Capozza Tile Co., Inc. v. Joy

• Decision Date: 30 September 2002
• Docket Number: No. 01-108-PC.,01-108-PC.
• Citation: 223 F.Supp.2d 307
• Parties: CAPOZZA TILE COMPANY, INC., Plaintiff v. Richard N. JOY, et al., Defendants and John Flynn, et al., Plaintiffs v. Capozza Tile Company, Inc., Defendant
• Court: U.S. District Court — District of Maine

223 F.Supp.2d 307

CAPOZZA TILE COMPANY, INC., Plaintiff v. Richard N. JOY, et al., Defendants and John Flynn, et al., Plaintiffs v. Capozza Tile Company, Inc., Defendant

No. 01-108-PC.

United States District Court, D. Maine.

September 30, 2002.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Marshall J. Tinkle, David M. Hirshon, Tompkins, Clough, Hirshon & Langer, Portland, ME, for Capozza Tile Company, Inc., plaintiff.

Jeffrey Neil Young, McTeague, Higbee, Macadam, Case, Watson & Cohen, Topsham, ME, Ira R. Mitzner, Dickstein, Shapiro, Morin & Oshinsky, LLP, Washington, DC, for Bricklayers & Trowel Trades Intern. Pension Fund.

Jonathan S.R. Beal, Fontaine & Beal, P.A., Portland, ME, Michael A. Feinberg, Renee Bushey, Feinberg, Charnas & Birmingham, P.C., Boston, MA, for Richard N Joy, International Union of Bricklayers & Allied Craftworkers Local No. 1 — Northern New England, defendants.

ORDER AFFIRMING RECOMMENDED DECISION OF THE MAGISTRATE JUDGE

HORNBY, Chief Judge.

The United States Magistrate Judge filed with the court on April 29, 2002, with copies to counsel, his Recommended Decision on Motions for Summary Judgment and Memorandum Decision on Availability of Jury Trial. Objections to the Recommended Decision were filed by plaintiffs, Trustees of the Bricklayers & Trowel Trades International Pension Fund ("Fund"), on May 8, 2002; by Capozza Tile ("Capozza") on May 13, 2002; and by defendant International Union of Bricklayers & Allied Craftworkers Local No.1 — Northern New England ("Local 1") on May 15, 2002. I have reviewed and considered the Recommended Decision, together with the entire record; I have made a de novo determination of all matters adjudicated by the Recommended Decision; and I concur with the recommendations of the United States Magistrate Judge for the reasons set forth in his Recommended Decision, and determine that no further proceeding is necessary.

I add only the following. The Fund argues that it should be treated like a holder in due course and should be able to rely on the signed document in its possession, since it is upon just such documents that it must make actuarial assumptions concerning amounts that it will have to pay and thus amounts that it must collect as premiums. Mem. Supp. of Objections at 4 (Docket No. 55). That argument has some appeal, because Fund trustees have no good way to determine whether the agreements presented to them have been properly entered into. As a result, the cases have routinely denied employers certain fraud defenses, specifically so-called fraud in the inducement defenses, where the employer knew what it was signing but relied perhaps on a union's statements that it would enforce the document differently than written. See, e.g., Agathos v. Starlite Motel, 977 F.2d 1500, 1505-06 (3d Cir.1992); Central States, Southeast and Southwest Areas Pension Fund v. Gerber Truck Serv., Inc., 870 F.2d 1148, 1153-55 (7th Cir.1989); Southwest Adm'rs, Inc. v. Rozay's Transfer, 791 F.2d 769, 774-75 (9th Cir.1986), cert. denied, 479 U.S. 1065, 107 S.Ct. 951, 93 L.Ed.2d 999 (1987). Capozza, however, is arguing fraud not in the inducement, but in the execution. It says that the document the Fund has and is suing on (a collective bargaining agreement) is not a document that its president signed. (The president says that he was given only a signature page and was told that it dealt only with pension benefits for four employees. A jury may ultimately disbelieve him, but his statement creates a genuine issue of material fact.) Even a holder in due course cannot overcome that kind of defense. U.C.C. § 3-305(2)(b) (1998). The policy arguments the Fund trustees advance still seem to apply (reliance upon the document for actuarial purposes and the difficulties they confront in testing the validity of the collective bargaining agreements they are given), but the common law distinction is recognized in the cases; the courts are willing to enforce a document that a party signed under a misapprehension of what its effect would be, but balk at enforcing a document that the party signed on the misapprehension that it was something different than it actually was. Compare Agathos, 977 F.2d at 1505-06, Gerber, 870 F.2d at 1153-55, and Rozay's Transfer, 791 F.2d at 774-75, with Connors v. Fawn Mining Corp., 30 F.3d 483, 492 (3d Cir. 1994), and Operating Eng'rs Pension Trust v. Gilliam, 737 F.2d 1501, 1504-05 (9th Cir.1984). Neither ERISA nor the caselaw supports summary judgment for the Fund trustees if I take the factual assertions most favorably to Capozza.

