United States District Court, D. Massachusetts
MEMORANDUM AND ORDER
B. Saris Chief United States District Judge
Thompson, Kimberly Thompson, Air Quality Experts, Inc.
(“Air Quality”), and AQE, Inc.
(“AQE”) (collectively, “defendants”)
are charged with mail fraud, theft or embezzlement from an
employee benefit plan, and making false ERISA statements. The
indictment alleges that the defendants made false reports to
the Massachusetts Laborers' Benefit Fund
(“MLBF”) and, based on those reports, failed to
make payments due to the MLBF.
defendants moved to dismiss the indictment. They argued that,
under the facts as alleged, their representations were not
false and they did not fail to pay any money to which the
alleged victim was entitled. For the reasons below, the
defendants' motion (Docket No. 39) is DENIED.
following facts stated in the indictment are taken as true
for the purpose of a motion to dismiss the indictment.
Boyce Motor Lines, Inc. v. United States, 342 U.S.
337, 343 n.16 (1952).
times relevant to the indictment, Air Quality was an asbestos
abatement company incorporated in New Hampshire in 1987. AQE
was an asbestos abatement company incorporated in New
Hampshire in 2005.
and Kimberly Thompson together owned and operated Air Quality
and AQE. Christopher Thompson was the president and treasurer
of Air Quality. Kimberly Thompson, his wife, was the
president of AQE and the clerk of Air Quality.
about September 22, 2005, AQE agreed to be bound by any
collective bargaining agreement (“CBA”) between
the Massachusetts Laborers' District Council of the
Laborers' International Union of North America and the
Massachusetts Building Wreckers and Environmental Remediation
Association, Inc. During the relevant time period, there were
three consecutive CBAs that spanned the dates of July 1, 2004
to June 30, 2016. The CBAs governed the remittance of fringe
benefit contributions to a number of employee welfare and
pension benefit plans, some of which were subject to the
provisions of Title I of the Employee Retirement Income
Security Act of 1974 (“ERISA”). Under the terms
of the CBAs, AQE was obligated to make monthly
“remittance reports” to the MLBF that reported
the number of hours worked by union members for AQE and to
make benefit contributions to the MLBF based on those hours.
is no suggestion in the indictment or by either of the
parties that Air Quality was a signatory to any of the CBAs.
Quality operated out of the same location as AQE under the
same management, using the same equipment, and employing the
same workforce. As a result, the indictment alleges that the
companies were actually “a single business.”
conditions permitted, ” the defendants paid employees
from the payroll of Air Quality rather than that of AQE
because that choice was “generally financially
advantageous.” By doing so and reporting to the MLBF
only the hours worked by union members paid from the payroll
of the union signatory AQE, the defendants allegedly failed
to report all of the hours they were obligated to report and
failed to make the required amount of contributions to the
MLBF. The indictment further alleges that this
“double-breasted shop” arrangement violated the
CBA and that the defendants “concealed and caused to be
concealed” from the MLBF the payment from the payroll
account of Air Quality for work covered by the CBA.
indictment also alleges that the defendants failed to report
and to make benefit contributions for “shop
hours” (time spent preparing for and traveling to a job
site at the beginning of a workday and returning and
unloading trucks and equipment at the end of a workday) that
union members worked for AQE.
January 19, 2016, the defendants were indicted on eighteen
counts of mail fraud, in violation of 18 U.S.C. § 1341;
one count of theft or embezzlement from an employee benefit
plan, in violation of 18 U.S.C. § 664; and eighteen
counts of making false ERISA statements, in violation of 18
U.S.C. § 1027. The indictment also included ...