Flynn, John v. Flores, Priscilla

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United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Decided January 9, 2004

No. 02-7091

JOHN FLYNN, JOHN T. JOYCE, LOUIS WEIR, FRANK STUPAR,
JAMES BOLAND, GEORGE HARBISON, DOMINIC SPANO, PAUL SONGER,
CHARLES VELARDO, EUGENE GEORGE, JOHN WALLNER,
WALTER KARDY, DAN SCHIFFER, AND JOSEPH SPERANZA, JR.,
AS TRUSTEES OF, AND ON BEHALF OF THE
BRICKLAYERS AND TROWEL TRADES INTERNATIONAL PENSION FUND,
APPELLEES

v.

R.C. TILE, R.C. CONSTRUCTION, RICHARD C. FLORES, AND
PRISCILLA JEAN FLORES,
APPELLANTS

Appeal from the United States District Court
for the District of Columbia
(No. 99cv02044 (EGS))

Ira R. Mitzner filed a brief for appellees.

Bills of costs must be filed within 14 days after entry of judgment.
The court looks with disfavor upon motions to file bills of costs out
of time.
 2

Richard C. Flores, individually and doing business as R.C.
Construction, and Priscilla Jean Flores, individually and
doing business as R.C. Tile, filed a brief for appellants pro se.
Before: GINSBURG, Chief Judge, and SENTELLE and
HENDERSON, Circuit Judges.
Opinion for the Court filed by Chief Judge GINSBURG.
GINSBURG, Chief Judge: Richard Flores, individually and
doing business as R.C. Construction, and Priscilla Flores,
individually and doing business as R.C. Tile, appeal the
judgment of the district court in favor of the Trustees of the
Bricklayers and Trowel Trades International Pension Fund
upon the Trustees’ claim under the Employment Retirement
Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001 et
seq., for delinquent pension contributions. The appellants
contend the district court overlooked genuine issues of mate-
rial fact and applied incorrect legal standards in concluding
R.C. Tile was the alter ego of R.C. Construction and liable for
its delinquent pension contributions. We affirm the judg-
ment.*

I. Background
The three Flores brothers – Joseph, Richard, and Jesse –
do tile work on public projects in southern California. Joseph
Flores manages all operations of the family’s tile installation
businesses; his wife, Priscilla Flores, oversees the finances
and acts as office manager for the family’s businesses. Rich-
ard and Jesse Flores set tile and do not have management
responsibilities.
Over the past thirty years the Flores family has owned and
operated several tile businesses in southern California. Jo-
seph Flores owned and operated Majestic Tile from 1970 to
1995; Richard Flores worked for him. Majestic Tile closed in
1995 after Joseph Flores encountered problems with the IRS
owing to Majestic’s failure to remit payroll taxes. This case

* This case was considered upon the record from the district
court and upon the briefs submitted by parties. See FED. R. APP. P.
34(a)(2); D.C. CIR. RULE 34(j).
 3

concerns three of the family’s businesses that began opera-
tions after Majestic was closed.
In 1995 Richard started a business known as R.C. Con-
struction. Although nominally the owner, Richard had little
knowledge about or involvement with the management and
finances of R.C. Construction. Richard received wages for
his work as a tile setter but received no share of the profits.
Joseph Flores, who referred to himself as the ‘‘operations
manager’’ of R.C. Construction, estimated, bid, and negotiat-
ed R.C. Construction’s tile setting contracts as he had Majes-
tic’s before. Priscilla was in charge of R.C. Construction’s
finances, as she had been of Majestic’s.
In 1996 R.C. Construction entered into a collective bargain-
ing agreement (CBA) with the local affiliate of the Interna-
tional Union of Bricklayers and Allied Craftsmen. R.C.
Construction thereby agreed to make contributions to the
Bricklayers and Trowel Trades International Pension Fund
‘‘for each hour worked by all workmen covered by this
agreement’’ – defined to include all tile setters employed by
R.C. Construction – until such time as the company gave
effective notice of its withdrawal from the CBA. Although
R.C. Construction ceased making payments to the Fund in
December 1997, and ceased operating in January 1998, it did
not then provide the Fund with a notice of withdrawal from
the CBA.
Shortly after R.C. Construction ceased operations, Jesse
Flores started R.C. Tile. Although Jesse was listed as the
owner, he did not have any involvement in the management of
the firm; he worked solely as a tile setter. Joseph, who
again styled himself the ‘‘operations manager,’’ stated in his
deposition that ‘‘R.C. Tile was my company.’’ Priscilla served
R.C. Tile, as she had R.C. Construction, as the office manager
and bookkeeper. Although there was no written contract
between the two companies, R.C. Tile assumed R.C. Con-
struction’s tile setting sub-contracts and completed jobs R.C.
Construction had begun. R.C. Tile did not, however, become
a signatory to the CBA or contribute to the Fund.
 4

