Boilermaker-Blacksmith Nat. Pension v. Gendron

• Decision Date: 27 April 2000
• Docket Number: No. Civ.A. 98-2317-KHV.,Civ.A. 98-2317-KHV.
• Citation: 96 F.Supp.2d 1202
• Parties: BOILERMAKER-BLACKSMITH NATIONAL PENSION FUND, et al., Plaintiffs, v. Theodore G. GENDRON, et al., Defendants.
• Court: U.S. District Court — District of Kansas

96 F.Supp.2d 1202

BOILERMAKER-BLACKSMITH NATIONAL PENSION FUND, et al., Plaintiffs, v. Theodore G. GENDRON, et al., Defendants.

No. Civ.A. 98-2317-KHV.

United States District Court, D. Kansas.

April 27, 2000.

COPYRIGHT MATERIAL OMITTED

G. Gordon Atcheson, Charles R. Schwartz, Curtis, G. Barnhill, Blake & Uhlig, P.A., Kansas City, KS, Mark A. Kistler, Yonke, Arnold, Newbold & Regan, P.C., Kansas City, MO, for Plaintiffs.

William S. Robbins, Jr., Watkins, Boulware, Lucas, Miner, Murphy & Taylor, LLP, Kansas City, MO, Dan C. Sanders, Aaron J. Racine, Gepford, Monaco & Sanders L.C., Kansas City, MO, for Defendants.

MEMORANDUM AND ORDER

VRATIL, District Judge.

Plaintiffs bring suit under Sections 502 and 515 of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. §§ 1132 and 1145, to collect fringe benefit contributions allegedly due and owing from defendants. This matter comes before the Court on the following motions: Defendant Sandra Gendron's Motion To Dismiss, Or, In The Alternative, Motion For Summary Judgment (Doc. # 83) and Plaintiffs' Motion For Summary Judgment (Doc. # 86), both filed February 28, 2000, and Defendants Theodore G. Gendron, Jon-Michael Gendron, And Northeast Service And Inspections, Inc. [sic] Motion For Summary Judgment Or, In The Alternative, For Partial Summary Judgment (Doc. # 94) filed March 7, 2000. For reasons set forth below, the Court finds that each motion should be overruled.

Plaintiffs are multi-employer benefit plans and fiduciaries under ERISA. They provide pension and health insurance coverage and benefits to employees whose employers are bound to collective bargaining agreements with the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers, AFL — CIO ("the union"). Plaintiffs assert claims against Tank Maintenance & Technology, Inc. ("Tank Maintenance"), Northeast Service & Inspections, Inc. ("Northeast Services"), J.M.G., Inc., Theodore Gendron ("Gendron"), Sandra Gendron ("Sandra") and Jon-Michael Gendron ("Jon-Michael").¹ In Count I, they claim that five defendants—Northeast Services, J.M.G., Inc., Gendron, Sandra and Jon-Michael —are liable on a $223,219.02 judgment for unpaid benefit contributions from September 1993 through September 1996, as alter egos of Tank Maintenance. In Count II, plaintiffs seek unpaid benefits for October 1996 to the present from Tank Maintenance. They claim that Northeast Services, J.M.G., Inc., Gendron, Sandra and Jon-Michael are liable for such contributions as alter egos of Tank Maintenance. As to both counts, plaintiffs contend that Gendron, Sandra and Jon-Michael are liable as alter egos of Northeast Services.

In their motion for summary judgment, plaintiffs assert that the record conclusively establishes that Northeast Services is the alter ego of Tank Maintenance and that Gendron, Sandra and Jon-Michael are alter egos of both Tank Maintenance and Northeast Services. Plaintiffs further contend that collateral estoppel precludes defendants from re-litigating the amount of judgment which plaintiffs have obtained against Tank Maintenance for the time period from September 1993 to September 1996, and that defendants' failure to keep adequate records entitles plaintiffs to a conclusive presumption that defendants owe benefit contributions for all of Northeast Services payroll hours in 1997 and 1998. Defendants contend that the undisputed evidence establishes that they are not alter egos of either Tank Maintenance or Northeast Services. In addition, Sandra asserts that the Court lacks subject matter and personal jurisdiction over plaintiffs' claims against her.

Summary Judgment Standard

Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. Fed.R.Civ.P. 56(c); accord Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Vitkus v. Beatrice Co., 11 F.3d 1535, 1538-39 (10th Cir.1993). A factual dispute is "material" only if it "might affect the outcome of the suit under the governing law." Anderson, 477 U.S. at 248, 106 S.Ct. 2505. A "genuine" factual dispute requires more than a mere scintilla of evidence. Id. at 252, 106 S.Ct. 2505.

