Opinion
3:22-cv-00218-YY
06-26-2023
TRUSTEES OF THE OREGON AND SOUTHWEST WASHINGTON PAINTERS PENSION TRUST FUND; TRUSTEES OF THE EMPLOYEE PAINTERS' TRUST; TRUSTEES OF THE OREGON AND SOUTHWEST WASHINGTON DRYWALL APPRENTICESHIP AND TRAINING TRUST FUND; TRUSTEES OF THE WALL AND CEILING INDUSTRY PROMOTION FUND OF OREGON AND SOUTHWEST WASHINGTON; GYPSUM DRYWALL LABOR MANAGEMENT COOPERATION INITIATIVE; and INTERNATIONAL UNION OF PAINTERS AND ALLIED TRADES, DISTRICT COUNCIL NO. 5, Plaintiffs, v. PORTLAND DRYWALL SYSTEMS ENTERPRISE, INC.; and ABELARDO CHAVEZ, an individual, Defendant.
FINDINGS AND RECOMMENDATIONS
Youlee Yim You, United States Magistrate Judge
FINDINGS
Plaintiffs-the International Union of Painters and Allied Trades (”Union”) and the trustees of several trust funds-have brought ERISA and breach of contract claims against defendants Portland Drywall Systems Enterprise, Inc. (“PDSE”) and Abelardo Chavez (“Chavez') for failure to pay wages, fringe benefits, liquidated damages, and other amounts owed. Plaintiffs filed a Motion for Summary Judgment on April 13, 2023. ECF 23. Defendants' response to the motion was due 21 days later, on May 4, 2023. See LR No 7-1(f)(1). To date, no response has been filed, and defendants' counsel advised the court by email on June 14, 2023, that no response would be forthcoming. Some courts have viewed the failure to file a response as a concession on the merits. In any event, plaintiffs have established they are entitled to summary judgment on the merits, as discussed below.
See Lykins v. Hohnbaum, No. CIV. 01-63-JO, 2002 WL 32783973, at *3 (D. Or. Feb. 22, 2002) (finding plaintiff conceded dismissal of a claim by not addressing it on a motion for summary judgment); Ward v. Nat'l Entm't Collectibles Ass'n, Inc., No. CV11-06358-MMM(CWx), 2012 WL 12885073, at *10 (C.D. Cal. Oct. 29, 2012) (holding that by failing to oppose defendants' motion for summary judgment on damages claim, plaintiff abandoned the right to seek such damages); Bolbol v. City of Daly City, 754 F.Supp.2d 1095, 1115 (N.D. Cal. 2010) (“[P]laintiff fails to address this issue in her opposition brief and apparently concedes that she may not proceed on this claim. Accordingly, the court grants summary judgment in favor of defendants as to this claim”); Ankele v. Hambrick, 286 F.Supp.2d 485, 496 (E.D. Pa. 2003) (“Plaintiff makes no response to this argument, and thus has waived his opportunity to contest it. Therefore, summary judgment is appropriate.”).
I. Jurisdiction
The court has original jurisdiction over plaintiffs' 29 U.S.C. § 1145 claim pursuant to 28 U.S.C. § 1331 and supplemental jurisdiction over plaintiffs' breach of contract claim pursuant to 28 U.S.C. § 1367.
The court has personal jurisdiction over PDSE because it is an Oregon corporation with its principal place of business in Beaverton. See Daimler AG v. Bauman, 571 U.S. 117, 137 (2014) (“With respect to a corporation, the place of incorporation and principal place of business are ‘paradig[m] . . . bases for general jurisdiction.'”) (citation omitted). The court has personal jurisdiction over Chavez because he is the corporation's registered agent, secretary, and vice president of operations and has listed a Beaverton address. Compl. ¶¶ 5-8, ECF 1; Supp. Mot. Summ. J., Ex. 1, ECF 29-1 (Oregon Secretary of State business entity records).
