Trustees-Northern Nevada Operating Engineers Health & Welfare Trust Fund et al v. Mach 4 Construction, LLC et al, No. 3:2008cv00578 - Document 59 (D. Nev. 2010)

Court Description: ORDER denying 50 Motion for Summary Judgment. See order for specifics. Signed by Judge Larry R. Hicks on 7/23/10. (Copies have been distributed pursuant to the NEF - EM)
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Trustees-Northern Nevada Operating Engineers Health & Welfare Trust Fund...4 Construction, LLC et al Doc. 59 1 2 3 4 5 UNITED STATES DISTRICT COURT 6 DISTRICT OF NEVADA 7 8 9 10 11 12 13 14 15 16 ***** ) TRUSTEES of the NORTHERN NEVADA ) OPERATING ENGINEERS HEALTH & ) 3:08-CV-00578-LRH-RAM ) WELFARE TRUST FUND, et al., ) ) Plaintiffs, ORDER ) ) v. ) MACH 4 CONSTRUCTION, LLC, a Nevada ) ) limited liability company; DUNCAN MILLER; ANGELA MILLER; DOES 1-100; ) ) and BLACK AND WHITE COMPANIES ) 101-200; ) ) Defendants. _____________________________________ ) Before the court is Plaintiffs’, trustees of various operating engineer trust funds 17 18 (collectively “Plaintiffs”), Motion for Summary Judgment (#501) filed on March 2, 2010. 19 Defendants Mach 4 Construction, LLC (“Mach 4”); Duncan Miller (“Mr. Miller”); 20 and Angela Miller (“Ms. Miller”) (collectively “Defendants”) filed an opposition (#52) to which 21 Plaintiffs replied (#57). 22 I. Facts and Procedural History Plaintiffs are the chairman and co-chairman of the Board of Trustees of various 23 24 operating engineer trust funds (collectively “trust funds”). (Compl. (#1) ¶ 3.) The trust funds are 25 1 Refers to the court’s docket entry number. 1 employee benefit plans according to Section 3(3) of ERISA, 29 U.S.C. § 1002(3), and multi- 2 employer plans according to Section 3(37) of ERISA, 29 U.S.C. § 1002(37). (Id.) 3 Defendant Mach 4 is a Nevada corporation that employs operating engineers. (Compl. 4 ¶¶ 4-5.) On May 1, 2007, Mach 4 executed the Independent Northern Nevada Construction 5 Agreement (“Short Form”) with Operating Engineers Local Union No. 3 of the International Union 6 of Operating Engineers, AFL-CIO (“Union”). (Compl. ¶ 10.) The Short Form contains terms from 7 the Master Agreement executed by the Nevada Chapter of the Associated General Contractors of 8 America, Inc., and the Union. Together, the Short Form and Master Agreement are the controlling 9 Collective Bargaining Agreements (“CBAs”). 10 Pursuant to the CBAs, Mach 4 agreed to make fringe benefit payments to the trust funds 11 for every hour worked by operating engineers regardless of their union membership status. 12 (Compl. ¶ 13.) Additionally, Mach 4 agreed to submit employer contribution reporting forms to 13 Plaintiffs on a monthly basis. (Id.) Moreover, pursuant to the Short Form, Mr. and Ms. Miller, 14 managers at Mach 4, guaranteed Mach 4's obligations. (Mot. Summ. J. ¶ 2.) 15 On October 30, 2008, Plaintiffs filed a complaint against Defendants, alleging three 16 causes of action: (1) breach of contract - Mach 4; (2) breach of guaranty - Mr. Miller; and (3) 17 breach of guaranty - Ms. Miller. Thereafter, on March 2, 2010, Plaintiffs filed the present motion 18 for summary judgment (#50). 19 II. Legal Standard 20 Summary judgment is appropriate only when “the pleadings, depositions, answers to 21 interrogatories, and admissions on file, together with the affidavits, if any, show that there is no 22 genuine issue as to any material fact and that the moving party is entitled to judgment as a matter 23 of law.” FED. R. CIV. P. 56(c). In assessing a motion for summary judgment, the evidence, 24 together with all inferences that can reasonably be drawn therefrom, must be read in the light most 25 favorable to the party opposing the motion. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 2 1 U.S. 574, 587 (1986); County of Tuolumne v. Sonora Cmty. Hosp., 236 F.3d 1148, 1154 (9th Cir. 2 2001). 