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The Board of Trustees for The Cement Masons Health & Welfare Trust Fund for Northern California v. Castillo

United States District Court, N.D. California

May 7, 2015

THE BOARD OF TRUSTEES FOR THE CEMENT MASONS HEALTH & WELFARE TRUST FUND FOR NORTHERN CALIFORNIA, et al., Plaintiffs,
v.
SAMUEL MAGANA CASTILLO, et al., Defendants.

ORDER GRANTING PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT

THELTON E. HENDERSON, District Judge.

This matter is before the Court on Plaintiffs' motion for default judgment. (Docket No. 26). Defendants provided no response, and oral argument was held before the Court on May 4, 2015. After carefully considering the written and oral arguments presented by Plaintiffs in light of applicable law, the Court hereby GRANTS Plaintiffs' motion for default judgment.

BACKGROUND

Plaintiff's Complaint in this case was filed with the Court on October 30, 2014. (Docket No. 1). The Complaint was served on Defendants on November 8, 2014, for which proof of service was filed with the Summons on November 14, 2014. (Docket Nos. 6, 7). Defendants' responsive pleading was due on December 1, 2014; however, no answer or other responsive pleadings were filed, and default was entered against Defendants on January 13, 2015. (Docket No. 16).

Defendants are an employer within the meaning of ERISA §§ 3(5) and 515. Additionally, Defendants are an employer in an industry affecting commerce within the meaning of 29 U.S.C. § 185.

For good cause, the Court finds that the allegations in Plaintiffs' Complaint are true, including the following facts. On November 7, 2013, Defendants signed a Memorandum Agreement with the District Council of Plasterers and Cement Masons of Northern California ("Memorandum Agreement"). Ex. A to Lauziere Decl. (Docket No. 22-1). The District Council of Plasterers and Cement Masons of Northern California is a labor organization within the meaning of 29 U.S.C. § 150. By executing the Memorandum Agreement, Defendants became bound to the 2013-2016 Cement Masons Master Agreement for Northern California ("Master Agreement"), which included a provision providing that Defendants were bound by any future modifications, changes, amendments, supplements, extensions or renewals of that agreement. Id. Defendants also agreed to and became bound to the obligations and duties in the Trust Agreements that govern the Trust Funds identified by the Master Agreement and incorporated therein by reference. Id.

LEGAL STANDARD

After entry of default, a court may grant default judgment on the merits of the case. See Fed.R.Civ.P. 55. "The district court's decision whether to enter a default judgment is a discretionary one." Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). The court considers the following factors in determining whether to enter default judgment:

(1) the possibility of prejudice to the plaintiff; (2) the merits of plaintiff's substantive claim; (3) the sufficiency of the complaint; (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect; and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits.

Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). Generally, the factual allegations of the complaint, except those concerning damages, "will be taken as true." Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977) (per curiam).

DISCUSSION

The Court determines that the Eitel factors support a finding in favor of Plaintiffs' motion for default judgment. See Eitel, 559 F.2d at 560. However, the Court also finds it necessary to address the liquidated damages and interest requested by Plaintiffs in this action.

Plaintiffs contend that they are entitled to liquidated damages and interest pursuant to the Trust Agreements and ERISA. Mot. at 12 (Docket No. 26). Plaintiffs explain that they "calculated the liquidated damages and interest amounts due at the Trust Funds' standard rate." ERISA provides that liquidated damages shall be awarded if "(1) the fiduciary obtains a judgment in favor of the plan, (2) unpaid contributions exist at the time of suit, and (3) the plan provides for liquidated damages." Idaho Plumbers and Pipefitters Health & Welfare Fund v. United Mech. Contractors, Inc., 875 F.2d 212, 215 (9th Cir. 1989). This Order provides for a judgment in favor of Plaintiffs for unpaid contributions that existed at the time of suit; therefore, factors one and two are met. However, while the plan provides for liquidated damages, the formula for calculating those liquidated damages is less than straightforward.

Plaintiffs have demonstrated that Defendants failed to pay delinquent contributions in the amount of $98, 706.42. Mot. at 2; Ex. D to Lauziere Decl. (Docket No. 22-6). Plaintiffs assert that these delinquent payments entitled them to liquidated damages in the amount of $600 and interest in the amount of $10, 377.64, pursuant to the Parties' agreements. Mot. at 2, 13. Additionally, Plaintiffs' claim that Defendants' late payments of ...


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