United States District Court, E.D. Pennsylvania
TRUSTEES OF THE NATIONAL ELEVATOR INDUSTRY PENSION, ET AL.
1ST PRIORITY ELEVATOR COMPANY, ET AL.
BARCLAY SURRICK, J.
before the Court is Plaintiffs' Motion for Default
Judgment. (ECF No. 5.) For the following reasons, the Motion
will be granted.
ERISA action, Plaintiffs, which include Trust Funds for the
National Elevator Industry (“NEI Funds”), seek to
collect delinquent employee benefit fund contributions from
Defendant 1st Priority Elevator Company and 1st Priority
Elevator's owner and officer, Mauline Williams (the
“Individual Defendant”). Plaintiffs request the
outstanding contributions due, as well as interest and
liquidated damages on those payments.
Complaint alleges that on September 22, 2003, 1st Priority
Elevator and the International Union of Elevator Constructors
(the “Elevator Union”) entered into a Collective
Bargaining Agreement (“CBA”) establishing the
terms and conditions of employment for the elevator workers
employed by 1st Priority Elevator. (Compl. ¶ 5, ECF No.
1.) Pursuant to the CBA, 1st Priority Elevator was bound by
the terms and conditions of the Declarations of Trust
(referred to as the “Trust Agreements” in the
Complaint) associated with each of the NEI Funds.
(Id. ¶ 7.) Pursuant to the Declarations of
Trust, 1st Priority Elevator was obligated to file monthly
reporting forms with the Plaintiff NEI Funds and to submit
contributions that correspond to the total number of hours
worked by covered 1st Priority Elevator employees.
(Id. ¶¶ 6, 7.) These contributions finance
the NEI Funds and provide pension, medical, and educational
benefits to the Union employees. (Default Mem. 1, ECF No. 4.)
As a result, the NEI Funds are third party beneficiaries to
the CBA. (Id.)
allege in the Complaint that an audit conducted by the
Trustees revealed that for the period January 1, 2012 through
May 31, 2014, 1st Priority Elevator owes $37, 627.17 in
additional contributions and interest. Additional
interest that has accrued since the time of the audit totals
$3, 320.75. (Default Mem. 4.) The Declarations of Trust also
provide that when an employer fails to pay the amounts
required by the CBA on time, the Fund Trustees may seek
liquidated damages in the amount of 20 percent, interest,
costs, and attorneys' fees associated with the collection
of the delinquent contributions. (Compl. ¶ 11.) The
liquidated damages amount associated with these delinquent
contributions totals $7, 132.64. (Default Mem. 4-5.)
Plaintiffs also seek audit fees in the amount of $3, 862.00,
and additional interest in the amount of $80.66 for the late
payment of contributions for the months of February, March,
May, and June 2017. (Id. at 4.) Finally, Plaintiffs
seek attorneys' fees in the amount of $1, 437.50 and
costs in the amount of $670, for having to bring this
lawsuit. (Id. at 12.)
Complaint was filed on July 12, 2017. Defendants were served
with the Complaint on July 28, 2017. (ECF No. 2.) Defendants
failed to file an Answer, or otherwise plead or defend this
action. On August 8, 2017, the Clerk of the Court entered
default against Defendants. (ECF No. 5.) On August 31, 2017,
Plaintiffs filed this Motion for Default Judgment. Defendants
have not responded to the Motion and no attorney has entered
an appearance on behalf of Defendants.
determining whether a default judgment is warranted, courts
in this circuit weigh three factors: (1) prejudice to the
plaintiff if default is denied; (2) whether the
defendant's delay is due to culpable conduct; and (3)
whether the defendant appears to have a litigable defense.
Chamberlain v. Giampapa, 210 F.3d 154, 164 (3d Cir.
2000) (citation omitted). We are satisfied that all of these
factors weigh in favor of entering default judgment.
will be prejudiced if the default is denied. Plaintiffs will
be required to make payments to its union members despite its
inability to collect contributions from 1st Priority Elevator
that are due under the CBA and the Declarations of Trust.
See Nat'l Elec. Benefit Fund v. FJM Elec. Constr.,
LLC, No. 13-3057, 2015 WL 6750726, at *2 (E.D. Pa. Nov.
5, 2015) (finding that plaintiff union would have been
prejudiced if default judgment were denied because it was
still required to make vested payments to participants even
if the employer failed to make the required contributions).
addition, Defendants' culpability is evident from the
fact that they failed to make contributions or respond in any
way to Plaintiffs' claims despite being put on notice.
See New Jersey Bldg. Laborers' Statewide Pension Fund
& Trustees Thereof v. Belmont Contracting Corp., No.
13-507, 2014 WL 3731267, at *2 (D.N.J. July 25, 2014)
(finding that the defendant “is culpable because it has
been served with notice of this action, but has failed to
Defendants do not appear to have a litigable defense. With
respect to 1st Priority Elevator, Section 1145 of ERISA
requires that “[e]very employer who is obligated to
make contributions to a plan or under the terms of a
collectively bargained agreement . . . make such
contributions in accordance with the terms and conditions of
such plan or such agreement.” 29 U.S.C. § 1145. In
the event that an employer such as 1st Priority Elevator
fails to make contributions in violation of the CBA, the
Court may award:
(A) the unpaid contributions;
(B) interest on the unpaid ...