Nelson v. Stair
| Decision Date | 21 September 2017 |
| Docket Number | No. 4:15-CV-1200 CAS,4:15-CV-1200 CAS |
| Court | U.S. District Court — Eastern District of Missouri |
| Parties | TERRY M. NELSON, et al., Plaintiffs, v. ACORN STAIR & WOODWORK, INC., et al., Defendants. |
TERRY M. NELSON, et al., Plaintiffs,
v.
ACORN STAIR & WOODWORK, INC., et al., Defendants.
No. 4:15-CV-1200 CAS
UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MISSOURI EASTERN DIVISION
September 21, 2017
MEMORANDUM AND ORDER
This matter is before the Court on plaintiffs' motion for default judgment against defendant AS & W, LLC. Plaintiffs' motion is accompanied by affidavits and exhibits. Also before the Court is defense counsel's motion to withdraw as counsel for defendant AS & W, LLC. For the following reasons, the Court will grant plaintiffs default judgment in the amount of $19,594.31, and deny as moot defense counsel's motion to withdraw.
This is an action under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. §1132, and Section 4301 of the Multiemployer Pension Plan Amendments Act of 1980 ("MPPAA"), 29 U.S.C. §1451. Plaintiffs, who are trustees of the Carpenters' Pension Trust Fund of Saint Louis ("Pension Trust"), seek to collect withdrawal liability from defendant AS & W, LLC.
Plaintiffs originally brought suit against defendants Acorn Stair & Woodwork, Inc. ("Acorn Stair") and Lawrence E. Pecor, IV, an individual d/b/a Acorn Stair. Plaintiffs alleged that defendants Acorn Stair and Pecor were employers within the meaning of ERISA, 29 U.S.C. §1002(5), and Sections 2(2), (6) and (7) of the Labor Management Relations Act of 1947
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("LMRA"), 29 U.S.C. §§152(2), (6) and (7). According to the original Complaint, Acorn Stair was dissolved as a Missouri corporation for failure to file its annual report, but defendant Pecor, who was an officer and director, continued to conduct business in the name of Acorn Stair after its corporate dissolution. Plaintiffs alleged that defendants Acorn Stair and Pecor experienced a "partial withdrawal" from the Pension Trust during the plan year ending April 30, 2011. The Pension Trust actuarial consultants computed that defendants had withdrawal liability of $19,302.00, and the Pension Trust issued a withdrawal liability assessment to defendants in this amount, which defendants neither disputed nor paid. In the original Complaint, plaintiffs sought a judgment against defendants Acorn Stair and Pecor in the amount of $19,302.00, plus interest, unspecified liquidated damages, attorneys' fees and costs.
On September 18, 2015, Pecor filed an answer to the Complaint. Defendant Acorn Stair did not respond to the original Complaint in a timely manner. On September 28, 2015, plaintiffs filed a First Amended Complaint. Plaintiffs added defendant AS & W, LLC as a defendant, but Lawrence E. Pecor, IV was not named as a defendant in plaintiffs' First Amended Complaint. The allegations in the First Amended Complaint were nearly identical to the original Complaint, with the notable exception that defendant AS & W, LLC was alleged to be an employer within the meaning of ERISA and the LMRA. Defendant AS & W, LLC was alleged to be "a disguised continuation of, and alter ego of, defendant Acorn Stair & Woodwork, Inc., and is therefore liable for amounts owed by Acorn Stair & Woodwork, Inc." Doc. 9 at 2. Plaintiffs further alleged that defendant AS & W, LLC was liable for $19,302.00 in withdrawal liability.
Defendants did not respond to the First Amended Complaint in a timely manner. Instead, Larry Pecor, III, filed two motions to dismiss, which were out of time, on behalf of defendants
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Acorn Stair and AS & W, LLC. The Court ordered that both motions be stricken from the record because Larry Pecor, III, was not a licensed attorney, and he could not represent corporate entities without a law license. Moreover, the motions were untimely.
In an Order dated December 1, 2015, the Court directed plaintiffs to file, on or before December 15, 2015, a motion for default judgment as to defendants Acorn Stair and AS & W, LLC. In that Order, plaintiffs were warned that failure to comply would result in dismissal of these parties without prejudice. Plaintiffs requested and were granted three extensions of time to file for default judgment. In the meantime, on March 15, 2016, attorneys Randall Grady and Joseph D. Schneider entered appearances on behalf of defendant AS & W, LLC, only. Defense counsel filed a consent motion for leave to file defendant AS & W, LLC's answer to the First Amended Complaint out of time, which the Court granted.
Plaintiffs never filed a motion for default judgment as to defendant Acorn Stair. On May 18, 2016, defendant Acorn Stair was dismissed, without prejudice, pursuant to Rule 41(b) of the Federal Rules of Civil Procedure.
In July 2016, plaintiffs moved to amend their complaint in order to allege two alterative grounds for liability as to defendant AS & W, LLC. The Court granted the motion, and plaintiffs filed a Second Amended Complaint. The allegations in the Second Amended Complaint are nearly identical to the two prior complaints, however, the Second Amended Complaint is against AS & W, LLC only, and it alleges that this defendant is liable for the withdrawal liability of Acorn Stair because AS & W, LLC and Acorn Stair are members of a "common control group," or in the alterative, AS &W, LLC is an "alter ego" of Acorn Stair. In the Second Amended Complaint
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plaintiffs seek $19,302.00 in withdrawal liability, plus interest, unspecified liquidated damages, attorneys' fees, and costs against defendant AS & W, LLC.
Despite being represented by counsel, defendant AS & W, LLC never answered or otherwise responded to plaintiffs' Second Amended Complaint. Plaintiffs filed a motion for the entry of clerk's default against defendant AS & W, LLC - a motion which defendant AS & W, LLC did not oppose. The clerk of court entered default against defendant AS & W, LLC, pursuant and Rule 55(a) of the Federal Rules of Civil Procedure on October 24, 2016.
Following the entry of default, defense counsel moved to withdraw as counsel. In their one-page motion, attorneys Randall Grady and Joseph D. Schneider state that AS & W, LLC had failed to "substantially fulfill obligations" and "uphold communications with movants." Doc. 40 at 1. The motion also states that the clerk of court has entered default against AS & W, LLC and, therefore, "the movants can withdraw without adversely affecting [AS & W, LLC]'s material interests." Id. Defense counsel represent in their certificate of service that a copy of the motion to withdraw was sent to defendant AS & W, LLC.
Plaintiffs filed a motion for the entry of default judgment against defendant AS & W, LLC pursuant to Rule 55(b)(2) of the Federal Rules of Civil Procedure. The motion is supported by affidavits and exhibits. Defendant AS & W, LLC, which is still represented, did not oppose the motion for the entry of default judgment, and the time to do so has long expired. No other attorney has entered an appearance on behalf defendant AS & W, LLC.
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I. Motion to Withdraw
The law does not permit a corporate defendant to proceed pro se, Ackra Direct Mktg. Corp. v. Fingerhut Corp., 86 F.3d...
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