-GWF Trustees of the Construction Industry and Laborers Health and Welfare Trust et al v. Interstate Hotel Installation, No. 2:2012cv00353 - Document 35 (D. Nev. 2013)

Court Description: ORDER Granting in part and Denying in part 13 Motion for Summary Judgment. FURTHER ORDERED that 27 Motion to Withdraw CounterMotion for Summary Judgment is GRANTED. The Trust Funds' CounterMotion 15 is WITHDRAWN. FURTHER ORDERED that 28 Motion for Leave to File Sur-Reply and for Oral Argument is DENIED. Signed by Judge Miranda M. Du on 3/5/13. (Copies have been distributed pursuant to the NEF - MMM)
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-GWF Trustees of the Construction Industry and Laborers Health and We...terstate Hotel Installation Doc. 35 1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 DISTRICT OF NEVADA 8 *** 10 TRUSTEES OF THE CONSTRUCTION INDUSTRY AND LABORERS HEALTH AND WELFARE TRUST, et al., 11 Plaintiffs, 9 v. 12 13 INTERSTATE HOTEL INSTALLATION, 14 Defendant. 15 16 I. Case No. 2:12-cv-00353-MMD-GWF ORDER (Def.’s Motion for Summary Judgment – dkt. no. 13; Plf.’s CounterMotion for Summary Judgment – dkt. no. 15; Plf.’s Motion to Withdraw CounterMotion – dkt. no. 27; Plf.’s Motion for Leave to File Sur-Reply and for Oral Argument – dkt. no. 28) SUMMARY 17 Before the Court are various motions brought by the parties in this Employee 18 Retirement Income Security Act (“ERISA”) action. Defendant Interstate Hotel Installation 19 (“Interstate”) brings this Motion for Summary Judgment, which Plaintiffs opposed. (See 20 dkt. no. 13.) Plaintiffs subsequently filed a Motion for Leave to File Sur-Reply and for 21 Oral Argument. (Dkt. no. 28.) 22 Plaintiffs also filed a CounterMotion for Summary Judgment (dkt. no. 15), which 23 they subsequently sought to withdraw through a Motion to Withdraw CounterMotion (dkt. 24 no. 27.) 25 II. BACKGROUND 26 Plaintiffs are Trustees of the Construction Industry and Laborers Health and 27 Welfare Trust, Trustees of the Construction Industry and Laborers Joint Pension Trust, 28 Trustees of the Construction Industry and Laborers Vacation Trust, and Trustees of the Dockets.Justia.com 1 Southern Nevada Laborers Local 872 Training Trust (collectively “Trust Funds” or 2 “Plaintiffs”). Interstate, a Nevada corporation, employed persons who performed work 3 covered by a collective bargaining agreement between Interstate and the Laborers 4 International Union of North America, Local 872 (“the Local”). The Trust Funds are 5 ERISA employee benefit trust funds that provide pension, health and welfare, vacation, 6 and training benefits to employees covered by the collective bargaining agreement 7 between Interstate and the Local. 8 Plaintiffs filed their Complaint in this case on March 5, 2012, seeking delinquent 9 contributions they allege an entitlement to through various collective bargaining 10 agreements, trust agreements that established the Trust Funds, and provisions of 11 ERISA-mandated reports and contributions. (See dkt. no. 1 at ¶¶ 4-9.) They seek 12 contributions for the period between July 1, 2003, and March 31, 2009. This is the third 13 such action brought by the Trust Funds. They had first filed suit on December 31, 2007, 14 for an audit and contributions covering the period from January 1, 2001, to May 28, 15 2008. 16 agreement entered into on May 27, 2008. (Dkt. no. 13-3.) The Trust Funds brought a 17 second suit on December 11, 2009, for an audit and contributions for July 1, 2003, and 18 March 31, 2009. (See dkt. no. 13-4.) The second suit was also voluntarily dismissed on 19 September 16, 2010, pursuant to a settlement agreement. (Dkt. no. 13-6.) (See dkt. no. 13-1.) That suit was voluntarily dismissed per a settlement 20 After filing an Amended Answer to the Complaint (dkt. no. 8), Interstate filed this 21 Motion for Summary Judgment on April 13, 2012 (dkt. no. 13). Five days later, the Trust 22 Funds filed their CounterMotion for Summary Judgment (dkt. no. 15), but later filed a 23 Motion to Withdraw the CounterMotion (dkt. no. 27). Good cause appearing, the Court 24 grants the Trust Funds’ Motion to Withdraw, and addresses the remaining two Motions 25 below. 26 III. LEGAL STANDARD 27 The purpose of summary judgment is to avoid unnecessary trials when there is no 28 dispute as to the facts before the court. Nw. Motorcycle Ass’n v. U.S. Dep’t of Agric., 18 2 1 F.3d 1468, 1471 (9th Cir. 1994). Summary judgment is appropriate when the pleadings, 2 the discovery and disclosure materials on file, and any affidavits “show there is no 3 genuine issue as to any material fact and that the movant is entitled to judgment as a 4 matter of law.” Celotex Corp. v. Catrett, 477 U.S. 317, 330 (1986). An issue is “genuine” 5 if there is a sufficient evidentiary basis on which a reasonable fact-finder could find for 6 the nonmoving party and a dispute is “material” if it could affect the outcome of the suit 7 under the governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986). 