Building Serv. 32B-J Pension v. Vanderveer Estates

• Decision Date: 17 January 2001
• Docket Number: No. 00 CIV. 0364(RWS).,00 CIV. 0364(RWS).
• Citation: 127 F.Supp.2d 490
• Parties: BUILDING SERVICE 32B-J PENSION FUND, et al., Plaintiffs, v. VANDERVEER ESTATES HOLDING, LLC., Defendant.
• Court: U.S. District Court — Southern District of New York

127 F.Supp.2d 490

BUILDING SERVICE 32B-J PENSION FUND, et al., Plaintiffs, v. VANDERVEER ESTATES HOLDING, LLC., Defendant.

No. 00 CIV. 0364(RWS).

United States District Court, S.D. New York.

January 17, 2001.

Raab, Sturm & Goldman, New York (Regina E. Paul, of Counsel), for Plaintiffs.

Ira Drogin, New York City, for Defendant.

OPINION

SWEET, District Judge.

Plaintiff Building Service 32B-J Health, Pension and Annuity Funds (the "Funds") have moved for reconsideration and reargument pursuant to Local Rule 6.3, or to alter or amend this Court's November 21, 2000 opinion and order, pursuant to Rules 52(b), 59(e) or 60(b), Fed.R.Civ.P., to the extent that it held that defendant Vanderveer Estates Holding, LLC ("Vanderveer") was not liable for contributions to the Funds after April 20, 2000. Vanderveer opposes the motion.

Also pending are the Funds' motion to hold Vanderveer in contempt for failing to file a $75,000 bond in compliance with this Court's October 5, 2000 opinion, and the parties' proposed judgments.

For the reasons set forth below, both the motion to reconsider and the contempt motion are granted. Judgment shall issue in accordance with this opinion.

The Parties and Related Entities

Local 32B-J, Service Employees International Union, AFL-CIO ("Union") is a labor organization that represents members employed in the building service industry in metropolitan New York City.

The Funds are jointly administered, multi-employer, labor-management trust Funds based in New York City. The Funds are employee benefit plans that provide benefit coverage for participants employed by employers who are parties to collective bargaining agreements with the Union. The purpose of the Funds is to receive contributions from employers who are parties to collective bargaining agreements with the Union, to invest and maintain those monies, and to distribute pensions, health and insurance benefits, and annuity payments to eligible employees.

The Realty Advisory Board on Labor Relations, Inc. ("RAB") is a multi-employer organization which is a signatory to a series of collective bargaining agreements ("CBA") with the Union covering employees of apartment buildings in New York City.

Vanderveer is a for-profit domestic limited liability company based in New York City that owns several buildings in Brooklyn and employs workers covered by the RAB collective bargaining agreement.

Prior Proceedings

The prior proceedings in this case are set forth in two opinions of this Court, familiarity with which is assumed. See Building Service 32B-J Health Funds v. Vanderveer Estates Holding, LLC, 121 F.Supp.2d 750 (S.D.N.Y.2000); ("Vanderveer II"); Building Service 32B-J Pension Fund v. Vanderveer Estates Holding, LLC, 115 F.Supp.2d 459 (S.D.N.Y.2000) ("Vanderveer I").

On November 20, 2000, one day before Vanderveer II was issued, the Funds moved to hold Vanderveer in contempt of Vanderveer I, which, although denying the Funds' motion for a preliminary injunction, had ordered Vanderveer to file a $75,000 bond. 115 F.Supp.2d at 464. Vanderveer filed the $75,000 bond on December 13, 2000, and filed its opposition to the contempt motion three days later. The Funds filed a reply on December 19, 2000, and the motion was deemed fully submitted on December 27, 2000.

Meanwhile, the Court issued its opinion on the Funds' motion for summary judgment in Vanderveer II, holding that although Vanderveer was not a signatory to the 1997 RAB Agreement, it was an assignee of a signatory, and was therefore bound to contribute to the Funds. Vanderveer II, 121 F.Supp.2d at 756-57. Vanderveer was found liable for back contributions plus interest from the date it purchased the covered properties to April 20, 2000, when the collective bargaining contract to which it was an assignee expired, in addition to statutory liquidated damages, attorneys' fees and costs. Id., 121 F.Supp.2d at 758. The parties were invited to submit documentation calculating these amounts in support of their proposed judgments in accordance with the opinion, id., which they did, from December 7, 2000 through December 15, 2000.

However, the Court abstained from entering a judgment in accordance with Vanderveer II because the Funds filed the instant motion on December 1, 2000, seeking reconsideration of one aspect of that opinion. Specifically, the Funds take issue with the holding that Vanderveer was not obligated to contribute to the Funds after April 20, 2000, when a new agreement was entered (to which Vanderveer was neither a party nor an assignee) that abrogated the prior contract. Vanderveer opposed the motion in a December 26, 2000 filing, and the motion was deemed fully submitted on December 27, 2000.

