Teamsters Local 456 Pension v. K&D Industries of NY

Background

The plaintiffs were the Teamsters Local 456 Pension, Health and Welfare, Annuity, Education & Training, Industry Advancement and Legal Services Funds, acting through their trustees and fiduciaries, and Westchester Teamsters Local Union No. 456. The Funds are multiemployer benefit plans under the Employee Retirement Income Security Act, and the Union is a labor organization under the Labor Management Relations Act.

The Union and K&D Industries of NY, LLC were parties to a collective bargaining agreement. The agreement required K&D to make contributions to the benefit plans based on its employees’ hours and to deduct union dues and related obligations from employees’ wages. Karl Bjorkland was alleged to be an owner, officer, and agent of K&D.

The parties settled the plaintiffs’ claims for unpaid contributions and deductions. Revised settlement documents stated that defendants owed $179,438.90, consisting of $151,344.56 in contributions and deductions, $944.77 in pre-settlement interest, $6,565.96 in amortized interest, $17,274.50 in liquidated damages, and $3,309.11 in attorneys’ fees and costs through January 15, 2025. Defendants agreed to pay $162,164.40, representing the total amount less liquidated damages, in monthly installments of $6,756.85 from February 1, 2025, through January 1, 2027.

The settlement documents included a confession of judgment. That document allowed the plaintiffs to seek judgment for $179,438.90, less payments made, plus attorneys’ fees and costs incurred in collection efforts if defendants defaulted. Defendants missed a payment due in July 2025. Plaintiffs sent a notice of default, but defendants did not cure the default. Plaintiffs then moved for entry of judgment seeking $117,560.31, statutory interest, attorneys’ fees, and costs. The motion was unopposed.

Court’s analysis

The court explained that a confession of judgment is governed by state law rather than a federal procedural rule. A federal court may enter judgment under a confession of judgment when it has subject-matter jurisdiction and the confession was made voluntarily, knowingly, and intelligently. New York law also requires the confession to state the amount for which judgment may be entered, authorize entry of judgment, and briefly explain the facts supporting the debt.

The court found that it had subject-matter jurisdiction because the parties’ stipulation of conditional discontinuance expressly stated that the court would retain jurisdiction over the action, settlement, and parties to enforce the settlement. The court also found no indication that defendants signed the confession of judgment involuntarily or without understanding its terms. The document was signed and notarized by Bjorkland individually and as K&D’s representative.

The court further found that the confession of judgment satisfied the requirements of New York law. It stated the amount that could be entered, authorized entry in the Southern District of New York, and summarized the facts supporting the debt.

Ruling

Judge Cathy Seibel concluded that plaintiffs were entitled to entry of judgment under the settlement and confession of judgment. The amount was $117,560.31, calculated as $151,344.56 in unpaid contributions and deductions minus $33,784.25 in five payments made from February through June 2025.

The court granted plaintiffs’ motion for entry of judgment. It directed that judgment be entered in favor of plaintiffs for $117,560.31, with interest at the statutory rate under 28 U.S.C. § 1961(a) from the date of entry until payment. The court also granted plaintiffs’ request for attorneys’ fees and costs, but required plaintiffs to submit an affidavit or declaration with contemporaneous billing records and an itemized statement of costs before that award could be entered.

The court also required plaintiffs to submit an affidavit confirming that the July payment was not made on or before July 11, 2025, if that was in fact the case. Plaintiffs’ supporting documents were due August 15, 2025, and any opposition was due August 29, 2025. The clerk was directed to terminate the pending motion.