United States District Court, W.D. Pennsylvania
CARPENTERS COMBINED FUND, INC., by James R. Klein, Administrator, Plaintiff,
JOHN LUCCI, and THOMAS VELOTTA, Defendants. LABORERS' COMBINED FUNDS OF WESTERN PENNSYLVANIA, Plaintiff,
JOHN LUCCI, and THOMAS VELOTTA, Defendants.
OPINION AND ORDER
MAUREEN P. KELLY, CHIEF UNITED STATES MAGISTRATE JUDGE.
Carpenters Combined Funds, Inc. (“the Carpenters
Fund”) and Plaintiff Laborers' Combined Funds of
Western Pennsylvania (“the Laborers Fund”)
(collectively “Plaintiffs” or “the
Funds”) filed these related actions against John Lucci
(“Lucci”) and Thomas Velotta
(“Velotta”) for recovery of certain unpaid fringe
benefit contributions and related interest, liquidated
damages and attorneys' fees pursuant to the Employee
Retirement Income Security Act of 1974 (“ERISA”),
29 U.S.C. §§ 1001, et seq.
before the Court are the Motions for Summary Judgment against
Defendant Velotta filed by Plaintiffs. ECF No.
For the following reasons, both motions will be denied.
The Carpenters Fund Action
Carpenters Fund brought its action at Civil Action No.
13-1287 under ERISA for fringe benefit contributions related
to work performed by carpenters during the period from 2012
to 2013, which all were due and owing to the Carpenters Fund
by Concrete Restoration Services, LLC (“CRS” or
“Concrete Restoration Services”) by virtue of a
collective bargaining agreement (“CBA”) and trust
agreements incorporated therein. See C.A. No.
13-1287: ECF No. 3 (generally) and ¶ 3. The Carpenters
Fund seeks to hold Velotta liable under ERISA, alleging that
he was an ERISA fiduciary during the relevant time period
regarding the fringe benefit payments due.
The Laborers Fund Action
Laborers Fund brought essentially the same action at Civil
Action No. 13-1288under ERISA for fringe benefit
contributions related to work performed by Laborers for CRS
between 2012 and 2013. See C.A. No. 13-1288: ECF No.
3 (generally) and ¶ 16. As the principal payments
regarding the laborers' work have been paid and are no
longer outstanding, the Laborers Fund now only seeks to hold
Velotta liable under ERISA for payment of the remaining
unpaid liquidated damages, interest, and attorneys' fees.
See ECF No. 42-1 (Affidavit of Botsford,
Administrator Laborers Fund).
also brings a state law claim for conversion at Count II
seeking recovery for amounts they claim were withheld from
workers' wages for union dues and legislative funds
(“political action committee” or
“PAC” contributions) but not remitted to the
Funds. See ECF No. 3, ¶¶ 19-25.
these matters were stayed until February 26, 2015 at the
request of Plaintiffs. ECF Nos. 28, 29. On April 8, 2016,
counsel for Velotta filed a motion to withdraw as counsel in
both cases, which the Court granted. ECF No. 34, 35. Velotta
has since been proceeding pro se.
Motions for Summary Judgment
January 9, 2017, Plaintiffs each filed a Motion for Summary
Judgment against Velotta with Brief in Support, ECF Nos. 39,
arguing that they are entitled to summary judgment on the
ERISA claim against Velotta for breach of fiduciary duty
based on the contention that Velotta was a fiduciary under
ERISA either by virtue of his position at CRS, or
alternatively, under a theory that Velotta Company and CRS
constituted a “single employer” and Velotta would
be liable with respect to Fund assets representing the work
performed by laborers and contractors for CRS by virtue of
his position at Velotta Company. Plaintiffs' Motions do
not mention Count II, although that count is briefly
addressed in the supporting briefs. Plaintiffs filed Concise
Statements of Material Facts in support of their Motions, ECF
No. 41, with separate Appendices. ECF No. 42. On January 30,
2017, Velotta filed Responses in Opposition, ECF No. 44,
disputing certain of the Material Facts asserted by
Plaintiffs, namely: 1) that Velotta is a personally liable
“fiduciary” under ERISA during the relevant time
period for which the Funds seek payment, as Velotta contends
he was not an officer or employee of CRS during the relevant
time period and thus did not then have authority or control
over CRS payments to the Funds; and 2) that Velotta Company
is a “single employer” with CRS, as Velotta
maintains the two were maintained as separate legal entities.
