Opinion
Civil No. 08-6237 (JRT/AJB).
February 7, 2011
Pamela Hodges Nissen and Natalie Woodward Kohner, ANDERSON, HELGEN, DAVIS NISSEN, LLC, Minneapolis, MN, for plaintiffs.
Mark J. Girouard and Matthew E. Damon, NILAN JOHNSON LEWIS, P.A., Minneapolis, MN, for defendant and third-party plaintiff Marsden Bldg Maintenance, LLC.
Michael G. Latiff, MCDONALD HOPKINS, PLC, Bloomfield Hills, MI; Craig M. Stanley, BUTZEL LONG, Detroit, MI; Gregory J. Stenmoe and Britt M. Gilbertson, BRIGGS AND MORGAN, PA, Minneapolis, MN, for third-party defendant Aristeo Services, LLC.
Richard L. Kaspari, METCALF, KASPARI, ENGDAHL LAZARUS, PA, Minneapolis, MN, for third-party defendant Service Employees International Union, Local 26.
MEMORANDUM OPINION AND ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
The trustees of several multi-employer employee welfare funds ("Laborers Funds") brought this action against Marsden Bldg Maintenance, LLC ("Marsden") pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001. The Laborers Funds allege that Marsden, a commercial cleaning services company, failed to contribute to certain employee benefit funds owed on behalf of workers who performed cleaning services at the Ford Motor Company's plant ("Ford Plant") in St. Paul, Minnesota.
With leave of the Court, Marsden subsequently filed a third-party complaint against Aristeo Services, LLC and Aristeo Construction ("Aristeo"), with which it had subcontracted to perform cleaning services at the Ford Plant, and the Service Employees International Union ("SEIU"), Local 26, the union whose members Marsden hired to perform the work. On April 20, 2010, the Court denied Aristeo's motion to dismiss or for summary judgment. (Docket No. 79.)
Marsden has moved for summary judgment against the Laborers Funds, the SEIU has moved to dismiss Marsden's third party claims against it, and Aristeo has moved for summary judgment against Marsden. For the reasons stated below, the Court concludes that Marsden is entitled to the relief it has requested, and the other pending motions are moot.
BACKGROUND
At the heart of this dispute is whether Marsden was obligated to pay into certain employee benefit plans based on their contractual obligations and the type of work in which Marsden's employees were engaged at the Ford Plant.
I. THE COLLECTIVE BARGAINING AGREEMENTS AND SUBCONTRACTS
The Laborers Funds, which benefit members of a local affiliate of the Laborers International Union of North America ("LIUNA"), are jointly-trusteed fringe benefit plans created and maintained pursuant to the Labor Management Relations Act of 1947, 29 U.S.C. § 186(c)(5). (Compl. ¶¶ 1-6, Docket No. 1.) Marsden is a limited liability cleaning services company located in Saint Paul, Minnesota. (Answer ¶ 3, Docket No. 3.) The vast majority of Marsden's business involves janitorial cleaning. (Aff. of Mary Marsden, March 24, 2010, at ¶ 2, Docket No. 90.) The company also provides "final construction cleaning" on construction sites, although those services constitute less than one percent of Marsden's overall business. ( Id. ¶ 3.)
Marsden has recognized SEIU Local 26 as the exclusive bargaining agent for its janitorial contract cleaning employees in the Twin Cities metropolitan area for over fifty years. ( Id. ¶ 5.) During the time period at issue in this action, Marsden was a signatory to two successive collective bargaining agreements between the SEIU and the Minneapolis-St. Paul Service Contract Cleaners Association ("SEIU CBAs"). Those contracts apply to "general cleaning" work performed by Marsden employees. General cleaning is defined in the SEIU CBAs as:
[C]leaning duties in buildings such as, but not limited to, remove and dispose of trash, waste and other refuse, wet and damp mop floors, sweep, dust mop floors, dust furniture and other office equipment, operate power cleaning tools, such as floor buffers, commercial vacuums, clean washrooms, vacuum carpets, plus other related duties. . . .
