Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Alvarado v. Gaylor Inc. Employee Trust

United States District Court, S.D. Indiana, New Albany Division

April 20, 2017

HARVEY ALVARADO, et al, Plaintiffs,



         This matter comes before us on Defendant Gaylor Inc. Employee Trust's (the “Trust”) Motion to Dismiss [Dkt. No. 20]. The motion is fully briefed. For the reasons set forth herein, we GRANT IN PART and DENY IN PART Defendant's Motion.


         Our recitation of facts below is based on the Amended Complaint which is consistent with the proper procedure as set out in the Federal Rules of Civil Procedure. Plaintiffs' response to Defendant's Motion to Dismiss, Docket Number 24, relies on facts not contained in the Amended Complaint, including, for example, three affidavits and certified payroll records. Absent the applicability of one of a few narrow exceptions, when adjudicating a motion to dismiss our review is limited to the allegations contained in Plaintiffs' Amended Complaint. Rosenblum v., Ltd., 299 F.3d 657, 661 (7th Cir. 2002). Accordingly, Plaintiffs cannot defeat Defendants' Motion by relying on factual statements not included in the Amended Complaint.

         Plaintiffs' claims against the Trust are based on purported violations of 29 U.S.C. § 1001, et seq., the Employee Retirement Income Security Act of 1974 (“ERISA”), and Kentucky Revised Statutes § 337.505, [1] and Plaintiffs have invoked our federal question jurisdiction, 28 U.S.C. § 1331 and 29 U.S.C. § 1132(e) (ERISA jurisdictional statute) as well as supplemental jurisdiction, 28 U.S.C. § 1367.

         Plaintiffs were employed by Gaylor, Inc. (“Gaylor”), an electrical contractor. From 2009 through 2011, Plaintiffs performed work on several Kentucky projects regulated by the Kentucky “prevailing wage” laws (which have since been repealed). According to Plaintiffs, they were paid a “prevailing wage” for their work on these Kentucky projects, which included a basic hourly rate and an additional amount as a fringe benefit, determined on an hourly rate set by the Commissioner for the Commonwealth of Kentucky. Pursuant to Kentucky law, an employer's contribution for fringe benefits could either be made to a trust, paid in cash to the employee, or some combination thereof. K.R.S. § 337.505 (repealed January 8, 2017).

         In 2009, 2010, and 2011, the Trust received fringe benefit contributions from Gaylor and administered those contributions. [Amended Complaint (“Am. Compl.”) ¶¶ 20, 22.] No part of the fringe benefit contributions was paid to Plaintiffs in cash, but instead were all placed into the Trust. [Id. ¶ 23.] It is Plaintiffs' claim that “the contributions received by the [Trust] from Gaylor were not fully and properly disbursed for qualified fringe benefits for Plaintiffs”, in violation of the Trust's fiduciary duties under ERISA, 29 U.S.C. § 1104, and KRS § 337.505, and those violations damaged Plaintiffs.” [Id. ¶¶ 24-27; Dkt. No. 24 (explaining that when the Trust failed to use all of Gaylor's contributions to provide fringe benefits for Plaintiffs, it was required to pay out the unused portions to Plaintiffs in cash, which it did not do).] Plaintiffs also contend that the Trust violated ERISA, 29 U.S.C. § 1132(c), by refusing to supply information requested by Plaintiffs related to fringe benefit contributions. It is unclear from the Amended Complaint the date on which Plaintiffs requested said information from the Trust or what specific information they sought.

         Plaintiffs' claims are limited to contributions made “prior to January 2011.” [Am. Comp. ¶ 32 (“[P]rior to January, 2011, Defendant [Trust] did not properly use the fringe benefit contributions paid by Gaylor to provide qualified benefits to Plaintiffs.”).] It is unclear from the Amended Complaint when Plaintiffs became aware of the Trust's alleged failure to properly use the fringe benefit contributions; however, Plaintiffs explain in their response to Defendant's Motion to Dismiss that they first were suspicious of a problem in January, 2011 [Dkt. No. 24 at 2].

         Plaintiffs have brought three claims against the Trust: ERISA - Breach of Fiduciary Duties; ERISA - Refusal To Supply Requested Information; and Violations of Kentucky Revised Statute § 337.505. In Count I, Plaintiffs contend that the Trust “breached its fiduciary duties under 29 U.S.C. § 1104 by not properly using fringe benefit contributions to provide qualified fringe benefits for Plaintiffs in accordance with the Kentucky prevailing wage laws.” [Am. Compl. ¶ 39.] Count II of their Amended Complaint alleges that the Trust “violated 29 U.S.C. § 1132(c) by refusing to supply requested information about the fringe benefit contributions.” [Id. ¶ 42.] Plaintiffs also assert a claim based on state law in Count III alleging that the Trust “failed to expend the full fringe benefit contributions it received from Gaylor to provide qualified fringe benefits to Plaintiffs, ” in violation of Kentucky Revised Statute § 337.505.

         The Trust seeks to dismiss this case in its entirety because no ERISA claims have been asserted; Plaintiffs' claims, according to Defendant, are rooted in a violation of Kentucky prevailing wage laws and not ERISA; therefore, this court lacks jurisdiction. Further, the Trust argues that Plaintiffs' second claim (breach of failure to disclose information) is barred by the statute of limitations. Without federal causes of action, the Trust contends that we lack supplemental jurisdiction over Plaintiffs' state law claims. The Trust also contends that Count III, based on a violation of Kentucky statutory law, fails to state a claim upon which relief can be granted.

         Standard of Review

         “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice” to withstand the requirements of Federal Rules of Civil Procedure 8 and 12(b)(6). Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 555). “[A]t some point, the factual detail in a complaint may be so sketchy that the complaint does not provide the type of notice of the claim to which the defendant is entitled under Rule 8.” Airborne Beepers & Video, Inc. v. AT & T Mobility LLC, 499 F.3d 663, 667 (7th Cir. 2007); Killingsworth v. HSBC Bank Nevada, N.A., 507 F.3d 614, 618 (7th Cir. 2007) (A statement of the claim must be sufficient “to give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.”).

         A party moving to dismiss nonetheless bears a weighty burden. “[O]nce a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint.” Twombly, 550 U.S. at 563 (citing Sanjuan v. Am. Bd. of Psychiatry and Neurology, Inc.,40 F.3d 247, 251 (7th Cir. 1994) (“At [the pleading stage] the plaintiff receives the benefit of imagination, so long as the hypotheses are consistent with the complaint.”)). In addressing a Rule 12(b)(6) motion, we treat all well-pleaded factual allegations as true, and we construe all inferences that reasonably may be drawn from those ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.