The moving party bears the initial burden of showing the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Hicks v. City of Watonga, 942 F.2d 737, 743 (10th Cir.1991). Once the moving party meets its burden, the burden shifts to the non-moving party to demonstrate that genuine issues remain for trial "as to those dispositive matters for which it carries the burden of proof." Applied Genetics Int'l, Inc. v. First Affiliated Secs., Inc., 912 F.2d 1238, 1241 (10th Cir.1990); see also Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Bacchus Indus., Inc. v. Arvin Indus., Inc., 939 F.2d 887, 891 (10th Cir.1991). The nonmoving party may not rest on its pleadings but must set forth specific facts. Applied Genetics, 912 F.2d at 1241.

"[W]e must view the record in a light most favorable to the parties opposing the motion for summary judgment." Deepwater Investments, Ltd. v. Jackson Hole Ski Corp., 938 F.2d 1105, 1110 (10th Cir.1991). Summary judgment may be granted if the non-moving party's evidence is merely colorable or is not significantly probative. Anderson, 477 U.S. at 250-51, 106 S.Ct. 2505. "In a response to a motion for summary judgment, a party cannot rely on ignorance of facts, on speculation, or on suspicion, and may not escape summary judgment in the mere hope that something will turn up at trial." Conaway v. Smith, 853 F.2d 789, 794 (10th Cir.1988). Essentially, the inquiry is "whether the evidence presents a sufficient disagreement to require submission to the jury or whether it is so one-sided that one party must prevail as a matter of law." Anderson, 477 U.S. at 251-52, 106 S.Ct. 2505.

Facts

The following facts are either undisputed or, where disputed, set forth according to each party's contentions.²

Plaintiffs administer collective bargaining agreements between the Boilermakers union and signatory employers. Under ERISA, each plaintiff is an "employee benefit plan" as defined in 29 U.S.C. § 1002(3) and a "multi-employer plan" within the meaning of 29 U.S.C. § 1002(37); also, each plaintiff has been established pursuant to Section 302(c)(5) of the Labor Management Relations Act, 29 U.S.C. § 186(c)(5). The collective bargaining agreements require signatory employers to provide plaintiffs monthly reports and payments based upon the number of hours worked by their employees. Reports and contributions for each month are due on the 15th day of the following month. Late payments are subject to a one-time 12 per cent liquidated damage assessment and unpaid balances accrue interest at the rate of 12 per cent per annum.

In 1992, Gendron incorporated Tank Maintenance, a New Jersey corporation with its principal place of business in New Jersey. Tank Maintenance performed general welding work, including welding on steel tanks, tank repair and pipe work. When he started Tank Maintenance, Gendron personally owned some of its equipment. Tank Maintenance did not pay Gendron for the use of his equipment. Gendron also loaned personal funds to the company and managed its day-to-day business. His brother Jon-Michael served as the Tank Maintenance president. Jon-Michael's authority was equal to or greater than his brother's. Jon-Michael was authorized to execute collective bargaining agreements, execute mechanics lien wavers for tank projects and seek to represent Tank Maintenance in this Court. Generally, Gendron was in charge of tank work and Jon-Michael was responsible for pipe work.³

Defendants maintain that Wallace Ford acted as vice president of Tank Maintenance. According to defendants, Ford managed the daily affairs of Tank Maintenance and, with Gendron, made all major decisions. According to Jon-Michael, however, he, Gendron and Sandra (Gendron's wife) ran Tank Maintenance. Tank Maintenance did not keep corporate records which identified its corporate officers. Jon-Michael believed that Sandra was the vice president and secretary. He was "almost positive" that she maintained the corporate records, though he never asked her to do so.

Defendants have no records of any corporate meetings of Tank Maintenance, and the parties do not agree on who owned its stock. Defendants contend that Sandra, Jon-Michael, Ford, Mark Heslin and Joseph Lucas were shareholders until July 7, 1997, when they tendered their shares to Tank Maintenance and Gendron became sole shareholder. Plaintiffs assert that Tank Maintenance never had shareholders. Plaintiffs cite Gendron's deposition testimony that he had no idea who owned the Tank Maintenance stock and that he would have to look for that information in corporate minutes from the annual meeting.

Union Agreements

In August 1993, Tank Maintenance employees were on a Kerr-McGee job site to repair an above ground storage tank. Because Tank Maintenance was not party to a union contract, the union erected a picket line.⁴ Therefore, on August 13, 1993, Gendron spoke with George Santos ("Santos"), a union representative, about getting a job compliance agreement for the Kerr-McGee project. A job compliance agreement covers one job and allows work by non-union contractors who agree to post bond and pay wages and fringe benefits under the Articles of Agreement Covering Tank Repair and Related Work ("Tank Repair Agreement").⁵ Santos faxed Gendron an excerpt from an agreement which reflected a $20,000 bond requirement and contained a copy of an escrow agreement that referred to a job compliance understanding.⁶

On August 16, 1993,...