(Aff. of Matthew E. Damon, March 31, 2010, Ex. A at 10, Art. 7.1; Ex. B at 5, Art. 7.1, Docket No. 71.) The SEIU CBAs also include "repair person/special crew" work, defined as "general handyman duties such as, but not limited to, minor repairs. . . ." ( Id., Ex. A at 11, Art. 7.3; Ex. B at 5, Art. 7.3.) Marsden provides paid holidays, health insurance, and other fringe benefits directly to its employees under the terms of the SEIU CBAs. ( Id., Ex. C at 16:11-17.)
On October 4, 2005, Marsden signed another agreement ("2004 Agreement") between commercial cleaning contractors and the Laborers' District Council of Minnesota and North Dakota, Local 132, a LIUNA affiliate. ( Id., Ex. D.) The 2004 Agreement expired in April 2007. Marsden signed a successive agreement covering the period of May 2007 to April 2010 ("2007 Agreement"). ( Id., Ex. E.) Both the 2004 and 2007 Agreements are limited in scope; they apply only to "companies or individuals that perform final commercial cleaning services on construction sites. . . ." ( Id., Ex. D at 1; Ex. E at 1 (emphasis added).)
The 2004 Agreement establishes two separate pay scales applicable to different kinds of work: the "Commercial Cleaner Wage Rate" and the "Construction Craft Laborer Rate." ( Id., Ex. D at 3-7, Arts. 3-5.) The Commercial Cleaner Wage Rate is applicable to "Final Clean-Up" work, defined as "cleaning which occurs immediately before a construction project or a phase of a construction project is turned over to its owner." ( Id.) The Construction Craft Laborer Rate, which is higher than the Commercial Cleaner Wage Rate, applies to "work that is not Final Clean-Up," including "the removal or disposal or any construction materials, scrapping or `rough cleaning.'" ( Id.) The 2004 Agreement requires the employer to provide the union with payroll information upon request to demonstrate its compliance in the event of a dispute regarding hours, wages, or fringes. ( Id. at 7, Art. 6.)
The 2007 Agreement is substantively the same as the 2004 Agreement, except that it includes an additional type of work to which the Commercial Cleaner Wage Rate applies, namely "[w]ork specified to render HVAC components clean, and to verify their cleanliness through inspection and/or testing." ( Id., Ex. E. at 3-4, Art. 3.) Both the 2004 and 2007 Agreements state that they apply "only to on-site cleaning and related work as described in Article 3[,]" the provision that sets forth the work covered by the Commercial Cleaner Wage Rate and specifies that any work outside its parameters will be subject to the Construction Craft Laborer Rate. ( Id. at 11-12, Art. 13.2; Ex. D at 11, Art. 13.2.) While Marsden was required to provide fringe benefits directly to employees under the SEIU CBAs, the 2004 and 2007 Agreements require it to make contributions to the Laborers Funds "for each hour worked by all Employees covered by [the] Agreement[s]." ( Id., Ex. D at 11-16; Ex. E at 12-17.) The 2004 and 2007 Agreements provide: "There shall be no requirement that Employees sent to work outside the scope of this Agreement be paid fringes, nor shall the Employer be required to duplicate fringe contributions." ( Id., Ex. D at 13, Art. 14.1(5); Ex. E at 13, Art. 14.1(4).)
In 2007, Ford contracted with Aristeo to perform general maintenance services at the plant. (Aff. of Michael G. Latiff, Apr. 1, 2010, Ex. D, Docket No. 67.) Marsden, however, performs the work pursuant to a subcontract with Aristeo. ( Id., Ex. E.)
Aristeo was a signatory to the National Maintenance Agreement ("NMA"). ( Id., Ex. C.) In contrast to the 2004 and 2007 Agreements (signed by Marsden) applicable to companies that perform final commercial cleaning services on construction sites, the NMA signed by Aristeo "does not cover work performed by the Employer of a new construction nature. . . ." ( Id., Art. IV.2.)
Marsden's subcontracts with Aristeo contain a provision titled called "Special Provisions." (Damon Aff., Ex. H at 3, Docket No. 71.) The provision lists, without explanation, a series of references to requirements and documents including "OSHA Standards," "Certified Payroll," "Environmental Checklist," and "National Maintenance Agreement." ( Id.) Robert Streeter, Aristeo's Program Manager at the Ford Plant, suggested that the reference to the NMA was part of a template Aristeo utilized for its subcontracts. ( Id., Ex. G at 13:20-24.)
