Opinion
21 Civ. 7766 (VSB)(GWG)
01-18-2022
TRUSTEES of the NEW YORK CITY DISTRICT COUNCIL OF CARPENTERS PENSION FUND et al., Petitioners, v. OFFSITE CONSTRUCTION SOLUTIONS LLC, Respondent.
REPORT & RECOMMENDATION
GABRIEL W. GORENSTEIN, UNITED STATES MAGISTRATE JUDGE
Petitioners are multiemployer labor-management trust funds (the “Funds”) established by the New York City District Council of Carpenters (the “Union, ” together with the Funds, “petitioners”) under the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1002 et seq. Petitioners bring this action against Offsite Construction Solutions LLC (“Offsite”) to confirm and enforce an arbitration award pursuant to Section 301(a) of the Labor Management Relations Act (“LMRA”), 29 U.S.C. § 185(a), Section 502(a)(3) of ERISA, 29 U.S.C. § 1132(a)(3), and Section 9 of the Federal Arbitration Act, 9 U.S.C. § 9. See Petition to Confirm an Arbitration Award, filed Sept. 16, 2021 (Docket # 1) (“Pet.”). Petitioners also seek post-judgment interest, attorneys' fees, and costs. For the following reasons, this petition should be treated as an unopposed motion for summary judgment and judgment should be entered in Petitioners' favor in the amount of $398,649.02.
I. BACKGROUND
This action arises out of a collective bargaining agreement (“CBA”) between Offsite and the Union. See Pet. ¶¶ 1, 9-10; Opinion and Award of Arbitrator, dated June 12, 2021, annexed as Ex. 5 to Pet. (“Arb. Award”), at 1-2. In or around May 2019, Offsite became a member of the Association of Wall-Ceiling & Carpentry Industries of New York, Inc. (the “Association”). See Letter from John DeLollis, dated May 30, 2019, annexed as Ex. A to Pet. (confirming Offsite's membership). By joining the Association, Offsite agreed to be bound by the CBA that existed between the Association and the Union. See Pet. ¶ 10; CBA, annexed as Ex. 2 to Pet., arts. I, II. Under the CBA, Offsite was required to make certain contributions to the Funds based on the number of hours worked by its employees. Pet. ¶ 11; CBA art. XVII, § 1. The CBA also required Offsite to furnish its books and records for an audit at the Funds' request, to ensure compliance with the CBA. Pet. ¶ 12; CBA art. XVII, § 1; Arb. Award at 2. By joining the Association, Offsite also assented to the Funds' Collection Policy, which provided that if Offsite did not make its books available for an audit, the Funds “shall determine the estimated amount of the employer's delinquent contributions based on the assumption that the employer's weekly hours subject to contributions for each week of the requested audit period are the highest number of average hours reported per week for any period of four consecutive weeks during the audit period.” Revised Statement of Policy for Collection of Employer Contributions, annexed as Ex. C to Pet. (the “Collection Policy”), § IV.
The Funds requested an audit for the period November 13, 2019 to date. Pet. ¶ 21; Arb. Award at 2. Offsite refused to allow the Funds' auditors to audit Offsite's books. Pet. ¶ 22; Arb. Award at 2. The Funds then conducted an estimated audit pursuant to the Collection Policy, which concluded that Offsite had failed to make required contributions in the principal amount of $317,290.20. Pet. ¶ 23; Arb. Award at 2. Following the audit, the Funds submitted the dispute to arbitration pursuant to the CBA. See Pet. ¶ 24; CBA art. XIII; Arb. Award at 1-2; Notice of Hearing, dated Mar. 31, 2021, annexed as Ex. D to Pet. After providing the required notice to both parties, see Notice of Hearing, the arbitrator held a hearing on June 9, 2021, and issued a written decision on June 12, 2021, Arb. Award at 3; Pet. ¶ 25.
