Teamsters Local Union No. 469 v. Teamsters Joint Council No. 73 Pension Fund, Civil Action No. 14-7466 (MCA)
| Decision Date | 22 September 2015 |
| Docket Number | Civil Action No. 14-7466 (MCA) |
| Parties | TEAMSTERS LOCAL UNION NO. 469, et al., Plaintiffs, v. TEAMSTERS JOINT COUNCIL NO. 73 PENSION FUND, et al., Defendants. |
| Court | U.S. District Court — District of New Jersey |
NOT FOR PUBLICATION
This matter comes before the Court by way of Defendants Teamsters Joint Council No. 73 ("Joint Council"), Teamsters Joint Council No. 73 Pension Fund (the "Fund"), and the Fund's Board of Trustees' ("Trustees") (collectively, "Defendants") motion to dismiss Plaintiffs Teamsters Local Union No. 469 ("Local 469"), Fredrick P. Potter, Jr., Michael L. Broderick, And Michael Tkatch's ("Individual Plaintiffs") (collectively, "Plaintiffs") Amended Complaint for lack of subject matter jurisdiction, pursuant to Federal Rule of Civil Procedure 12(b)(1), and failure to state a claim, pursuant to Federal Rule of Civil Procedure 12(b)(6) [Dkt. No. 11]. For the reasons set forth below, the motion is GRANTED.
Plaintiff Local 469 is an unincorporated labor organization. Am. Compl., Dkt. No. 10, at 1 ¶ 15. The Individual Plaintiffs are all members of Local 469's executive board: Mr. Potter isPresident, Mr. Broderick is Secretary-Treasurer, and Mr. Tkatch is Vice President. Id. at ¶¶ 2-4. Local 469 is an affiliate organization of the International Brotherhood of Teamsters ("IBT") and a member of Joint Council No. 73, a subordinate body of the IBT. Id. at 2-3 ¶¶ 1, 3. The IBT's Constitution sets out the parameters of the relationship between the Joint Council and its Local Unions and provides for dispute resolution mechanisms. Id. at 11-12 ¶ 43. Until recently, Local 469 was also a contributor to the Teamsters Joint Council No. 73 Pension Fund (the "Fund").
The Fund is a multi-employer, defined benefit pension plan that is subject to the Employee Retirement Income Security Program ("ERISA"), 29 U.S.C. § 1001 et seq. Id. at 3 ¶ 3. It is administered by a Board of Trustees, who are also the members of the Joint Council's executive board. Id. The Trustees are fiduciaries of the Fund, its assets, and its participants. Id. at 13 ¶ 52.
In or about 1971, the Joint Council's Executive Board created the Fund as a separate legal entity from both the Joint Council and the IBT and determined that the Fund would be governed by the Joint Council No. 73 Pension Trust Agreement ("Trust Agreement" or "Agreement"). Id. at 4 ¶¶ 6-9, 12. In the event an affiliate owed money to the Fund, Section 13 of the Trust Agreement permitted the Trustees to "take such steps including, but without limitation to, the institution of . . . any proceeding at law, in equity or in bankruptcy or arbitration, as may be necessary for the collection of Council and Affiliate contributions . . . ." Certification of Genevieve M. Murphy-Bradacs ("Murphy-Bradacs Cert."), Ex. A, Trust Agreement, Dkt. No. 11 (emphasis added). The Agreement also permits the Trustees to amend any section at any time. Id. §§ 10, 12.
After its creation, the Fund solicited the Joint Council's Local Union members to contribute to the Fund on behalf of their full-time employees. Am. Compl. 5 ¶ 13. Local 469 became a contributor to the Fund in 1971, but other members of the Joint Council chose not to join. Id. at 4-5 ¶¶ 6, 14. When contributing Unions ceased making contributions to the Fund, the Fund nevertook direct action against them. Id. at 5 ¶¶ 15-16. In such cases, the Fund attempted to hold the IBT liable for unpaid contributions, but the IBT refused to repay any debts. Id. at 5-6 ¶ 16. When Local 469 became a contributor to the Fund, neither it nor anyone on its behalf signed an agreement with the Fund that prohibited Local 469 from unilaterally stopping its contribution payments to the Fund. Id. at 6 ¶ 17.
Around September 14, 2009, the Fund notified all contributing Local Unions and all participants that it was terminating accrual of additional pension credits for all Fund participants.1 Id. at 7 ¶ 22; Certification of Basil Castrovinci ("Castrovinci Cert."), Exs. 1, 2, Benefits Memoranda, Dkt. No. 11. Contributors, however, had to continue paying into the Fund. Am. Compl. at 7 ¶ 22. As a result, the Individual Plaintiffs, all of whom are participants in the Fund, would not receive any new accrual of pension benefits. Am. Compl. at 7 ¶ 22. Local 469 continued to pay into the Fund until it gave written notice on December 19, 2013, that, effective December 31, 2013, it would no longer make contributions to the Fund on behalf of anyone. Id. at 7-8 ¶ 24. Local 469 has not made any contributions to the Fund since the end of 2013. Id. at ¶ 25.