In 1998 Jesse Flores transferred the assets of R.C. Tile to
Priscilla Flores; there was no written contract of sale and
apparently no consideration. Priscilla continued to do busi-
ness under the R.C. Tile name and each member of the
Flores family continued to perform his or her job at R.C. Tile.
When R.C. Construction had not made any payments to the
Fund for more than a year, the Trustees of the Fund made
unavailing demands upon both R.C. Construction and R.C.
Tile. Richard and Priscilla Flores respectively notified the
Trustees that R.C. Construction and R.C. Tile (although not a
signatory) were withdrawing from the CBA.* The Trustees
then sued R.C. Construction, R.C. Tile, and Richard and
Priscilla Flores under, 29 U.S.C. §§ 1132(g)(2) and 1145 to
recover the delinquent pension fund payments.
The district court granted the Trustees’ motion for sum-
mary judgment. The court concluded from the undisputed
material facts that ‘‘R.C. Construction and the two R.C. Tile
companies are alter egos’’ and that ‘‘it is in the interest of
justice to hold that these three successive companies are alter
egos.’’ The appellants moved for reconsideration, which the
district court denied, and they now appeal to this court.

II. Analysis
We review the district court’s grant of summary judgment
de novo. See Workman v. United Methodist Comm. on
Relief of the Gen. Bd. of Global Ministries, 320 F.3d 259, 262
(D.C. Cir. 2003). Summary judgment is appropriate only if
‘‘there is no genuine issue as to any material fact and TTT the
moving party is entitled to a judgment as a matter of law.’’
FED. R. CIV. P. 56(c); see Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 247 (1986).
The appellants present three arguments for reversing the
judgment of the district court: First, the court failed to

* The notice of withdrawal was dated May 28, 1999. Under the
CBA, however, a notice of withdrawal delivered within the 60 days
prior to June 1 was not effective until June 1 of the following year.
 5

consider the Declaration of Joseph Flores, which contained
material facts in dispute. Second, the court both ignored
other facts material to whether R.C. Construction and R.C.
Tile were alter egos and applied incorrect legal standards for
determining whether an entity is an alter ego under the
ERISA. Third, the Trustees are barred by equitable consid-
erations from recovering the delinquent pension contribu-
tions.
A. Declaration of Joseph Flores
In its initial decision the district court refused to consider
the Declaration of Joseph Flores because it ‘‘contradicts Mr.
Flores’ deposition testimony at several relevant points.’’ The
court would not allow the Flores to ‘‘create a TTT factual
dispute through the submission of a self-serving declaration
that contradicts prior deposition testimony.’’
Upon the Flores’ motion for reconsideration, however, the
district court did consider the Declaration and found it did
not contradict any fact material to whether R.C. Tile was the
alter ego of R.C. Construction. Rather, the court stated, the
Declaration disputed only ‘‘minor and immaterial issues of
fact’’ and did not alter the district court’s conclusion that the
Trustees were entitled to summary judgment.
On review, therefore, this court need not consider the
merits of the district court’s initial conclusion that the Decla-
ration was a ‘‘sham affidavit.’’ The appellants’ protestation
notwithstanding, at the end of the day the district court
simply did not ignore Joseph’s Declaration in granting sum-
mary judgment to the Trustees.
B. Alter Ego Liability
The Trustees’ claim arises under § 515 of the Multiemploy-
er Pension Plan Amendments Act of 1980 (MPPAA). 29
U.S.C. § 1145. That provision makes a federal obligation of
an employer’s contractual commitment to contribute to a
multiemployer pension fund:
Every employer who is obligated to make contributions
to a multiemployer plan under the terms of the plan or
under the terms of a collectively bargained agreement
 6

