Rhode Island Carpenters Fund v. Trevi Icos Corp.

• Decision Date: 31 January 2008
• Docket Number: C.A. No. 04-163S.
• Citation: 533 F.Supp.2d 246
• Parties: RHODE ISLAND CARPENTERS ANNUITY FUND, Rhode Island Carpenters Pension Fund, Rhode Island Carpenters Vacation Fund, Rhode Island Carpenters Health Fund and. Donald Lavin, in his official capacity as Co-Administrator of the Funds, Plaintiffs, v. TREVI ICOS CORPORATION, Defendant.
• Court: U.S. District Court — District of Rhode Island

533 F.Supp.2d 246

RHODE ISLAND CARPENTERS ANNUITY FUND, Rhode Island Carpenters Pension Fund, Rhode Island Carpenters Vacation Fund, Rhode Island Carpenters Health Fund and. Donald Lavin, in his official capacity as Co-Administrator of the Funds, Plaintiffs, v. TREVI ICOS CORPORATION, Defendant.

C.A. No. 04-163S.

United States District Court, D. Rhode Island.

January 31, 2008.

COPYRIGHT MATERIAL OMITTED

Elizabeth A. Wiens, Marc B. Gursky, Gursky Law Associates, North Kingstown, RI, for Plaintiffs.

John D. O'Reilly, III, O'Reilly, Grosso & Gross, P.C., Framingham, MA, R. Daniel Prentiss, R. Daniel Prentiss, P.C., Seth Yurdin, Prentiss Law Firm, Providence, RI, Robert D. City, City, Hayes & Dissette, P.C., Boston, MA, for Defendant.

DECISION AND ORDER

WILLIAM E. SMITH, District Judge.

This matter is before the Court on Defendant Trevi Icos Corporation's Motion for Attorney's Fees and Costs. For the reasons that follow, Defendant's Motion is granted.

I. Background¹

Plaintiff Donald Lavin is the administrator of several employee benefit funds administered for the benefit of members of Rhode Island Carpenters Local 94 ("Carpenters Union").² Defendant is a construction contractor based in Massachusetts and specializing in the operation of heavy excavation equipment. Defendant is a party to two collective bargaining agreements ("CBA") that govern its relationships with the Carpenters Union.

In 2003, Defendant subcontracted for work on a large construction project at a sewage treatment facility in the city of Warwick, Rhode Island. Part of this work involved designing and constructing the excavation support system and walls for two water purifying and clarifying tanks and a pump house. The design for the support system consisted of a series of interlocking cylinders of concrete, called a "secant pile wall." The drilling of these walls required the use of a drilling rig known as the CM-120. Defendant assigned the front-end position on the drilling work crew (the position charged with the physical labor that takes place out in front of the CM-120) to a member of the Laborers International Union of North America ("Laborers Union").

By fall 2003, Defendant finished its work and paid all wages and benefits for those workers it employed. It is undisputed that Defendant made all the necessary contributions to the employees' benefit funds associated with their respective labor unions, with the exception, of course, of those payments that were disputed by Plaintiff in this action. The contributions included those made on behalf of all Carpenters Union members that Defendant actually did employ on the job site.

On May 5, 2004, Plaintiff commenced an action in this Court seeking to "compel payment of contributions, interest, and penalties to employee benefit plans" under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq. Specifically, Plaintiff alleged that Defendant failed to submit timely payroll reports, failed to make timely contributions to the funds, and failed to comply with the terms and conditions of the trust agreements to which they were bound, all in violation of 29 U.S.C. §§ 1132(a)(3) and 1145. In plainer terms, Plaintiff alleged that the front-end work assigned to the Laborers Union should have been assigned to the Carpenters Union, and that Defendant therefore owed contributions and other payments to the Carpenters Union benefit funds.

After limited discovery, Defendant filed a motion for summary judgment asserting that the Court lacked jurisdiction to hear Plaintiffs claims, that the Plaintiff lacked standing, that Defendant had no obligation to make contributions under the terms of the CBAs, and that Plaintiffs action here was, in effect, an end-run around the jurisdiction dispute resolution procedures contained in the CBAs. The Court denied this motion and the matter proceeded to a bench trial on the question of whether either of the CBAs applied to the work performed by the front-end position on the CM-120 crew employed by Defendant and, if so, whether they required Defendant to make fund contributions. After a bench trial that commenced on April 16, 2007, the. Court found that Defendant had properly assigned the work in question to the Laborers Union. Judgment was entered in Defendant's favor on all counts on September 4, 2007.