In May 2014, the Fund's Trustees agreed to amend the language of the Trust Agreement's arbitration clause. Specifically, the Trustees amended Section 13 to permit the Trustees to designate a permanent arbitrator to hear all proceedings instituted for the collection of delinquent contributions. Id. at 9 ¶ 31; Murphy-Bradacs Cert., Ex. A. On June 23, 2014, the Fund notified Local 469 of its intention to initiate an arbitration hearing before the Fund's permanent arbitrator in order to obtain an award that would require Local 469 to pay delinquent contributions owed since January 2014. Am. Compl. at 9 ¶ 34.
On January 31, 2015, Plaintiffs filed the instant Amended Complaint. In Count I, Plaintiffs seek declaratory and injunctive relief against the Fund. In Count II, Plaintiffs seek declaratory and injunctive relief against the Joint Council. In Count III, the Individual Plaintiffs claim breach of fiduciary duty on the part of the Trustees. On February 13, 2015, Defendants moved to dismiss these counts for lack of subject matter jurisdiction and for failure to state a claim. Because Plaintiffs have failed to plead adequate facts to state a claim under any of these causes of action, the Court dismisses Plaintiff's Amended Complaint pending the outcome of the arbitration.
In considering Rule 12(b)(1) motions to dismiss for lack of subject matter jurisdiction, the party invoking federal jurisdiction bears the burden of proving that subject matter jurisdiction exists. See, e.g., Mortensen v. First Fed. Sav. & Loan Ass'n., 549 F.2d 884, 891 (3d Cir. 1977). A motion to dismiss for lack of subject matter jurisdiction may either "attack the complaint on its face" or "attack the existence of subject matter jurisdiction in fact, quite apart from any pleadings." Id. Where, as here, the Court evaluates the merits of a facial attack, "the court must consider the allegations of the complaint as true." Id.
When considering a Rule 12(b)(6) motion to dismiss, the court accepts as true all of the facts in the complaint and draws all reasonable inferences in favor of the plaintiff. Phillips v. Cnty. of Allegheny, 515 F.3d 224, 231 (3d Cir. 2008). Dismissal is inappropriate even where "it appears unlikely that the plaintiff can prove those facts or will ultimately prevail on the merits." Id. The facts alleged, however, must be "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 (2007). The allegations in the complaint "must be enough to raise a right to relief above the speculative level." Id. Accordingly, a complaint will survive a motion to dismiss if it provides asufficient factual basis such that it states a facially plausible claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Additionally, in evaluating a plaintiff's claims, generally "a court looks only to the facts alleged in the complaint and its attachments without reference to other parts of the record." Jordan v. Fox, Rothschild, O'Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir. 1994). However, "a document integral to or explicitly relied on in the complaint may be considered without converting the motion [to dismiss] into one for summary judgment." In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1426 (3d Cir. 1997) (internal quotation marks omitted and alteration in the original).2
Defendants move to dismiss the Amended Complaint based on the Court's lack of subject matter jurisdiction. Plaintiffs assert two possible bases for subject matter jurisdiction: Section 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185(a), and Section 502 of ERISA, 29 U.S.C. § 1132(a)(1)(B) and (a)(3).3 Am. Compl. at 3 ¶ 4.
Under ERISA, Plaintiffs assert that Subsections 1132(a)(1)(B) and (a)(3) confer jurisdiction. These subsections permit Federal courts to hear civil actions (1) brought "by a participant or beneficiary to recover benefits due him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of theplan," 29 U.S.C. § 1132(a)(1)(B) (emphasis added); or (2) brought "by a participant, beneficiary, or fiduciary to enjoin any act or practice which violates any provision of this subchapter or the terms of the plan, or to obtain other appropriate equitable relief," 29 U.S.C. § 1132(a)(3) (emphasis added).
Defendants argue that the Court does not have jurisdiction because Local 469 is not a "participant," "beneficiary," or "fiduciary," and because the individual Plaintiffs' claims do not seek redress for an ERISA violation or enforce rights under an ERISA plan. Defs.' Br. at 19. The Court disagrees.
Defendants are correct that Local 469 does not fall under either jurisdictional hook. ERISA defines "participants" as employees or former employees who are, or may be, eligible to receive benefits, 29 U.S.C. § 1002(7), and "beneficiaries" as people designated by a participant who may become eligible to receive benefits. 29 U.S.C. § 1002(8); see New Jersey State AFL-CIO v. State of N.J., 747 F.2d 891, 892-93 (3d Cir. 1984). "Fiduciaries" are those who "exercise[] any...
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