Marsden and Aristeo initially executed the subcontract in 2007, and then signed a substantively identical subcontract in 2008.
II. CLEANING SERVICES PROVIDED AT THE FORD PLANT
Marsden's employees at the Ford Plant empty waste cans, sweep, clean drinking fountains and surfaces, mop, vacuum, dust, scrub floors, pick up paper and litter, and clean restroom facilities. (Aff. of Christopher Obidiegwu, March 24, 2010, ¶ 4, Docket No. 91; id., Ex. 1.) They also provide cleaning services associated with the "paint booths" at the Ford Plant. ( Id. at ¶¶ 6-8.) The paint booths are separate areas in which automobile frames are transported on a conveyor system and sprayed with a protective layer, an electrocoat or e-coat, and then painted. ( Id. at ¶ 3.) Because of the specialized knowledge and experience associated with cleaning the paint booths, Marsden pays its employees who clean the paint booths a higher wage rate than general cleaners under the SEIU CBAs. (Marsden Aff. ¶ 8, Docket No. 90.)
While there have, on occasion, been small reconstruction or maintenance projects at the Ford Plant, Marsden's employees have not participated in these projects or provided janitorial services in relation to them. (Damon Aff., Ex. G at 43:17-44:24, Docket No. 71.) The subcontractors hired to perform these discrete projects were responsible for their own clean up. ( Id.)
III. ACTIONS PRECEDING THIS LAWSUIT
In April 2008, an Aristeo representative contacted Marsden and informed the company that it was required to join a National Maintenance Agreement Policy Committee. (Marsden Aff. ¶ 10, Docket No. 90; Damon Aff., Ex. F at 34:10-15, Docket No. 71.) An Aristeo employee visited a website associated with LIUNA and clicked on a link with the goal of requesting further information about the committee. (Damon Aff., Ex. F at 37:1-3, Docket No. 71; id., Ex. L at 24:10-26:14.)
Soon thereafter, LIUNA's national office sent Marsden a letter, referencing its employee's visit to the committee's website and inviting Marsden to sign and accept the NMA. (Marsden Aff. ¶ 11, Docket No. 90; id., Ex. 1.) Marsden has never signed the NMA, however, and after receiving the letter, Marsden visited the committee's website to terminate any affiliation with the committee. ( Id. at ¶ 11; Damon Aff., Ex. L at 29:12-18.)
On or around April 15, 2008, Laborers representatives visited the Ford Plant to examine what work Marsden employees were performing. (Aff. of Pamela H. Nissen, June 7, 2010, Ex. J at 48:3-51:25, Docket No. 84.) The Laborers Funds allege that their representatives were prohibited from viewing work in the paint booth and that during their visit one representative was physically threatened. ( Id.) LIUNA representatives subsequently attempted without success to meet with Marsden and Aristeo to ascertain the nature of the work conducted at the Ford Plant, particularly in the paint booth. ( Id. at 60:2-21.)
On April 16, 2008, LIUNA filed a grievance with Marsden. (Damon Aff., Ex. M, Docket No. 71.) The grievance stated that "[u]pon investigation of the jobsite at the Ford Plant," it was discovered that there were workers performing "contractual work covered by the NMA" who were not LIUNA members. ( Id.) LIUNA sought compensation for the work performed for over a year at the Ford Plant by Marsden's employees, and demanded that Marsden employ only members of its Local 132 at the plant going forward. ( Id.) On or about April 30, 2008, LIUNA filed another grievance asserting that Marsden violated the NMA by "using S.E.I.U. members to do clean up" at the Ford Plant. ( Id., Ex. P.) Neither grievance referenced the 2004 or 2007 Agreements with Marsden; rather, they referenced the NMA. ( Id., Exs. Q R.) Marsden denied the grievances. ( Id.)