The arbitrator found that Offsite owed the Funds $398,082.02. Arb. Award at 3; Pet. ¶ 26. This was calculated by totaling the amounts owed to the Funds: $317,290.20 in estimated principal contributions; $14,433.78 in interest through June 12, 2021; $63,458.04 in liquidated damages; $400.00 in court costs; $1,500 in attorneys' fees; and $1,000.00 for the arbitrator's fee. Arb. Award at 3; Pet. ¶ 26. The arbitrator also ruled that interest would accrue on the amount owed at an annual rate of 5.25% measured from the date of the award. Arb. Award at 3; Pet. ¶ 27. To date, Offsite has failed to comply with this award. Pet. ¶ 28.
On September 16, 2021, petitioners filed this action, seeking confirmation of the award as well as post-judgment interest, attorneys' fees, and costs. See Pet. ¶ 39. Petitioners served the Summons and Petition on Offsite on October 7, 2021 by serving Ria Jones, an individual at Offsite's place of business at 253 West 35th Street, 9th Floor, New York, NY 10001, who indicated that she was authorized to receive service on behalf of Offsite. See Affidavit of Service, filed October 8, 2021 (Docket # 7); see also Letter from Nicole Marimon, filed December 1, 2021 (Docket # 11). Proof of service was filed on October 8, 2021. See Affidavit of Service. Offsite has failed to appear and has not responded to the petition.
On December 21, 2021, the Court issued an Order stating that it intended to treat the petition as a motion for summary judgment and directing Offsite to respond to the petition by January 11, 2022. See Order of December 21, 2021 (Docket # 14). Offsite failed to do so.
II. APPLICABLE LAW
A. Standard of Review
Where a petition to confirm an arbitration award is unopposed, the Second Circuit has held that “the petition and accompanying record should [be] treated as akin to a motion for summary judgment based on the movant's submissions.” D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 109 (2d Cir. 2006); accord Trs. of N.Y.C. Dist. Council of Carpenters Pension Fund, Welfare Fund, Annuity Fund, and Apprenticeship, Journeyman Retraining, Educ. and Indus. Fund v. Eclipse Constr. Servs. Inc., 2021 WL 5567752, at *4 (S.D.N.Y. Nov. 26, 2021); Rotunno v. Laidlaw & Co. (UK) Ltd., 2021 WL 5450369, at *2 (S.D.N.Y. Nov. 19, 2021); Trs. for Mason Tenders Dist. Council Welfare Fund v. Super, LLC, 2017 WL 2703572, at *2 (S.D.N.Y. June 22, 2017). We therefore treat the petition as an unopposed motion for summary judgment to confirm an arbitration award.
Rule 56(a) of the Federal Rules of Civil Procedure states that summary judgment is appropriate when “the movant shows that there is no genuine dispute as to any material fact.” See also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A genuine issue of material fact exists “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). In determining whether a genuine issue of material fact exists, “[t]he evidence of the non-movant is to be believed” and the court must draw “all justifiable inferences” in favor of the nonmoving party. Id. at 255 (citing Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970)).
“[C]onfirmation of an arbitration award is a summary proceeding that merely makes what is already a final arbitration award a judgment of the court, and the court must grant the award unless the award is vacated, modified, or corrected.” D.H. Blair, 462 F.3d at 110 (citations and internal quotation marks omitted). However, even where the motion is unopposed, a court ruling on a summary judgment motion to confirm an arbitration award “may not grant the motion without first examining the moving party's submission to determine if it has met its burden of demonstrating that no material issue of fact remains for trial.” Id. (quoting Vt. Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241, 244 (2d Cir. 2004)). “[T]he court ‘cannot base the entry of summary judgment on the mere fact that the motion was unopposed, but, rather, must consider the merits of the motion.'” Trs. of the UNITE HERE Nat'l Health Fund v. JY Apparels, Inc., 535 F.Supp.2d 426, 428-29 (S.D.N.Y. 2008) (quoting United States v. 5800 SW 74th Ave., 363 F.3d 1099, 1101 (11th Cir. 2004)); accord Trs. of the N.Y.C. Dist. Counsel of Carpenters v. Exec. Millwork Corp., 2013 WL 265084, at *2-3 (S.D.N.Y. Jan. 22, 2013).