shall, to the extent not inconsistent with law, make such
contributions in accordance with the terms and condi-
tions of such plans or such agreement.
Section 515 was a response to the problem created when an
employer defaults upon its obligation to fund a multiemployer
defined-benefit pension plan: If one employer does not make
its contributions to such a plan, then the other participating
employers must make larger contributions to cover the short-
fall. See, e.g., H.R. REP. No. 96–869 (II) at 15 (1980). The
funding burden may be shifted beyond other participating
employers to taxpayers via the Pension Benefit Guaranty
Corporation, and to beneficiaries in the form of reduced
pension benefits. See Upholsterers’ Int’l Union Pension
Fund v. Artistic Furniture of Pontiac, 920 F.2d 1323, 1328–
29 (7th Cir. 1990).
Section 515 ‘‘evinces a strong congressional desire to mini-
mize contribution losses and the resulting burden such losses
impose upon other plan participants.’’ Id. at 1328. The
statute ‘‘puts multiemployer plans in a stronger position than
they otherwise occupy under common law contract princi-
ples,’’ Bakery & Confectionary Union & Indus. Int’l Pension
Fund v. Ralph’s Grocery Co., 118 F.3d 1018, 1021 (4th Cir.
1997); it facilitates recovery of contributions from delinquent
employers by limiting the defenses available to an employer
in an action brought to enforce the obligation created by
§ 515.
Alter ego liability under § 515 further protects the federal
interest in the solvency of multiemployer pension plans by
enabling ERISA trustees to recover delinquent contributions
from a sham entity used to circumvent the participating
employer’s pension obligations. See Massachusetts Carpen-
ters Cent. Collection Agency v. Belmont Concrete Corp., 139
F.3d 304, 305 n.3 (1st Cir. 1998). If R.C. Tile is the alter ego
of R.C. Construction, then R.C. Tile is bound by the pension
provisions of the CBA and therefore cannot serve to avoid
R.C. Construction’s obligation to the Fund. See id. at 307;
Central States, Southeast & Southwest Areas Pension Fund
v. Sloan, 902 F.2d 593, 596 (7th Cir. 1990) (alter ego of
 7

signatory employer ‘‘obligated to honor the pension contribu-
tion terms of the [CBA]’’).
In order to determine whether two nominally distinct unin-
corporated businesses are alter egos for the purpose of
assessing liability under § 515, we evaluate the similarities
between the two enterprises in their ownership, management,
business purpose, operations, equipment, and customers. See
Belmont Concrete, 139 F.3d at 308 (‘‘No single factor is
controlling, and all need not be present to support a finding of
alter ego status’’). We also look at any transactions or other
dealings between the two entities. See id.*
The evidence is overwhelming that R.C. Construction and
R.C. Tile had essentially the same ownership, management,
business purpose, operations, and customers. They were in
the same line of business (tile laying), in the same industry
sector (public works construction), in the same geographic
area (southern California). See id. at 306. Three members
of the Flores family successively owned R.C. Construction
(Richard) and R.C. Tile (Jesse, then Priscilla). Under each
owner, however, the assets and operations of the company
were essentially the same. The assets were transferred
among them in non-arms length transactions, which provides
a ‘‘clear foundation for a holding of ‘alter ego’ status.’’ Sloan,
902 F.2d at 597 (intra-family transfer of assets without con-
sideration a sham; transferee held alter ego under ERISA);
cf. Fugazy Cont’l Corp. v. NLRB, 725 F.2d 1416, 1419 (D.C.
Cir. 1984) (non-arms length transfer of operations ‘‘merely a
sham, creating a ‘disguised continuance’ of the predecessor’s
operations’’). In addition, regardless of the changing nominal
* Different considerations may be relevant where a corporation is
involved. Compare Greater Kansas City Laborers’ Pension Fund
v. Superior General Contractors, Inc., 104 F.3d 1050, 1055 (8th Cir.
1997), which applied to corporate entities ‘‘the alter ego doctrine as
developed under corporate law’’ in order to abide the ‘‘long-
established principle that a corporation’s existence is presumed to
be separate and may be disregarded only under narrowly pre-
scribed circumstances,’’ with Belmont Concrete, 139 F.3d at 306–08,
which applied the above-specified criteria to two corporations with-
out reference to their corporate status.
 8