Discussion

I. The Motion to Alter, Modify or Reconsider a Summary Judgment Decision is Granted

A. Authority to Reconsider

This Court has the discretion to reconsider Vanderveer's obligation to contribute after April 20, 2000 pursuant to Local Civil Rule 6.3, or to alter or amend the prior opinion pursuant to Federal Rules of Civil Procedure Rule 59(e), upon motion filed within ten days of the entry of the opinion. Under either rule, the burden is on the moving party to demonstrate that the Court overlooked controlling decisions or material facts that were before the Court on the original motion and might "materially have influenced its earlier decision." Anglo American Ins. Co. v. CalFed, Inc., 940 F.Supp. 554, 557 (S.D.N.Y.1996).

Local Rule 6.3 must be narrowly construed and strictly applied so as to avoid duplicative rulings on previously considered issues, and may not be employed as a substitute for appealing a final judgment. See Shamis v. Ambassador Factors, 187 F.R.D. 148, 150 (S.D.N.Y.1999). Therefore, a party moving for reargument "may not advance new facts, issues or arguments not previously presented to the court." Litton Indus., Inc. v. Lehman Bros. Kuhn Loeb, Inc., 1989 WL 162315, at *3 (S.D.N.Y.1989).

Nor is Rule 59(e) a vehicle by which a party may introduce new facts or arguments not previously raised. See Katz v. Berisford International PLC, No. 96 CIV. 8695(JGK), 2000 WL 1760965, *5 (S.D.N.Y. Nov.30, 2000). Alteration or amendment of a prior decision pursuant to Rule 59(e) is appropriate "only where controlling law has changed, new evidence is available, and/or clear error must be corrected or manifest injustice prevented." Cavallo v. Utica-Watertown Health Ins. Co., 3 F.Supp.2d 223, 225 (N.D.N.Y.1998).

If the Court proceeds to the merits of this motion to reconsider, it must decide whether there is a genuine issue of material fact such that neither party is entitled to summary judgment as a matter of law with respect to contributions owed after April 20, 2000. See Rule 56(c), Fed.R.Civ.P.

B. Proffered Grounds for Reconsideration, Alteration Or Amendment

Vanderveer II held in relevant part that Vanderveer's obligation to contribute pursuant to its status as an assignee of the 1997 Agreement terminated on April 21, 2000, when the 2000 Agreement went into effect. Although properly agreeing that Vanderveer is not bound by the 2000 Agreement,¹ the Funds assert that the 1997 Agreement remained in effect pursuant to its "Evergreen Clause," which they argue compelled Vanderveer to continue to make contributions notwithstanding the execution of another agreement.

The relevant facts pertaining to this motion lie in Articles XVII and XVIII of the 1997 RAB Agreement, which was submitted to the Court in support of the summary judgment motion. Article XVII provided that the 1997 Agreement remained in effect until "a successor Agreement" was executed. (Pltf. Mem. Ex. B (Pltf.Amd.Stmt.) ¶ 12.) However, Article XVIII provided that:

Upon the expiration date of this agreement, the same shall continue in full force and effect for an extended period until a successor agreement has been executed. During the extended period, all terms and conditions shall be in effect and the parties shall negotiate for a successor agreement retroactive to the expiration date... In the event that the parties are unable to agree upon the terms of a successor agreement, either party upon ten (10) days' written notice to the other party may cancel this agreement.

("The Evergreen Clause".) (Faul Summ. Judg. Aff. Ex. C at 89.)

The Funds contend that the Court (1) overlooked the 1997 Agreement's Evergreen Clause, which the Funds contend ensured that the 1997 Agreement remained in force until certain conditions precedent were met, including (a) the signing of a "successor agreement;" or (b) unsuccessful negotiation by the parties followed by ten days notice of cancellation; and (2) erroneously equated a "successor" Agreement with a contract that "superseded" the prior Agreement. The Funds argue that the 2000 Agreement did not function as a "successor" agreement terminating the prior agreement with respect to Vanderveer because Vanderveer was not a party thereto. Therefore, the Funds contend, the 1997 Agreement remains in effect as to Vanderveer pursuant to the Evergreen Clause because, as Vanderveer concedes, it did not file a cancellation notice.²

In response, Vanderveer first argues that this is an improper new argument premised upon facts previously submitted to the Court. On the merits, Vanderveer contends that the 2000 Agreement (1) was a successor agreement that terminated Vanderveer's obligations pursuant to Article XVII of the 1997 Agreement; and that (2) even if the 2000 Agreement was not a "successor" agreement, Vanderveer's obligation to contribute ended when the 1997 Agreement expired on April 20, 1997, because the Evergreen Clause applies only to "parties" to the 1997 Agreement, and not to non-parties who are nonetheless bound to it, such as Vanderveer.

C. Analysis

Although Vanderveer II took note of the fact that Vanderveer was not a party to the 2000 Agreement, it failed to address the legal effect of that fact on Vanderveer's obligations under the 1997 Agreement. In...