United States District Court, D. Hawaii
HAWAII ANNUITY TRUST FUND FOR OPERATING ENGINEERS, BY ITS TRUSTEES; LANCE WILHELM; KATHLEEN THURSTON; MARNIE KOGA HURSTY; CHAD GOODFELLOW; LEONARD DEMPSEY; RUSSELL E. BURNS; PANE MEATOGA, JR.; DAN REDING; STEVE INGERSOLL; AND MICHAEL AKAU, Plaintiff,
KAUAI VETERANS EXPRESS COMPANY, LTD., a Hawaii corporation, Defendant.
ORDER GRANTING PLAINTIFFS TRUSTEES OF THE HAWAII
ANNUITY TRUST FUND FOR OPERATING ENGINEERS' MOTION FOR
SUMMARY JUDGMENT, ECF NO. 87
Michael Seabright, Chief United States District Judge
(“Trustees”) are trustees of the Hawaii Annuity
Trust Fund for Operating Engineers (“the Trust”),
a multiemployer employee benefit plan within the meaning of
the Employment Retirement Income Security Act of 1974
(“ERISA”), 29 U.S.C. §§ 1001, et seq.,
that was established pursuant to a trust agreement
incorporated in a collective bargaining agreement
(“CBA”) between Defendant Kauai Veterans Express
Company, Ltd. (“Kauai Veterans”) and the
Operating Engineers Local Union No. 3 of the International
Union of Operating Engineers, AFL-CIO (“the
Union”). See Compl. ¶¶ 1-5, ECF No.
1. Trustees seek summary judgment on their asserted right to
enforce the CBA and an order requiring Kauai Veterans to (1)
pay delinquent contributions, liquidated damages, and
interest in the amounts determined by audit of Kauai
Veterans' payroll records and (2) submit reports and
monetary contributions for the period starting July 1, 2017
until the CBA expires or is legally terminated. See
Mot. at 2, ECF No. 87; Reply at 2, ECF No. 95. Trustees also
seek audit fees, attorneys' fees, and costs incurred in
this action, as well as partial judgment pursuant to Federal
Rule of Civil Procedure 54. Mot. at 2.
reasons stated below, Trustees' Motion is GRANTED.
December 1, 2017, this court issued a comprehensive order
that granted Trustees' motion for partial summary
judgment and denied Kauai Veterans' motions for partial
summary judgment (the “December 1 Order”). ECF
No. 78; Haw. Annuity Tr. Fund for Operating Eng'rs v.
Kauai Veterans Express Co., 2017 WL 5972691 (D. Haw.
Dec. 1, 2017). More specifically, the December 1 Order (1)
set forth a detailed factual background, (2) granted
Trustees' request for further audit of Kauai
Veterans' payroll records, (3) determined that pursuant
to MacKillop v. Lowe's Market, Inc., 58 F.3d
1441 (9th Cir. 1995), Kauai Veterans' contribution
obligations continue until adjudication of pending NLRB
proceedings regarding the validity of the CBA, and thus (4)
denied summary judgment to Kauai Veterans as to its
contention that based on its withdrawal of Union recognition,
its contribution obligations ended on July 1,
Kauai Veterans, 2017 WL 5972691, at *1-3, 6-8. The
court presumes a detailed familiarity with the December 1
Order and therefore, sets forth only those facts necessary to
address the instant Motion.
Veterans and the Union entered into a CBA entitled
“Kauai Trucking Agreement 2011-2014” (“the
2011 Agreement”). ECF No. 1-1. With exceptions not
relevant here, the 2011 Agreement covers all Kauai Veterans
employees “performing work under the classifications
set forth in Exhibit ‘A' (Wage and Classification
Schedule) attached hereto . . . .” Id. §
02.01.00, Ex. A. The classifications listed in Exhibit A
• 8011 Tractor Trailer (Hauling Equipment)
• 8461 Truck Driver (Slip-in or Pup)
• 8431 Truck Driver (Semi-Trailer, Rock Cans, Semi-Dump
• 7732 Tandem Dump Truck
• 8433 Freight Truck Driver
• 4645 Mechanic
Id., Ex. A. The 2011 Agreement requires that the
“Employer . . . permit an audit of the Employer's
payroll records . . . to ascertain whether all contributions
due have been paid.” Id. § 14.03.02.