In opposition, Velotta relies on the record as contained
within Plaintiffs' Appendices. On February 13, 2017,
Plaintiffs filed replies in support of their motions for
summary judgment, ECF No. 45, arguing that because the
pro se defendant failed to file a separate response
to each of their Concise Statement of Material Fact as
required by the rules, the stated facts should be deemed
admitted. Velotta responded with motions to strike the
replies as untimely, ECF No. 47, which the Court denied. ECF
No. 52. Plaintiffs' motions for summary judgment are now
ripe for resolution.
STANDARD ON SUMMARY JUDGMENT
deciding a summary judgment motion under Federal Rule of
Civil Procedure 56, a court must view the facts in the light
most favorable to the nonmoving party and must draw all
reasonable inferences, and resolve all doubts in favor of the
nonmoving party. Matreale v. New Jersey Dep't of
Military & Veterans Affairs, 487 F.3d 150, 152 (3d
Cir. 2007); Woodside v. Sch. Dist. of Phila. Bd. of
Educ., 248 F.3d 129, 130 (3d Cir. 2001). Rule 56
specifically provides that: “[t]he court shall grant
summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a). Thus,
summary judgment is warranted where, “after adequate
time for discovery and upon motion . . . a party . . . fails
to make a showing sufficient to establish the existence of an
element essential to that party's case, and on which that
party will bear the burden of proof at trial.”
Marten v. Godwin, 499 F.3d 290, 295 (3d Cir. 2007)
(quoting Celotex Corp. v. Catrett, 477 U.S. 317,
disputed fact is “material” if proof of its
existence or nonexistence would affect the outcome of the
case under applicable substantive law. Anderson v.
Liberty Lobby, 477 U.S. 242, 248 (1986); Gray v.
York Newspapers, Inc., 957 F.2d 1070, 1078 (3d Cir.
1992). An issue of material fact is “genuine” if
the evidence is such that a reasonable jury could return a
verdict for the nonmoving party. Anderson, 477 U.S.
at 257; Brenner v. Local 514, United Brotherhood of
Carpenters and Joiners of America, 927 F.2d 1283,
1287-88 (3d Cir. 1991). When determining whether there is a
genuine issue of material fact, the court must view the facts
and all reasonable inferences in favor of the nonmoving
party. EEOC v. Allstate Ins., 778 F.3d 444, 448 (3d
the movant bears the initial burden of demonstrating that
there is an absence of evidence to support the non-moving
party's case. Celotex Corp. v. Catrett, 477 U.S.
at 322. See Conoshenti v. Pub. Serv. Elec. & Gas
Co., 364 F.3d 135, 140 (3d Cir. 2004). “W]hen the
moving party has carried its burden under Rule 56(c), its
opponent must do more than simply show that there is some
metaphysical doubt as to the material facts . . . . Where the
record taken as a whole could not lead a rational trier of
fact to find for the nonmoving party, there is no genuine
issue for trial.” Scott v. Harris, 550 U.S.
372, 380 (2007) (quoting Matsushita Elec. Indus. Co. v.
