RENÉE MARIE BUMB, District Judge.
This matter comes before the Court upon the renewed Motion for Default Judgment [Docket No. 14] by Plaintiffs Trustees of the New Jersey B.A.C. Health Fund, Trustees of the New Jersey B.A.C. Annuity Fund, Trustees of the B.A.C. Local 5 Pension Fund, Trustees of the New Jersey BM&P Apprentice and Education Fund (the "Local Funds"), Trustees of the Bricklayers & Trowel Trades International Pension Fund ("IPF"), Trustees of the International Masonry Institute ("IMI" and, together with IPF and the Local Funds, the "Funds"), and Richard Tolson, as Administrator of B.A.C Administrative District Council of New Jersey (the "Union" and, together with the Funds, the "Plaintiffs"), seeking the entry of default judgment against Defendant Thurston F. Rhodes, Inc. d/b/a J & M Concrete & General Contracting (the "Defendant"), pursuant to Federal Rule of Civil Procedure 55(b)(2). For the following reasons, the Plaintiffs' motion will be granted, in part, and denied, in part.
On February 18, 2016, Plaintiffs commenced the instant litigation against Defendant, seeking to recover amounts owed to Plaintiffs pursuant to a collective bargaining agreement and Sections 502(a)(3) and 515 of the Employee Retirement Income Security Act ("ERISA") of 1974, 29 U.S.C. §§ 1332(a)(3), 1145, and Section 301 of the Labor Management Relations Act of 1947, 29 U.S.C. § 185. Compl. ¶¶ 1, 16-23 [Docket No. 1]. As alleged in the Complaint, Defendant did not pay certain required contributions and dues check-offs owed to its employees for work performed on the Yard House, Moorestown Mall project between August 27, 2015 and October 16, 2015 (the "Mall Project"). Compl. ¶ 14.
The Defendant was served with the Summons and Complaint on February 24, 2016. Marimon Decl. Ex. B [Docket No. 16-2]. The time for Defendant to respond to the Complaint expired on March 16, 2016. To date, Defendant has not answered or otherwise responded to the Complaint. The Clerk of the Court, upon request by Plaintiffs, entered default against Defendant on July 14, 2016 [Docket Nos. 5, 6]. Thereafter, Plaintiffs filed a Motion for Default Judgment [Docket No. 6], which the Court denied without prejudice on January 10, 2017 due to Plaintiffs' failure to establish sufficient proof of service upon Defendant and to adequately support their entitlement to the relief sought [Docket No. 12]. At the Court's direction, Plaintiffs served Defendant with a copy of the January 10, 2017 Memorandum Opinion and Order. Marimon Decl. Ex. E [Docket No. 16-5]. Plaintiffs filed the renewed Motion for Default Judgment against Defendant on February 9, 2017 [Docket No. 14] and served Defendant [Docket No. 18]. Defendant has not opposed or otherwise responded to the instant motion or appeared in the litigation.
Plaintiffs now request that default judgment be entered in Plaintiffs' favor and against Defendant in the total amount of $18,297.93, representing (1) contributions of $5,593.15; (2) interest thereon of $948.31; (3) liquidated damages of $1,118.63; (4) dues check-offs of $607.50; and (5) attorneys' fees and costs of $10,030.34, plus interest from February 7, 2017 through the date of the entry of default judgment.
"Before granting a default judgment, the Court must determine (1) whether there is sufficient proof of service, (2) whether a sufficient cause of action was stated, and (3) whether default judgment is proper."
The Summons and Complaint were served personally upon Jesus Mendoza, a managing agent authorized to accept service on behalf of Defendant, on February 24, 2016. Marimon Decl. ¶ 4 [Docket No. 16]; Marimon Decl. Ex. B. When Defendant failed to timely respond to the Complaint, Plaintiffs properly sought entry of default pursuant to Federal Rule of Civil Procedure 55(a) [Docket No. 5]. Likewise, Plaintiffs have served Defendant with the original Motion for Default Judgment, the Court's Memorandum Opinion and Order, and the renewed Motion for Default Judgment. Marimon Decl. Exs. C, E [Docket Nos. 16-3, 16-5]; Aff. of Serv. [Docket No. 18]. Accordingly, the Court finds that there has been sufficient proof of service upon the Defendant.
"Under ERISA, an employer who is obligated to contribute to a plan under the terms of a collective bargaining agreement must make such contributions in accordance with the terms and conditions of that agreement."
According to the Complaint, Defendant was bound by a collective bargaining agreement with Plaintiffs. Compl. ¶ 12. Additionally, in connection with the instant motion, Plaintiffs submitted a copy of the collective bargaining agreement, which establishes that, under Article XI of the agreement, Defendant was required to pay specified contributions to the Plaintiffs. Mercadante Decl. Ex. A, Art. XI [Docket No. 15-1]. Plaintiffs further allege that Defendant contravened the collective bargaining agreement by failing to remit certain sums to the Funds as required by Article XI. Compl. ¶ 17. Accordingly, the Court finds that Plaintiffs have demonstrated that Defendant was obligated to make contributions pursuant to the collective bargaining agreement.
While Defendant's default constitutes an admission of the allegations in the Complaint, "[a] default is not an admission of the amount of damages claimed."
