The court will initiate the call.

 S/Robert H. Cleland 

ROBERT H. CLELAND

UNITED STATES DISTRICT JUDGE

Dated: April 16, 2010

I hereby certify that a copy of the foregoing document was mailed to counsel of record

on this date, April 16, 2010, by electronic and/or ordinary mail. 

 S/Lisa Wagner 

Case Manager and Deputy Clerk

(313) 234-5522