Zenith Radio Corp., 475 U.S. 574, 586-87 (1986)). If the
nonmoving party bears the burden of proof at trial and fails
to make a sufficient showing on any essential element of its
case, the moving party is entitled to judgment as a matter of
law. Celotex, 477 U.S. at 323.
as here, however, the moving parties -- Plaintiffs -- bear
the burden of proof on each element of their claims,
succeeding on their motions for “affirmative”
summary judgment can prove a more difficult but not
insurmountable task because “the standard is more
stringent.” Nat'l State Bank v. Fed. Reserve
Bank, 979 F.2d 1579, 1582 (3d Cir. 1992). The moving
[b]ear the burden of proof on [their ERISA and conversion
claims]. “After all, the burden of proof includes the
obligation to persuade the factfinder that one's
propositions of fact are indeed true. Thus, if there is a
chance that a reasonable factfinder would not accept a moving
party's necessary propositions of fact, pre-trial
judgment cannot be granted. Specious objections will not, of
course, defeat a motion for summary judgment, but real
questions about credibility, gaps in the evidence, and doubts
as to the sufficiency of the movant's proof, will.”
Wallace v. Nat'l Indem. of Mid-Am., No. 14-1253,
2016 WL 6948781, at *3 n.2 (W.D. Pa. July 8, 2016) (quoting
El v. Se. Pa. Transp. Auth. (SEPTA), 479 F.3d 232,
238 (3d Cir. 2007)). Plaintiffs must convince the Court that
they have met this exacting standard on every essential
element of their claims. As the United States Court of
Appeals for the Third Circuit further explained in
Nat'l State Bank, “where the movant bears
the burden of proof at trial and the motion does not
establish the absence of a genuine factual issue, the
district court should deny summary judgment even if no
opposing evidentiary matter is presented.” 979
F.2d at 1582 (emphasis added) (citing Resolution Tr.
Corp. v. Gill, 960 F.2d 336, 340 (3d Cir. 1992)).
FACTS RELATIVE TO MOTIONS FOR SUMMARY
Response to Plaintiffs' Concise Statement of
outset, the Court must address the application of the Local
Rules of this Court and Plaintiffs' argument that the
Concise Statement of Material Facts, ECF No. 41, to which
Velotta did not separately respond, is deemed admitted in all
respects. ECF No. 45.
Civil Rule 56, sets forth the requirements for filings in
summary judgment motions. Local Civil Rule 56.B.1 requires
the movant to file a separate concise statement of material
facts citing “to a particular pleading, deposition,
answer to interrogatory, admission on file or other part of
the record supporting the party's statement, acceptance,
or denial of the material fact.” LCvR 56.B.1. In
response, the opposing party is required to provide a
separately filed concise statement admitting or denying the
facts in the moving party's concise statement, LCvR
56.C.1.a, setting forth the basis for a denial of the moving
party's concise statement with reference to the record,
LCvR 56.C.1.b, and providing any additional material facts
that are necessary for the court's ruling on the motion.
LCvR 56.C.1.c. Finally, Local Civil Rule 56.E provides that
facts asserted as undisputed by either party “will for
the purpose of deciding the motion for summary judgment be
deemed admitted unless specifically denied or otherwise
controverted by a separate concise statement of the opposing
party.” LCvR 56.E.
Velotta, proceeding pro se, did not provide a
separate responsive Concise Statement of Facts as required by
Local Rule 56.C.1, he did specifically indicate certain facts
he vehemently disputes with citations to evidence in the
record in his responsive briefs.
the admonition of the United States Court of Appeals for the
Third Circuit in Nat'l Bank regarding the
standard on movants' motions, the Court will consider as
contested the specifically challenged facts by Velotta where
they are adequately supported by the record. The remaining
statement of facts proffered by Plaintiffs, to the extent
they are adequately supported by the record as required by
Local Civil Rule 56.B.1 and are in accordance with the
standards applicable to motions under Federal Rule of Civil
Procedure 56, will be deemed admitted for purpose of the
summary judgment motions in accordance with Local Civil Rule
Carpenters Fund and the Laborers Fund are multi employer
fringe benefit funds that provide medical and retirement
benefits to carpenters, laborers and their families. ECF No.