II. Summary Judgment Standard
Under Federal Rule of Civil Procedure 56(a), “[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.” The party moving for summary judgment bears the initial responsibility of informing the court of the basis for the motion and identifying portions of the pleadings, depositions, answers to interrogatories, admissions, or affidavits that demonstrate the absence of a triable issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the moving party does so, the nonmoving party must “go beyond the pleadings” and “designate ‘specific facts showing that there is a genuine issue for trial.'” Id. at 324 (citing FED. R. CIV. P. 56(e)).
In determining what facts are material, the court considers the underlying substantive law regarding the claims. Anderson v. Liberty Lobby, 477 U.S. 242, 248 (1986). Otherwise stated, only disputes over facts that might affect the outcome of the suit preclude the entry of summary judgment. Id. A dispute about a material fact is genuine if there is sufficient evidence for a reasonable jury to return a verdict for the non-moving party. Id. at 248-49. A “scintilla of evidence” or “evidence that is merely colorable or not significantly probative” is insufficient to create a genuine issue of material fact. Addisu v. Fred Meyer, Inc., 198 F.3d 1130, 1134 (9th Cir. 2000). The court “does not weigh the evidence or determine the truth of the matter, but only determines whether there is a genuine issue for trial.” Balint v. Carson City, Nev., 180 F.3d 1047, 1054 (9th Cir. 1999). “Reasonable doubts as to the existence of material factual issue are resolved against the moving parties and inferences are drawn in the light most favorable to the non-moving party.” Addisu, 198 F.3d at 1134 (citation omitted).
III. Pertinent ERISA Provisions
Pursuant to 29 U.S.C. § 1154:
[e]very employer who is obligated to make contributions to a multiemployer plan under the terms of the plan or under the terms of a collectively bargained agreement shall, to the extent not inconsistent with law, make such contributions in accordance with the terms and conditions of such plan or such agreement.
Plaintiffs are entitled to bring a civil action for an employer's failure to pay. 29 U.S.C. § 1132.
If judgment is entered in favor of the plaintiffs, the “court shall award”:
(A) the unpaid contributions,
(B) interest on the unpaid contributions,
(C) an amount equal to the greater of-
(i) interest on the unpaid contributions, or
(ii) liquidated damages provided for under the plan in an amount not in excess of 20 percent (or such higher percentage as may be permitted under Federal or State law) of the amount determined by the court under subparagraph (A),
(D) reasonable attorney's fees and costs of the action, to be paid by the defendant, and
(E) such other legal or equitable relief as the court deems appropriate.”29 U.S.C. § 1132(g)(2). An award is mandatory if (1) the employer is delinquent at the time the action is filed; (2) the plan provides for such an award; and (3) the district court enters judgment against the employer. Masonry Indus. Tr. Admin., Inc. v. Chris Lee Masonry, Inc., No. 3:14-CV-01570-HZ, 2016 WL 3396939, at *2 (D. Or. June 14, 2016).
IV. Plaintiffs' Claims and Damages
On April 19, 2021, Chavez signed a Memorandum of Understanding with the Union, on behalf of PDSE and in his capacity as vice president of operations. Wolfe Decl., Ex. 1, ECF 25 at 9. Under the MOU, “[t]he Employer agree[d] to be bound by the terms and conditions of the Oregon & SW Washington Area Agreement for the Drywall Industry” (the “Agreement”) “for the life of the” DePaul Treatment Center project. Id. Pursuant to the Agreement, an employer is required to make contributions to various funds based on hours worked by each employee. Id., Ex. 2, ECF 25 at 32-34.
