Flying Tiger Line v. CENTRAL STATES, ET AL.
| Citation | 715 F. Supp. 1284 |
| Decision Date | 29 June 1989 |
| Docket Number | Civ. A. No. 86-304-CMW. |
| Parties | The FLYING TIGER LINE, INC., et al., Plaintiffs, v. CENTRAL STATES, SOUTHEAST AND SOUTHWEST AREAS PENSION FUND, et al., Defendants. |
| Court | U.S. District Court — District of Delaware |
R. Franklin Balotti, Jesse A. Finkelstein and William W. Bowser of Richards, Layton & Finger, Wilmington, Del. (Peter A. Gold and Robert G. Haas of Blank, Rome, Comisky & McCauley, Philadelphia, Pa., Douglas D. Broadwater and Richard Liebeskind, Jr. of Cravath, Swaine & Moore, New York City, of counsel), for plaintiffs.
David McBride and Barry Willoughby of Young, Conaway, Stargatt & Taylor, Wilmington, Del. (Thomas W. Jennings and Kent Cprek of Sagot & Jennings, Philadelphia, Pa., of counsel), for defendants.
This protracted litigation involves withdrawal liability under the Multiemployer Pension Plan Amendments Act of 1980 ("MPPAA"), 29 U.S.C. §§ 1381-1461. The Court returns to this action for a decision on the motion of defendant Teamsters Pension Trust Fund of Philadelphia & Vicinity ("the Fund") for attorneys' fees and costs in connection with its successful motion for summary judgment for an award of interim payments.
This suit commenced in July, 1986, when plaintiffs The Flying Tiger Line, Inc., Tiger International, Inc. and Warren Transport, Inc. (collectively "Tiger") filed an action in this Court seeking declaratory and injunctive relief. The Fund subsequently filed a counterclaim for withdrawal liability. The history of this case has been adequately set forth in previous opinions, and will not be repeated here except as relevant. See Flying Tiger Line v. Teamsters Pension Tr. Fund, 830 F.2d 1241 (3d Cir.1987); Flying Tiger Line v. Cent. States Pension Fund, 704 F.Supp. 1277 (D.Del.1989); Flying Tiger Line v. Cent. States Pension Fund, 659 F.Supp. 13 (D.Del.1986).
In an Opinion and Order dated February 6, 1989, the Court denied Tiger's motion for summary judgment and granted the Fund's cross motion for summary judgment. Specifically, the Court sent the entire MPPAA dispute between Tiger and the Fund to arbitration and ordered that Tiger make interim payments of withdrawal liability pending completion of arbitration. See Flying Tiger, 704 F.Supp. at 1295. Additionally, the Court stayed the proceedings in this court pending arbitration. Id.
On February 24, 1989, the Fund filed a motion for attorneys' fees and costs in connection with its efforts to obtain interim withdrawal liability payments from Tiger.1 In support of its motion, the Fund submitted affidavits from its attorneys, listing attorneys' fees of $24,070.75 and costs of $756.83 as having been incurred in the interim-payments portion of this litigation.2 Both parties subsequently filed briefs in connection with the Fund's motion.3
Tiger raises four arguments in opposition to the Fund's application for fees and costs. None of these arguments, which will be addressed here seriatim, precludes such an award.
The Fund moved for fees and costs pursuant to the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq.; the MPPAA, 29 U.S.C. § 1381 et seq.; and Local Rule 6.3. The applicable section of ERISA is section 1132(g)(2):
29 U.S.C. § 1132(g)(2). Section 1451(b) of MPPAA provides that a failure to make withdrawal liability payments within the time prescribed "shall be treated in the same manner as a delinquent contribution (within the meaning of section 1145 of this title)." 29 U.S.C. § 1451(b).
The language of section 1132(g)(2) is mandatory. In the Third Circuit, when a pension fund successfully obtains an order compelling interim payments, an award of attorney's fees is "no longer discretionary." United Retail & Wholesale Employees Teamsters Union Local v. Yahn & McDonnell, Inc., 787 F.2d 128, 134-35 (3d Cir.1986) (quoting Operating Engineers Pension Trust v. Reed, 726 F.2d 513, 514 (9th Cir.1984)), aff'd, 481 U.S. 735, 107 S.Ct. 2171, 95 L.Ed.2d 692 (1987). There is no basis for a district court to defer an award of fees and costs until after arbitration or review in the district court. Id. at 135.