“[T]he court's function in confirming or vacating an arbitration award is severely limited.” Willemijn Houdstermaatschappij, BV v. Standard Microsystems Corp., 103 F.3d 9, 12 (2d Cir. 1997) (alteration in original) (citation and internal quotation marks omitted); see also Major League Baseball Players Ass'n v. Garvey, 532 U.S. 504, 509 (2001) (noting that “[j]udicial review of a labor-arbitration decision pursuant to [a CBA under the LMRA] is very limited.”). A court need only find “a barely colorable justification for the outcome reached” by the arbitrator to confirm an award. D.H. Blair, 462 F.3d at 110 (internal citation and quotation marks omitted). In a case involving a CBA, “the Court evaluates whether the arbitrator ‘acted within the scope of his authority, '” Trs. of the N.Y.C. Dist. Counsel of Carpenters, 2013 WL 265084, at *3 (quoting Local 1199 v. Brooks Drug Co., 956 F.2d 22, 25 (2d Cir. 1992)), and an award will be confirmed as long as it “draws its essence from the collective bargaining agreement, ” United Steelworkers of Am. v. Enter. Wheel & Car Corp., 363 U.S. 593, 597 (1960); accord Trs. of the Unite Here Nat'l Health Fund v. Am. Leather Prods., L.L.C., 2009 WL 5178004, at *5-6 (S.D.N.Y. Dec. 31, 2009); Supreme Oil Co. v. Abondolo, 568 F.Supp.2d 401, 405-06 (S.D.N.Y. 2008).
B. Law Governing Attorneys' Fees
Under ERISA, a court “shall” award “reasonable attorney's fees and costs” in any action “by a fiduciary for or on behalf of a plan to enforce [delinquent contributions required under a CBA] . . . in which a judgment in favor of the plan is awarded.” 29 U.S.C. §§ 1132(g)(2)(D), 1145; see Labarbera v. Clestra Hauserman, Inc., 369 F.3d 224, 226 (2d Cir. 2004) (award of fees and costs is “mandatory” under 29 U.S.C. § 1132(g)(2)).
In New York State Ass'n for Retarded Children, Inc. v. Carey, 711 F.2d 1136 (2d Cir. 1983), the Second Circuit held that a party seeking an award of attorneys' fees must support the request with contemporaneous time records that show “for each attorney, the date, the hours expended, and the nature of the work done.” Id. at 1148. The requirements of Carey apply to applications under 29 U.S.C. § 1132(g)(2)(D). See, e.g., Carney v. Prompt Maint. Servs., Inc., 2002 WL 122934, at *7 (S.D.N.Y. Jan. 30, 2002) (citing Plumbers Local No. 371 Joint Plumbing Indus. Bd. Pension Fund v. Frank Liquori Plumbing & Heating, Inc., 1996 WL 445065, at *5 (E.D.N.Y. June 26, 1996)). A court may accept a “typed listing of [attorneys'] hours from computer records, ” in lieu of contemporaneous records, where the record shows that the attorneys “made contemporaneous entries as the work was completed, and that their billing was based on these contemporaneous records.” Cruz v. Local Union No. 3, 34 F.3d 1148, 1160 (2d Cir. 1994).
III. DISCUSSION
A. Confirmation of Arbitration Award
As discussed above, Offsite has not appeared in this case or responded to the petition. Indeed, the arbitrator noted that Offsite had not appeared for the arbitration hearing despite proof by petitioners that Offsite had “legally sufficient notice of this proceeding and the claims against it.” Arb. Award at 1-2.
Applying the principles discussed above, the Court concludes that petitioners have demonstrated that there is no genuine issue of material fact precluding summary judgment as to all aspects of the arbitrator's award. Although petitioners have not presented the Court with all of the materials on which the arbitrator based his decision, there is no indication that the arbitrator misinterpreted these materials or otherwise acted arbitrarily, in excess of his power, or contrary to law. See, e.g., Trs. of the N.Y.C. Dist. Council of Carpenters Pension Fund v. Dejil Sys., Inc., 2012 WL 3744802, at *3 (S.D.N.Y. Aug. 29, 2012) (“Dejil”) (confirming award although plaintiff had not submitted all materials relied on by the arbitrator). The CBA provided for arbitration; the dispute was submitted to a duly designated arbitrator; and the arbitrator calculated the award based on the terms of the CBA. See Arb. Award at 1-3. Nothing in the record suggests that the Court should not confirm the award. See, e.g., Dejil, 2012 WL 3744802, at *3 (“Where, as here, there is no indication that the arbitration decision was made arbitrarily, exceeded the arbitrator's jurisdiction, or otherwise was contrary to law, a court must confirm the award upon the timely application of any party.”).