In support of their motion for summary judgment, plaintiffs have submitted a declaration prepared by Kirk Malcolm, a business representative of the Union. Malcolm Decl., ECF 26. Malcolm attests that, on the DePaul Treatment Center project, PDSE used Union-represented employees to perform work that was subject to contributions under the Agreement, but did not pay those contributions. Id., ¶ 6, ECF 26 at 3. PDSE and its employees met with Malcolm to try to determine the current amount of outstanding wages, benefits, and dues. Id., ¶ 8, ECF 26 at 3. PDSE also prepared a summary of unpaid wages, dues, and benefits related to its work on the DePaul Treatment Center project, id., ¶ 9, ECF 26 at 4, which is attached to Malcolm's declaration. Id., Ex. 2, ECF 26 at 16.
In support of plaintiffs' claims, Malcolm has submitted a spreadsheet summarizing the amounts that PDSE owes, characterized as follows:
Id., Ex. 3, ECF 26 at 19-20. The calculations in Malcolm's spreadsheet appear to correspond to the terms of the Agreement. For example, the Agreement states that funds collected for the Apprenticeship Fund are governed by another document, i.e., the Agreement and Declaration of Trust of Oregon and Southwest Washington Drywall Apprenticeship and Training Trust Fund. Wolfe Decl., Ex. 1, ECF 25 at 37. Pursuant to that agreement, unpaid amounts are taxed at 10% interest. Id., Ex. 5, ECF 25 at 125; see Malcolm Decl., Ex. 3, ECF 26 at 19 (spreadsheet reflecting unpaid apprenticeship contributions assessed at 10% interest). Similarly, the Agreement incorporates the Employees Painters' Trust Health and Welfare Plan, Wolfe Decl., Ex. 2, ECF 25 at 32, under which delinquent contributions are taxed at 12%. Id., Ex. 3, ECF 25 at 75. The Agreement further allows for liquidated damages in various amounts. See, e.g., id., Ex. 3, ECF 25 at 75; Malcolm Decl., Ex. 3, ECF 26 at 20 (spreadsheet reflecting liquidated damages for unpaid contributions to the Employee Painters' Trust Health and Welfare Plan of 1% per month or $100, whichever is greater at 12% interest). Defendants do not challenge these calculations or the other calculations in the spreadsheet, and they appear to be supported by the terms of the Agreement and the other trust agreements that the Agreement references.
Unpaid wages:
$58,422.27
Unpaid Fringe Benefit Contributions:
$46,165.82
Interest on Unpaid Contributions:
$8,610.40
Liquidated Damages:
$6,429.78
Total:
$119,628.27
The Agreement obligates employers to pay the following contributions (referencing the terminology and abbreviations on the spreadsheet proffered by plaintiffs, Malcolm Decl., Ex. 3, ECF 26 at 19-20):
Wages: Agreement, ECF 25 at 27.
Appr & Trng: Id., ECF 25 at 36.
DC Dues (aka Dues Check-Off): Id., ECF 25 at 34.
EPT Health & Welfare: Id., ECF 25 at 33.
FTI (aka IUPAT FTI): Id., ECF 25 at 37.
Industry (aka Walls & Ceiling Promotion Fund): Id., ECF 25 at 33, 131.
IU Admin Dues (aka IUPAT Admin. Dues): Id., ECF 25 at 34.
ORSWWA Painters Pension: Id., ECF 25 at 33.
LMCI (aka Labor Management Cooperative Initiative): Id., ECF 25 at 37.
MRP (aka Market Recovery): Id., ECF 25 at 43.See also id., Ex. 2, ECF 25 at 12 (outlining rates).
