Opinion
Civil Action 21 Civ. 1755 (AJN) (SLC)
12-27-2021
THEATRICAL DRIVERS AND HELPERS LOCAL UNION NO. 817, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, Petitioner, v. BNM PRODUCTION SERVICES, INC., d/b/a “Ricky Rush, ” Respondent.
HONORABLE ALISON J. NATHAN, United States District Judge:
REPORT AND RECOMMENDATION
SARAH L. CAVE, United States Magistrate Judge.
I. INTRODUCTION
Before the Court is the motion of Petitioner Theatrical Drivers and Helpers Local Union No. 817, International Brotherhood of Teamsters (“Local 817”), seeking entry of a default judgment confirming an arbitration award against Defendant BNM Production Services, Inc., doing business as “Ricky Rush” (“BNM”). (ECF No. 19 (the “Motion”)). For the reasons set forth below, I respectfully recommend that the Motion be GRANTED and a default judgment against BNM be entered. 1
II. BACKGROUND
This factual summary is drawn from Petition, which the Court construes as true for purposes of the Motion. See Bricklayers & Allied Craftworkers Loc. 2 v. Moulton Masonry & Const. LLC, 779 F.3d 182, 187 (2d Cir. 2015).
Local 817 is a labor organization that represents employees in industries affecting commerce within the meaning of the National Labor Relations Act, 29 U.S.C. § 152(5) and the Labor Management Relations Act, 29 U.S.C. § 185. (ECF No. 3 ¶ 1). Local 817 and BNM were parties to a collective bargaining agreement (“CBA”), which provided for final and binding arbitration of disputes between them before the American Arbitration Association (“AAA”). (Id. ¶¶ 5-6). A dispute arose between Local 817 and BNM over BNM's failure to pay contractual wages and benefits contributions to Jennifer Sonnenfeld, Jesse Davidson, Susan Shopmaker, and Emily Fleisher, each of whom was covered by the CBA (the “Employees”). (Id. ¶ 7). On December 3, 2018, Local 817 filed a demand for arbitration with the AAA. (Id. ¶ 8).
The benefits contributions were to be paid to the “Motion Picture Industry Pension and Health Plans” (“MPIPHP”). (ECF No. 19-6 at 1-2).
An AAA arbitrator held a hearing on April 16, 2019, at which both Local 817 and BNM appeared. (ECF No. 19-2 at 50-53). Local 817 presented evidence, none of which BNM disputed, and, in fact, admitted that it owed the Employees the amounts they were seeking, but was unable to pay. (Id. at 51). The arbitrator found that BNM had entered into two agreements with Local 817 covering the Employees, and that pursuant to those agreements, BNM owed the Employees a total of $38,557.82. (Id.) Accordingly, the arbitrator issued the Award in the amount of $38,557.82, calculated as follows: 2
(ECF No. 19-2 at 52-53). The Award also provided that BNM was to pay the $275 arbitration administrative fee. (Id.) BNM has not made the payments required by the Award. (ECF No. 3 ¶ 12).
Employee
Salary, Meals & Rentals
Benefits Contribution to MPIPHP
Total
Jesse Davidson
$4,034
$1,419.65
$5,453.65
Jennifer Sonnenfeld
$3,792
$532.37
Susan Shopmaker
$20,000
$4,365.20
$24,365.20
Emily Fleisher
$3,000
$1,694.60
$4,694.60
$38,557.82
As addressed below, the Court finds a mathematical error in the arbitrator's computation of the total owed to Jennifer Sonnenfeld, as $3,792 + $532.37 = $4,324.37, not $4,044.37 as indicated in the Award.
B. Procedural Background
On March 4, 2021, Local 817 timely filed a petition seeking confirmation of an April 29, 2019 arbitration award (the “Award”) against BNM. (ECF No. 3 (the “Petition”)). After BNM failed to appear and respond to the Petition, the Clerk of the Court entered a Certificate of Default against BNM. (ECF No. 18). On June 17, 2021, Local 817 filed the Motion, accompanied by its attorney's affidavit and supporting exhibits. (ECF No. 19). On November 8, 2021, the Honorable Alison J. Nathan referred the Motion to the undersigned for a report and recommendation. (ECF No. 20). On November 18, 2021, the Court issued an order directing BNM to file a response to the Motion no later than December 17, 2021, and warning BNM that the failure to do so or to contact the Court to request a hearing would result in the Court issuing a report and 3 recommendation based on the Motion alone, without an in-court hearing. (ECF No. 21). BNM has not filed a response to the Motion or otherwise contacted the Court.