The Laborers Funds directed its third party administrator, Zenith Administrators ("Zenith"), to audit Marsden. ( Id., Ex. S at 63:1-73:15; Marsden Aff. ¶ 12, Docket No. 90.) The Laborers Funds allege that Marsden did not provide sufficient information to enable Zenith to complete its audit. Marsden produced an Excel spreadsheet with hours its Ford Plant employees worked, but it did not produce "job description[s] or any other documents that would identify what the individuals listed on the payroll records did in the course of their employment." (Pl.'s Opp'n at 7, Docket No. 82.) The Laborers Funds have acknowledged that Marsden provided job descriptions for the paint booth cleaning work, however, in the course of discovery during this lawsuit, and plaintiffs have not filed any relevant Motion to Compel. Zenith's lead auditor testified that in conducting the audit she presumed that any hour of work performed by any Marsden employee at the Ford Plant was Laborers' work. (Damon Aff., Ex. T at 66:-17, Docket No. 71.)
On July 9, 2008, representatives from the Laborers Funds and Marsden met. ( Id., Ex. L at 95:23-96:4.) According to Marsden, the Laborers Funds demanded that Marsden recognize LIUNA as the representative for at least some of Marsden's Ford Plant employees and offered to make the audit "go away" if Marsden accepted their demand. ( Id. at 96:5-98:10.) Marsden declined the alleged offer. ( Id.)
Based on the results of the audit, the Laborers Fund submitted an invoice to Marsden seeking $1,120,416.62 in contributions, and liquidated damages based on every hour of work that any Marsden employee performed at the Ford Plant since its subcontract with Aristeo commenced. (Marsden Aff. ¶ 21, Docket No. 90; id., Exs. 7, 8.)
On December 2, 2008, the Laborers Funds filed this action against Marsden to collect unpaid fringe benefits. In their Complaint, plaintiffs allege that Marsden violated the terms of the 2004 and 2007 Agreements by employing individuals to perform work covered by the Agreements at the Ford Plant without contributing to the Laborers Funds.
In addition to the approximately $1.12 million for fringe benefit contributions relating to work performed at the Ford Plant, the Laborers Fund also sought $91,316.95 for unpaid contributions for work performed at sites other than the Ford Plant. The parties have settled their dispute regarding non-Ford plant work. (Docket No. 112.)
On July 23, 2009, Marsden filed a third-party complaint against Aristeo and the SEIU. (Docket No. 14.) In its amended third-party complaint, Marsden alleges breach of contract, intentional misrepresentation, and negligent misrepresentation against Aristeo. (Docket No. 33.) It also alleges negligent misrepresentation and unjust enrichment against the SEIU. Marsden argues that in the event it is found liable to plaintiffs to make contributions to the Laborers Funds, it should receive contribution and full indemnification from Aristeo and the SEIU. Marsden also seeks a declaration that it was not bound by its agreement with the SEIU to the extent that it was required to make contributions to the Laborers Funds for the same work.
ANALYSIS
I. STANDARD OF REVIEW
Summary judgment is appropriate where there are no genuine issues of material fact and the moving party can demonstrate that it is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). A fact is material if it might affect the outcome of the suit, and a dispute is genuine if the evidence is such that it could lead a reasonable jury to return a verdict for either party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A court considering a motion for summary judgment must view the facts in the light most favorable to the non-moving party and give that party the benefit of all reasonable inferences that can be drawn from those facts. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).II. MARSDEN'S SUMMARY JUDGMENT MOTION
"Under ERISA § 515, the [Laborers] Funds may collect only those contributions that [the employer] is contractually obligated to pay." Carpenters Fringe Benefit Funds of Ill. v. McKenzie Eng'g, 217 F.3d 578, 582 (8th Cir. 2000). Marsden argues that it is entitled to summary judgment because the Laborers Funds have not proffered sufficient evidence from which a reasonable factfinder could conclude that any work performed by Marsden employees at the Ford Plant was covered by an applicable CBA. The Laborers Funds argue that Marsden carries the burden of proof to establish that its employees at the Ford Plant were not performing work covered by the 2004 and 2007 Agreements because of its failure to maintain adequate records. ERISA requires employers to maintain records of hours worked by employees to enable trustees of employee benefit funds to calculate benefits under ERISA plans. 29 U.S.C. § 1059(a)(1); ( see also Ex. E at 13, Art. 14.1(4).) Accordingly, courts consistently conclude that once the trustees produce evidence challenging the accuracy of the employer's records, the burden shifts to the employer to produce evidence of the precise amount of work performed. See, e.g., Mich. Laborers' Health Care Fund v. Grimaldi Concrete, Inc., 30 F.3d 692, 696 (6th Cir. 1994). That presumption, however, is applied only after the fund trustees have shown " that there exist some employees who . . . performed covered work. . . ." Motion Picture Indus. Pension Health Plans v. N.T. Audio Visual Supply, Inc., 259 F.3d 1063, 1066 (9th Cir. 2001) (emphasis added). Here, the Laborers Funds are not entitled to the burden-shifting framework because they cannot meet their "threshold burden" of establishing that Marsden's employees at the Ford Plant performed work covered by any agreement to contribute to the Laborers Funds. Trs. of I.B.E.W. Local Union 405 Deferred Savs. Fund v. Duball Elec., Inc., No. C02-0048, 2005 WL 3973836, at *6 (N.D. Iowa Dec. 13, 2005).