Additionally, Chavez, who is the corporation's registered agent, secretary, and vice president of operations and signed the MOU, is individually liable. The Employee Painters' Trust Health and Welfare Plan (“EPT Trust”), which is incorporated “as though fully set forth” in the Agreement, Wolfe Decl., Ex. 2, ECF 25 at 32, states that corporate officers are individually liable for contributions as follows:
8. Liability of Corporate Officers
In recognition that individuals have responsibilities in a corporation which is a participating Employer in a Trust, and that contributions are for the welfare of covered employees, the responsible individuals in a corporation which is a participating Employer shall be individually liable for payment of contributions and other charges owing under this Article VIII. Therefore, in the event any corporate Participating Employer which is obligated to make contributions to the Trust fails to make such contributions, the President, the Treasurer, and any other corporate officer who is responsible for payment of contributions by the corporation to the Trust fund shall be each individually liable for the payment of contributions and any other amount due under this Article VIII, and under applicable Federal law, 29 U.S.C. Section 1132(9).Wolfe Decl., Ex. 3, ECF 25 at 76. The EPT Trust broadly defines contributions as payments made pursuant to the terms of a collective bargaining agreement:
“Contributions” - the payments made or to be made to the Trust by an individual Employer pursuant to the terms of a collective bargaining agreement or a special agreement which are made or to be made by an Employer for the purpose of providing benefits to employees covered by said agreement; and self payments by or on behalf of participants including reimbursement or subrogation as permitted by the Trustees or by law.Id., ECF 25 at 54. Article VIII of the EPT Trust requires contributions to be paid within a certain time period and allows for liquidated damages, interest, attorney's fees, and court costs. Id., ECF 25 at 74-75. Because the Agreement, by reference, indicates that corporate officers are individually liable for contributions, Chavez is individually liable for the non-payments. See Emp. Painters' Tr. v. J & B Finishes, 77 F.3d 1188, 1190 (9th Cir. 1996) (finding the president of a corporation was personally liable where the agreement provided that corporate officers would be personally liable for breaches of contract and unpaid trust fund contributions).
Plaintiffs also seek attorney's fees and paralegal fees as follows:
Attorney Michael Urban: 37.10 hours at $225 per hour, totaling $8,347.50;
Paralegal Valerie Hernquist: 1.40 hours billed at $110 per hour, totaling $154.00; and
Paralegal April Denni: 52.30 hours billed at $110 per hour, totaling $5,753.00.Mot. Summ. J. 15, ECF 23.
Reasonable attorney's fees are authorized by 29 U.S.C. § 1132(g)(2) and the terms of the Agreement. Wolfe Decl., Ex. 2, ECF 25 at 34. Generally, attorney's fees are calculated using the lodestar method, i.e., by multiplying the number of hours worked by the reasonable hourly rate. See Perdue v. Kenny A., 559 U.S. 542, 551 (2010) (holding “the lodestar approach” is “the guiding light” when determining reasonable fees). In determining the “reasonable hourly rate to use for attorneys and paralegals[,]” the court looks to the “prevailing market rates in the relevant community.” Gonzalez v. City of Maywood, 729 F.3d 1196, 1205 (9th Cir. 2013) (citations and internal quotation marks omitted). The court also excludes hours “that are excessive, redundant, or otherwise unnecessary.” McCown v. City of Fontana, 565 F.3d 1097, 1102 (9th Cir. 2009) (quoting Hensley v. Eckerhart, 461 U.S. 424, 434 (1983)). The party seeking fees bears “the burden of documenting the appropriate hours expended in the litigation, and [is] required to submit evidence in support of those hours worked.” United Steelworkers of Am. v. Ret. IncomePlan For Hourly-rated Emps. Of Asarco, Inc., 512 F.3d 555, 565 (9th Cir. 2008) (quotations omitted).
For purposes of determining the prevailing market rate, the relevant community is the “one in which the district court sits.” Davis v. Mason County, 927 F.2d 1473, 1488 (9th Cir. 1991). This court uses the most recent Oregon State Bar Economic Survey as a benchmark for comparing an attorney's billable rate with the fee customarily charged in the locality. PrecisionSeed Cleaners v. Country Mut. Ins. Co., 976 F.Supp.2d 1228, 1244 (D. Or. 2013); see also Copeland-Turner v. Wells Fargo Bank, N.A., No. 11-cv-37-HZ, 2012 WL 92957, at *2 (D. Or. Jan. 11, 2012) (“Judges in the District of Oregon use the Oregon State Bar Economic Survey . . . as a benchmark for assessing the reasonableness of hourly billing rates.”). The Economic Survey sets forth rates charged by Oregon attorneys in the relevant year, including rates specific to communities such as Portland.
