Fishbein v. Miranda, 06 Civ. 13222(BSJ)(GWG).
| Decision Date | 16 November 2009 |
| Docket Number | No. 06 Civ. 13222(BSJ)(GWG).,06 Civ. 13222(BSJ)(GWG). |
| Citation | 670 F.Supp.2d 264 |
| Parties | Arthur FISHBEIN, James Crowley, Janet Sachs, Herbert Pobiner, Louis Flacks, and Paul Berkman, as Trustees of the Union Mutual Medical Fund, and the Union Mutual Medical Fund, Plaintiffs, v. George MIRANDA, Charles Hall, Jr., Martin Keane, Martin Sheer, and Thomas Mackell, Jr., in their capacities as Trustees of the Allied Welfare Fund; George Miranda, Robert Bellach, Anthony Cerbone, Martin Sheer, John Does 1-6 in their capacities as Trustees of Teamsters Local 210 Affiliated Health and Insurance Fund, and Crossroads Healthcare Management, LLC., Defendants. |
| Court | U.S. District Court — Southern District of New York |
Robert J. Kipnees, John Albert Fialcowitz, Lowenstein Sandler PC, Roseland, NJ, for Plaintiffs, Interested Party and Counter Defendants.
Anusha Rasalingam, Friedman & Wolf, Roland Richard Acevedo, Seiff Kretz & Abercrombie, New York, NY, Thomas Albert Thompson, Thomas A. Thompson, Law Offices, Yonkers, NY, for Defendants.
Plaintiffs Arthur Fishbein, James Crowley, Janet Sachs, Herbert Pobiner, Louis Flacks, and Paul Berkman, as Trustees of the Union Mutual Medical Fund (collectively, "Plaintiff UMMF Trustees") and the Union Mutual Medical Fund ("Plaintiff UMMF," and together with Plaintiff UMMF Trustees, "Plaintiffs") commenced this action on November 15, 2006. On June 24, 2008, Plaintiffs filed an Amended Complaint. The Local 210 Affiliated Health and Insurance Fund ("Defendant Local 210 Fund") now moves pursuant to Rules 12(b)(6) and 12(b)(1) of the Federal Rules of Civil Procedure to dismiss the first, second, and third causes of action in the Amended Complaint on the grounds that (1) Plaintiffs lack standing; (2) Plaintiffs have failed to state a claim upon which relief may be granted; and (3) this Court lacks subject matter jurisdiction over the action. For the reasons stated below, Defendant Local 210 Fund's Motion is DENIED as to the first and second causes of action in the Amended Complaint and GRANTED as to the third cause of action.
This case arises out of a set of collective bargaining agreements ("CBAs") pursuant to which Defendant Local 210 Fund and the Allied Welfare Fund ("Defendant AWF") collect contributions from employers and then remit a portion of these contributions to Plaintiff UMMF. Plaintiffs allege that Defendants Local 210 Fund and AWF failed to remit to Plaintiff UMMF employer contributions received by Defendants Local 210 Fund and AWF and properly owed to Plaintiff UMMF under the terms of the relevant CBAs.
Plaintiff UMMF is a multi-employer, collectively bargained group health plan protected and governed by the Employee Retirement Income Security Act of 1974 ("ERISA"). (Am. Compl. ¶ 2.) Plaintiff UMMF Trustees is a group of trustees of Plaintiff UMMF. (Id.) The participants and beneficiaries of Plaintiff UMMF are primarily retired members of two unions: (1) the Allied Trades Council, Division Local 338, Retail, Wholesale and Department Store Union-United Food and Commercial Workers, AFL-CIO (the "ATC"), and (2) the International Brotherhood of Teamsters Local Union 210 ("Local 210," and together with the ATC, the "Unions"). (Id.) Local 210 was known as the International Brotherhood of Teamsters Local Union 815 ("Local 815") until April 2005, when the two Locals were merged together. (Id.)
Defendants Local 210 Fund and AWF are both multi-employer, collectively bargained "employee welfare benefit plans" established to provide life insurance, health insurance, and other benefits for their participants. (Am. Compl. ¶¶ 8, 11.) The participants in Defendant AWF are primarily active union workers, and those in Defendant Local 210 Fund are primarily active employees of Local 210 and its predecessor, Local 815. (Id. ¶¶ 8, 11.) Defendant AWF was divided in or about April 2006, and a portion of Defendant AWF's assets were transferred to Defendant Local 210 Fund. (Id. ¶ 10) Defendant Local 210 Fund is a successor in interest, in whole or in part, to Defendant AWF. (Id. ¶ 11.)
Plaintiff UMMF is funded primarily through contributions by employers ("Contributing Employers") who are parties to CBAs with the Unions. (Am. Compl. ¶ 5.) Under the CBAs, Contributing Employers are required to make contributions to Defendants AWF and Local 210 Fund for the benefit of both active and retired Union workers. (Id.) According to Plaintiffs' allegations, the CBAs further require Defendants AWF and Local 210 Fund to remit a portion of the funds collected from Contributing Employers to Plaintiff UMMF. (Id.)
