Sheet Metal Workers' Nat'l Pension Fund v. Coverex Corporate Risk Solutions

SHEET METAL WORKERS' NATIONAL PENSION FUND,NATIONAL ENERGY MANAGEMENT INSTITUTE COMMITTEE FOR THE SHEET METALAND AIR CONDITIONING INDUSTRY, SHEET METAL OCCUPATIONAL HEALTH INSTITUTE TRUST,INTERNATIONAL TRAINING INSTITUTE FOR THE SHEET METAL AND AIR CONDITIONING INDUSTRY,and NATIONAL STABILIZATION AGREEMENT OF THE SHEET METAL INDUSTRY FUND, Plaintiffs, v. COVEREX CORPORATE RISK SOLUTIONS and MATTHEW AMODEO, Defendants.

09-CV-0121 (SJF)(ARL)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

May 28, 2015

ORDER

FEUERSTEIN, District Judge:

I. BACKGROUND

On January 13, 2009, plaintiffs Sheet Metal Workers' National Pension Fund ("NPF"), National Energy Management Institute Committee for the Sheet Metal and Air Conditioning Industry ("NEMI"), Sheet Metal Occupational Health Institute Trust ("SMOHI"), International Training Institute for the Sheet Metal and Air Conditioning Industry ("ITI") and National Stabilization Agreement of the Sheet Metal Industry Fund ("SASMI") (collectively, "plaintiffs" or "the Funds"), all employee benefit plans within the meaning of § 3(3) of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1002(3), commenced this action against Rolf's Metal Tops Inc. ("RMTI") and Joseph C. Iorio ("Iorio"), inter alia, pursuant to Section502 of ERISA, 29 U.S.C. § 1132, seeking, inter alia, to enforce the obligations of RMTI to make contributions to the Funds; to reclaim property of the Funds converted by RMTI and Iorio; and to remedy RMTI's and Iorio's breaches of fiduciary obligations and commission of prohibited transactions.

On March 6, 2009, plaintiffs filed a First Amended Complaint, inter alia, adding defendants Coverex Corporate Risk Solutions ("Coverex") and Matthew Amodeo ("Amodeo") (collectively, "defendants") as additional defendants to this action and seeking damages to reclaim property of the Funds converted by defendants and to remedy their breaches of fiduciary obligations and commission of prohibited transactions in the sum of sixty-seven thousand seven hundred twenty-nine dollars and fifty-eight cents ($67,729.58), together with interest thereon, liquidated damages and reasonable attorneys' fees and costs. Issue was joined by the filing of an answer to the amended complaint on behalf of defendants on April 29, 2009.

By order dated August 24, 2009, the Honorable Arlene R. Lindsay, United States Magistrate Judge, inter alia, stayed this case pursuant to 11 U.S.C. § 362(a) due to RMTI's filing of a voluntary petition for bankruptcy under Chapter 7 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York on August 16, 2009. By order dated November 17, 2009, upon the joint application of plaintiffs and defendants, Magistrate Judge Lindsay lifted the stay with respect to plaintiffs' claims against Iorio.

On October 27, 2010, October 28, 2010 and November 9, 2010, Iorio filed letters, inter alia, requesting that this action be stayed pursuant to 11 U.S.C. § 362(a) because he had filed a voluntary petition for bankruptcy under Chapter 7 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York on October 20, 2010.However, on June 14, 2011, plaintiffs filed a motion to sever their claims against RMTI and Iorio so that they could proceed with their claims against defendants in this action. During a hearing on the motion held on June 24, 2011, the Honorable Thomas C. Platt, Senior United States District Judge, to whom this case was originally assigned, orally granted plaintiffs' motion to sever.¹

On October 28, 2012, plaintiffs moved pursuant to Rule 56 of the Federal Rules of Civil Procedure for partial summary judgment on their claims against Amodeo. By Memorandum and Order dated April 22, 2013 ("the April Order"), inter alia, Judge Platt granted summary judgment in favor of plaintiffs on the issue of Amodeo's liability for breach of a fiduciary duty and conversion, finding, inter alia, that Amodeo was the Chief Financial Officer ("CFO") of RMTI, (April Order at 3); "was a fiduciary within the scope of ERISA and [] exercised discretion and authority over the contributions belonging to the [] [F]unds," (id. at 12); and "breached his fiduciary duty with respect to plaintiffs' funds and converted the contributions which rightfully belonged to plaintiffs," (id. at 1). In the April Order, Judge Platt indicated that "[t]he exact sum of damages and whether plaintiffs are entitled to attorneys' fees and costs shall be determined at trial in this matter." (Id. at 13).

