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New England Carpenters Central Collection Agency v. Whipple Construction Inc.

United States District Court, D. Massachusetts

August 6, 2019

NEW ENGLAND CARPENTERS CENTRAL COLLECTION AGENCY et al., Plaintiffs,
v.
WHIPPLE CONSTRUCTION INC. and GEOFFREY EVANCIC, Defendants.

          MEMORANDUM AND ORDER ON PLAINTIFFS' MOTION FOR ENTRY OF DEFAULT JUDGMENT

          ALLISON D. BURROUGHS, U.S. DISTRICT JUDGE.

         On November 3, 2015, the Trustees of New England Carpenters Guaranteed Annuity Fund, New England Carpenters Pension Fund, New England Carpenters Health Benefits Fund, New England Carpenters Vacation Savings Fund, and New England Carpenters Training Fund (collectively, “the Funds”) and the New England Carpenters Central Collection Agency (together with the Funds, “Plaintiffs”) filed a complaint against Whipple Construction, Inc. (“Whipple Construction”) and Geoffrey Evancic (“Evancic”) (together, “Defendants”) alleging violations of the Employee Retirement Income Security Act of 1974 (“ERISA”) and the Labor Management Relations Act of 1947 based on Whipple Construction's failure to make employer contributions to the Funds as required by a collective bargaining agreement. [ECF No. 1 (“Complaint” or “Compl.”)]. The Court entered a notice of default against Evancic on September 17, 2018. [ECF No. 40]. Currently pending before the Court is Plaintiffs' Renewed Motion for Entry of Default Judgment against Evancic.[1] [ECF No. 51]. For the following reasons, the Renewed Motion for Entry of Default Judgment [ECF No. 51] is GRANTED.

         I. FACTUAL BACKGROUND

         The following summary of facts is drawn from the Complaint, the well-pleaded allegations of which the Court accepts as true for purposes of this Memorandum and Order. See Brockton Sav. Bank v. Peat, Marwick, Mitchell & Co., 771 F.2d 5, 13 (1st Cir. 1985) (explaining that after the entry of a default, allegations of fact in the complaint must be taken as true); see also Franco v. Selective Ins., 184 F.3d 4, 9 n.3 (1st Cir. 1999) (“A party who defaults is taken to have conceded the truth of the factual allegations in the complaint as establishing the grounds for liability as to which damages will be calculated.”).

         The Funds are trusts established in accordance with 29 U.S.C. § 186(c) and are employee pension benefit or welfare plans as defined by 29 U.S.C. § 1002(2). [Compl. ¶ 4]. The United Brotherhood of Carpenters & Joiners of America and the New England Regional Council of Carpenters (together, the “Union”) are labor organization as defined by 29 U.S.C. § 152(5). [Id. ¶ 5]. The Funds are maintained pursuant to collective bargaining agreements between the Union and employers under which employers contribute to the Funds for covered work performed by employees. [Id. ¶ 6].

         Whipple Construction, which was run by Evancic, was an employer subject to a collective bargaining agreement with the Union. [Id. ¶¶ 8-11]. As such, Whipple Construction was obligated to make contributions to the Funds for each hour of work performed by its employees under a collective bargaining agreement. [Id. ¶ 11]. Whipple Construction failed to make contributions to the Funds for work performed by its employees and failed to submit reports of the number of hours worked by each employee. [Id. ¶¶ 13-14].

         During this time, Evancic had broad personal discretion and control over the assets and expenditures of Whipple Construction. [Id. ¶ 19]. This included making the decision to withhold payment of amounts that were due to the New England Carpenters Health Benefits Fund (“Health Benefits Fund”). [Id. ¶ 20]. Under the terms of the trust agreement for the Health Benefits Fund, these amounts due, but not yet paid, were assets of the Health Benefits Fund from the moment they became due. [Id. ¶ 17]. By virtue of exercising discretion and control over assets of the Health Benefits Fund, Evancic was a fiduciary of the Health Benefits Fund within the meaning of 29 U.S.C. § 1002(21). [Id. ¶ 19].

         II. PROCEDURAL HISTORY

         Plaintiffs initiated this action on November 3, 2015. [ECF No. 1]. Evancic was served on November 9, 2015. [ECF No. 4]. When Defendants failed to answer or otherwise respond to the Complaint, Plaintiffs requested a notice of default on December 3, 2015. [ECF Nos. 6, 7]. On December 7, 2015, the Court ordered Defendants to show cause why the Court should not enter a default and ordered them to respond to the Complaint by December 18, 2015 or risk a default. [ECF No. 8]. Defendants filed their answer on December 30, 2015. [ECF No. 11].

         On January 7, 2016, Plaintiffs moved to strike the untimely filed answer and again sought an entry of default against Defendants. [ECF No. 12]. On April 6, 2016, Plaintiffs' counsel advised the Court that Whipple Construction had a matter pending in the U.S. Bankruptcy Court for the District of Massachusetts and stated his belief that the automatic stay applied to further prosecution of Whipple Construction. [ECF No. 20]. The Court held a status conference on June 22, 2016, at which counsel for Defendants appeared. [ECF Nos. 23, 24]. The Court granted Plaintiffs' motion to strike but denied the request for a default judgment and ordered Defendants “to file an answer to the Complaint and/or a status report within 60 days.” [ECF No. 24].

         In compliance with the Court's order, Defendants filed a status report on August 22, 2016 and requested additional time to respond to the Complaint or to file an additional status report. [ECF No. 25]. The Court allowed a 60-day extension. [ECF No. 26]. Defendants filed another status report on November 1, 2016, which again requested additional time to respond or to file an additional status report. [ECF No. 27]. The Court allowed the extension to January 2, 2017. [ECF No. 28].

         After Defendants failed to file an answer or additional status report, the Court, on March 8, 2017, ordered Defendants to show cause why a default judgment should not be entered and required a status report by March 21, 2017. [ECF No. 29]. Defendants complied with the order and filed a status report on March 21, 2017, which advised the Court of the ongoing bankruptcy action. [ECF No. 30]. The same day, Defendants' counsel moved to withdraw himself as counsel based on a breakdown of communication between him and Defendants. [ECF No. 32]. The Court granted the motion to withdraw on March 22, 2017. [ECF No. 34].

         Thereafter, the Court sought updates from the parties and requested regular status reports due on June 1, 2018 and September 14, 2018. [ECF Nos. 35-38]. Only Plaintiffs submitted status reports, which advised the Court of the ongoing bankruptcy involving Whipple Construction. [ECF Nos. 36, 38]. On September 14, 2018, Plaintiffs requested a notice of default ...


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