The Laborers Funds also argue that because this is an ERISA collection action by trustees of pension funds, Marsden is entitled to only two defenses: that the requested contributions themselves are illegal or that the CBA is void. See Cent. States, Se. and Sw. Areas Pension Fund v. Indep. Fruit and Produce Co., et al., 919 F.2d 1343, 1348 (8th Cir. 1990). If a fund's beneficiaries are not covered by the CBA, however, then the funds are not entitled to any contributions based on their work. See Carpenters Fringe Benefit Funds, 217 F.3d at 583-585. Zenith's unsupported assumption that every hour worked by Marsden employees at the Ford Plant was covered by the 2004 and 2007 Agreements, standing alone, is insufficient evidence of coverage. See id.
The only executed contracts between LIUNA and Marsden are the 2004 and 2007 Agreements. Accordingly, the Court must look at those agreements to determine whether, and the extent to which, Marsden is obligated to contribute to the Laborers Funds for work performed at the Ford Plant. 29 U.S.C. § 1145; Trs. of Minn. Ceramic Tile and Allied Trades Ret. Fund v. Legacy Tile and Marble, Inc., No. 06-2965, 2008 WL 624120, at *6 (D. Minn. Mar. 4, 2008). "[T]he interpretation of CBAs is governed by federal [common] law, [although] courts may draw upon state rules of contractual interpretation to the extent that those rules are consistent with federal labor policies." Nichols v. Alcatel USA, Inc., 532 F.3d 364, 377 (5th Cir. 2008) (quotation omitted). The Court must construe the CBA as a whole and read the terms of the agreement in context. Sheet Metal Workers Intern. Ass'n, Local No. 3 v. Lozier Corp., 255 F.3d 549, 551 (8th Cir. 2001). The Court must begin with the CBA's explicit language, and consider extrinsic evidence of the parties' intent only when the contested terms of the CBA are ambiguous. UAW v. BVR Liquidating, Inc., 190 F.3d 768, 772 (6th Cir. 1999); John Morrell Co. v. Local Union 304A of United Food and Commercial Workers, 913 F.2d 544, 551 (8th Cir. 1990).
Here, the 2004 and 2007 Agreements explicitly and unambiguously apply only to "companies or individuals that perform final commercial cleaning services on construction sites. . . ." (Damon Aff., Ex. D at 1; Ex. E at 1, Docket No. 71 (emphasis added).) The Agreements are replete with additional references confirming that they are limited in scope to services performed on construction sites. For example, the 2004 and 2007 Agreements provide that the employer "agrees not to subcontract any work covered by this Agreement to be performed at the construction site" to any subcontractor that has not entered into an agreement with LIUNA. ( Id., Ex. D at 8; Ex. E at 8 (emphasis added).) "Final Clean-Up" is defined as "cleaning that occurs immediately before a construction project or phase of a construction project is turned over to the owner" while work that is not Final Clean-Up is paid at the Construction Craft Labor Rate. ( Id., Ex. D at 3; Ex. E at 4 (emphasis added).)
The Laborers Funds nonetheless argue that the 2004 and 2007 Agreements are not restricted to work performed at a construction site. In support of their argument, the Laborers Funds point to Article 3 of each agreement, which references "Commercial Cleaning." The references, however, are with regard to the Commercial Cleaning Wage Rate applicable to "Final Clean-Up" work (and, in the case of the 2007 Agreement, HVAC Cleaning and Decontamination work) at construction sites. (Damon Aff., Ex. D at 3-4; Ex. E at 3-4, Docket No. 71.) The Laborers Funds also cite several regulatory definitions of "construction site," but offer no evidentiary support for the necessary finding that the Ford Plant actually was a construction site or that Marsden's employees performed Final Clean-Up or other construction related cleaning services at the plant. See 41 C.F.R. § 60-1.3; 48 C.F.R. § 22.801.