ownership interest of the various members of the Flores
family, Joseph and his wife at all times managed all facets
and controlled the finances of the enterprise. See NLRB v.
Omnitest Inspection Servs., Inc., 937 F.2d 112, 118 (3d Cir.
1991) (in determining whether employers are alter egos ‘‘ac-
tual control can be more significant than formal ownership’’).
On several projects R.C. Tile assumed R.C. Construction’s
subcontracts and completed work begun by R.C. Construc-
tion. R.C. Tile also employed many of the tile-setters who
had worked for R.C. Construction.
All these facts indicate R.C. Tile is the alter ego of R.C.
Construction and therefore liable for that company’s pension
obligations as a signatory of the CBA. See Belmont Con-
crete, 139 F.3d at 309. The appellants point to no significant
differences between R.C. Construction and R.C. Tile.
The appellants’ undocumented assertion that R.C. Tile used
different equipment, employees, and accountants than had
R.C. Construction and that the two companies obtained dif-
ferent construction contracts does not shake our conviction
that they were alter egos. Differences in the contracts and in
the employee roster were inevitable because the entities
operated successively rather than simultaneously. Such dif-
ferences as may arise over time following a non-arms length
transfer are ‘‘not sufficient for a finder of fact to conclude
that the businesses are not ‘alter egos.’ ’’ Sloan, 902 F.2d at
598. Even if the appellants could point to evidence in the
record to support the asserted differences between the two
companies, therefore, those differences would not outweigh
the similarities of ownership, management, business purpose,
customers, and operations that demonstrate R.C. Tile was the
alter ego of R.C. Construction.
The record also shows the Flores themselves treated R.C.
Tile as the alter ego of R.C. Construction. In a letter to a
general contractor, Priscilla Flores stated, ‘‘R.C. Construction
is now doing business as R.C. Tile.’’ Faxes from Priscilla to
suppliers were signed on behalf of ‘‘R.C. Construction/R.C.
Tile.’’ Letters and bid notes from Joseph to general contrac-
tors identify Joseph’s company as ‘‘R.C. Construction/R.C.
 9

Tile.’’ The notice of withdrawal from the CBA stated both
R.C. Construction and R.C. Tile were withdrawing, even
though R.C. Construction was the only signatory.
Nor did the Flores treat the two businesses as distinct
entities in transactions between them. See Laborers’ Pension
Trust Fund v. Sidney Weinberger Homes, Inc., 872 F.2d 702,
705 (6th Cir. 1988) (failure to respect formalities in dealings
between individual and wholly owned company indicative of
alter ego status). The Flores did not observe any of the
formalities indicative of separate enterprises; there is no
evidence of a written agreement, let alone the payment of any
consideration, for either the transfer of assets from R.C.
Construction to R.C. Tile or for the transfer of R.C. Tile from
Jesse to Priscilla. See Fugazy, 725 F.2d at 1419 (lack of
formalities surrounding transfer of assets and operations
evidence of alter egos). On the contrary, R.C. Construction’s
assets were used for the benefit of R.C. Tile. Specifically,
payments received for work performed on R.C. Construc-
tion’s contracts went to pay R.C. Tile’s bills. After R.C.
Construction ceased doing business, Priscilla Flores used
R.C. Construction’s bank accounts for R.C. Tile’s purposes.
R.C. Tile borrowed money using R.C. Construction’s line of
credit. R.C. Tile used R.C. Construction’s name to order
supplies and to do business with contractors. For R.C. Tile
to get the benefits of R.C. Construction’s assets and goodwill
without taking responsibility for that company’s pension lia-
bilities would undermine the policy of the ERISA strictly to
bind employers to their pension obligations.
The appellants argue R.C. Construction and R.C. Tile
cannot be alter egos because ‘‘there was no anti-union ani-
mus’’ behind their closing R.C. Construction and establishing
R.C. Tile. We shall assume there was none. As the First
Circuit has noted, however, ‘‘A finding of anti-union animus is
not essential’’ to hold one entity is the alter ego of another for
the purpose of ERISA liability. Belmont Concrete, 139 F.3d
at 308; see also NLRB v. Allcoast Transfer, Inc., 780 F.2d
576, 580–82 (6th Cir. 1986) (collecting cases holding anti-union
animus not required to be alter egos under NLRA); Greater
Kansas City Laborers Pension Fund v. Thummel, 738 F.2d
 10