II. Discussion

A. Cottrill Analysis

ERISA permits the Court "in its discretion [to] allow a reasonable attorney's fee and costs of action to either party." 29 U.S.C. § 1132(g); see also Cook v. Liberty Life Assurance Co. of Boston, 334 F.3d 122, 123 (1st Cir.2003). The Court should consider five factors in deciding whether to award fees and costs to a party: (1) the degree of culpability or bad faith attributable to the losing party; (2) the depth of the losing party's pocket, i.e., his or her capacity to pay an award; (3) the extent (if at all) to which such an award would deter other persons acting under similar circumstances; (4) the benefit (if any) that the successful suit confers on plan participants or beneficiaries generally; and (5) the relative merit of the parties' positions. Cottrill v. Sparrow, Johnson & Ursillo, Inc., 100 F.3d 220, 225 (1st Cir.1996); see also Beauvais v. Citizens Fin. Group, Inc., 418 F.Supp.2d 22, 33 (D.R.I.2006). These so-called Cottrill factors are guidelines and do not preclude the Court from consideration of other factors. Cook, 334 F.3d at 124. Rather, the Court may — and should — consider "additional criteria that seem apropos." Cottrill, 100 F.3d at 225. Ultimately, the test for granting or denying attorney's fees and costs in an ERISA case is, in a word, "flexible." Id.; see also Gray v. New England Tel. & Tel. Co., 792 F.2d 251, 258 (1st Cir.1986).

ERISA's broad language permits the Court to award fees and costs to "either" party. However, the substantive purpose of ERISA is remedial, i.e., it is designed to protect "the interests of participants in employee benefit plans and their beneficiaries." 29 U.S.C. § 1001(b). Consequently, some courts have noted that fees or costs seldom should be assessed against unsuccessful ERISA plaintiffs. See, e.g., Operating Eng'rs Pension Trust v. Gilliam, 737 F.2d 1501, 1505-06 (9th Cir. 1984); Marquardt v. N. Am. Car Corp., 652 F.2d 715, 719-20 (7th Cir.1981).

Before the Court tackles the individual Cottrill factors it should be noted that this is not a typical ERISA case. As was discussed in the Court's decision denying summary judgment, the driving force behind this action seems to be a jurisdictional dispute between two labor unions — the Carpenters Union Local 94 and the Laborers Union, both of which claimed the right to represent the workers on the "front-end" of the CM-120. R.I. Carpenters Annuity Fund v. Trevi Icos Corp., 474 F.Supp.2d 326, 331 (D.R.I.2007). Whether fees should be awarded turns on the question of whether it is appropriate to use ERISA litigation as a vehicle to pursue Local 94's claim of jurisdiction. If it is legitimate to use ERISA in this way, then even an unsuccessful Plaintiff might not be "culpable" under the Cottrill factors. If it is not, then to use ERISA this way (at the expense of an innocent employer) more likely evidences culpability under the Cottrill analysis.

1. Degree of Culpability or Bad Faith

The question of whether it was appropriate to use an ERISA action to pursue jurisdictional aims must be considered in light of the record developed at trial. The record reveals that on two similar projects, the Washington Street Bridge and the I-195 Providence River Bridge projects, similar jurisdictional challenges were mounted by the Carpenters Union before the National Labor Relations Board ("NLRB") as well as in arbitration. In both instances, the challenges were unsuccessful. See Def.'s Trial Ex. K (NLRB Decision and Determination of Dispute, March 31, 2004), and L (American Arbitration Ass'n Decision and Award, Nov. 4, 2005). These cases involved similar disputes over jurisdiction, but different types of construction equipment. The NLRB proceeding involved a claim by the Carpenters Union Local 94 that the employees it represented were entitled to drilling and concrete placement work that had been assigned to employees represented by the Laborers Union Local 271. Laborers Int'l Union of N. Am., Local 271, AFL-CIO, 341 N.L.R.B. 533, 533 (2004). The work in question required the use of a large drill to bore 7-20 feet into the solid rock layer underlying the surface ground, and the filling of the bore hole with concrete. Id. After considering various factors, inducting the relevant CBAs, employer preference and past practice, area practice, safety, and the relative skills and training of the employees, the NLRB awarded the drilling and concrete-placement work to employees represented by the Laborers Union. Id. at 536. Significantly, the NLRB found that the employer had in the past assigned drilling work to employees represented by the Laborers Union, and that the area practice in New England was to assign drilling work to employees represented by the Laborers Unions.³ Id. at 535-36. Similarly, the arbitration involved a dispute over work related to caisson construction using a piece of heavy equipment, known as the "Supertop," that used a large drill to force casings into a deep water shaft. See Def.'s Trial Ex. L. Arbitrator Bornstein determined that the Supertop more resembled drilling equipment than pile-driving equipment, and that in Rhode Island the area practice was that drilling and associated welding work generally had been assigned to employees represented by the Laborers Union. He concluded that the employer did not violate the relevant CBA by assigning the Supertop work to employees represented by the Laborers Union.

At the time of the filing of this action, the NLRB decision had been reviewed and the arbitration was ongoing. However, Plaintiff continued this litigation even after Arbitrator Bornstein⁴ issued...