Recent Decisions

J&K effectively obtains meaningful judgments on behalf of its Taft-Hartley Fund clients that also affect the industry as a whole

Seventh Circuit finds that a purchaser’s pre-acquisition notice of seller’s obligation to contribute to a pension fund is sufficient to satisfy the notice requirement in successor liability claims (read full decision)
In reversing a decision from the U.S. District Court for the Northern District of Illinois, the U.S. Court of Appeals for the Seventh Circuit held that notice for purposes of successor liability in the withdrawal liability context is satisfied if the purchaser was aware of the seller’s obligation to contribute to a multiemployer defined benefit pension plan.  The Court of Appeals held that the District Court erred when it found there was insufficient evidence of notice of potential withdrawal liability to prevent summary judgment from being entered in favor of the employer.  Specifically, the Court of Appeals reasoned that successor liability rules should be loosened in the withdrawal liability context and that a “lack of familiarity of the concept of withdrawal liability cannot be an excuse.”  Board of Trustees of the Autom v. Full Circle Group, Inc., et al, 7th Cir., No. 15-2497, 6/24/16. 

Chicago district court finds controlled group company liable for withdrawal liability (read full decision)

In granting the multiemployer defined benefit pension fund’s motion for summary judgment, Judge Dow of the U.S. District Court for the Northern District of Illinois held that the Defendant was liable for $548,457.85 in withdrawal liability owed by an employer that had contributed to the pension fund and had the same ownership composition as the Defendant.  The Court reasoned that the Defendant was liable for the withdrawal liability because it was under common control with the contributing employer and had engaged in leasing property continuously and regularly for the primary purpose of income or profit.  Bd. of Trs. of the Automobile Mechanics’ Local No. 701 Union and Industry Pension Fund v. 6516 Ogden Avenue, LLC, N.D. Ill., No. 14-cv-3531, 3/16/16.

 

Cincinnati district court finds related operations to be alter egos (read full decision)

In granting the Taft-Hartley funds' motion for summary judgment, Judge Barrett of the U.S. District Court for the Southern District of Ohio held that the Defendants, which consisted of a husband and wife, their business partner and the business partner’s company, were all alter egos of each other and bound to a collective bargaining agreement that required them to contribute to the funds.  The Court rejected the husband and wife’s claims that they never signed a collective bargaining agreement and determined that the commingled operations of the husband and wife, their business partner and his company resulted in them all being liable under the terms of the collective bargaining agreement.  The Court ordered all of the Defendants to submit to an audit to determine the amounts owed as a result of their alter ego status.  Bd. of Trs. of the Plumbers, Pipe Fitters & Mech. Equip. Serv., Local Union 392 Pension Fund v. Susan L. Humbert d/b/a Genesis Mechanical, et al., S.D. Ohio, No. 13-cv-4, 2/23/16. 

 

Sixth Circuit finds in favor of Taft-Hartley benefit funds (read full decision)
In reversing a decision from the U.S. District Court for the Southern District of Ohio, the U.S. Court of Appeals for the Sixth Circuit held that an employer was bound to make contributions to the fringe benefit funds, even in the absence of a signed CBA. In holding the employer was bound to the CBA as a matter of law, the Court of Appeals held that Section 302 of the LMRA merely requires that contributions to the funds be made pursuant to a "written agreement," not a signed written agreement. The Court further reasoned that the employer was a member of the MCA during the relevant time period and acted in a manner that was consistent with being bound to the CBA for ten years. Bd. of Trs. of the Plumbers. Pipe Fitters & Mech. Equip. Serv., Local Union 392 Pension Fund v. B&B Mech. Servs.. Inc., 6th Cir., No. 14-4017, 12/29/15.

 

Chicago district court binds signatory company's sister-company (read full decision)

In granting the Taft-Hartley funds' motion for summary judgment, Judge Blakey of the U.S. District Court for the Northern District of Illinois held that the non-union residential arm of a double-breasted operation was also bound to the union commercial arm's collective bargaining agreement with the pipe fitters' union. Specifically, the District Court held that the non-union residential company was a single employer with the union-commercial company because of their interrelated operations, common management and common ownership. Therefore, the non-union residential company was required to pay contributions for work performed by its residential pipefitters. Board of Trustees of the Pipe Fitters Retirement Fund, Local 597 et al v. Northern Weathermakers HVAC, Inc. et al., N.D. Ill., No. 13-cv-08562, 12/10/15.

 

Cincinnati district court binds a successor employer (read full decision)

By granting the Taft-Hartley funds' motion for summary judgment, Judge Black of the U.S. District Court for the Southern District of Ohio ruled that a non-union company was the alter-ego of a union company. The District Court held that the non-union company, which was owned by the children and spouse of the owner of the original signatory company and, in many aspects, continued the operations of the original signatory company without interruption, was liable for contributions to the Taft-Hartley funds because it was the alter-ego of the original signatory company. Additionally, the District Court rejected the successor company's claim that the one-unit employee rule precluded their liability. Pipefitters & Mechanical Equipment Service, Local Union No. 392 Pension Fund et al v. R. and T. Schneider Plumbing Co. et al., S.D. Ohio. No. 13-cv-858. 7/10/15.

 

 

 

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