8 Where reasonable minds could differ on the material facts at issue, however, summary 9 judgment is not appropriate. Warren v. City of Carlsbad, 58 F.3d 439, 441 (9th Cir. 10 1995). “The amount of evidence necessary to raise a genuine issue of material fact is 11 enough ‘to require a jury or judge to resolve the parties' differing versions of the truth at 12 trial.’” Aydin Corp. v. Loral Corp., 718 F.2d 897, 902 (9th Cir. 1983) (quoting First Nat’l 13 Bank v. Cities Service Co., 391 U.S. 253, 288-89 (1968)). In evaluating a summary 14 judgment motion, a court views all facts and draws all inferences in the light most 15 favorable to the nonmoving party. Kaiser Cement Corp. v. Fishbach & Moore, Inc., 793 16 F.2d 1100, 1103 (9th Cir. 1986). 17 The moving party bears the burden of showing that there are no genuine issues 18 of material fact. Zoslaw v. MCA Distrib. Corp., 693 F.2d 870, 883 (9th Cir. 1982). “In 19 order to carry its burden of production, the moving party must either produce evidence 20 negating an essential element of the nonmoving party’s claim or defense or show that 21 the nonmoving party does not have enough evidence of an essential element to carry its 22 ultimate burden of persuasion at trial.” Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 23 F.3d 1099, 1102 (9th Cir. 2000). 24 requirements, the burden shifts to the party resisting the motion to “set forth specific 25 facts showing that there is a genuine issue for trial.” Anderson, 477 U.S. at 256. The 26 nonmoving party “may not rely on denials in the pleadings but must produce specific 27 evidence, through affidavits or admissible discovery material, to show that the dispute 28 exists,” Bhan v. NME Hosps., Inc., 929 F.2d 1404, 1409 (9th Cir. 1991), and “must do Once the moving party satisfies Rule 56’s 3 1 more than simply show that there is some metaphysical doubt as to the material facts.” 2 Orr v. Bank of Am., 285 F.3d 764, 783 (9th Cir. 2002) (internal citations omitted). “The 3 mere existence of a scintilla of evidence in support of the plaintiff’s position will be 4 insufficient.” Anderson, 477 U.S. at 252. 5 IV. DISCUSSION 6 Interstate brings its Motion for Summary Judgment arguing that the Trust Funds’ 7 claims are barred pursuant to the two dismissal rule, and that the plain language of Fed. 8 R. Civ. P. 41(a)(1) bars this suit based on the prior dismissals. (See dkt. no. 13 at 8-9.) 9 Interstate also argues that the Trust Funds’ claims for contribution prior to March 5, 10 2006, are time-barred. (Id. at 9-10.) In the alternative, Interstate requests partial 11 summary judgment on the Trust Funds’ contribution claims for one employee that was 12 subject to a prior settlement. (Id. at 10.) 13 A. 14 Fed. R. Civ. P. 41(a)(1) governs voluntary dismissal of actions by a plaintiff, and 15 provides that a plaintiff may voluntarily dismiss an action, without a court order, by filing 16 a notice of dismissal or, where the defendant has answered or filed a motion for 17 summary judgment, a stipulation of dismissal signed by all the parties that have 18 appeared in the action. It further provides that “if the plaintiff previously dismissed any 19 federal- or state-court action based on or including the same claim, a notice of dismissal 20 operates as an adjudication on the merits.” Fed. R. Civ. P. 41(a)(1)(B). “[A] voluntary 21 dismissal is presumed to be ‘without prejudice’ unless it states otherwise, but a voluntary 22 dismissal of a second action operates as a dismissal on the merits if the plaintiff has 23 previously dismissed an action involving the same claims.” Commercial Space Mgmt. 24 Co., Inc. v. Boeing Co., Inc., 193 F.3d 1074, 1076 (9th Cir. 1999). This rule is known as 25 the “two dismissal rule.” Id. Two Dismissal Rule 26 However, “[a] trust fund that wishes to preclude the application of res judicata to a 27 future action based on a claim that the employers’ payments have been inaccurate, can 28 reserve that right in any agreement that results in the dismissal with prejudice of an 4 1 action for delinquent payments.” Int’l Union of Operating Engineers-Employers Const. 2 Indus. Pension, Welfare & Training Trust Funds v. Karr, 994 F.2d 1426, 1432 (9th Cir. 3 1993). 