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Raines v. Dow Acoustics, Inc.

United States District Court, D. Minnesota

February 9, 2018

John Raines and Tim McGough, as Trustees of the Carpenters & Joiners Welfare Fund, Twin City Carpenters Pension Master Trust Fund, and Twin City Carpenters Vacation Fund; John Raines as Trustee of the Carpenters and Joiners Apprenticeship and Journeymen Training Trust Fund, and each of their successors, Plaintiffs,
v.
Dow Acoustics, Inc., Defendant.

          Amanda R. Cefalu, Esq., and Bryan J. Morben, Esq., Kutak Rock, counsel for Plaintiffs.

          Mark S. Mathison, Esq., Meghann F. Kantke, Esq., and Tara Craft Adams, Esq., Gray Plant Mooty, counsel for Defendant.

          MEMORANDUM OPINION AND ORDER

          DONOVAN W. FRANK UNITED STATES DISTRICT JUDGE

         INTRODUCTION

         The plaintiffs in this case filed suit to recover unpaid fringe benefit contributions from the defendant. This matter is before the Court on the plaintiffs' motion for summary judgment. For the reasons discussed below, the Court denies the plaintiffs' motion.

         BACKGROUND

         Plaintiffs are trustees over various fringe benefit funds (the “Trustees”). Plaintiffs filed suit against Defendant Dow Acoustics, Inc., alleging that Dow failed to make the required contributions for its employees' fringe benefits pursuant to certain collective bargaining agreements. Dow contends that it never agreed to the CBAs.

         In 1979, David Wood started Dow, which installs acoustic ceilings and wall panels. (Doc. No. 28 (“Adams Decl.”) ¶ 2, Ex. 1 (“David Wood Dep.”) at 6.) Dow was a nonunion company. (Id. at 7.) But around 2003, one of Dow's general contractors required Dow to join a union to continue working on a project. (Id. at 8.) David Wood then approached one of his employees about joining the union to continue the job. (Id. at 9.) Dow apparently agreed with the union to have one person join the union who would work on all of Dow's union jobs. (Id. at 10.) David Wood signed a one-page Acceptance of Agreement and a one-page Independent Contractor Work Sheet. (Adams Decl. ¶ 3, Ex. 2.) The Acceptance of Agreement provided that Dow agreed to be bound by a CBA and that Dow had received a copy of the CBA. The Independent Contractor Work Sheet identifies the project for which the CBA applied. According to David Wood, despite agreeing to the contrary, the union never gave him the CBA. (David Wood Dep. at 12.) In 2004, Dow signed identical contracts for two more projects. (Adams Decl. ¶¶ 4-5, Exs. 3 & 4.)

         In 2006, Jim Wood, David's son, bought Dow. (Doc. No. 25 (“Cefalu Aff.”) ¶ 2, Ex.1 (“Jim Wood Dep.”) at 22.) According to Jim Wood, the union's business agent, Mike Harrom, would come by once or twice a year to get Dow to join the union. (Jim Wood Dep. at 32-34.) Harrom disputes this and states that he was trying to convince Dow to join unions in other states where Dow did business. (Cefalu Aff. ¶ 3, Ex. 2 (“Harrom Dep.”) at 52-53.) Jim Wood stated that he was always clear with Harrom that Dow could not join the union. (Jim Wood Dep. at 33.)

         Despite the apparent misunderstanding, Dow would sign Acceptance of Agreements each year, which included provisions stating that Dow agreed to the terms of the CBA and that Dow received a copy of the CBA. (See Jim Wood Dep. at 115-17; Cefalu Aff. ¶¶ 5-7, Exs. 4-7.) Jim Wood contends that Harrom explained that the Acceptance of Agreements would continue the agreement that only a few Dow employees would be union members. (Jim Wood Dep. at 115-17.) Both David Wood and Jim Wood testified that they never received a copy of the CBA, despite signing an agreement stating the opposite. (Id. 113-14; David Wood Dep. at 12.)

         As relevant here, Dow signed Acceptance of Agreements for 2012, 2013, and 2014. (Cefalu Aff. ¶¶ 5-7, Exs. 4-7.) Unlike the 2003 and 2004 Acceptance of Agreements, however, the agreements for 2012 through 2014, did not include an Independent Contractor Work Sheet identifying the projects for which the CBAs applied. (See id.) For the 2012 agreement, Plaintiffs could not produce evidence that Dow was given the entire CBA, but Harrom testified that his usual practice was either to send a contract early or to leave one. (Harrom Dep. at 106-07.) For the 2013 agreement, Plaintiffs produced a letter sent to Dow with a copy of the CBA. (Doc. No. 35 (“Morben Aff.”) ¶ 1, Ex. 2.) But the 2013 agreement was intercepted by Dow's office manager, who apparently never showed the CBA to Jim Wood and forged his signature on the agreement. (Jim Wood Dep. at 38-40.) For the 2014 agreement, Harrom testified that he left a full CBA with Dow (Harrom Dep. at 98-99), but Jim Wood testified that he never received one. (Jim Wood Dep. at 113-14.)

         In 2015, the fund's third-party administrator discovered that Dow had not been paying for fringe benefits for all of its employees for 2012 through 2014. On August 4, 2016, the Trustees filed suit and now move the Court for summary judgment.[1]

         DISCUSSION

         I. ...


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