41 ¶ 1. CRS was bound by the CBAs and their
incorporated Trust Agreements entered into with the
Carpenters Union and the Laborers Union. ECF No. 41 ¶
11. See ECF No. 42-6 (Laborers CBA from 2008 to
2010); ECF No. 42-7 (Laborers CBA from 2010 to 2013); ECF No.
42-12 (Carpenters CBA from 2008 to 2010); ECF No. 42-13
(Carpenters CBA from 2011 to 2013). The CBAs require the
timely payment of fringe benefit contributions and wage
deductions to the Funds on a monthly basis with associated
interest, liquidated damages and attorneys' fee due for
failure to timely make required payments. ECF No. 41 ¶
11. At some point, though the precise dates are never
provided by Plaintiffs, Velotta Company also was a signatory
to the CBAs with the Carpenters Union and the Laborers Union.
ECF No. 42-22 at 55-56. Velotta Company appears to have made
its payments to the Fund as required by the CBAs, ECF No.
42-22 at 55-56, and is not a defendant in this action.
failed to make certain principal contributions it owed to the
Carpenters Fund for work performed from September 2012 to
June 2013, ECF No. 3, ¶ 15, regarding which the
Carpenters Fund seeks payment through Civil Action No.
13-1287. According to the Carpenters Fund, the amount due and
owing by CRS through December 31, 2016, including liquidated
damages, attorney's fees, and interest for Count I totals
$85, 151.08. ECF No. 42-14. Regarding Count II for
conversion, the amount due and owing to the Carpenters Funds
through December 31, 2016 for principal and interest totals
$4, 209.95. ECF No. 42-14.
the Laborers Fund, it is alleged in the Amended Complaint in
Civil Action No. 13-1288 that CRS did not make payment for
certain principal contributions it owed to the Laborers Fund
for work performed from June 2012 through June 2013. ECF No.
3, ¶ 16. According to the Affidavit of Dawn Botsford,
Administrator of the Laborers Fund, all of these principal
payments were eventually made to the Laborers Fund, but
amounts remain outstanding for interest, liquidated damages,
and attorneys' fees. ECF No. 42-1, ¶ 2
(“Botsford Affidavit”). The remaining amount due
and owing to the Laborers Funds by CRS through December 31,
2016, totals $218, 809.41 under Count I pursuant to ERISA for
interest, liquidated damages, and attorney's fees, ECF
No. 42-8, and totals $13, 386.19 for interest under Count II
for conversion. ECF No. 42-8.
Concrete Restoration Services (“CRS”)
an Ohio Limited Liability Company that was started and
originally owned by its two members, Lucci and his brother.
ECF No. 42-22 at 18, 33. Subsequently, Velotta Company became
part owner of CRS through a purchase of CRS equipment. ECF
No. 42-22 at 34. According to the amended and restated
operating agreement of CRS (“CRS Operating
Agreement”) dated January 1, 2006, signed by Lucci for
himself and signed by Velotta on behalf of Velotta Company,
Lucci and Velotta Company were then the two Members of CRS
with Velotta Company owning 68 % of CRS and Lucci owning 32
%. ECF No. 42-22 at 28-29; ECF No. 42-18 at 2-3, 12, 15,
23-24. The CRS Operating Agreement also provided that if the
members holding the majority of interest determined that
additional funds were required to pay CRS operating costs,
then the members shall contribute additional funds in
proportion to their interest. ECF No. 42-18 at 3. If a member
is unable or unwilling to make a proportionate contribution,
the contributing member could make the non-contributing
member's proportionate contribution resulting in a loan
from the contributing member. ECF No. 42-18 at 3 (emphasis
point, Velotta was an officer of CRS, serving as its Vice
President. ECF No. 42-22 at 16-17. In his capacity as an
officer of CRS, Velotta, amongst other things, assisted in
estimating jobs, and was an additional signatory on CRS'
checking account, ECF No. 42-22 at 19; ECF No. 42-24 at 6.