4 agreeing to reserve plaintiffs’ right to conduct an audit and seek additional amounts 5 owing at some later time.” 6 Chevrolet, No. C 09-0466, 2009 WL 4572738, at *5 (N.D. Cal. Dec. 1, 2009). “Karr does not prohibit parties to a lawsuit for delinquent contributions from Bd. of Trustees of Auto. Indus. Welfare Fund v. Crown 7 In their first stipulated dismissal, the parties expressly agreed that Interstate would 8 “waive any and all time related defenses including, but not limited to, statute of 9 limitations . . .” for the period of time from the date of the Complaint to 60 days after 10 compliance with the audit agreed to in the stipulation. (Dkt. no. 15-3 at ¶ 2.) After filing 11 of the second suit, the parties entered into a settlement agreement which specifically 12 reserved the right to pursue further claims for potential contribution deficiencies 13 discovered after the completion of the audit. (Dkt. no. 15-5 at ¶ 6.) Applying the two- 14 dismissal rule in this circumstance would flout the parties’ settlement agreement, run 15 counter to the spirit of Karr, and would serve an injustice to the Trust Funds’ expectation 16 that Interstate would comply with the terms of the contract it entered into. The parties’ 17 agreement ought not to be disturbed, particularly where that agreement was signed by 18 the Court. (See dkt. no. 15-6.) 19 B. 20 Interstate also argues that the six-year statute of limitations applicable to the Trust 21 Funds’ claim preclude them from seeking contributions for the period prior to March 5, 22 2006 (six years before this suit was filed). See Wetzel v. Lou Ehlers Cadillac Group 23 Long Term Disability Ins. Program, 222 F.3d 643, 648 (9th Cir. 2000) (holding that 24 applicable statute of limitations for an ERISA action is that which governs suits on written 25 contracts); NRS § 11.190(1)(b) (providing a six-year limitation period for actions on a 26 written contract). Since contracts between parties limiting the right to plead the statute of 27 limitations are enforceable, Interstate’s argument fails for the reasons set forth below. 28 See Abramson v. Brownstein, 897 F.2d 389, 393 (9th Cir. 1990) (noting that under Statute of Limitations 5 1 California law, parties to a contract may waive the running of the statute by express 2 agreement); Matter of VMS Ltd. P’ship Sec. Litig., 26 F.3d 50, 51 (7th Cir. 1994) (noting 3 that “a promise not to plead the statute of limitations, made during the course of 4 settlement negotiations, is enforceable”). 5 Interstate waived any statute of limitations defense when it entered into the first 6 settlement agreement. In their May 27, 2008, agreement, the parties agreed that 7 Interstate would “waive any and all time related defenses, including but not limited to, 8 statute of limitations . . . on the passage of time from December 31, 2007 . . . to a date 9 sixty (60) days after the contract compliance audit in this matter has been completed.” 10 (See dkt. no. 13-3 at ¶ 2.) The Trust Funds request contributions for the period dating 11 back to July 1, 2003. The Trust Funds filed their second suit on December 11, 2009, 12 and Interstate concedes that the original settlement agreement applied up until this 13 point. Therefore, the operative period to calculate the statute of limitations at that time 14 was from July 1, 2003, to December 31, 2007 (a total of 1654 days, or 4 years and 6 15 months). 16 The court-approved second stipulated agreement was entered into on September 17 16, 2010. Even if the Court were to not toll the statute of limitations for the period 18 between the second stipulated dismissal on September 16, 2010, to March 5, 2012, the 19 date of the filing of this claim (a total of 537 days, or 1 year, 5 months and 19 days), the 20 oldest claim still falls just shy of the six-year statute of limitations. 21 Interstate seeks to alter the goal posts by arguing that the Court ought to calculate 22 the statute of limitations not from the date of the second stipulated dismissal, but from 23 some date between the filing of the second lawsuit and the September 16, 2010, date of 24 the second stipulated dismissal, since the audit over the disputed contributions was 25 completed before September 16, 2010. However, it presents no evidence to allow the 26 Court to determine when the audit was completed, and instead points to a clause of the 27 second settlement agreement that states that an audit for the period through June 30, 28 2003, was completed. (See dkt. no. 13-5 at 1.) But this dispute concerns contributions 6 1 for the period after June 30, 2003. Indeed, the second paragraph of the second 2 settlement agreement makes expressly clear that an audit for the period beginning July 3 1, 2003, has not been completed, since Interstate is compelled to provide “for inspection 4 and audit its payroll and reasonably related records . . . from July 1, 2003 through June 5 30, 2008.” (Id. at ¶ 2.) As a result, at the time the second settlement agreement was 6 signed on September 16, 2010, no audit for the disputed period appears to have 7 occurred, and therefore the first settlement agreement’s waiver of the statute of 8 limitations defense extended until September 16, 2010. 9 Interstate also seeks to characterize the second settlement agreement as a 10 novation that superseded the waiver of the statute of limitations defense in the first 11 agreement. The Court seriously doubts that the second settlement agreement applies to 12 vacate the first agreement’s waiver to resurrect from the grave Interstate’s statute of 13 limitations defense. But even if it did, equitably tolling the statute of limitations would be 14 appropriate in this circumstance. See Copeland v. Desert Inn Hotel, 673 P.2d 490, 492 15 (Nev. 1983) (listing factors to consider when determining whether to apply doctrine of 16 equitable tolling). Accordingly, the statute of limitations defense is unavailable to 17 Interstate. 18 C. 19 In the alternative, Interstate seeks partial summary judgment on the Trust Funds’ 20 claims for delinquent contributions relating to work performed by employee Anthony 21 Davis. On January 8, 2008, Davis, through a representative from the Local, submitted a 22 grievance to Interstate seeking back wages and benefits for hours worked from April 23 2007 through January 2, 2008. (See dkt. no. 13-2A.) On May 13, 2008, Interstate and 24 Davis’ representative entered into a settlement agreement where Interstate was to pay 25 the Local a total of $11,465.44. 26 Interstate stated that it was paid for a settlement “to include wage and benefits.” (Dkt. 27 no. 13-2C.) 28 /// Partial Summary Judgment for Claims Relating to Anthony Davis (Dkt. no. 13-2B.) 7 The check ultimately issued by 1 The Court agrees with Interstate. The documents provided in support of 2 Interstate’s Motion indicate that the Local settled its claims over both back wages and 3 benefits with Interstate, at least for the period between April 2007 through January 2, 4 2008. The Trust Funds argue that because they were not parties to the binding 5 agreement between Interstate and the Local, the Davis settlement has no bearing on 6 this action. However, as Interstate correctly points out, “[a] third party beneficiary who 7 seeks to enforce a contract does so subject to the defenses that would be valid as 8 between the parties.” Morelli v. Morelli, 720 P.2d 704, 706 (Nev. 1986). Here, the Trust 9 Funds are third party beneficiaries of the collective bargaining agreement signed 10 between the Local and Interstate. See, e.g., Pierce Cnty. Hotel Emps. & Rest. Emps. 11 Health Trust v. Elks Lodge, 827 F.2d 1324, 1326 (9th Cir. 1987) (noting that benefits 12 trust funds are third party beneficiaries of collective bargaining agreements between the 13 employer and the union). Here, the Trust Funds are third party beneficiaries of the 14 collective bargaining agreement, and cannot sue to recover delinquent contributions for 15 payments received by the Local that included benefit contributions. It is irrelevant that 16 Interstate agreed in the second settlement agreement to make Davis’ employment 17 records available for an audit. (See dkt. no. 13-5 at ¶ 2.) The Trust Funds thus fail to 18 raise any triable issue of material fact as to delinquent contributions made for Davis’ 19 employment between April 2007 and January 2, 2008. 20 V. CONCLUSION 21 In sum, Interstate’s Motion for Summary Judgment on the Trust Funds’ claims 22 fails. However, the Court grants its request for partial summary judgment as to Anthony 23 Davis’ claims with respect to the period outlined above. As the Court’s adjudication of 24 Interstate’s Motion did not require additional briefing or an oral hearing, the Trust Funds’ 25 Motion for Leave to File Sur-Reply and for Oral Argument is denied. Accordingly, IT IS HEREBY ORDERED that Defendant Interstate’s Motion for 26 27 Summary Judgment (dkt. no. 13) is DENIED in part and GRANTED in part. 28 /// 8 1 IT IS FURTHER ORDERED that Plaintiff Trust Funds’ Motion to Withdraw 2 CounterMotion for Summary Judgment (dkt. no. 27) is GRANTED. The Trust Funds’ 3 CounterMotion (dkt. no. 15) is hereby WITHDRAWN. 4 5 6 IT IS FURTHER ORDERED that the Trust Funds’ Motion for Leave to File SurReply and for Oral Argument (dkt. no. 28) is DENIED. DATED THIS 5th day of March 2013. 7 8 MIRANDA M. DU UNITED STATES DISTRICT JUDGE 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 9