On September 18, 2013, Amodeo moved pursuant to Rule 60(b)(2) of the Federal Rules of Civil Procedure to vacate and set aside the April Order on the ground that newly discovered evidence demonstrated that he was not a fiduciary under ERISA. By order dated June 26, 2014("the June Order"), Judge Platt denied Amodeo's motion on the grounds, (1) that all of the newly discovered documents existed as of the date of the April Order; and (2) that Amodeo failed to demonstrate "that he was excusably ignorant of the facts that existed at the time the [April] Order was issued despite exercising due diligence[.]" (June Order at 6).

On July 8, 2014, this case was reassigned to me. By order dated July 9, 2014 ("the July Order"), I, inter alia, (1) granted plaintiffs' application for leave to serve a motion for summary judgment, in lieu of a trial, on the issue of damages; and (2) directed plaintiffs to file a status report regarding the status of their claims against Coverex on or before August 11, 2014, or their claims against Coverex in this action would be deemed voluntarily dismissed. Although plaintiffs filed a status report on July 18, 2014, they did not specifically address the status of their claims against Coverex in this action. Accordingly, and since plaintiffs have taken no steps to prosecute their claims against Coverex in this action for the approximate six (6) years that it has been pending, plaintiffs' claims against Coverex are dismissed in their entirety with prejudice pursuant to Rule 41(b) of the Federal Rules of Civil Procedure for failure to prosecute and to comply with an order of this Court.

Pending before the Court is plaintiffs' motion pursuant to Rule 56 of the Federal Rules of Civil Procedure for summary judgment on the issue of damages against Amodeo. For the reasons set forth below, plaintiffs' motion is granted in part and denied in part.

II. DISCUSSION

A. Standard of Review

"A motion for summary judgment may properly be granted * * * only where there is nogenuine issue of material fact to be tried, and the facts as to which there is no such issue warrant judgment for the moving party as a matter of law." In re Dana Corp., 574 F.3d 129, 151 (2d Cir. 2009); see Fed. R. Civ. P. 56(a) ("The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.") In ruling on a summary judgment motion, the district court must first "determine whether there is a genuine dispute as to a material fact, raising an issue for trial." McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 202 (2d Cir. 2007) (internal quotations and citations omitted); see Ricci v. DeStefano, 557 U.S. 557, 129 S. Ct. 2658, 2677, 174 L. Ed. 2d 490 (2009) (holding that "[o]n a motion for summary judgment, facts must be viewed in the light most favorable to the nonmoving party only if there is a 'genuine' dispute as to those facts." (emphasis added) (internal quotations and citation omitted)); Vermont Right to Life Comm., Inc. v. Sorrell, 758 F.3d 118, 142 (2d Cir. 2014), cert. denied, 135 S. Ct. 949, 190 L. Ed. 2d 830 (2015) ("The role of the court on a summary judgment motion is to determine whether, as to any material issue, a genuine factual dispute exists." (quotations and citation omitted)). "On a motion for summary judgment, a fact is material if it 'might affect the outcome of the suit under the governing law.'" Royal Crown Day Care LLC v. Dep't of Health & Mental Hygiene of City of New York, 746 F.3d 538, 544 (2d Cir. 2014) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986)).

In reviewing the record to determine whether there is a genuine issue for trial, the court must "construe the evidence in the light most favorable to the nonmoving party," Dalberth v. Xerox Corp., 766 F.3d 172, 182 (2d Cir. 2014) (quotations and citation omitted), and "resolve all ambiguities and draw all permissible factual inferences in favor of the party against whomsummary judgment is sought." Smith v. County of Suffolk, 776 F.3d 114, 121 (2d Cir. 2015) (quotations and citation omitted); accord Delaney v. Bank of America Corp., 766 F.3d 163, 168 (2d Cir. 2014). "An issue of fact is genuine 'if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.'" Dalberth, 766 F.3d at 182 (quoting Anderson, 477 U.S. at 248, 106 S. Ct. 2505); see also Delaney, 766 F.3d at 168. "Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial." Ricci, 557 U.S. 557, 129 S. Ct. at 2677 (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348, 89 L. Ed. 2d 538 (1986)); accord Smith, 776 F.3d at 121.

"The moving party bears the initial burden of showing that there is no genuine dispute as to a material fact." CILP Assocs., L.P. v. PriceWaterhouse Coopers LLP, 735 F.3d 114, 123 (2d Cir. 2013) (quotations, brackets and citation omitted); see also Crawford v. Franklin Credit Mgmt. Corp., 758 F.3d 473, 486 (2d Cir. 2014). "[W]hen the moving party has carried its burden * * *, its opponent must do more than simply show that there is some metaphysical doubt as to the material facts * * *[,]" Scott v. Harris, 550 U.S. 372, 380, 127 S. Ct. 1769, 167 L. Ed. 2d 686 (200...