Having reviewed the Complaint and Plaintiffs' submissions in connection with the instant motion, the Court finds that Plaintiffs' allegations sufficiently state a cause of action under ERISA.
To determine whether default judgment is proper, the Court must first consider the prejudice to the Plaintiffs if the Motion for Default Judgment is not granted. By failing to respond to Plaintiffs' Complaint or to oppose the Motion for Default Judgment, Defendant has deprived Plaintiffs of the opportunity to litigate their claims against Defendant. Further, Defendant's failure to make the required contributions may negatively impact Plaintiffs' ability to pay their beneficiaries.
This Court next evaluates whether the Defendant has any meritorious defenses. As Defendant has failed to submit a responsive pleading addressing why default judgment should not be entered in Plaintiffs' favor, the Court is "not in a position to determine whether [Defendant] has any meritorious defense or whether any delay is the result of culpable misconduct."
Finally, Defendant's "failure to respond permits the Court to draw an inference of culpability on [its] part."
The Court now considers Plaintiffs' request for damages. While Defendant's default constitutes an admission of the allegations in the Complaint, "[a] default is not an admission of the amount of damages claimed."
Here, Plaintiffs seek $5,593.15 in outstanding unpaid contributions and $607.50 in outstanding dues check-offs for work performed in connection with the Mall Project under the terms of the parties' collective bargaining agreement. In support of these amounts, Plaintiffs submit Mr. Mercadante's Declaration, as well as the spreadsheets setting forth his calculations. Mercadante Decl. ¶¶ 1, 6; Mercadante Decl. Exs. C, D [Docket Nos. 15-3, 15-4]. Plaintiffs further seek interest on the delinquent contributions owed to the Local Funds in the amount of $238.07 and to the IPF in the amount of $710.24, for a total of $948.31. Mercadante Decl. ¶ 10. The interest owed was calculated pursuant to the Statement of Policy for Collection of Employer Contributions (the "Collection Policy"), which provides for 10% compounded interest on delinquent contributions payable to the Local Funds and 15% compounded interest payable to the IPF.
Plaintiffs also seek liquidated damages in the amount of $1,118.63. Mercadante Decl. ¶ 11. ERISA provides for liquidated damages not to exceed twenty percent of the unpaid contributions. 29 U.S.C. § 1132(g)(2). Additionally, the Collection Policy provides for the recovery of liquidated damages of 20% of the amount of delinquent contributions owed. Mercadante Decl. Ex. E, Art. II ¶ 6. Here, $1,118.63 represents 20% of the outstanding unpaid contributions of $5,593.15. Accordingly, the Court finds that Plaintiffs' request for liquidated damages is properly supported and appropriate.
Finally, Plaintiffs seek attorneys' fees in the amount of $9,241.00 and costs of $609.34, for a total of $9,850.34.
According to this Court's calculations and review of the time sheets, the three associates and one law clerk collectively billed a total of 44 hours, amounting to $8,800.00 in legal fees. Marimon Decl. Ex. F. Additionally, four paralegals collectively billed 4.9 hours, amounting to $441.00 in paralegal fees.
The Court, however, does not find the number of attorney hours billed to be reasonable. Prior to the entry of this Court's January 10, 2017 Memorandum Opinion and Order, Plaintiffs' counsel billed 14.8 attorney hours preparing the Complaint and the first Motion for Default Judgment, performing legal research in connection with alter ago theories of liability, and communicating regarding the litigation. Indeed, Plaintiffs' counsel billed 9.7 hours, or $1,940, preparing just the original Motion for Default Judgment, which included no memorandum of law and which this Court found to be deficient. Thereafter, in response to this Court's Memorandum Opinion and Order directing Plaintiffs to submit a properly supported renewed Motion for Default Judgment addressing the deficiencies identified by the Court, Plaintiffs' counsel billed 29.2 additional attorney hours preparing their roughly 11-page memorandum of law and supporting documents. The Court sees no reason why counsel billed over forty hours preparing a routine and properly supported motion for default judgment.
As a result, the Court denies Plaintiffs' request for attorneys' fees without prejudice.
Finally, Plaintiffs are entitled to recover reasonable costs of the action under Section 502(g)(2)(D) of ERISA. 29 U.S.C. § 1132(g)(2)(D). Here, Plaintiffs submit billing records accounting for administrative costs including filing fees and service fees associated with this litigation, amounting to $609.34. Marimon Decl. Ex. F. The Court finds that these costs are reasonable and should be awarded.
In sum, the Court shall award Plaintiffs a total amount of $9,317.93, representing (1) $5,593.15 in unpaid contributions; (2) $948.31 in interest; (3) $1,118.63 in liquidated damages; (4) $607.50 in dues check-offs; (5) $441.00 in paralegal fees; and (6) $609.34 in litigation costs, as well as interest incurred from the date of filing the renewed motion through the entry of this Order and accompanying Judgment. Plaintiffs' request for attorneys' fees is denied without prejudice. Plaintiffs' counsel shall be granted an opportunity to provide additional support for the reasonableness of their request for attorneys' fees.
For the foregoing reasons, Plaintiffs' Motion for Default Judgment will be granted, in part, and denied, in part. Specifically, the Motion is denied without prejudice as to Plaintiffs' request for attorneys' fees. The Motion is granted in all other respects. An appropriate Order and Judgment shall issue on this date.