Raines v. Wingender

Background

The plaintiffs were John Raines and Tim McGough, as trustees of the Carpenters & Joiners Welfare Fund, and Raines as trustee of the Carpenters and Joiners Apprenticeship and Journeyman Training Trust Fund. The funds were multi-employer benefit plans administered under the Employee Retirement Income Security Act (ERISA).

The defendant, Kenny Wingender, did business as BN Service, Inc. The opinion states that he worked in the construction industry in Omaha, Nebraska, employed carpentry workers, submitted reports for them, and made some fringe-benefit contributions. The opinion also states that BN Service, Inc. was not an active corporation and that no corporate entity operated under the name BN SVCS, which appeared in the collective bargaining agreement.

Wingender signed a collective bargaining agreement negotiated between the Omaha Building Contractors Employers Association and Carpenters District Council of Kansas City Local Union 427. The agreement required covered employers to submit monthly reports identifying covered work and to make fringe-benefit contributions. It also required liquidated damages of 10 percent, interest on late contributions, and reasonable attorney’s fees and costs when payments were delinquent.

The plaintiffs alleged that Wingender failed to timely submit reports and contributions for August through December 2018. After the lawsuit was filed, he submitted reports for August 2018 through January 2019 and paid $16,648.36 in contributions. The plaintiffs claimed that $1,664.84 in liquidated damages and $252.08 in interest remained unpaid, totaling $1,916.92. They also alleged that Wingender failed to submit reports and contributions for later months, leaving the amount owed for that period undetermined.

Procedure and ruling

The plaintiffs filed the complaint on January 9, 2019, and served Wingender on January 17, 2019. He did not answer or otherwise respond, and the clerk entered default on February 11, 2019. He also did not appear at the August 1, 2019 hearing on the plaintiffs’ motion.

The court applied Federal Rule of Civil Procedure 55, which governs default judgments. It accepted the complaint’s well-pleaded factual allegations as true, but required proof of damages where the amount was uncertain. The court also relied on ERISA’s requirement that an employer obligated to contribute to a multi-employer plan make those contributions according to the plan or collective bargaining agreement.

The court concluded that the plaintiffs’ requested relief was supported by the collective bargaining agreement and ERISA. It further concluded that Wingender was personally liable. The court distinguished an earlier decision involving a corporate officer because Wingender’s agreement did not clearly show that he signed only in an official corporate capacity. The court relied on the facts that Wingender personally employed the workers, operated as a sole proprietor under another name, and used an inactive corporation’s name.

The court ordered the following:

Effect

The order required Wingender personally to provide the outstanding reports and held him liable for the stated $1,916.92. It did not itself state a final dollar amount for later-period contributions because those amounts depended on the reports. It authorized the plaintiffs to seek a later money judgment for those amounts and related charges.

The opinion contains an apparent numerical inconsistency: the factual discussion identifies liquidated damages of $1,664.84, while paragraph 2 of the order states $1,644.84; the total of $1,916.92 matches $1,664.84 plus $252.08. The supplied filing date is August 29, 2019, while the signed opinion is dated August 28, 2019.