Opinion
Case No.: 3:17-cv-01614-BEN-NLS
12-05-2017
LABORERS' INTERNATIONAL UNION OF NORTH AMERICA, LOCAL 89, AFL-CIO, PETITIONER, v. MEK ENTERPRISES, a Delaware Corporation, also known as MEK, also known as MEK Enterprises, also known as MEK Contracting, et al., Respondents.
ORDER:
(1) GRANTING PETITION TO CONFIRM ARBITRATION AWARD; and
(2) GRANTING REQUEST FOR ENTRY OF DEFAULT JUDGMENT
Before the Court are the Petition to Confirm Arbitration Award and Request for Entry of Default Judgment filed by Petitioner Laborers' International Union of North America, Local 89, AFL-CIO. (Docket Nos. 1, 7.) Respondents MEK Enterprises and MEK Enterprises GOV, Inc. did not respond to Petitioner's petition or default judgment request, and have not made an appearance in this case. For the reasons that follow, Petitioner's petition and request for default judgment are GRANTED.
I. PETITION TO CONFIRM ARBITRATION AWARD
Federal courts have jurisdiction to vacate or enforce compliance with an arbitration award for breaches of collective bargaining agreements pursuant to Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185. See Kemner v. Dist. Council of Painting & Allied Trades No. 36, 768 F.2d 1115, 1118 (9th Cir. 1985). In considering whether to confirm an arbitration award, "[f]ederal courts should not review the merits of arbitration awards, but rather should merely determine whether the parties agreed to arbitrate the dispute and to give the arbitrator the power to provide for his award." Phoenix Newspapers, Inc. v. Phoenix Mailers Union Local 752, Int'l Bhd. of Teamsters, 989 F.2d 1077, 1080 (9th Cir. 1993).
Here, Petitioner alleges its dispute is governed by a collective bargaining agreement, namely the San Diego Unified School District Project Stabilization Agreement - Construction and Major Rehabilitation Funded by Proposition S ("PSA") and the Master Labor Agreement for Building Construction between the Associated General Contractors of America, San Diego Chapter, Inc. and the Southern California District Council of Laborers for San Diego County ("MLA"), which was incorporated by reference by the PSA. (See Docket No. 1, Pet. at p. 3.) Petitioner further alleges Respondents agreed to be a party to, and bound by, the PSA pursuant to "a series of Letters of Assent." (Id. at pp. 3-5.) According to the PSA, failing resolution through the preliminary grievance process, all disputes regarding "[a]ny questions arising out of and during the term of this Agreement involving its interpretation and application" must be submitted to arbitration. (Id. at p. 5; Docket No. 1-2, Ex. 1 at pp. 22-23.) Petitioner asserts that this dispute arises out of Respondents' violations of the PSA and MLA. (Pet. at pp. 5-6.) Respondent, who bears the burden of demonstrating why the arbitration award should not be confirmed, has not appeared in this action. Accordingly, the Court GRANTS the petition and confirms the Arbitrator's award in Petitioner's favor.
II. Request for Default Judgment
Procedurally, Petitioner has met all of the requirements for entry of default judgment. Default was entered as to Respondents on September 19, 2017, for failure to plead or otherwise defend against the Petition. (Docket No. 6.) There is no evidence to indicate that Respondents are infants or incompetent persons, or that the Servicemembers Civil Relief Act applies. Finally, the notice of the default was served on Respondents. (See Docket No. 5-1, Declaration of Aaron G. Lawrence ¶ 2.)
Furthermore, the Court finds that the substantive factors set forth in Eitel v. McCool, 782 F.2d 1470 (9th Cir. 1986) weigh in favor of granting default judgment. Petitioner will be prejudiced if it has no way of enforcing the arbitration award. The merits and sufficiency of the claims have already been determined by the Arbitrator. The sum is substantial - over $65,000 - and results from Respondents' refusal to pay compensation owed. Respondents have had multiple opportunities to defend themselves and have chosen not to appear. Finally, because entry of default leads to the presumption that Petitioner's allegations are true, and because Respondents have not appeared, there is no dispute as to material facts. In sum, the factors weigh in favor of granting default judgment. Therefore, the Court GRANTS Petitioner's request for entry of default judgment against Respondents.
III. Prejudgment Interest
Petitioner seeks prejudgment interest at the rate of 10% per annum for the period beginning April 17, 2017 (the date the Arbitrator issued its written arbitration award) through the date this Court enters judgment pursuant to California Civil Code Sections 3287 and 3289. The Ninth Circuit has recognized that "[p]re-judgment interest is governed by state law ... and [California] law provides that pre-judgment interest is available from the date the arbitration panel renders its award." Goldman v. Gagnard, No. 11-CV-3028-LHK, 2011 WL 13177619, at *3 (N.D. Cal. Oct. 27, 2011) (citing Fidelity Fed. Bank, FSB v. Durga Ma Corp., 387 F.3d 1021, 1024 (9th Cir. 2004)). California Civil Code Section 3289 sets the statutory rate of prejudgment interest at an annual rate of 10%. Accordingly, the Court GRANTS Petitioner's request for prejudgment interest in the amount of $4,134.50, calculated as follows: on damages in the amount of $65,047.15 from April 17, 2017 to the present (232 days) at the annual rate of 10%.
Docket No. 1-8, Ex. 7, Arbitration Award.
IV. Attorney's Fees
Finally, Petitioner seeks to recover its attorney's fees in the amount of $16,870. "Ordinarily, the prevailing party in a lawsuit does not collect attorney's fees absent contractual or statutory authorization." Sheet Metal Workers' Int'l Ass'n Local Union No. 359 v. Madison Indus., Inc. of Arizona, 84 F.3d 1186, 1192 (9th Cir. 1996) (citing Int'l Union of P.I.W. v. W. Indus. Maint., Inc., 707 F.2d 425, 428 (9th Cir. 1983). Petitioner implicitly acknowledges that it is not entitled to an attorney's fee award under any contractual or statutory authorization.
Instead, it relies on the Ninth Circuit's previous holding that "a court may award fees if it finds that the losing party 'acted in bad faith, vexatiously, wantonly, or for oppressive reasons.'" (Docket No. 7-1, Req. Entry Default J. at p. 7) (citing Sheet Metal Workers, 84 F.3d at 1192) (emphasis added.) The Court has reviewed the documents proffered by Petitioner to support its request for attorney's fees, but finds an absence of evidence that Respondents have "acted in bad faith, vexatiously, wantonly, or for oppressive reasons." Sheet Metal Workers', 84 F.3d at 1192 (quoting Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240, 258-59 (1975)). Accordingly, Petitioner's request for attorney's fees is DENIED.
The Court acknowledges that other courts have found a party has acted acted in bad faith, vexatiously, wantonly, or for oppressive reasons by virtue of its failure to comply with an arbitration award, but declines to make such a finding without any other evidence demonstrating such conduct. --------
CONCLUSION
For the reasons set forth above, IT IS HERBY ORDERED that:
1. Petitioner's petition to confirm arbitration award against Respondents (Docket No. 1) is GRANTED;
2. The Arbitrator's Award (Docket No. 1-8) is confirmed in favor of Petitioner;DATED: December 05, 2017
3. Petitioner's request for entry of default judgment (Docket No. 7) against Respondents is GRANTED; and
4. Default judgment is entered in favor of Petitioner against Respondents in the amount of $69,181.65, consisting of the $65,047.15 arbitration award and $4,134.50 in prejudgment interest.
/s/_________
HON. ROGER T. BENITEZ
United States District Judge