To the contrary, the record evidence regarding the nature of the work performed by Marsden's employees leads the Court to conclude that the rendered services were outside the scope of the 2004 and 2007 Agreements. Aristeo's Project Manager at the Ford Plant testified that he has directly supervised the work of Marsden employees at the Ford Plant and that none of it is cleaning services related to construction or construction equipment. (Damon Aff., Ex. G at 43:17-44:24, Docket No. 71.) The only reconstruction or remodeling that occurred at the plant during the relevant period was "a power line changeover and some other small projects" performed by employees of companies other than Marsden. ( Id.)
Although the Laborers Funds' audit invoice reflects every hour worked by every Marsden employee at the Ford Plant, in its opposition briefs plaintiffs do not dispute that the only work conceivably covered by the 2004 and 2007 Agreements is the paint booth cleaning. Yet Christopher Obidiegwu, Marsden's Account Manager who works on site at the Ford Plant and has firsthand knowledge of the work conducted by Marsden employees there, described in detail the paint booth cleaning work and explained that it is unrelated to construction. (Obidiegwu Aff. ¶¶ 5-10, Docket No. 91.) Marsden's paint booth employees are paid at a higher wage rate because their work requires additional training. For example, they "clean out the pit areas in which Ford employees work on the underside of automobiles . . . and they clean around the chemical bath vats in the paint building." ( Id. ¶ 7.)
According to the Laborers Funds, the paint booth work exceeds the scope of the SEIU CBAs, which are limited to janitorial tasks such as "remove and dispose of trash, waste and other refuse, wet and damp mop floors, sweep, dust mop floors, dust furniture and other office equipment, operate power cleaning tools, . . . clean washrooms, vacuum carpets, plus other related duties." ( Id., Ex. A, Art. 7.1; Ex. B, Art. 7.1.) The question before the Court, however, is whether the 2004 and 2007 Agreements cover paint booth cleaning. Based on the plain language of those agreements, which are limited in scope to certain types of cleaning services performed at construction sites, they do not.
Assuming as true the Laborers Funds' allegations that paint booth cleaning involves working with and cleaning up hazardous materials and waste, using scrubbing equipment removing accumulated buildup, and cleaning up after another Aristeo subcontractor blasts enamel and primes the booth, plaintiffs have nonetheless not established how any of this work, individually or cumulatively, turns the Ford Plant into a construction site. (Pl.'s Opp'n at 15, Docket No. 82.)
According to Obidiegwu, Marsden employees do not remove any hazardous waste associated with their work in the paint booths. (Obidiegwu Aff. ¶ 8, Docket No. 91.)
The 2004 and 2007 Agreements are not only limited to construction sites. They are also restricted to certain types of work performed at construction sites, namely "Final Clean-Up" and, as of 2007, "HVAC Cleaning and Decontamination." "Final Clean-Up" is " cleaning which occurs immediately before a construction project or a phase of a construction project is turned over to its owner." (Damon Aff., Ex. D at 3, Art. 3.2; Ex. E at 3, Art. 3.2, Docket No. 71 (emphasis added).) HVAC Cleaning and Decontamination is "[w]ork specified to render HVAC components clean. . . ." ( Id., Ex. E at 3, Art. 3.2.) Even if the paint booth cleaning was similar to work that Marsden employees might perform at a construction site, the Laborers Funds have not established how the paint booth work could possibly fit any category of cleaning work to which the 2004 and 2007 Agreements apply such as Final Clean-Up or HVAC Cleaning and Decontamination.
The 2004 and 2007 Agreements discuss a third type of work, "Construction Craft Laborer Work." When workers are "performing removal or disposal of construction materials, scrapping, or `Rough Cleaning,'" work traditionally performed by Construction Craft Laborers, they are not categorized as Commercial Cleaners and must be paid a higher wage. There is no record evidence that Marsden employees were engaged in rough cleaning or other Construction Craft work at the Ford Plant. To the contrary, the Laborers Funds' own audit seeks contributions only for work performed at the Commercial Cleaner rate set forth in the 2004 Agreement, not at the higher Construction Craft rate. (Marsden Aff., Ex. 8, Docket No. 90.)