Plaintiffs allege that in or about December 2005, and again in January 2006, Defendant AWF and Crossroads Healthcare Management ("Defendant Crossroads") tried to bring about a merger between Defendant AWF and Plaintiff UMMF. (Am. Compl. ¶ 27.) Plaintiff UMMF refused this merger based on a variety of reasons, including Plaintiffs' concern that Plaintiff UMMF's assets could be diverted to support active Union members, thus diminishing the benefits of retirees. (Id.)
Plaintiffs allege that Defendants AWF and Local 210 Fund have retaliated against Plaintiffs for refusing this merger offer. On or around August 31, 2006, participants in Plaintiff UMMF received a letter indicating that they were eligible for coverage under a new retiree health plan, the Teamsters Local 210 Affiliated Health and Insurance Fund Retiree Group Health Plan. (Am. Compl. ¶ 38.) On or about September 16, 2006, George Miranda ("Defendant Miranda"), a current or former trustee of both Defendant AWF and Defendant Local 210 Fund,2 sent a letter to participants in Plaintiff UMMF indicating that contributions to Plaintiff UMMF were being redirected to Defendants AWF and/or Local 210 Fund to fund health benefits for both active and retired workers. (Id. ¶ 39.) Plaintiffs also claim that Defendant Crossroads has provided false and misleading information to participants in Plaintiff UMMF, such as indicating that the Local 210 Retiree Plan was a successor to Plaintiff UMMF. (Id. ¶ 40.)
Remittances from Defendant AWF to Plaintiff UMMF dropped from $60,000-$74,000 per month in early 2006 to $450 in October 2006. (Am. Compl. ¶ 41.) Plaintiffs allege that this drop was due to Defendants AWF and Local 210 Fund's efforts to solicit participants away from Plaintiff UMMF and to siphon contributions from Plaintiff UMMF. (Id. ¶ 42.) Plaintiffs further allege that Defendants AWF and Local 210 Fund possess monies properly owed to Plaintiff UMMF under the relevant CBAs, but that Defendants AWF and Local 210 Fund have withheld these funds. (Id. ¶ 50 (2).)
Duane Reade, Inc., Duane Reade, and DRI I, Inc. (collectively, "Duane Reade") have a CBA (the "Duane Reade CBA") with the ATC. (Am. Compl. ¶ 20.) The Duane Reade CBA required Duane Reade to contribute fifty-nine dollars per employee per week to Defendant AWF. (Id.) Defendant AWF, in turn, was required under the Duane Reade CBA to remit eight dollars per employee per week of the Duane Reade contributions to Plaintiff UMMF. (Id.)
For a period of time beginning in or about 2000, Duane Reade failed to contribute funds to Defendant AWF, and thus to Plaintiff UMMF. (Am. Compl. ¶ 21.) Plaintiffs allege that in or about March 2006, the ATC and Duane Reade reached a settlement (the "Duane Reade Settlement"). (Id. ¶ 24.) Plaintiffs state that Defendant AWF has already received approximately $850,000.00 in settlement monies from Duane Reade, and that more funds are to be paid by Duane Reade to Defendant AWF and/or to its successor in interest, Defendant Local 210 Fund. (Id.)
Plaintiffs allege that Defendant AWF is required by the Duane Reade CBA to pay Plaintiff UMMF a portion of the funds received under the Duane Reade Settlement. (Am. Compl. ¶ 25.) Plaintiffs state that the ATC and Defendant AWF currently possess monies received under the Duane Reade Settlement that are properly owed to Plaintiff UMMF pursuant to the Duane Reade CBA. (Id. ¶ 46(2).) According to Plaintiffs, the ATC and Defendant AWF have refused to provide Plaintiff UMMF Trustees with any information relating to the Duane Reade Settlement. (Id. ¶ 26.)
On November 15, 2006, Plaintiffs filed the instant action in the United States District Court for the Southern District of New York alleging violations of sections 515, 404(a), 409(a), and 406(b)(2) of ERISA, 29 U.S.C. §§ 1145, 1104(a), 1109(a), and 1106(b)(2), violations of the Health Insurance Portability and Accountability Act of 1976, 42 U.S.C. § 1320 et seq. and of state and common law privacy laws, and breach of fiduciary duty and breach of contract. Plaintiffs filed an Amended Complaint on June 24, 2008. Defendants now move to dismiss Counts One, Two, and Three of the Amended Complaint.
Rule 12(b)(6) of the Federal Rules of Civil Procedure provides for dismissal of a complaint that fails to state a claim upon which relief may be granted. "In ruling on a motion to dismiss for failure to state a claim upon which relief may be granted, the court is required to accept the material facts alleged in the complaint as true." Frasier v. Gen. Elec. Co., 930 F.2d 1004, 1007 (2d Cir. 1991). The court is also required to read a complaint generously, drawing all reasonable inferences from its allegations in favor of the plaintiff. See California Motor Transp. Co. v. Trucking Unlimited, 404 U.S. 508, 515, 92 S.Ct. 609, 30 L.Ed.2d 642 (1972).
"While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (internal quotations omitted). Instead, a...
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