Plaintiffs have submitted an itemized list of the work that Urban, Hernquist, and Denni performed on this case and the time spent on each task. Urban Decl., Ex. 1, ECF 24. The work does not appear excessive or duplicative. Urban was admitted to practice law in California in 1980, Nevada in 1989, Washington in 1990, and Oregon in 2016. Id., ¶ 5(h), ECF 24. The median rate for Portland attorneys with over 30 years of experience is $425. See OREGON STATE BAR, 2022 ECONOMIC SURVEY 43 tbl.36 (2022). In light of Urban's experience, the requested hourly rate of $225 is reasonable.
Work performed by non-attorneys, such as paralegals, are awarded at market rates, if this is “the prevailing practice in a given community.” Trustees of Const. Indus. & Laborers Health & Welfare Tr. v. Redland Ins. Co., 460 F.3d 1253, 1257 (9th Cir. 2006). According to the most recent National Utilization and Compensation Survey Report, the average hourly billable rate for a paralegal in the Far West region, which includes the State of Oregon, is $122 per hour. National Association Legal Assistants, National Utilization and Compensation Survey Report 40 fig.32 (2022); see also Pac. Coast Fruit Co. v. Ron Squires dba Four Seasons Farmers Mkt., No. 3:16-CV-00463-BR, 2016 WL 4443166, at *3 (D. Or. Aug. 19, 2016) (relying on a prior version of this report to determine the reasonable hourly billable rate for a paralegal).
Finally, plaintiffs seek $904.98 in costs, including $402 for filing fees, $308.90 in service fees, and $194.08 in printing, postage, and scanning fees. “Unless a federal statute, these rules or a court order provides otherwise, costs-other than attorney's fees-should be allowed to the prevailing party.” FED. R. CIV. P. 54(d)(1). “Rule 54(d)(1) creates a presumption in favor of awarding costs to the prevailing party, and a district court has limited discretion to deny fees under the rule.” Goldberg v. Pac. Indem. Co., 627 F.3d 752, 758 (9th Cir. 2010). Additionally, under the Agreement, the employer is “liable for all costs of collection of the payments,” Wolfe Decl., Ex. 2, ECF 25 at 38, including the costs that plaintiffs request here.
In sum, there is no genuine issue of material fact that defendants' failed to pay plaintiffs pursuant to their obligations under the Agreement and 29 U.S.C. § 1154, and that defendants owe plaintiffs unpaid wages, fringe benefit contributions, liquidated damages, interest, attorney's fees, and costs in the amounts they claim are due.
RECOMMENDATIONS
Plaintiffs' Motion for Default Judgment (ECF 23) should be GRANTED and judgment should be entered against defendants Portland Drywall Systems Enterprise, Inc. and Abelardo Chavez, individually, and jointly and severally, as follows:
Unpaid wages for employees:
$58,422.27
Unpaid Fringe Benefit Contributions:
$46,165.82
Interest on Unpaid Contributions:
$8,610.40
Liquidated Damages:
$6,429.78
Attorney's Fees:
$14,254.50
Costs:
$904.98
Total:
$134,787.75
SCHEDULING ORDER
These Findings and Recommendations will be referred to a district judge. Objections, if any, are due Tuesday, July 11, 2023. If no objections are filed, then the Findings and Recommendations will go under advisement on that date.
If objections are filed, then a response is due within 14 days after being served with a copy of the objections. When the response is due or filed, whichever date is earlier, the Findings and Recommendations will go under advisement.
NOTICE
These Findings and Recommendations are not an order that is immediately appealable to the Ninth Circuit Court of Appeals. Any Notice of Appeal pursuant to Rule 4(a)(1), Federal Rules of Appellate Procedure, should not be filed until entry of a judgment.