LAWRENCE E. KAHN, District Judge.
Plaintiffs Graphic Communications Conference of the International Brotherhood of Teamsters National Pension Fund ("Fund"), Fund Trustee George Tedeschi, and Fund Trustee Malcolm Pritzker (collectively, "Plaintiffs"), brought this action against Defendant Brigar X-Press Solutions, Inc. ("Defendant") to collect delinquent payments to a multi-employer pension plan pursuant to the Employee Retirement Income Security Act ("ERISA"). Dkt. No. 1 ("Complaint") at 1. After Defendant failed to answer, Plaintiffs filed a Request for entry of default on August 2, 2010. Dkt. No. 9. The Clerk of the Court executed a Certificate of default on August 4, 2010. Dkt. No. 10.
Plaintiffs allege in the Complaint that Defendant agreed, pursuant to a collective bargaining agreement ("CBA") and a special participation agreement ("SPA"), to make monthly contributions to the Fund on behalf of covered employees. Compl. ¶ 5. Pursuant to the Agreement and Declaration of Trust governing the Fund, the Fund is entitled to assess interest and establish liquidated damages on delinquent contributions, and to recover all collection expenses.
Plaintiffs allege that, beginning in January 2010, Defendant became delinquent in making monthly contributions to the Fund. Compl. ¶ 8. According to Fund records, the following monthly contributions by Defendant were delinquent:
Thomas Decl. ¶ 11; Second Thomas Decl. ¶ 4. Further, as of December 15, 2011, Defendant had not yet made any of the required contributions for the period between January 2011 and November 2011. Second Thomas Decl. ¶ 7. According to Plaintiffs, under the terms and conditions of the Fund, Defendant owes: (1) $56,851.42 in unpaid contributions; (2) $4,355.67 in interest; and (3) $23,978.21 in liquidated damages.
After the clerk has filed an entry of default against a party that has failed to plead or otherwise defend, a court may enter default judgment upon application of the opposing party. FED. R. CIV. P. 55(b). Default judgment is an extreme sanction, and decisions on the merits are favored.
However, a court cannot take allegations in a complaint regarding damages as true.
Here, Defendant failed to answer Plaintiffs' Complaint, despite having been duly served. And, although Defendant contacted Plaintiffs after the Clerk made an entry of default, Defendant still did not file a formal response before the Court. Status Report. Moreover, Plaintiffs sent a courtesy copy of the Motion papers to Defendant.
29 U.S.C. § 1145. The Court has reviewed all submissions, taking all allegations in the Complaint as true, and finds that Defendant: (1) is an "employer" as defined in 29 U.S.C. § 1002(5); and (2) is obligated to make contributions to a multiemployer plan — here, the Fund — under the terms of both the CBA and the SBA. Further, Plaintiffs have alleged that Defendant was delinquent in making monthly contributions to the Fund, in violation of the Fund Agreement and Declaration of Trust. The Court therefore finds that Plaintiffs have established each of the elements necessary to state a claim pursuant to 29 U.S.C. § 1145.
As a threshold matter, the Court notes that Plaintiffs seek unpaid contributions, interest, and liquidated damages that accrued well after their Complaint was filed on July 7, 2010. Generally, awarding compensation in a default judgment for payments due after an action was filed would be improper under Rule 54(c) of the Federal Rules of Civil Procedure. FED. R. CIV. P. 54(c) ("A default judgment must not differ in kind from, or exceed in amount, what is demanded in the pleadings."). However, because Plaintiffs also demanded damages for "any delinquencies subsequent to the filing of this case but prior to entry of a final order," damages that accrued during the pendency of this action are not precluded because they were explicitly requested in the Complaint. Compl. at 4;
Because Defendant is found to have violated § 1145, Plaintiffs are entitled to receive as damages the total amount of any unpaid contributions. 29 U.S.C. § 1132(g)(2)(A). Plaintiffs claim that Defendant's required monthly contributions between January 2011 and November 2011 remain unpaid. Second Thomas Decl. ¶ 7. Plaintiffs also submitted detailed spreadsheets showing the amount of each delinquent monthly contribution and a total amount outstanding of $56,851.42. Ex. 1 at 1-3. Accordingly, the Court awards Plaintiffs $56,851.42 in unpaid contributions.
Plaintiffs are also entitled to receive interest on all delinquent contributions. 29 U.S.C. § 1132(g)(2)(B). Pursuant to the terms of the Fund, Defendant owes interest on any delinquent contributions calculated at a daily rate of prime plus one percent or eight percent, whichever is greater. Second Thomas Decl. ¶ 8. Plaintiffs have submitted detailed documentation showing that Defendant owes interest of $1,250.26 for the contributions due between January 2010 and October 2010, and $3,105.41 for the contributions due between November 2010 and November 2011.
The Proposed Judgment submitted by Plaintiffs also seeks continuing interest calculated at eight percent per day, "until the judgment is paid in full." Proposed J.; Declaration of William Pozefsky (Dkt. No. 12-2) at 2. However, post-judgment interest is more properly calculated pursuant to 28 U.S.C. § 1961, which states that "interest shall be allowed on any money judgment in a civil case recovered in a district court." 28 U.S.C. § 1961(a) (emphasis added);
Under 29 U.S.C. § 1132(g)(2)(C), Plaintiffs are entitled to the liquidated damages provided for under the plan, so long as they do not exceed twenty percent of the unpaid contributions. Under the terms of the Fund's Declaration of Trust, Plaintiffs are entitled to liquidated damages in the amount of twenty percent of unpaid contributions. Second Thomas Decl. ¶ 9. Plaintiffs have submitted documentation showing that twenty percent of all delinquent and unpaid contributions equates to $10,491.86 for the period of January 2010 through October 2010, and $13,486.35 for November 2010 through November 2011.
The Proposed Judgment submitted by Plaintiffs seeks "the costs and disbursements of this action." Proposed J. However, in reviewing the submissions, the only cost documented by Plaintiffs in their detailed submissions to date is $220.00 for arbitration costs and fees. Compl. ¶ 13; Dkt. No. 1-2 at 4. The Court therefore awards Plaintiffs $220.00 in costs and disbursements.
Accordingly, it is hereby: