United States District Court, N.D. Ohio, Eastern Division
Trustees of Ohio Bricklayers Health and Welfare Fund, et al., Plaintiffs,
VIP Restoration, Inc., et al., Defendants.
MEMORANDUM OF OPINION AND ORDER
PATRICIA A. GAUGHAN UNITED STATES DISTRICT COURT CHIEF JUDGE.
matter is before the Court upon Plaintiffs' Motion for
Summary Judgment against Defendant Rick Semersky. (Doc. 15).
The motion is unopposed. This is an ERISA case. For the
reasons that follow, the motion is GRANTED.
are Trustees of the following funds: the Ohio Bricklayers
Health and Welfare Fund, the Bricklayers and Trowel Trades
International Pension Fund, the International Masonry
Institute, the Bricklayers and Allied Craftworkers Local No.
55 Pension Fund, and the Bricklayers and Allied Craftworkers
Local No. 7 Pension Fund (together, the “Funds”).
Plaintiffs bring this lawsuit against Defendants VIP
Restoration, Inc. (“VIP”) and its president, Rick
Semersky, Jr., alleging claims for breach of collective
bargaining agreements, breach of fiduciary duty, and
violation of the Employee Retirement Income Security Act of
Funds are multi-employer plans, which are maintained pursuant
to collective bargaining agreements (“CBAs”)
between VIP and Local Unions Nos. 5, 7, 8, 16 and 55
(“Local Unions”). (Docs. 1 and 5 ¶¶ 3,
10). It is undisputed that the Funds are trust funds that
were established for the purpose of providing health care,
pension, and related benefits for participants and their
dependents. (Docs. 1 and 5 ¶ 3; Doc. 15-6 ¶ 2).
CBAs require VIP to pay contributions to the Funds for work
done in the geographic jurisdiction of the Local Unions.
(Docs. 1 and 5 ¶¶ 12, 13). Pursuant to the CBAs,
VIP also agrees to submit timely and accurate monthly reports
to the Funds with respect to all employees performing covered
work and to make contributions to the Funds. Id. at
¶ 14. The CBAs require VIP to submit to audits by the
Funds to determine that the contributions had been made in
accordance with the parties' agreements. Id. at
¶ 11. The terms of the CBAs provide that when VIP fails
to make timely contributions to the Funds, it is required to
pay a penalty, including but not limited to interest and
liquidated damages. (Doc. 1-3, PageID# 116; Doc. 1-4, PageID#
137; Doc. 1-5, PageID# 189-190; Doc. 1-7, Page ID#256-57;
Doc. 1-8, PageID# 284-85).
is the president, owner, and principal officer of VIP. (Docs.
1 and 5 ¶¶ 6, 27). He admits to being a fiduciary
under ERISA. Id. at ¶ 6. He is the only person
with authority to sign checks at VIP, and he had the final
say over which VIP bills were paid. (Doc. 15-11, PageID# 767;
Doc. 15-12, PAGEID#851).
also owned other companies, and admitted in his deposition
that he used monies from the VIP bank account for the benefit
of himself and his other companies. (Doc. 15-17,
PAGEID#794-800). For example, VIP paid for the liquor permit
for one of Semersky's restaurants. Id. at
799-800. VIP paid for a consultant and other individuals who
did work for Semersky's other companies. Id. at
794, 800. VIP also paid for Semersky's Shoreby Club
membership. Id. at 795. VIP repeatedly transferred
money to Semersky's other restaurants. Id. at
797-98. Meanwhile, VIP did not stay current with the
contributions that it owed to the Funds. (See Doc.
15-6 ¶ 5).
Funds retained an auditor to review the books and records of
VIP and determine whether VIP had paid contributions on all
work covered by the CBAs during the period January 1, 2012
through September 30, 2016. (Doc. 15-1 ¶ 1). Larry
Brown, CPA, conducted the audit. Id. at ¶¶
1-2. Auditor Brown determined that VIP failed to pay
contributions in a timely manner, and, therefore, accrued
interest and liquidated damages. Id. ¶ 5.
Further, VIP frequently paid contributions late. Funds
Administrator Kimberly Wood and Executive Director David F.
Stupar calculated the additional interest and liquidated
damages associated with VIP's late payments. (Doc. 15-6;
went into receivership in September 2017. (Doc. 11-1).
Documents produced by VIP demonstrate that the funds loaned
to Semersky's other businesses by VIP totaled $2, 436,
335.20 at that time. (Doc. 15-13).
Plaintiffs filed this lawsuit asserting three claims for
relief. Count one is a claim for breach of the CBAs between
the parties. Count two is a claim for breach of fiduciary
duty. Count three is a claim for prohibited transactions
under ERISA. When VIP went into receivership, it moved to
stay the case. The Court granted that stay as to VIP only,
and allowed the case to continue as to Semersky. Plaintiffs
move for summary judgment with respect to Counts 2 and 3
against Semersky. Semersky is not a party to Count 1, and
Plaintiffs have not moved on that Count. Semersky has not
opposed the motion.
judgment is appropriate when no genuine issues of material
fact exist and the moving party is entitled to judgment as a
matter of law. Celotex Corp. v. Catrett, 477 U.S.
317, 322-23 (1986) (citing Fed.R.Civ.P. 56(c)); see also
LaPointe v. UAW, Local 600, 8 F.3d 376, 378 (6th Cir.
1993). The burden of showing the absence of any such genuine
issues of material facts rests with the moving party:
[A] party seeking summary judgment always bears the initial
responsibility of informing the district court of the basis
for its motion, and identifying those portions of “the
pleadings, depositions, answers to interrogatories, and
admissions on file, together with affidavits, ” if any,
which it believes demonstrates the absence of a genuine issue
of material fact.
Celotex, 477 U.S. at 323 (citing Fed.R.Civ.P.
56(c)). A fact is “material only if its resolution will
affect the outcome of the lawsuit.” Anderson v.
Liberty Lobby, 477 U.S. 242, 248 (1986). Accordingly,
the nonmoving party must present “significant probative
evidence” to demonstrate that “there is [more
than] some metaphysical doubt as to the material
facts.” Moore v. PhilipMorris Cos.,
Inc., 8 F.3d 335, 340 (6th Cir.1993). The nonmoving
party may not simply rely on its pleading, but must
“produce evidence that results in a ...