The Board of Trustees of the Local 522 Welfare Fund of New York and New Jersey v. CBF Trucking, Inc. et al

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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THE BOARD OF TRUSTEES OF THE
LOCAL 522 WELFARE FUND OF
NEW YORK AND NEW JERSEY,
REPORT AND
Plaintiff, 	RECOMMENDATION
24 CV 7958 (NRM)(RML)
-against-
CBF TRUCKING, INC., and
C&F TRUCKING SOLUTIONS, LLC, as
successor to CBF TRUCKING, INC.,
Defendants.
----------------------------------------------------X
LEVY, United States Magistrate Judge:
By order dated April 25, 2025, the Honorable Nina R. Morrison, United States
District Judge, referred plaintiff’s motion for default judgment to me for report and
recommendation. For the reasons stated below, I respectfully recommend that the motion be
denied at this time.
B ACKGROUND AND F ACTS
Plaintiff Board of Trustees of the Local 522 Welfare Fund of New York and New
Jersey (“plaintiff” or the “Fund”) brought this case on November 15, 2024, asserting claims
against defendants CBF Trucking, Inc. (“CBF”) and its alleged successor, C&F Trucking
Solutions, LLC (“C&F”) (together, “defendants”), under Sections 502 and 515 of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), 29 U.S.C. §§ 1132 and 1145,
to collect delinquent employer contributions to the Fund. (Complaint, dated Nov. 15, 2024
(“Compl.”), Dkt. No. 1.) The Fund is an “employee welfare benefit plan” and a “multiemployer
plan” within the meaning of sections 3(1) and 3(37) of ERISA, 29 U.S.C. §§ 1002(1), 1002(37).
(Id. ¶ 4.)
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According to the complaint, CBF (which allegedly has ceased operations) was
located at 1230 McCarter Highway, Newark, New Jersey, and its alleged successor company,
C&F, is located at 125 Clay Street, Newark, New Jersey.1 (Id. ¶¶ 7–8.) Defendants allegedly
were party to a collective bargaining agreement and subsequent memoranda of agreement
(collectively, the “CBA”) with Local 701 of the International Brotherhood of Teamsters, AFL-
CIO. (Id. ¶ 6.) Pursuant to the CBA, defendants were obligated to remit monthly contributions
to the Fund on behalf of their employees working in covered employment. (Id. ¶¶ 10–11.)
Plaintiff alleges that defendants failed to remit required contributions to the Fund for the months
of March through November 2024. (Id. ¶ 12.) Plaintiff seeks an award of $266,115 in
delinquent contributions, plus interest, liquidated damages, and attorney’s fees and costs.
(Memorandum of Law in Support of Plaintiff’s Motion for Entry of Default Judgment, dated
Apr. 23, 2025 (“Pl.’s Mem.”), Dkt. No. 14-4, at 8.)
Both defendants were served with the summons and complaint. (Affidavits of
Service of Timothy Botti, sworn to Jan. 31, 2025 (“Affidavits of Service”), Dkt. Nos. 6, 7.)
Neither defendant has answered or moved with respect to the complaint. On February 25, 2025,
the Clerk of the Court noted defendants’ defaults. (See Clerk’s Certificate of Default, dated Feb.
25, 2025, Dkt. No. 12.) Plaintiff filed the instant motion for default judgment on April 24, 2025.
(Notice of Motion for Entry of Default Judgment, dated Apr. 24, 2025, Dkt. No. 14.)
1 Although defendants are located in New Jersey, venue is proper in this district under section
502(e)(2) of ERISA, 29 U.S.C. § 1132(e)(2), as the Fund is administered in this district. (Compl.
¶ 3). Trs. of Pavers & Rd. Builders Dist. Council Welfare, Pension, & Annuity Funds v. Rici
Corp., No. 24 CV 6632, 2025 WL 2682626, at *4 (E.D.N.Y. Sept. 19, 2025) (“An action to
recover unpaid contributions under ERISA may be brought in the district where the plan is
administered or where the court has jurisdiction over the parties.”) (citing 29 U.S.C. §§
1132(e)(2), 1451(d) & 185(a)).
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DISCUSSION
A. Default Standard
The Federal Rules of Civil Procedure prescribe a two-step process for a plaintiff
to obtain a default judgment. First, “[w]hen a party against whom a judgment for affirmative
relief is sought has failed to plead or otherwise defend, and that failure is shown by affidavit or
otherwise, the clerk must enter the party’s default,” as it has done here. F ED. R. C IV. P. 55(a).
Second, after a default has been entered against the defendant and the defendant fails to appear
or move to set aside the default under Rule 55(c), the court may, on a plaintiff’s motion, enter a
default judgment. F ED. R. C IV. P. 55(b)(2). To grant a default judgment, the court must ensure
that the plaintiff took all the required steps in moving for default judgment, including providing
proper notice of the lawsuit to the defendant. BASF Corp. v. Original Fender Mender, Inc., No.