2011 Agreement also provides it “shall not be modified
except by written document signed by the parties, ”
id. § 21.00.00, and that it “contains the
entire agreement of the parties and neither party has made
representations to the other which are not contained herein,
” id. § 22.01.00. The 2011 Agreement
lasted through at least June 30, 2014, but it remained in
effect thereafter unless Kauai Veterans provided the Union
with written notice of termination consistent with
“Section 8(d) of the National Labor Relations Act, as
amended.” Id. § 01.01.00.
or August 2014, Kauai Veterans and the Union entered into
another agreement (“the 2014 Agreement”), which
states: “It is understood that unless modified by this
Memorandum of Agreement, the terms and conditions of the
existing collective bargaining Agreement shall be
unchanged.” ECF No. 1-2 at 1. The 2014 Agreement states
that it is effective from July 1, 2014 through June 30, 2019,
and will remain in effect thereafter unless Kauai Veterans
provides the Union with written notice of termination
consistent with “Section 8(d) of the National Labor
Relations Act, as amended.” Id. §
01.01.00. The 2014 Agreement also provides, in part:
WAGE AND CLASSIFICATION SCHEDULE
Excluding projects on which Davis-Bacon and GCLA/BILA wage
and fringe benefit rates must be paid, wage and fringe
benefit rates as set forth in Exhibit “A” Wage
and Classification Schedule, shall apply to all Off-Site work
performed by the Employer.
*The Union shall allocate increases to wages and/or fringe
Id. at 1; Def.'s Ex. C at 4, ECF No. 94-6. On
July 2, 2014, the 2014 Agreement modifying the CBA was
ratified by the Union membership. See Meatoga Decl. ¶ 4,
ECF No. 96-2; Pls.' Ex. A, ECF No. 96-4; Def.'s Ex. C
August 19, 2014, Sharon Costello, Director of Contracts for
the Union, wrote a letter to Kauai Veterans advising, in
pertinent part, that:
Pursuant to the current Agreement with the [Union] and [Kauai
Veterans], . . . effective July 1, 2014, the existing wages
shall be increased as indicated below:
All other terms and conditions of the existing Agreement
shall remain unchanged. . . .
Def.'s Ex. D, ECF No. 94-7.
a meeting held sometime in 2014 or 2015, Union Representative
Ana Tuiasosopo allegedly told Stanley Morinaka, Sr.,
President of Kauai Veterans, that “he may ‘leave
out' the ‘freight boys' from the Trust Fund
contributions.” Morinaka Decl. ¶ 4, ECF No. 94-2.
On January 22, 2015, Pane Meatoga, the Union's District
Representative, sent an email to Susan Taniguchi, Kauai
Veterans' Office Manager, stating that after the 2014
Agreement was ratified, Kauai Veterans raised an issue
regarding “wages for freight.” Def.'s Ex. C
at 1. The email further stated that in response, Meatoga had
“explained that freight from the pier or warehouses
were in the jurisdiction of the Teamsters Union. As such we
will not acknowledge that work in our contracts.”
Id. at 2; Meatoga Decl. ¶ 3. Based on the
August 19, 2014 letter, the January 22, 2015 email, and
information discussed during the meeting with Tuiasosopo,
Morinaka instructed his employees not to make contributions
to the Trust for “Freight Truck Drivers.”
Morinaka Decl. ¶ 5.
February 1, 2017, Kauai Veterans purportedly withdrew
recognition from the Union, effective July 1, 2017, based on
an alleged lack of majority support. Def.'s Concise
Statement of Facts (“CSF”) ¶ 1, ECF No. 94;
see also Def.'s Amended CSF ¶¶ 13-14,
ECF No. 49 (filed in support of a prior motion for partial
summary judgment). In response, the Union filed charges of
unfair labor practices against Kauai Veterans with the
National Labor Relations Board
parties agree that Kauai Veterans' reports and
contribution payments to the Trust for May and June 2017 were
late and that Kauai Veterans did not submit reports and
contributions from July 2017 to July 2018. Pls.' CSF
¶ 6, ECF No. 88; Def.'s CSF at 2, ECF No. 94. Kauai
Veterans underwent audits for 2014 through June 2017 that
were performed by Hawaii Benefit Administrators, Inc.