926, 930 (8th Cir. 1984); Fugazy, 725 F.2d at 1419–20; J.M.
Tanaka Constr. Co. v. NLRB, 675 F.2d 1029, 1033 (9th Cir.
1982). Anti-union animus may be a reason one entity should
be deemed the alter ego of another for the purpose of
assigning liability under the ERISA, but the absence of anti-
union animus certainly does not establish that two entities are
not alter egos.
Therefore, based upon the similarities between R.C. Con-
struction and R.C. Tile with respect to management, owner-
ship, business purpose, operations, and customers, and in
light of the principals’ complete failure to maintain any mean-
ingful distinction between the two entities, it appears R.C.
Construction and R.C. Tile are alter egos.
C. Defenses
Although a favorable balance of the equities is not required
to conclude that one entity is the alter ego of another for the
purposes of § 515, the appellants present three equitable
arguments against holding R.C. Tile liable as the alter ego of
R.C. Construction. First, the appellants contend R.C. Tile
should not be held the alter ego of R.C. Construction because
R.C. Tile received no economic benefit from its failure to
contribute to the Fund. According to the appellants, R.C.
Tile was required by California law to, and did, pay its non-
union employees ‘‘prevailing wages (which is the same as
union scale wages, including trust fund contributions.)’’
Even assuming the truth of that assertion – for which the
appellants point to no record evidence – such payments do
not absolve R.C. Tile of its obligation to make contributions to
the Fund pursuant to the CBA. See Brogan v. Swanson
Painting Co., 682 F.2d 807, 809 (9th Cir. 1982); Audit Servs.,
Inc. v. Rolfson, 641 F.2d 757, 761 (9th Cir. 1981); Mullins v.
Kaiser Steel Corp., 642 F.2d 1302, 1310–11 n.8 (D.C. Cir.
1980), rev’d on other grounds, 455 U.S. 72 (1982); cf. O’Hare
v. Gen. Marine Transp. Corp., 740 F.2d 160, 170 (2d Cir.
1984) (purchase of equivalent health insurance for non-union
employees does not excuse failure to contribute to ERISA
benefit funds). Nor is the result inequitable. On the con-
trary, having reaped the benefits of R.C. Construction’s as-
 11

sets and goodwill, R.C. Tile should not be able to avoid R.C.
Construction’s liability to the Fund.
Furthermore, even an employer that receives no economic
benefit from avoiding its obligations does harm to the pension
fund, which relies upon contributions (and the investment
income thereon) from all signatory employers to finance the
defined benefits due to beneficiaries. See Cent. Pa. Team-
sters Pension Fund v. McCormick Dray Line, Inc., 85 F.3d
1098, 1109 & n.4 (3d Cir. 1996); Mullins, 642 F.2d at 1310
n.8. Payments made to non-union employees in lieu of contri-
butions to the Fund do nothing to remedy the harm to the
Fund from the non-payment of pension contributions due
under the CBA.
Second, the appellants argue holding R.C. Tile liable would
unjustly enrich the Fund, for which any award of damages
would be a windfall. According to the appellants, the Trus-
tees would receive contributions in respect of, but would not
incur any obligations to provide pension benefits to, R.C.
Tile’s non-union employees.
This is nonsense. R.C. Tile’s decision to employ non-union
labor does not diminish the Fund’s defined-benefit obligation
to its union beneficiaries. Mirroring that obligation, the
Trustees had a clear right under the CBA to receive R.C.
Construction’s contributions. See McCormick Dray Line, 85
F.3d at 1109 (‘‘[T]he welfare fund expected to have those
funds at hand for payout of benefits on behalf of other
employees, including employees of other employers who are
members of the multiemployer welfare fund’’). The appel-
lants’ argument is also foreclosed by Mullins, a case brought
by union health and welfare trust funds, in which we stated:
It is not unfair to [the employer] that it be required to
contribute to the TTT funds after having indirectly paid a
comparable amount to other workers, for this is exactly
what it contracted to do. Neither would enforcing the
contract as written create a ‘‘windfall’’ for the Trustees.
642 F.2d at 1310 n.8; see also Bituminous Coal Operators’
Ass’n, Inc. v. Connors, 867 F.2d 625, 636 (D.C. Cir. 1989) (no
 12

defense that contributions required by CBA would, if paid,
over-fund pension plan).
Finally, the appellants argue (under the heading of ‘‘waiv-
er’’) the Trustees are barred from recovering unpaid pension
contributions because they ‘‘waited for more than a year’’
before notifying R.C. Construction and R.C. Tile of their
delinquency. The appellants claim they were prejudiced by
the delay because R.C. Tile paid out as wages the monies now
claimed by the Trustees for the benefit of the Fund. This
argument, which is doubtful as a matter of law, see McCor-
mick Dray Line, 85 F.3d at 1108 (two year delay between
discovery of delinquency and filing of suit not unreasonable),
is utterly foreclosed by the undisputed facts of this case.
After R.C. Construction ceased making payments to the
Fund in December 1997, the Trustees ‘‘requested an audit of
R.C. Construction’s books and records, pursuant to ERISA
and the [CBA], so that it could be determined whether
contributions had been made’’ in full. Declaration of David
Stupar, Executive Director of the Fund, at ¶ 12. The Trus-
tees were still trying to get that information when they filed
this suit. Upon these facts we cannot say the Trustees were
dilatory in notifying the appellants of their delinquency.

III. Conclusion
For the foregoing reasons, the judgment of the district
court is
Affirmed.