3 The moving party bears the burden of informing the court of the basis for its motion, 4 along with evidence showing the absence of any genuine issue of material fact. Celotex Corp. v. 5 Catrett, 477 U.S. 317, 323 (1986). On those issues for which it bears the burden of proof, the 6 moving party must make a showing that is “sufficient for the court to hold that no reasonable trier 7 of fact could find other than for the moving party.” Calderone v. United States, 799 F.2d 254, 259 8 (6th Cir. 1986); see also Idema v. Dreamworks, Inc., 162 F. Supp. 2d 1129, 1141 (C.D. Cal. 2001). 9 To successfully rebut a motion for summary judgment, the non-moving party must 10 point to facts supported by the record that demonstrate a genuine issue of material fact. Reese v. 11 Jefferson Sch. Dist. No. 14J, 208 F.3d 736 (9th Cir. 2000). A “material fact” is a fact “that might 12 affect the outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 13 242, 248 (1986). Where reasonable minds could differ on the material facts at issue, summary 14 judgment is not appropriate. See v. Durang, 711 F.2d 141, 143 (9th Cir. 1983). A dispute 15 regarding a material fact is considered genuine “if the evidence is such that a reasonable jury could 16 return a verdict for the nonmoving party.” Liberty Lobby, 477 U.S. at 248. The mere existence of 17 a scintilla of evidence in support of the plaintiff’s position will be insufficient to establish a 18 genuine dispute; there must be evidence on which the jury could reasonably find for the plaintiff. 19 See id. at 252. 20 III. 21 Discussion According to § 12.01.00 of the Master Agreement, Mach 4 agreed to contribute to the 22 Trust Fund for every hour worked by an operating engineer. (See Mot. Summ. J., Ex. 4 56.) 23 Plaintiffs contend that Mach 4 breached the Collective Bargaining Agreements by failing to report 24 and contribute for all hours worked by operating engineers. (Compl. ¶ 15.) In opposition, Mach 4 25 argues that there was no breach of contract because it terminated the CBAs prior to the date of the 3 1 alleged breach. 2 On June 2, 2008, Defendants sent notice to Plaintiffs that it was terminating the CBAs 3 as of May 1, 2008. (Defs.’ Opp’n Pls.’ Mot. Compel, Ex. 4.) Plaintiffs argue that Defendants’ 4 notice was too late, as a matter of law, to terminate the agreements and therefore, summary 5 judgment on the breach of contract claim is appropriate. (See Pls.’ Mot. Summ. J. 15:18-19.) 6 Pursuant to the Short Agreement: 7 The Individual Employer agrees to be bound to . . . future Master Agreements and any amendment(s) thereto: provided, however, . . . either party . . . [may] terminate this Agreement . . . during the period of sixty (60) to ninety (90) days prior to the expiration of any Master Agreement. 8 9 (Mot. Summ. J., Ex. 2.) Moreover, the Master Agreement provides that: 10 [The agreement is] in effect through June 30, 2008, and if the written notice provided by Section 8(d) of the National Labor Relations Act . . . is not given by either the Union or the Employer to the other, it shall continue indefinitely, provided however, this Agreement may be terminated at any time after June 30, 2008, by either the Union or the Employer giving to the other written notice provided by Section 8(d) of the Act in which event this Agreement shall terminate at the end of the sixtieth (60th) calendar day after receipt of such notice. 11 12 13 14 15 (Mot. Summ. J., Ex. 3.) The plain language of the Short Form provides that either party may terminate the Short 16 17 Form if it provides notice sixty days prior to the initial expiration of the Master Agreement. 18 Moreover, that the Master Agreement, incorporating Section 8(d) of the National Labor Relations 19 Act,2 allows either party to terminate the Master Agreement if it provides notice at least 60 days 20 prior to the proposed termination. Based on the CBAs, Plaintiffs contend that Mach 4 failed as a 21 matter of law to provide appropriate written notice during the period of 60 to 90 days prior to the 22 2 23 24 Pursuant to Section 8(d) of the National Labor Relations Act, “No party . . . shall terminate or modify such contract, unless the party desiring such termination of modification . . . serves a written notice to the expiration date thereof, or in the event such contract contains no expiration date, sixty days prior to the time it is proposed to make such termination or modification.” (29 U.S.C. § 158(d)(1).) 25 4 1 expiration of the Master Agreement, and thus did not terminate the agreements. (Pls.’ Mot. Summ. 2 J. 15: 19-20.) Further, Plaintiffs argue that Mach 4's attempt to terminate the CBAs on May 1, 3 2008, by providing notice on June 2, 2008, is procedurally improper because the notice of 4 termination can only terminate an agreement on a date after notice has been given. (See Reply 5 Supp. Pls.’ Mot. Summ. J. 9:1-9.) 6 In opposition, Defendants argue that the notice, provided on June 2, 2008, terminated 7 the contracts on either May 1, 2008, or on August 30, 2008. (Opp’n Mot. Summ. J. 2:23; 3:7; 8 Defs’ Opp’n to Pls.’ Mot. Compel, Ex. 4.) Defendants argue that the notice terminated the CBAs 9 on May 1, 2008 because that was Defendants’ stated date of termination. (Opp’n Mot. Summ. J. 10 2:22-23.) Defendants alternatively argue that the letter terminated the contracts on August 30, 11 2008, because the Master Agreement contains a termination provision that allows either party to 12 terminate the agreement 60 days after notice is given, any time after the June 30, 2008 automatic 13 continuation. (Opp’n Mot. Summ. J. 3:7-12.) 14 Initially, the court finds that the plain language of the CBAs does not permit or 15 contemplate retroactive termination. Thus, Defendants’ June notice was insufficient to terminate 16 the agreements as of the proclaimed May 1, 2008 termination date. Accordingly, the court finds 17 that Defendants did not terminate the CBAs on May 1, 2008, and, therefore, the Master Agreement 18 did not terminate on June 30, 2008, but was automatically renewed pursuant to the Master 19 Agreement’s language. (See Mot. Summ. J., Ex. 3 (“if the written notice . . . is not given . . . [the 20 Master Agreement] shall continue indefinitely.”)) 21 As to Plaintiffs’ argument that Mach 4's notice did not terminate the agreements after 22 the continuation of the Master Agreement, the court finds that a genuine issue of material fact 23 exists regarding whether Defendants’ notice terminated the CBAs sixty days after the notice 24 became effective on June 30, 2008. (Defs.’ Opp’n to Pls.’ Mot. Compel, Ex. 4.) The CBAs do not 25 indicate whether a party can provide a notice of termination prior to the automatic renewal date of 5 1 the Master Agreement and whether such notice would be sufficient to terminate the CBAs sixty 2 days later. 3 Taking the evidence in the light most favorable to Defendants, Defendants’ notice, even 4 if insufficient to terminate the CBAs prior to automatic renewal on June 30, 2008, was sufficient to 5 terminate the agreement sixty days after automatic renewal. (See Mot. Summ. J., Ex. 3 (“[the 6 Master agreement] may be terminated at any time after June 30, 2008.”)) The prior notice reflected 7 Defendants’ intent to terminate the CBAs at the earliest possible termination date which the court 8 finds is sixty days after the Master Agreement’s June 30, 2008 automatic renewal date. Therefore, 9 the court finds that Plaintiffs are not entitled to summary judgment on their breach of contract 10 claim because there is a disputed issue of material fact as to whether Defendants terminated the 11 CBAs. Accordingly, the court shall deny Plaintiff’s motion for summary judgment on the breach 12 of contract claim. Moreover, because the breach of guaranty claims rely on the underlying breach 13 of contract claim, the court shall deny summary judgment for those claims as well. 14 15 16 IT IS THEREFORE ORDERED that Plaintiffs’ motion for summary judgment (#50) is hereby DENIED. 17 IT IS SO ORDERED. 18 DATED this 23rd day of July, 2010. 19 20 21 __________________________________ LARRY R. HICKS UNITED STATES DISTRICT JUDGE 22 23 24 25 6