Velotta, however, did not have any role in determining
amounts of salary, wages, or fringe benefits of CRS
employees, ECF No. 42-22 at 41, and did not sign any of the
CRS employee paychecks which were all were signed with
Lucci's signature using a signature stamp. ECF No. 42-24
at 5. Other details regarding Velotta's work for CRS are
either not provided by Plaintiffs through record evidence or
are disputed by Velotta's testimony. Lucci, who
admittedly worked for CRS and whose signature was on all of
CRS issued paychecks, received a CRS paycheck through
December 2013, during the relevant time period. ECF No. 42-24
parties dispute the precise time period during which Velotta
served as an officer of CRS and whether Velotta served as its
Vice President or its President. Velotta testified at his
deposition that “at one time” he was a Vice
President at CRS, ECF No. 42-22 at 16-17; that he was never
the President, ECF No. 42-22 at 21; that he had check writing
authority for CRS “a long time ago” and that
Lucci had the check writing authority for CRS, ECF No. 42-22
at 19; that he resigned from CRS and quit the company having
signed a resignation letter dated May 1, 2008, and that, at
the very least by October of 2010, he was no
longer employed and had nothing to do with CRS, ECF No. 42-22
at 13, 16, 21, 25; and that he had not worked for CRS for at
least “six, seven years” as of the date of his
January 2017 deposition. ECF No. 42-22 at 25,
explained that it was his signature on the May 1, 2008
resignation letter, but offered that given that the events
occurred nearly a decade prior to his deposition he could not
specifically recall handing the resignation letter to Lucci
or telling Lucci of his resignation, but assumed that he had
done so. ECF No. 42-22 at 22. His testimony supports that, at
the very least sometime between May 1, 2008 and October of
2010, he ceased working for CRS and serving as its Vice
President. ECF No. 42-22 at 21-22. Regarding his reasons for
resigning from CRS, Velotta was able to recall that:
[a]t that time, Velotta Company had some work in Pennsylvania
and it needed 100 percent of my attention because things were
going sour on some jobs, and I didn't like the way-I
didn't like dealing with John Lucci and how he performed
his work, and so I decided just to quit and get away from it.
ECF No. 42-22 at 43. After Velotta quit working for CRS,
Velotta never took any personal action to take his name off
of the signature card held at the bank for the CRS
account. ECF No. 42-22 at 31.
Company is an Ohio Corporation. ECF No. 42-21, ¶
2. Robert Velotta, Defendant Velotta's
uncle, was President of Velotta Company up until February of
2016. ECF No. 42-22 at 7, 8. As of 2012, Velotta, his father
Michael Velotta, Carolann Velotta, and her father Robert
Velotta were each 25% owners of the Velotta Company. ECF No.
41 ¶ 6; ECF No. 42-22 at 7, 30. Defendant Velotta served
as Velotta Company's Vice President of Operations. ECF
No. 41 ¶ 5. Carolann Velotta served as Velotta
Company's Vice President of Finance, ECF No. 42-22 at 27,
was responsible for signing the checks of Velotta Company and
for maintaining its finances and financial records. ECF No.
42-22 at 36-37. She did not report to Defendant Velotta and
he was not responsible for finances at Velotta Company. ECF
No. 42-22 at 26, 35, 37.
Meager (“Meager”), was an employee of Velotta
Company, ECF No. 42-22 at 38-39, who at one point filled out
and signed an “employer survey” form provided by
the auditor of the Laborers dated July 21, 2009, in which she
listed herself as CRS' controller, see ECF No.
42-11 (indicating CRS as the correct name of “your
company”), and listed that Velotta was President of CRS
and Lucci was Vice President of CRS. Velotta, however,
testified that he was never the President of CRS. ECF No.
42-22 at 21. Although Lucci indicated that
Velotta was President of CRS and that he ...