Tiger's first argument in opposition to the Fund's motion for fees and costs is that the statutory scheme provides for such items only in an action "by a fiduciary for or on behalf of a plan", and that, because this action was brought by Tiger seeking declaratory judgment and not by the Fund, any award is precluded by the language of section 1132(g). This misguided argument by Tiger exalts form over substance. It is true that the literal wording of section 1132(g)(2) refers to an action by a fiduciary. However, the Third Circuit has held that a counterclaim by a pension fund for withdrawal liability is an "action" to enforce a delinquent contribution under section 1145, and that the attorney's fee provision relevant to such a counterclaim is section 1132(g)(2). Penn Elastic Co. v. United Retail & Wholesale Emp., 792 F.2d 45, 47 (3d Cir.1986). Tiger's argument that it should not have to pay fees and costs because the Fund did not initiate this case fails in light of this holding.4
Tiger's second argument is that it has never failed to make withdrawal liability payments. It bases this assertion on the fact that the Court's Opinion of February 6, 1989, made a discretionary ruling that Tiger's payments of withdrawal liability would become due on January 31, 1989, sixty days from the date of the Fund's "precautionary re-demand." See 704 F.Supp. at 1295 n. 19. Tiger's defense in this regard is based on a misreading of the Court's Opinion. If Tiger has never failed to make payments, one wonders why the parties have spent much of the past year in a controversy over Tiger's withdrawal liability.
It is true that the Court, exercising its discretion in fashioning an equitable remedy, ordered that payment would not be due until January 31, 1989. However, the Court did not hold that the Fund's first demand letter, dated January 20, 1988, was ineffective. To the contrary, the Court found that "the Fund's demand letter of January 20, 1988 complied with MPPAA and was sufficient to put Tiger on notice as to the alternative bases of liability." Flying Tiger, 704 F.Supp. at 1285. Tiger was thus under a statutory obligation to make payments of withdrawal liability within sixty days of the initial demand. See 29 U.S.C. § 1399(c)(2). It failed to do so, and was therefore delinquent in its withdrawal liability obligation.
Tiger next argues that the Fund's motion violates the Court's stay of these proceedings. At the close of its most recent Opinion in this case, the Court stated that the "proceedings in this Court are stayed pending arbitration." Flying Tiger, 704 F.Supp. at 1295. Contrary to Tiger's assertion, this stay is not so broad as to preclude consideration of the Fund's motion.
The power to stay proceedings is incidental to the power inherent in every court to schedule disposition of cases on its docket so as to promote fair and efficient adjudication, and how this can best be done is a decision properly vested in the trial courts. Gold v. Johns-Manville Sales Corp., 723 F.2d 1068, 1077 (3d Cir.1983); Exxon Corp. v. Dept. of Energy, 577 F.Supp. 703, 707 (D.Del.1983). A stay is thus a matter in the sound discretion of the court. Cessna Aircraft Co. v. Fidelity and Cas. Co. of N.Y., 616 F.Supp. 671, 675 (D.N.J.1985); Amersham Intern. PLC v. Corning Glass Works, 618 F.Supp. 507, 509 (E.D.Mich. 1984). A stay of proceedings pending arbitration does not deprive the court of jurisdiction to enter ancillary orders such as an award of attorney's fees. The mere fact that the only matter pending before a court is a motion for attorney's fees does not mean that the court lacks jurisdiction or that the case is not pending. Knights of the K.K.K. v. East Baton Rouge, 679 F.2d 64, 68 (5th Cir.1982); Buckton v. National Collegiate Athletic Assoc., 436 F.Supp. 1258, 1262-63 (D.Mass.1977).
Tiger's fourth argument in opposition to the Fund's motion is that the Fund has not adequately substantiated its request. In support of its motion, the Fund submitted affidavits of its two lead attorneys in this case, Barry M. Willoughby and Kent Cprek. Tiger does not challenge these affidavits on grounds of hourly rates, time expended or description of services. Rather, Tiger argues that the affidavits do not adequately demonstrate whether the expenses incurred were the result of the Fund's attorneys' efforts on issues other than interim payments.
This argument by Tiger fails as well. Both attorneys specifically state in their affidavits that the fees sought are for time expended on the interim payments issue, and not on other matters. Tiger's argument is further weakened by the fact that an award of fees and costs for time expended on other matters is the subject of a separate motion by the Fund.
Finally, Tiger argues that, in the event the Court decides an award of fees and costs is mandated, the amount of the award should be nominal in light of the lack of any bad faith by Tiger. Even though an award of fees and costs may be mandatory, the court retains the discretion to determine the reasonableness of the fee. Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 1939, 76 L.Ed.2d 40 (1983) (applying Civil Rights Attorney's Fee Awards Act of 1976, 42 U.S.C. § 1988); Vernau v. Frankstown Food A Rama, Inc., 651 F.Supp. 245, 247 (W.D.Pa.1986) (applying 29 U.S.C. § 1132(g)). The courts have identified the salient factors relevant to such a determination in an ERISA action: (1) the degree of the opposing party's culpability or...
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