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Board of Trustees of The Southern California Local 831 Employer Health Fund v. Exhibit Installation Specialists, Inc.

United States District Court, C.D. California

April 23, 2014

BOARD OF TRUSTEES OF THE SOUTHERN CALIFORNIA LOCAL 831 EMPLOYER HEALTH FUND; THE EMPLOYER TRAINING AND RE-TRAINING FUND; EMPLOYER HEALTH FUND, Plaintiffs,
v.
EXHIBIT INSTALLATION SPECIALISTS, INC.; and DOES 1-10, inclusive, Defendants.

ORDER GRANTING APPLICATION FOR DEFAULT JUDGMENT [17]

OTIS D. WRIGHT, II, District Judge.

I. INTRODUCTION

Plaintiff Board of Trustees of the Southern California Local 831 Employer Health Fund, Employer Pension Fund and Employer Training and Re-Training Fund ("The Board of Trustees") filed this Motion for Default Judgment stemming from the Complaint it filed against Exhibit Installation Services ("EIS") on November 6, 2013. In its Complaint, The Board of Trustees allege that EIS violated the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001-461. ("ERISA") by failing to make contributions to various employee benefit plans. EIS has not answered the Complaint or appeared before the Court. The Clerk of Court entered default on March 13, 2014, and the Board of Trustees filed this Motion for Default Judgment on March 21, 2014. For the reasons discussed below, the Court GRANTS Plaintiff's Motion for Default Judgment.

II. FACTUAL BACKGROUND

The Board of Trustees filed this action against EIS on November 6, 2013, alleging delinquent trust-fund contributions to employee benefit plans in violation of 29 U.S.C. § 1145. (ECF No. 1.) The Board of Trustees contends that from November 2010 to July 2013, EIS failed to pay a total of $157, 626.21 in monthly employer contributions due to various employee benefit plans under two collective bargaining agreements ("CBA") between EIS and Tradeshow and Sign Crafts Local 831 ("Local 831"). ( Id. at ¶ 12.)

Defendant EIS is a Pennsylvania corporation that designs, fabricates, and manages tradeshow-exhibit projects. ( Id. at ¶ 5.) The Board of Trustees manages and administers employee benefit plans for Local 831, a labor union representing employees working in the tradeshow and sign-craft industry. ( Id. at ¶ 3.)

Local 831 and EIS entered into two consecutive CBAs. ( Id. at ¶ 8.) The first CBA was in force from September 1, 2008, to August 31, 2011. ( Id. ) The second CBA was in force on September 1, 2011, and is scheduled to end on August 31, 2014. ( Id. ) Under the terms of the CBAs, EIS was required to make monthly contributions into trust funds for employee health and dental insurance, pension, and training and retraining. (Mot. Ex. A.) The trust funds are "employee benefit plans" as defined by 29 U.S.C. § 1002(3). (Compl. ¶ 3.) The CBAs provide that The Board of Trustees would administer and manage the trust funds, which were third-party beneficiaries under both CBAs. ( Id. ) Payments were due on the first calendar day of the month and were considered delinquent if not made by tenth day of the month. (Mot. Ex. A.) Delinquent payments were subject to interest and liquidated damages. (ECF No. 21 at 4.)

The Board of Trustees alleges that EIS failed to make 15 scheduled payments into the employee trust funds between November 2010 and July 2013. (Compl. at ¶ 12.) The Board of Trustees contends that EIS owes it a total of $208, 056.53, including (1) $157, 626.21 in unpaid contributions, (2) $28, 340.62 in liquidated damages, (3) $18, 625.28 in interest, and (4) $3, 464.42 in attorneys' fees. ( Id. at ¶ 12-15.)

On January 13, 2014, The Board of Trustees served the Summons and Complaint on EIS by leaving a copy with the receptionist and sending a copy first-class mail in compliance with California Code of Civil Procedure section 415.20. (ECF No. 8.) EIS was required to answer the Complaint by February 4, 2014. Fed.R.Civ.P. 12(a)(1)(A)(i). It failed to do so and the Clerk entered default on March 13, 2014. (ECF No. 15.) The Board of Trustees now moves for entry of default judgment against EIS. (ECF No. 17.) To date, the Court has received no response from EIS.

III. LEGAL STANDARD

Federal Rule of Civil Procedure 55(b) authorizes a district court to grant default judgment after the default is entered under Rule 55(a). Local Rule 55-1 requires that the movant submit a declaration establishing (1) when and against which party default was entered; (2) identification of the pleading to which default was entered; (3) whether the defaulting party is a minor, incompetent person, or active service member; and (4) that the defaulting party was properly served with notice if required by Federal Rule of Civil Procedure 55(b)(2).

A district court has discretion whether to enter default judgment. Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). Upon default, the defendant's liability generally is conclusively established and the well-pleaded factual allegations in the complaint are accepted as true. Televideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-19 (9th Cir. 1987) (per curiam) (citing Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977)).

In exercising its discretion, a court must consider several factors: (1) the possibility of prejudice to plaintiff; (2) the merits of plaintiff's substantive claim; (3) the sufficiency of the complaint; (4) the sum of money at stake; (5) the possibility of dispute concerning material facts; (6) whether the defendants default was due to excusable neglect; and (7) the strong policy underlying the Federal Rules of ...


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