23 CV 2796, 2023 WL 8853704, at *5 (E.D.N.Y. Dec. 22, 2023), report and recommendation
adopted (Jan. 9, 2024) (“A court may not enter a default judgment unless it has jurisdiction over
the person of the party against whom the judgment is sought, which also means that he must
have been effectively served with process.” (internal quotation marks and citation
omitted)). Here, plaintiff has demonstrated that it properly served defendants with the summons
and complaint. (See Affidavits of Service.) Plaintiff has also shown that it served the Motion for
Default Judgment and accompanying submissions on defendants in compliance with Local Civil
Rule 55.2(a)(3). (See Certification of Service of Owen M. Rumelt, Esq., dated Apr. 24, 2025,
Dkt. No. 14-7.)
B. Standing
Standing is an “irreducible constitutional minimum.” Lujan v. Defs. of Wildlife,
504 U.S. 555, 560 (1992). Therefore, the court must evaluate whether a plaintiff has standing
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even where standing is not challenged. See Garnet v. Ramos Bros. Inc., No. 16 CV 2792, 2017
WL 590323, at *1 (E.D.N.Y. Feb. 13, 2017) (citation omitted). “To establish standing, a plaintiff
must prove: ‘(1) injury in fact, which must be (a) concrete and particularized, and (b) actual or
imminent; (2) a causal connection between the injury and the defendant’s conduct; and (3) that
the injury is likely to be redressed by a favorable decision.’” Hennessy by & through Hennessy
v. 194 Bedford Ave. Rest. Corp., No. 21 CV 5434, 2022 WL 4134502, at *2 (E.D.N.Y. Aug. 8,
2022) (quoting Kreisler v. Second Ave. Diner Corp., 731 F.3d 184, 187 (2d Cir. 2013), report and
recommendation adopted, 2022 WL 4134437 (E.D.N.Y. Sept. 12, 2022)).
“ERISA is a comprehensive federal law that sets standards for private retirement
and health plans, governs their administration, and generally preempts state regulation of benefits
plans.” Annuity, Pension, Welfare, Training & Lab. Mgmt. Coop. Tr. Funds of Int’l Union of
Operating Eng’rs Loc. 14-14B, AFL-CIO v. C.M. Ashland Constr., 714 F. Supp. 3d 167, 176
(E.D.N.Y. 2024) (citing ERISA § 514(a) (29 U.S.C. § 1144(a))). “ERISA vests the Court with
jurisdiction over civil actions brought by fiduciaries of employee benefit plans to enforce
provisions of such plans.” Id. (first quoting Trs. of Loc. 7 Tile Indus. Welfare Fund v. City Tile,
Inc., No. 10 CV 322, 2011 WL 917600, at *1 (E.D.N.Y. Feb. 18, 2011), report and
recommendation adopted, 2011 WL 864331 (E.D.N.Y. Mar. 10, 2011); and then citing 29 U.S.C.
§ 1132(a)(3) (permitting fiduciaries of a plan to bring an ERISA action)). Here, plaintiff is a
fiduciary within the meaning of section 3(21) of ERISA, 29 U.S.C. § 1002(21), and the Fund is a
multiemployer benefit plan under ERISA. See LoPresti v. Terwilliger, 126 F.3d 34, 40 (2d Cir.
1997) (explaining the broad, functional definition of fiduciaries under ERISA); Trs. of Mosaic &
Terrazzo Welfare Pension, Annuity, & Vacation Funds v. Cont’l Floors, Inc., No. 13 CV 1739,
2013 WL 5637492, at *4 (E.D.N.Y. Oct. 15, 2013) (“Section 502 of ERISA (29 U.S.C. § 1132)
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creates jurisdiction, endowing plan trustees with standing to enforce section 515.”); (Compl. ¶¶
5, 7, 9.) Therefore, plaintiff has standing to bring suit for delinquent contributions to the Fund.
C. Liability
A defendant’s “default is deemed to constitute a concession of all well pleaded
allegations of liability.” Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155,
158 (2d Cir. 1992). Where a plaintiff moves for default judgment, the court “is required to
accept all of [the plaintiff’s] factual allegations as true and draw all reasonable inferences in [the
plaintiff’s] favor.” Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009) (citing Au Bon Pain
Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d Cir. 1981)). The court must also “determine whether
the [plaintiff’s] allegations establish [the defendants’] liability as a matter of law.” Id.
Section 515 of ERISA requires “[e]very employer who is obligated to make
contributions to a multi employer plan under the terms of the plan or under the terms of a
collectively bargained agreement [to] . . . make such contributions in accordance with the terms
and conditions of such plan or agreement.” 29 U.S.C. § 1145. Here, Article VI of the Fund’s
Agreement and Declaration of Trust (the “Trust Agreement”) provides, in relevant part:
In the event an Employer fails to make the contributions to the
Fund for which it is obligated, including, but not limited to,
contributions found due and owing pursuant to an audit, the
Trustees may bring an action on behalf of the Fund
pursuant to Sections 502(g)(2) and 515 of ERISA, to enforce the
Employer’s obligation. If a judgment is awarded in favor of the
Fund in such an action, the Court shall award the Fund the unpaid
contributions, interest accrued on the unpaid contributions at the
rate of eighteen (18%) percent per annum, liquidated damages
equal to the greater of the amount of interest on the unpaid
contributions or twenty (20%) percent of the unpaid contributions,
reasonable attorneys’ fees and costs of the action and such other
legal or equitable relief as the court deems appropriate.
