09-2219-cv
Masino v. Falzone
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUM M ARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUM M ARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERM ITTED AND IS GOVERNED
BY THIS COURT’S LOCAL RULE 32.1.1 AND FEDERAL RULE OF APPELLATE PROCEDURE 32.1.
W HEN CITING A SUM M ARY ORDER IN A DOCUM ENT FILED W ITH THIS COURT, A PARTY
M UST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (W ITH THE
NOTATION “SUM M ARY ORDER”). A PARTY CITING A SUM M ARY ORDER M UST SERVE A COPY
OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated Term of the United States Court of Appeals for the Second Circuit, held at the
Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York,
on the 11th day of June, two thousand and ten.
Present: RALPH K. WINTER,
JOHN M. WALKER, JR.,
ROSEMARY S. POOLER,
Circuit Judges.
_____________________________________________________
VINCENT MASINO, As Trustee of Asphalt Workers Local 1018 of the Labors International
Union of North America and ASPHALT WORKERS LOCAL 1018 OF THE LABORERS
INTERNATIONAL UNION OF NORTH AMERICA,
Plaintiffs-Appellees,
-v- (09-2219-cv)
LUCIANO FALZONE, As Trustee of the Local Union 1018 Death Benefit Trust Fund, LOCAL
UNION 1018 DEATH BENEFIT TRUST FUND, and LUCIANO FALZONE, ROBERT
MARESCO, JOHN MORELLO, ALFONSO LETO, CALOGERO FALZONE, ROLAND
BEDWELL, CONSTANTINO SEMINATORE,
Defendants-Appellants.
Appearing for Appellee: Barbara S. Mehlsack, Gorlick, Kravitz & Listhaus P.C. New York,
New York
Appearing for Appellant: David W. New, Herbert New & David W. New, P.C., Bloomfield,
New Jersey.
Appeal from the United States District Court for the Eastern District of New York
(Korman, J.).
ON CONSIDERATION WHEREOF, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the judgment of said District Court be and it hereby is AFFIRMED.
Defendants-appellants (hereinafter “defendants”) appeal the April 28, 2009, order of the
United States District Court for the Eastern District of New York (Korman, J.) granting
plaintiffs-appellees’ (hereinafter “plaintiffs”) motion for summary judgment and denying
defendants’ cross-motion for summary judgment. The district court’s order adopted without
opinion the March 31, 2009, report and recommendation of Magistrate Judge Robert Levy. We
assume the parties’ familiarity with the underlying facts, procedural history, and specification of
issues for review.
The Court reviews “de novo a district court’s ruling on cross motions for summary
judgment, in each case construing the evidence in the light most favorable to the non-moving
party.” Krauss v. Oxford Health Plans, 517 F.3d 614, 621-22 (2d Cir. 2008). We will affirm
only where the record reveals “no genuine issue as to any material fact” and demonstrates the
movant’s entitlement to judgment “as a matter of law.” Fed. R. Civ. P. 56(c); Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986).
Plaintiffs brought suit under Section 301(a) of the Labor Management Relations Act
(“LMRA”), 29 U.S.C. § 185(a), which states, in relevant part, that “[s]uits for violations of
contracts . . . between . . . labor organizations . . . may be brought in any district court of the
United States having jurisdiction of the parties . . . .” It is well-established, and defendants do
not dispute, that “a union constitution is a ‘contract’ within the plain meaning of § 301(a).” Shea
v. McCarthy, 953 F.2d 29, 31 (2d Cir. 1992) (internal citations omitted).
The district court concluded that the defendants breached the Laborers’ International
Union of North America (“LIUNA”) Uniform Local Union Constitution (“ULUC”) and
LIUNA’s International Union Constitution (“IUC”) (together “LIUNA Constitutions”) by
establishing the Local 1018 Death Benefit Trust Fund (“Fund”) and by failing to turn over the
assets in the Fund when Local 1018 was placed into trusteeship.
Defendants concede that if the Fund was not validly created under the LIUNA
Constitutions, they breached their obligation to turn over Local 1018 property upon trusteeship.
They argue, however, that the Fund was validly created under Article II, § 2 of the ULUC, which
states that “[A] Local Union shall have the authority . . . [t]o provide for the well-being and
security of members, officers and employees of the Local Union, including but not limited to the
establishment of insurance, health and welfare, pension, severance, and other employee benefit
plans.”
Although the Executive Board and membership approved in principle the creation of a
death benefit fund, at no point was a fund designating payable benefits created. The only step
taken in this regard were: (i) Falzone’s unilateral adoption of the Death Benefit Trust Agreement
(the “Agreement”); and (ii) the transfer of funds from the Local 1018 treasury into an account
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designated as the prospective death benefit fund. However, neither step was taken with the
informed consent of either the Local 1018 Executive Board or membership, in contravention of
the LIUNA Constitutions.
Moreover, the Agreement did not provide any details designating type, form, or specific
benefits to be provided to members upon their death. Rather, it stated only that such details
would be provided in a Schedule of Benefits to be subsequently adopted by the Trustee – i.e.
Falzone. Nor did the Agreement specify conditions of eligibility with respect to participation,
such as age, length of service, or other similar provisions. Finally, the Agreement did not specify
the members’ required contributions to the death benefit fund or procedures for the collection
thereof.
Had any members died between the time the Executive Board and membership approved
in principle the creation of a death benefit fund and the time the Local 1018 was placed in
trusteeship, the member would have had no legal right to any specific death benefit.
Accordingly, notwithstanding the approval by the Executive Board and membership of the
creation of a death benefit fund, and Falzone’s preliminary steps in this regard, an actual and
operative death benefit plan never came into existence before the Local 1018 was placed in
trusteeship.
Defendants rely heavily on three cases (collectively called the “Tile Worker Cases”) that
defendants claim upheld similar death benefit funds. See Tile, Marble, Terrazzo, Finishers,
Shopworkers & Granite Cutters Int’l Union v. Ceramic Tile Finishers Union, Local 25, 972 F.2d
738 (7th Cir. 1992) (“TMT Local 25”); Tile, Marble, Terrazzo, Finishers, Shopworkers &
Granite Cutters Int’l Union v. Tile, Marble, Terrazzo, Helpers & Finishers Local 32, 896 F.2d
1404 (3d Cir. 1990) (“TMT Local 32”); United Bhd. of Carpenters v. Tile Helpers Union Local
88, 803 F. Supp. 601 (E.D.N.Y. 1992) (“THU Local 88”). In all three cases, the courts found
that the motive for creating the death benefit fund was irrelevant to the question of whether it was
validly created. However, in the Tile Worker Cases, no one disputed the fact that the death
benefit funds had actually been created and would in fact provide benefits to members upon their
death. That is not the case here.
Accordingly, the judgment of the district court hereby is AFFIRMED.
FOR THE COURT:
Catherine O’Hagan Wolfe, Clerk
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