Finally, the Laborers Funds argue that Marsden is bound by the NMA through its "incorporation" into the subcontract between Aristeo and Marsden. As an initial matter, the plaintiffs' complaint does not reference the NMA at all. Rather, it alleges that the work performed by Marsden employees at the Ford Plant was covered by the 2004 and 2007 Agreements. The Laborers Funds did alert Marsden that it intended to pursue the NMA theory in the course of a discovery response. In this Court's Order denying Aristeo's Motion to Dismiss Marsden's Third Party Complaint, the Court described the NMA allegations as a "new theory of liability" and denied Aristeo's motion in part because "the Court ha[d] not determined whether plaintiffs are barred from advancing this theory of liability" based on the NMA. (Order at 9-10, n. 1, Docket No. 79.) However, the Laborers Funds never moved to amend their complaint. In the Court's view, it would be unfairly prejudicial to consider a theory that was not properly pled. Thomas Wong Gen. Contractor v. Lake Bank, N.A., No. 06-515, 2009 WL 4577722, at *6 n. 4 (D. Minn. Dec. 1, 2009).
Moreover, the NMA is of no help to the Laborers Funds because Marsden never signed it nor incorporated it by reference into the subcontracts. To the contrary, Marsden explicitly rebuffed LIUNA's invitation to become a signatory to the NMA. The subcontracts' unexplained reference to the NMA under the title "Special Provisions" is insufficient to bind Marsden to its terms. Rosenblum v. Travelbyus.com Ltd., 299 F.3d 657, 666 (7th Cir. 2002) ("Mere reference to another contract or document is not sufficient to incorporate its terms into a contract. There must be an express intent to incorporate. . . ."). As in Rosenblum, the subcontracts are silent with regard to the incorporation of the NMA, and the NMA is not included as an attachment. Id.
Even if Marsden was bound by the NMA despite never having seen it or signed it, to avoid summary judgment the Laborers Funds would have to proffer evidence that the NMA applied to the paint booth work. The NMA covers maintenance, repair, and renovation work. (Latiff Aff., Ex. C at Art. V, Docket No. 67.) The definition section of the NMA does not explicitly reference cleaning. ( Id.) The Laborers Funds have not attempted to explain how the work of Marsden's employees, in the paint booths or elsewhere in the Ford Plant, might be characterized as maintenance, repair, or renovation work.
Accordingly, the Court concludes that Marsden is entitled to summary judgment.
III. ARISTEO'S SUMMARY JUDGMENT MOTION AND SEIU'S MOTION TO DISMISS
Aristeo has moved for summary judgment against Marsden based on the claims in its third-party complaint for (a) breach of contract for failure to disclose material facts, (b) intentional misrepresentation, and (c) negligent misrepresentation. Marsden has withdrawn its negligent misrepresentation claim, so only the claims of breach of contract and intentional misrepresentation are at issue. Marsden asserted two claims against the SEIU, for negligent misrepresentation, unjust enrichment, and for a declaratory judgment that if Marsden is required to contribute to the Laborers Funds it should not be required to make contributions under the SEIU CBAs for the same work. The SEIU has filed a motion to dismiss these claims.
Marsden's third-party claims, however, are derivative. It seeks relief against Aristeo only if it is found obligated to make contributions to the Laborers Funds in this dispute. Since the Court grants summary judgment to Marsden, Aristeo's summary judgment motion and the SEIU's motion to dismiss are moot.
ORDER
Based on the foregoing, and the records, files, and proceedings herein, IT IS HEREBY ORDERED that:1. Marsden's Motion for Summary Judgment [Docket No. 64] is GRANTED.
2. SEIU's Motion to Dismiss Third-Party Claims [Docket No. 73] is DENIED as moot.
3. Aristeo's Motion for Summary Judgment [Docket No. 61] is DENIED as moot.
LET JUDGMENT BE ENTERED ACCORDINGLY.
DATED: February 7, 2011
at Minneapolis, Minnesota.