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(Declaration of Belkis Henriquez in Support of Plaintiff’s Motion for Default Judgment, dated
Apr. 23, 2025 (“Henriquez Decl.”), Dkt. No. 14-2, ¶ 5, Ex. C, Art. VI, ¶ 2.)
According to the complaint, defendants have “willfully failed to remit payment of
the Delinquent Contributions which are due and owing to the Fund.” (Compl. ¶ 16.) Plaintiff’s
undisputed allegations therefore establish liability to plaintiff under ERISA. See Bricklayers Ins.
& Welfare Fund v. Primo Brick, Inc., No. 11 CV 5742, 2013 WL 2120338, at *3 (E.D.N.Y. Apr.
3, 2013) (“Plaintiffs allege that defendant failed to make contributions to the Funds. . . .
Therefore, defendant’s failure . . . constitutes a violation of ERISA.”) (citations omitted)).
However, with respect to defendant C&F, the complaint alleges only “[u]pon
information and belief” that “at a point in time, CBF ceased operations and was succeeded by
C&F Trucking Solutions, LLC.” (Compl. ¶ 7.) The Second Circuit has held that a successor
company can be held liable under ERISA. See, e.g., N.Y. State Teamsters Conf. Pension & Ret.
Fund v. C&S Wholesale Grocers Inc., 24 F.4th 163, 178–79 (2d Cir. 2022). Successor liability is
a “deviation from the general common law rule” that “a corporation that merely purchases for
cash the assets of another corporation does not assume the seller corporation’s liabilities.” Id. at
176–77 (internal quotation marks omitted); see also Xue Ming Wang v. Abumi Sushi Inc., 262 F.
Supp. 3d 81, 88 (S.D.N.Y. 2017) (explaining that the successor liability doctrine was “designed
to impose liability upon successors beyond the confines of the common law rule when necessary
to protect important employment-related policies”). To establish successor liability, “(1) [the]
successor must have notice of its predecessor’s liability, and (2) there must be ‘substantial
continuity of identity in the business enterprise.’” C&S Wholesale Grocers Inc., 24 F.4th at 177
(quoting Stotter Div. of Graduate Plastics Co. v. Dist. 65, United Auto Workers, 991 F.2d 997,
1001 (2d Cir. 1993)); see also Battino v. Cornelia Fifth Ave., LLC, 861 F. Supp. 2d 392, 404–05
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(S.D.N.Y. 2012). Notice of the predecessor’s liability can be “actual or constructive, defined as
‘notice of any facts that one using reasonable care or diligence should have.’” Trs. of Fulton
Fish Mkt. Pension Fund v. M. Slavin & Sons, Ltd., No. 22 CV 187, 2024 WL 3759086, at *5
(S.D.N.Y. Aug. 12, 2024) (quoting Heavenly Hana LLC v. Hotel Union & Hotel Indus. of Hawaii
Pension Plan, 891 F.3d 839, 845 (9th Cir. 2018)). Courts evaluating whether there is substantial
continuity of identity in the business enterprise consider factors such as
whether the business of both employers is essentially the same;
whether the employees of the new company are doing the same
jobs in the same working conditions under the same supervisors;
and whether the new entity has the same production process,
produces the same products, and basically has the same body of
customers.
C&S Wholesale Grocers, 24 F.4th at 177 (quoting Fall River Dyeing & Finishing Corp. v.
N.L.R.B., 482 U.S. 27, 43 (1987)).
Plaintiff’s complaint and other submissions are devoid of any facts that would
support a finding that C&F is CBF’s successor. (See Compl., Henriquez Decl.; Pl.’s Mem.) Nor
has plaintiff submitted the CBA or any documentation to establish which entity was a party to the
CBA, which employees were allegedly covered by the CBA, or when ownership of the business
allegedly changed hands. Accordingly, I respectfully recommend that the motion for default
judgment be denied, with leave to renew upon the submission of relevant facts concerning
C&F’s successor liability.
CONCLUSION
For the reasons stated above, I respectfully recommend that plaintiff’s motion for
default judgment be denied, with leave to submit factual support for a finding of successor
liability. Plaintiff’s counsel is directed to serve copies of this report and recommendation on
defendants by regular mail, and to file proof of service with the court within ten (10) days of the
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date of this report and recommendation. Any objections to this report and recommendation must
be filed electronically within fourteen (14) days. Failure to file objections within the specified
time waives the right to appeal. See 28 U.S.C. § 636(b)(1); F ED. R. C IV. P. 72, 6(a), 6(d).
Respectfully submitted,
_________________________
ROBERT M. LEVY
United States Magistrate Judge
Dated: Brooklyn, New York
January 30, 2026
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