On August 4, 2000, Attorney Michael Weiss filed a
Motion to Withdraw as counsel for the Respondents, which was
granted by Order dated August 17, 2000. On September 29, 2000, the
Complainant filed a Motion To Strike Answer And Enter Default
Judgment. The Complainant argues that the Respondents have failed
to comply with discovery requests and moves that Respondents'
Answer be stricken and default judgment be entered against them.
On October 2, 2000, the Complainant filed a Notice Of Motion and
Motion For Entry Of Default Decision And Order.
On October 3, 2000, a Show Cause Order was issued
Ordering the Respondents to show cause, in writing, on or before
October 13, 2000, why the requested relief should not be granted
and why default judgment should not be entered against them. The
Respondents filed an answer to the Show Cause Order on October 16,
2000 [postmarked October 10, 2000], in which they request that
default judgment not be entered against them. Their argument can
be summed up as follows: 1) they were inexperienced in business
and they underbid the contract; 2) they were forced to pay drivers
lower wages; 3) the drivers were aware of and agreed to the wages
and were happy with their jobs; 4) they had no malice, tried to do
the best with the money they had to work with, and attempted to
give excellent service to the United States Postal Service; and, 5)
they have heavy medical expenses for themselves and school expenses
for their daughter.
On October 16, 2000, the Complainant filed a
Motion In Opposition To Response To Order to Show Cause, stating
that the response is unresponsive and that unusual circumstances do
not include "negligent or willful disregard of the contract
requirements and of the Act and regulations" citing Emerald
Maintenance Inc. , Supplemental Decision of the Administrative
Law Judge, SCA-153, April 5, 1973.
Judgment By Default
Rule 55 of the Federal Rules of Civil Procedure
provides that judgment by default may be entered when a party
against whom a judgment for affirmative relief is sought has failed
to plead or otherwise defend as provided by these rules and that
fact is made to appear by affidavit or otherwise. The Respondents
have failed to comply with the pre-trial order in that they have
not filed a pre-hearing statement as required by the order. The
Notice of Hearing and Prehearing Order contained the following
notice:
NOTICE: Failure to timely comply with this
prehearing order, without good cause shown, may result in
the dismissal of the proceeding, entry of default
judgment, or the imposition of other appropriate
sanctions against the offending party.
On August 24, 2000, a Notice was sent to the
Respondents advising them that their attorney had withdrawn from
the case, that they are responsible for defending the case, and
that failure to comply with the Pre-Hearing Order may result in
default judgment or other sanctions imposed against them. The
Respondents still failed to comply with the order. The
Complainant's Motion For Default Judgment is supported by affidavit
as provided by Rule 55. Moreover, the Respondents have failed to
comply with discovery requests in that they have failed to appear
for deposition and have failed to answer interrogatories.
Additionally, the Respondents filed an answer to the Show Cause
Order in which they admit that they paid wages less than provided
by the contract. I find that the facts of this case are proper for
the entry of Judgment by Default.
Findings
Upon review of the facts, I make the following
findings:
1. The Respondents entered into three
contracts with the United States Postal Service to perform work
with service employees, namely: Contract Number 92660 in the
amount of $46,890.22, awarded in 1995; Contract Number 92615 in the
amount of $97,951.46, awarded in 1995; and, Contract Number 927AT
in the amount of $279,842.00, awarded in 1998.
2. Jurisdiction properly rests with the
Office of Administrative Law Judges, United States Department of
Labor, pursuant to the Service Contract Act and the regulations
issued thereunder.
3. During the period required for the
performance of the subject contracts, the Respondents failed to pay
their employees the wages and fringe benefits as required under the
Act in the amount of $79,729.07 owed to twenty-one employees, and
the Respondents failed to maintain adequate and accurate records of
the hours worked by employees on said contracts.
4. There are no unusual circumstances that
would preclude placing the Respondents on the ineligible list for
a period of three years pursuant to § 5(a) of the Service
Contract Act (41 U.S.C. § 354(a)).
ORDER
Upon consideration of the foregoing, it is
therefore,
1. ORDERED that Judgement by Default is
hereby entered against the Respondents, jointly and severally, R &
B Trucking Company, a Partnership, Ramon Bello, and Christina
Bello, in the amount of $79,729.07, and it is further,
2. ORDERED that the Respondents, jointly and
severally, pay to the United States Department of Labor, Wage and
Hour Division, the sum of $79,729.07, for back wages and fringe
benefits owed to twenty-one (21) past and/or present employees of
the Respondents, and it is further,
3. ORDERED that the Respondents, jointly and
severally, shall be placed on the list making them ineligible for
Federal contracts for a period of three years from the date that
the Respondents' names are placed on the list, and it is further,
4. ORDERED that any moneys currently being
withheld by the United States Postal Service on current contracts
with the Respondents shall be released to the United States
Department of Labor, Wage and Hour Division, and that amount shall
be deducted from the total amount owed by the Respondents, and it
is further,
5. ORDERED that the hearing scheduled for
October 31, 2000, in Los Angeles, California, is hereby CANCELED.
ROBERT L. HILLYARD
[ENDNOTES]
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