III.DISCUSSION
Although Local 817 styled the Motion as one for a default judgment under Fed.R.Civ.P. 55(b)(2) and Local Civil Rule 55.2(b), “the Second Circuit has held that ‘default judgments in confirmation/[vacatur] proceedings are generally inappropriate.'” Trustees of the N.Y.C. Carpenters Relief & Charity Fund v. Acme Steel Shelving Corp., No. 12 Civ. 5572 (AJN), 2013 WL 12109394, at *1 (S.D.N.Y. June 5, 2013) (quoting D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 109 (2d Cir. 2006)). In D.H. Blair, the Second Circuit explained that Fed.R.Civ.P. “55 does not operate well in the context of a motion to confirm or vacate an arbitration award.” 462 F.3d at 107. The Second Circuit instead advised district courts to treat an unanswered petition to confirm an arbitration award as “a motion for summary judgment, ” given that such a petition is typically accompanied by a record consisting of, at least, the agreement to arbitrate and the award, from which the court “may resolve many of the merits or at least command judicial deference.” New York City Dist. Council of Carpenters Pension Fund v. Metro. Millwork & Installations, Inc., No. 10 Civ. 5177 (JMF) (HBP), 2012 WL 2399502, at *4-5 (S.D.N.Y. June 5, 2012) (quoting D.H. Blair, 462 F.3d at 109). Accordingly, I respectfully recommend that Local 817's Motion be construed as a motion for summary judgment pursuant to Fed.R.Civ.P. 56. See Acme Steel, 2013 WL 12109394, at *1 (following D.H. Blair, and construing default judgment motion seeking to confirm arbitration award as summary judgment motion); see also Local 355 United Serv. Workers Union v. LA Mech. Corp., No. 15-CV-4474 (MKB) (VMS), 2016 WL 4367220, at *3 (E.D.N.Y. July 14, 2016) (collecting 4 cases treating unopposed motions to confirm arbitration awards as motions for summary judgment).
“Notwithstanding this inquiry, courts are ‘severely limited' in their review of arbitration awards because they should not undermine the purpose of arbitration, which is to settle disputes efficiently and to avoid costly litigation.” Trustees of the N.Y.C. Dist. Council of Carpenters Pension Fund v. Premium Sys., Inc., No. 12 Civ. 1749 (LAK) (JLC), 2012 WL 3578849, at *3 (S.D.N.Y. Aug. 20, 2012) (quoting Willemijn Houdstermaatschappij, BV v. Standard Microsys. Corp., 103 F.3d 9, 12 (2d Cir. 1997)). “Normally, confirmation of an arbitration award is a summary proceeding that merely makes what is already a final arbitration award a judgment of the court, and the court must grant the award unless the award is vacated, modified, or corrected.” D.H. Blair, 462 F.3d at 110 (internal citations and quotation marks omitted). “Only ‘a barely colorable justification for the outcome reached' by the arbitrators is necessary to confirm the award.” Id. (quoting Landy Michaels Realty Corp. v. Local 32B-32J, Serv. Emp. Int'l Union, 954 F.2d 794, 797 (2d Cir. 1992)).
The Court's review of the Award demonstrates that the arbitrator assessed the merits of the undisputed evidence and concluded that: (i) there were binding agreements between Local 817 and BNM; (ii) those agreements required BNM to make certain payments with respect to the Employees; (iii) by its own admission, BNM had not made those payments; and (iv) Local 817 had properly demanded-in the form of the “Grievance” before the arbitrator-that BNM pay the amounts it owed. (ECF No. 19-2 at 50-51). The arbitrator concluded:
After consideration of the evidence presented by [Local 817], which is not disputed by [BNM], the Undersigned awards [Local 817] payment by [BNM] of $38,557.82 for amounts owed by [BNM] to the [Employees], as set forth in the attached Appendix A ....5 (ECF No. 19-2 at 52).
The Court concludes that the Award “provides more than a ‘barely colorable justification for the outcome reached, '” with the exception of one mathematical correction to the Award as noted below. Acme Steel, 2013 WL 12109394, at *2 (quoting Landy Michaels, 954 F.2d at 797). “The arbitrator justified his decision based on the relevant and binding aspects of the [a]greement[s], ” id., which are in the record on the Motion, as well as the undisputed evidence Local 817 presented at the hearing. (ECF No. 19-2 at 7-52). I also find that the arbitrator's “reasoning is consistent with applications to confirm arbitration awards that courts in this District have approved.” Premium, 2012 WL 3578849, at *3 (collecting cases); see Acme Steel, 2013 WL 12109394, at *2 (reaching the same conclusion).