Finally, there is no necessary inconsistency in recognizing personal immunity for the union official while leaving open the preemption issue. The policies at stake in preemption and immunity are not identical.

It is therefore ORDERED that the Recommended Decision of the Magistrate Judge is hereby ADOPTED. The motion of the Fund plaintiffs for summary judgment is DENIED. The motion of defendants Richard N. Joy and Local 1 for summary judgment is GRANTED as to all claims asserted against Joy and otherwise DENIED.

SO ORDERED.

RECOMMENDED DECISION ON MOTIONS FOR SUMMARY JUDGMENT AND MEMORANDUM DECISION ON AVAILABILITY OF JURY TRIAL

DAVID M. COHEN, United States Magistrate Judge.

John Flynn and the trustees of the Bricklayers and Trowel Trades International Pension Fund ("the Fund") move for summary judgment on their complaint ("the Flynn motion") against Capozza Tile Company, Inc. ("Capozza") in one of the two actions that have been consolidated for purposes of this proceeding.¹ I recommend that the court deny that motion. Richard N. Joy and the International Union of Bricklayers & Allied Craftworkers Local No. 1 — Northern New England ("Local 1") move for summary judgment in the other action ("the Joy motion"). I recommend that the court grant the motion as to Joy and deny it as to Local 1.

Capozza moves to strike certain paragraphs of the statement of material facts submitted in support of the Flynn motion and all of the statement of material facts submitted in support of the Joy motion. Capozza also moves to strike all factual allegations and new material filed in response to its motion to strike portions of the Flynn statement of material facts, and the Flynn plaintiffs in turn move to strike this motion to strike. Because my recommended decision does not rely on many of the factual allegations challenged by the motions to strike, it is unnecessary to address those motions separately. Where I do rely on any factual assertion so challenged, I will note my reasons for doing so in the body of this recommended decision.

Finally, in accordance with my Amended Report of Final Pretrial Conference and Order ("Final Pretrial Order") (Docket No. 40), the parties have submitted memoranda of law on the question whether Capozza is entitled to a jury trial on the claims asserted against it in the Flynn action. I conclude that jury trial is available on those claims.

I. Summary Judgment Standard

Summary judgment is appropriate only if the record shows "that there is 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). "In this regard, `material' means that a contested fact has the potential to change the outcome of the suit under the governing law if the dispute over it is resolved favorably to the nonmovant .... By like token, `genuine' means that `the evidence about the fact is such that a reasonable jury could resolve the point in favor of the nonmoving party ....'" McCarthy v. Northwest Airlines, Inc., 56 F.3d 313, 315 (1st Cir.1995) (citations omitted). The party moving for summary judgment must demonstrate an absence of evidence to support the nonmoving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). In determining whether this burden is met, the court must view the record in the light most favorable to the nonmoving party and give that party the benefit of all reasonable inferences in its favor. Cadle Co. v. Hayes, 116 F.3d 957, 959 (1st Cir.1997). Once the moving party has made a preliminary showing that no genuine issue of material fact exists, "the nonmovant must contradict the showing by pointing to specific facts demonstrating that there is, indeed, a trialworthy issue." National Amusements, Inc. v. Town of Dedham, 43 F.3d 731, 735 (1st Cir.1995) (citing Celotex, 477 U.S. at 324, 106 S.Ct. 2548); Fed. R.Civ.P. 56(e). "This is especially true in respect to claims or issues on which the nonmovant bears the burden of proof." International Ass'n of Machinists & Aerospace Workers v. Winship Green Nursing Ctr., 103 F.3d 196, 200 (1st Cir.1996) (citations omitted).

II. Factual Background

The parties' statements of material facts include the following undisputed relevant facts, appropriately supported in accordance with this court's Local Rule 56.

Capozza is a tile and flooring subcontractor and retailer. Plaintiff's Response to Defendants' Statement of Material Facts ("Capozza Responsive Joy SMF") (Docket No. 29) ¶ 1; Affidavit of Joseph A. Capozza, Jr. ("Capozza Aff.") (Docket No. 26) ¶ 1. The Bricklayers and Trowel Trades International Pension Fund is a multiemployer employee benefit plan that provides pension and other benefits to employees who work in the construction industry under contracts negotiated between local unions and employers. Plaintiffs' Rule 56(B) Statement of Materials [sic] Facts as to Which There is No Genuine Issue ("Flynn SMF") (Docket No. 19) ¶ 1; Defendant's Response to Plaintiffs' Statement of Material Facts, etc. ("Capozza Responsive Flynn SMF") (Docket No. 30) ¶ 1. Employers who are parties to such contracts must make contributions to the Fund. Id. In 1993, Joseph A. Capozza, Jr., then president of Capozza, and three other Capozza employees were members of the International Union of Bricklayers and Allied Craftworkers, Local No. 1. International Union...