Todd v. Casemakers, Inc., 76 C 2160.

• Decision Date: 10 February 1977
• Docket Number: No. 76 C 2160.,76 C 2160.
• Citation: 425 F. Supp. 1375
• Parties: Edward TODD et al., Plaintiffs, v. CASEMAKERS, INC., a corporation, Defendant.
• Court: U.S. District Court — Northern District of Illinois

425 F. Supp. 1375

Edward TODD et al., Plaintiffs, v. CASEMAKERS, INC., a corporation, Defendant.

No. 76 C 2160.

United States District Court, N. D. Illinois, E. D.

February 10, 1977.

Irving M. Friedman, Harold A. Katz, Stanley Eisenstein, Katz & Friedman, Chicago, Ill., for plaintiffs.

Fred R. Kimmel, Arvey, Hodes, Costello & Burman, Chicago, Ill., for defendant.

MEMORANDUM OPINION

WILL, District Judge.

Plaintiffs, the Board of Trustees of a health and welfare fund, bring this action pursuant to section 301 of the Labor Management Relations Act, 29 U.S.C. § 185, against a contributing employer, alleging that defendant has failed to make required payments to the fund. Plaintiff now moves for summary judgment on its cause of action. Defendant has responded with a motion to dismiss for lack of subject matter jurisdiction, or, alternatively, for a stay of proceedings here and an order to submit all issues to binding arbitration. For the reasons herein stated, we deny defendant's motions to dismiss and to stay, and we grant plaintiff's motion for summary judgment with respect to the issue of liability and deny the motion with respect to the issue of damages.

I.

The Chicago Textile Industry Health and Welfare Fund (the "Trust") was created by an agreement and declaration of trust dated March 26, 1971 pursuant to section 302 of the Labor Management Relations Act, 29 U.S.C. § 186, for the purpose of providing health and welfare benefits for employees whose employers have entered into collective bargaining agreements with labor organizations comprising the Chicago Joint Board of the Textile Workers Union of America, AFL-CIO. By written agreement dated March 31, 1971, defendant Casemakers became a participating employer in the Trust and became obligated to make contributions into the Trust on behalf of its employees, members of Local 1745 of the Textile Workers Union of America, AFL-CIO (Local 1745). On December 31, 1973, the Textile Workers Union, Local 1745, and Casemakers entered into a three year collective bargaining contract which provided in part that "The Company will continue to pay the full cost of employees' individual premiums for insurance." Plaintiffs have submitted an uncontroverted affidavit stating that from April 1, 1973 through and including January 31, 1976, Casemakers made contributions into the Trust on behalf of its employees. The affidavit further states that from February 1, 1976 through December 31, 1976, defendant failed to make required payments totalling $9,234.32 to the Trust. Plaintiff further alleges that a 10% late fee is also due. Casemakers states that it has made the required contributions to the Trust since the initiation of this suit, an allegation challenged by plaintiffs, and further objects to the computation of damages due.

II.

Section 301 of the Labor Management Relations Act states:

"(a) Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties."

Casemakers has challenged the jurisdiction of this Court to hear this action on the grounds that the Trust is not a labor organization and therefore does not come within section 301's coverage. This issue has been dealt with by a number of district courts which have found that the section does encompass suits brought by trustees of funds such as the Trust. See, e. g., Wishnick v. One Stop Food & Liquor Store, Inc., 359 F.Supp. 239 (N.D.Ill.1973); Owen v. One Stop Food & Liquor Store, Inc., 359 F.Supp. 243 (N.D.Ill.1973); Trustees v. Woehsberger Roofing Works, 66 LRRM 2047 (E.D.N.Y. 1967); Hann v. Korum, 64 LRRM 2862 (D.Ore.1967). As Judge Bauer stated in Wishnick:

"This is, in the language of the statute, a suit for violation of a contract `between an employer and a labor organization' (here the Retail Food and Drug Clerks Union, Local 1550) for the contributions to a Trust Fund for employees. Looking at the substance of the relationship between the parties, there is nothing to be gained by requiring a suit by the union rather than by the Trustees of its Welfare Fund. The United States Supreme Court has directed that Section 301 is not to be given a narrow meaning; Section 301 is designed to vindicate employees rights arising from a collective bargaining contract. . . . Vindication of such rights is the purpose of this suit, and thus the jurisdiction of this Court over the instant matter would be proper and appropriate." footnote omitted 359 F.Supp. at 242.

Plaintiffs have stated that payment of benefits on behalf of the employees of Casemakers has been suspended because of Casemakers' failure to contribute into the Trust. There is, therefore, a need for vindication of the employees' rights under the collective bargaining agreement, and we hold that jurisdiction to hear this case is present.

III.

Casemakers next suggests that, assuming that we find jurisdiction to exist, we nevertheless follow the action of the district court in International Brotherhood of Electrical Workers v. Dave's Electric Service, Inc., 382 F.Supp. 427 (M.D.Fla. 1974), which required that the parties first submit the trust fund issue to arbitration before coming into federal court...