Therefore, the award of $398,082.02 should be confirmed, including its award of interest at the rate of 5.25% per annum. At this rate, petitioners are entitled to prejudgment interest of $57.26 for each day after the date of the arbitration award, June 12, 2021, until the date judgment is entered by the Clerk of this Court.
B. Attorneys' Fees and Costs
The Court agrees with petitioners that an award of attorneys' fees is merited here. As previously noted, an award of attorneys' fees is mandatory under ERISA for the enforcement of any arbitration award. See 29 U.S.C. § 1132(g)(2)(D); see also CBA art. XIX, § 15(b) (permitting award of attorneys' fees). Petitioners' attorney has submitted a listing of hours expended based on contemporaneous time records, which reflect all time spent and activities performed in connection with this action. See Invoice dated Sept. 16, 2021, annexed as Ex. G to Pet.; Pet. ¶¶ 33-38. These records reflect that petitioners' attorney spent a total of 1.4 hours working on the case, billing at the rate of $350.00 per hour. Petitioners therefore incurred $490.00 in attorneys' fees. Because the number of hours is eminently reasonable and the respondents have contested neither the number of hours nor the attorney rate, the Court will accept them as reasonable.
Petitioners also seek repayment for “service fees and legal costs” in the amount of $77.00. See Pet. ¶ 38. Costs are specifically permitted by statute, which provides that “[a] bill of costs shall be filed in the case and, upon allowance, included in the judgment or decree.” 28 U.S.C. § 1920. Although petitioners have not provided documentation of the nature of these costs, courts in this district have generally allowed recovery of costs in similar amounts based solely on the allegations of the petition. See Trs. of N.Y.C. Dist. Council of Carpenters Pension Fund v. Espinosa Grp., Inc., 2018 WL 8059317, at *6 (S.D.N.Y. Oct. 16, 2018) (awarding $75.00 in costs without documentation beyond petition); Trs. of the N.Y.C. Dist. Council of Carpenters Pension Fund v. Golden Dev. & Constr. Corp., 2017 WL 2876644, at *6 (S.D.N.Y. July 6, 2017) (awarding $70.00 in costs without documentation beyond petition). Accordingly, the Court accepts petitioners' costs as reasonable and the petitioners' request for reimbursement of $77.00 in costs should be granted.
It is not necessary to rule on the request for post-judgment interest, as it will accrue automatically pursuant to 28 U.S.C. § 1961.
IV. CONCLUSION
For the foregoing reasons, petitioners' petition (Docket # 1) should be treated as a motion for summary judgment and granted. The Funds should be awarded $398,649.02 plus $57.26 in pre-judgment interest for each day from June 12, 2021 through the date judgment is entered by the Clerk of this Court.
The Clerk is requested to mail a copy of this Report and Recommendation to Offsite Construction Solutions LLC, 253 West 35th Street, 9th Floor, New York, NY 10001.
PROCEDURE FOR FILING OBJECTIONS TO THIS REPORT AND RECOMMENDATION
Pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure, the parties have fourteen (14) days including weekends and holidays from service of this Report and Recommendation to serve and file any objections. See also Fed.R.Civ.P. 6(a), (b), (d). Such objections (and any responses to objections) shall be filed with the Clerk of the Court, with copies sent to the Hon. Vernon S. Broderick, at 40 Foley Square, New York, New York 10007, and to the undersigned, at 500 Pearl Street, New York, New York 10007. Any request for an extension of time to file objections must be directed to Judge Broderick. If a party fails to file timely objections, that party will not be permitted to raise any objections to this Report and Recommendation on appeal. See Thomas v. Arn, 474 U.S. 140 (1985); Wagner & Wagner, LLP v. Atkinson, Haskins, Nellis, Brittingham, Gladd & Carwile, PC, 596 F.3d 84, 92 (2d Cir. 2010).