The Court, has, however, noted a mathematical error in the arbitrator's calculation of the amount BNM owed Jennifer Sonnenfeld, which in turn caused a mathematical error in the total amount of the Award. The arbitrator found that BNM owed her $3,792 in salary, meals, and rentals ($2,912 + $80 +$520 +$280) and $532.37 in benefits contributions, but computed the total to be $4,044.37, instead of the correct computation, which is $4,324.37. (ECF No. 19-2 at 52). As a result of this error, the arbitrator calculated the total amount that BNM owed as $38,557.82 (id.), instead of the correct computation, which is $38,837.82 ($5,453.65 + $4,324.37 + $24,365.20 +$4,694.60). In other words, the Award correctly allocated the individual amounts of wages and benefits contributions to each of the Employees, but simply tabulated the total amount for Jennifer Sonnenfeld, and accordingly, the total amount of the Award, incorrectly. “Courts have modified awards in similar circumstances where there is an evident material miscalculation of figures on the face of the arbitrator's award.” 6 Trustees of Empire State Carpenters Annuity, Apprenticeship, Labor-Mgmt. Cooperation, Pension and Welfare Funds v. Archetype Constr. Corp., No. 13-CV-1877 (JS) (GRB), 2014 WL 4659292, at *2 (E.D.N.Y. Sept. 16, 2014) (collecting cases and modifying arbitration award where arbitrator miscalculated sum of delinquent contributions); see Trustees of Empire State Carpenters Annuity, Apprenticeship, Labor-Mgmt. Cooperation, Pension, & Welfare Funds v. C.M.K. Contr. Inc., No. 13-CV-7005 (ADS) (AKT), 2015 WL 1198609, at *10 (E.D.N.Y. Mar. 14, 2015) (modifying award to correct arbitrator's computational error). I therefore respectfully recommend that the Award be modified to correct the computational error, and that judgment against BNM be entered in the following amounts with respect to the Employees:
Employee
Salary, Meals & Rentals
Benefits Contribution to MPIPHP
Total
Jesse Davidson
$4,034
$1,419.65
$5,453.65
Jennifer Sonnenfeld
$3,792
$532.37
$4,324.37
Susan Shopmaker
$20,000
$4,365.20
$24,365.20
Emily Fleisher
$3,000
$1,694.60
$4,694.60
$38,837.82
In addition, the Court recommends that the judgment also include the $275.00 AAA administration fee. See C.M.K. Contr., 2015 WL 1198609, at *18 (including amount of arbitrator's fee in judgment confirming arbitration award); Archetype Constr., 2014 WL 4659292, at *1-2 (same).
Finally, Local 817 also seeks post-judgment interest. (ECF No. 19-6 at 1-2). The applicable federal statute provides that “[i]nterest shall be allowed on any money judgment in a civil case 7 recovered in a district court . . . calculated from the date of the entry of the judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding . . . the date of the judgment. 28 U.S.C. § 1961(a). The Second Circuit has explained that an award of post-judgment interest is mandatory. See Schipani v. McLeod, 541 F.3d 158, 165 (2d Cir. 2008). Given the mandatory nature of post-judgment interest, I respectfully recommend that post-judgment interest be awarded pursuant to 28 U.S.C. § 1961(a).
IV.CONCLUSION
For the reasons set forth above, I respectfully recommend that Local 817's Motion be GRANTED, the Award be MODIFIED as set forth above, and judgment be entered in the total amount of $39,112.82, allocated as follows:
1) The sum of $4,034.00 in lost salary, meals, and rentals to Jesse Davidson and $1,419.65 to the MPIPHP on his behalf, plus post-judgment interest;
2) The sum of $3,792.00 in lost salary, meals, and rentals, to Jennifer Sonnenfeld and $532.37 to the MPHIPHP on her behalf, plus post-judgment interest;
3) The sum of $20,000 in lost salary to Susan Shopmaker and $4,365.20 to the MHPIPHP on her behalf, plus post-judgment interest;
4) The sum of $3,000 in lost salary to Emily Fleisher and $1,694.60 to the MHPIPHP on her behalf, plus post-judgment interest; and
5) The sum of $275.00 to Local 817 reflecting the arbitrator's administrative fee. 8