Board of Trustees of the Duluth Building Trades Health Fund v. Mechanical
Board of Trustees of the Duluth Building Trades Health Fund v. Gustafson Mechanical, Inc.
- Katherine Menendez
- 0:25-cv-04312
- U.S. District Court · District of Minnesota
- 5
In Board of Trustees of the Duluth Building Trades Health Fund v. Gustafson Mechanical, Inc., Judge Menendez granted the Fund's motion for default judgment, ordering Gustafson to turn over payroll records and pay delinquent ERISA contributions.
Employers who are signatories to collective bargaining agreements requiring contributions to union benefit funds, and the benefit funds that rely on those contributions to provide health coverage to workers. This ruling illustrates that failing to respond to an ERISA contribution lawsuit can result in a default judgment establishing liability, plus a court order to turn over payroll records for audit.
What happened
In Board of Trustees of the Duluth Building Trades Health Fund v. Gustafson Mechanical, Inc. (No. 25-cv-4312), a union health fund sued a mechanical contractor for failing to submit contribution reports and pay required contributions under a collective bargaining agreement for the period of March 2025 through September 2025. The fund is a multiemployer benefit plan governed by the federal Employee Retirement Income Security Act of 1974 (ERISA), which requires employers who sign collective bargaining agreements to make regular payments into benefit funds on behalf of covered workers.
Gustafson Mechanical was served with the lawsuit in November 2025 but never filed an answer, never appeared in court, and failed to show up for a June 2026 hearing. Because of this complete failure to respond, the court clerk entered a formal default against Gustafson in January 2026, clearing the way for the fund to seek a default judgment — a ruling in the plaintiff's favor based on the defendant's failure to participate.
Judge Katherine M. Menendez granted the Fund's motion for default judgment. The court found that Gustafson is liable for delinquent contributions, interest, liquidated damages of 20% of the unpaid contributions, and attorney fees and costs for the March through September 2025 period. Because the exact dollar amount cannot be calculated without Gustafson's records, the court also ordered Gustafson to hand over its contribution reports or payroll books for that period. The Fund may then file a separate motion asking the court to enter a specific money judgment once an audit is completed; Gustafson will have 21 days to respond to that motion.
The detailed version
- Board of Trustees of the Duluth Building Trades Health Fund v. Mechanical · No. 0:25-cv-04312
- Katherine Menendez
- July 8, 2026
Background
Plaintiff Board of Trustees of the Duluth Building Trades Health Fund (the Fund) is a multiemployer benefit plan as defined under the Employee Retirement Income Security Act of 1974 (ERISA). The Fund is administered by a joint Board of Trustees representing both labor and management, and the Board brought this action in its capacity as a fiduciary of the Fund.
Defendant Gustafson Mechanical, Inc. (Gustafson) executed a collective bargaining agreement (CBA) requiring it to make contributions to the Fund for each hour worked by employees performing CBA-covered work, with contributions due by the 15th day of the month following the month in which the obligation arose. As a CBA signatory, Gustafson is also bound by the Fund's Agreement and Declaration of Trust and Collection Policy.
The Fund initiated this action on November 12, 2025, seeking to compel Gustafson to produce contribution reports and payroll books and records for March 2025 through September 2025, and to recover delinquent contributions, interest, and liquidated damages for that period. Gustafson was served on November 17, 2025, but never filed an answer, never responded, and failed to appear at the June 16, 2026, remote hearing. The Clerk of Court entered a default against Gustafson on January 8, 2026.
Noteworthy: Gustafson did submit a contribution report for October 2025 indicating no contributions were owed for that month and that it would not file further reports — but submitted nothing for the March through September 2025 period despite repeated demands.
Legal Framework
The court has jurisdiction under 29 U.S.C. §§ 185(a), 1132, and 1145, and 28 U.S.C. § 1331. Venue is proper under 29 U.S.C. § 1132(e)(2).
Under Federal Rule of Civil Procedure 55(b)(2), a court may enter default judgment against a defaulting party upon application. Upon default, the court accepts the factual allegations in the complaint as true, but must still determine whether those facts constitute a legitimate cause of action. See Murray v. Lene, 595 F.3d 868, 871 (8th Cir. 2010).
Section 515 of ERISA, 29 U.S.C. § 1145, requires employers obligated under a CBA to make contributions in accordance with the agreement's terms. Section 502(g) of ERISA, 29 U.S.C. § 1132(g), provides for recovery of delinquent contributions, interest, liquidated damages, and attorney fees and costs.
Rulings
Judge Menendez granted the Fund's Motion for Default Judgment (Dkt. 8).
The court made the following specific rulings:
1. Liability established: Gustafson is liable to the Fund for delinquent contributions, interest, and liquidated damages due from March 1, 2025, through September 30, 2025, as well as attorney fees and costs of collection. The liquidated damages rate is 20% of delinquent contributions; interest accrues at 6% annually. The precise dollar amount cannot yet be determined without an audit of Gustafson's records.
2. Injunctive relief — records production: Gustafson is ordered to submit its contribution reports or payroll books and records to the Fund for March 2025 through September 2025, to enable a compliance audit. The court found that the Fund has no adequate remedy at law without those records.
3. Future money judgment process: The Fund may file and serve a motion for entry of a specific money judgment once it determines the amount owed after completing the audit. Gustafson will have 21 days after service to file a response. The court will then rule on written submissions unless it determines a hearing is required.
What Remains
No specific dollar amount has been entered yet. The amount of delinquent contributions — and thus the precise figures for liquidated damages, interest, and attorney fees — will be determined after the audit and a subsequent motion for a money judgment.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.