(“HBAI”) Payroll Auditor Noelle Tagaban.
See Tagaban Decl. ¶¶ 1, 7-10, ECF No.
88-3; Ilacqua Decl. ¶ 13, ECF No. 88-2. Based on these
audits, Trustees determined that from January 2014 through
June 2017, Kauai Veterans under-reported and failed to make
contributions for certain “misclassified”
employees who performed truck driver or mechanic duties.
See Pls.' CSF ¶¶ 9-14; Tagaban Decl.
¶¶ 9-19; Second Tagaban Decl. ¶ 5, ECF No.
96-3; Pls.' Exs. F, H to K, ECF Nos. 88-13, 88-15 to
88-18. Trustees further determined that Kauai Veterans owes
the following amounts: (1) liquidated damages and interest of
$1, 003.50 and $5.88, respectively, for the late May and June
2017 contributions; (2) unpaid contributions of $65, 088.13
and liquidated damages of $13, 017.72 for those unpaid
contributions; and (3) $22, 358.03 in interest as of
September 30, 2018 (at $21.40 per diem), for a total amount
due of $101, 473.67, plus additional interest, audit fees,
attorneys' fees and costs. See Pls.' CSF
¶¶ 6-7, 9, 16; Ilacqua Decl. ¶¶ 11-13;
Tagaban Decl. ¶¶ 12; Pls.' Exs. B to D, G to H,
ECF Nos. 88-9 to 88-11, 88-14 to 88-15.
to Kauai Veterans, the employees allegedly misclassified were
in fact freight truck drivers, mechanic helpers, or the son
of Kauai Veterans' president, and therefore, not covered
under the CBA. See Def.'s CSF at 3; id.
¶¶ 4-17, 27; Morinaka Decl. ¶ 6; Taniguchi
Decl. ¶¶ 2-15, ECF No. 94-3.
filed their motion for summary judgment on October 10, 2018.
ECF No. 87. Kauai Veterans filed its opposition on December
10, 2018. ECF No. 93. And Trustees filed their reply on
December 17, 2018. ECF No. 95. A hearing was held on January
STANDARD OF REVIEW
judgment is proper when there is no genuine issue of material
fact and the moving party is entitled to judgment as a matter
of law. Fed.R.Civ.P. 56(c). “A party seeking summary
judgment bears the initial burden of informing the court of
the basis for its motion and of identifying those portions of
the pleadings and discovery responses that demonstrate the
absence of a genuine issue of material fact.”
Soremekun v. Thrifty Payless, Inc., 509 F.3d 978,
984 (9th Cir. 2007) (citing Celotex, 477 U.S. at
323); see also Jespersen v. Harrah's Operating
Co., 392 F.3d 1076, 1079 (9th Cir. 2004). “When
the moving party has carried its burden under Rule 56[(a)]
its opponent must do more than simply show that there is some
metaphysical doubt as to the material facts [and] come
forward with specific facts showing that there is a
genuine issue for trial.” Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87
(1986) (citation and internal quotation marks omitted).
issue is ‘genuine' only if there is a sufficient
evidentiary basis on which a reasonable fact finder could
find for the nonmoving party, and a dispute is
‘material' only if it could affect the outcome of
the suit under the governing law.” In re
Barboza, 545 F.3d 702, 707 (9th Cir. 2008) (citing
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986)). When considering the evidence on a motion for
summary judgment, the court must draw all reasonable
inferences in the light most favorable to the nonmoving
party. Friedman v. Live Nation Merch., Inc., 833
F.3d 1180, 1184 (9th Cir. 2016).
the party moving for summary judgment would bear the burden
of proof at trial, ‘it must come forward with evidence
which would entitle it to a directed verdict if the evidence
went uncontroverted at trial.'” C.A.R. Transp.
Brokerage Co., Inc. v. Darden Rests., Inc., 213 F.3d
474, 480 (9th Cir. 2000) (quoting Houghton v. South,
965 F.2d 1532, 1536 (9th Cir. 1992)). In this instance, then,
Trustees “must establish beyond peradventure
all of the essential elements of the claim . . . to
warrant judgment in [their] favor.” Fontenot v.
Upjohn Co., 780 F.2d 1190, 1194 (5th Cir. 1986).