LABORERS (LIUNA)
DOJ-LIUNA Meet over Future of Oversite Agreement
The Dep't of Justice and the Laborers' Int'l Union of No. Am. have
been meeting behind closed doors to determine the next
phase of DOJ's five-year quasi-oversight agreement with LIUNA that expires
Jan. 31, 2000. The Feb. 1995 agreement stopped DOJ from filing a racketeering
suit against LIUNA and created LIUNA's
failed "internal reform effort." The initial deal was to end
in 1998, but DOJ and LIUNA have extended it for one-year in 1998 and 1999.
Reportedly, some type of DOJ oversight will continue, but DOJ and LIUNA have declined to give any details. According to the ethically-challenged Robert D. Luskin, LIUNA's "in-house prosecutor," "everybody is feeling comfortable with the atmosphere and direction" of the DOJ-LIUNA meetings. A decision is expected in early Jan.
LIUNA general counsel Michael S. Bearse, said the so-called internal reform effort has "accomplished what we said it would do." According to Bearse, both sides want "reasonable reassurances" that the so-called progress of the reform effort will continue -- it is just a matter of "agreeing on the mechanism." [Engineering News-Rec. 12/20/99]
Prediction: With ex-president Arthur A. Coia ousted and DOJ involved in racketeering suits against LIUNA Local 210 in Buffalo and the Chicago Laborers Dist. Council (which were all prime targets of the 1994 draft-RICO), DOJ may calculate that LIUNA's reform effort is of little use and effectively dispense with this defective oversite agreement.
Court Upholds Failed "Internal
Reform Effort"
The U.S. 7th Cir. Court of Appeals Dec. 17 rejected a challenge by
the Chicago Laborers Dist. Council to LIUNA's authority to place it under
a trustee's control. Saying that CLDC failed to demonstrate LIUNA had targeted
it for unwarranted discipline, the court called CLDC's argument that LIUNA
acted in "bad faith" in imposing the trusteeship "meritless." CLDC was
placed in trusteeship in Feb. 1998. The court also rejected CLDC's claims
that LIUNA's Ethics & Disciplinary Procedure, which was established
in 1995 under a controversial agreement between LIUNA and DOJ, was improperly
enacted. The same court previously upheld the EDP and the
LIUNA-DOJ scam.
The ethically-challenged Robert D. Luskin, LIUNA's "in-house prosecutor," said he wasn't surprised by the ruling. "We are long past the point where there are arguments about the scope of our authority or the validity of our mission," Luskin bragged. "In five years, we have not lost so much as a motion in district court." Luskin filed a complaint against CLDC in June 1997 alleging the body had been under the control of Chicago crime bosses for at least 25 years. Peter Vaira, LIUNA's "in-house judge," endorsed the action, arguing that a trusteeship was necessary to expel the influence of organized crime, etc. Tainted labor attorney Robert E. Bloch was appointed trustee.
CLDC refused Bloch access to its building. LIUNA and Bloch eventually gained a restraining order, barring CLDC and its board from interfering with the trusteeship. CLDC filed a counterclaim and LIUNA sought summary judgment. Among other things, CLDC alleged an improper relationship between Luskin and disgraced ex-boss Arthur A. Coia. CLDC also alleged it was a disciplinary strike against CLDC boss Bruno Caruso, who had run against Coia. U.S. Dist. Judge James B. Moran sided with LIUNA. On appeal, CLDC argued that it was the victim of a tainted hearing process and that LIUNA's "bad faith" and "unclean hands" precluded summary judgment. U.S. Appeals Judge John L. Coffey found such arguments meritless.
CLDC attorney Allan A. Ackerman described the ruling as "misguided." He noted that the court ignored arguments pertaining to LIUNA's ability to oust CLDC officers democratically elected by its membership. He said CLDC is considering an appeal to the U.S. Supreme Court on that issue and the issue of bad faith. Luskin pledged, "You'll see me push a peanut down State Street with my nose if cert is granted in this case." [BNA 12/23/99]
AFL-CIO / TEAMSTERS (IBT)
Teamsters Closer to Filing Long-Awaited RICO Suit
The Int'l Bhd. of Teamsters are close to filing
a civil suit under the Racketeer Influenced & Corrupt Organizations
Act against disgraced ex-boss Ron Carey for his role in the 1996 money-laundering
scandal that ejected him from the union. Other defendants may include the
AFL-CIO secretary-treasurer Richard L. Trumka and
Democratic Nat'l Committee for their respective roles in the schemes.
Trumka is alleged to have steered AFL-CIO funds to the Carey campaign;
he took the Fifth when called before federal investigations. Federal prosecutors
have alleged the DNC was also funneling money to Carey. The suit will seek
to recover about $3 million in union funds spent as a result of Carey's
1996 reelection. [Time 12/27/99]
TEAMSTERS (IBT)
Illinois Boss Guilty of Accepting Bribe
Walter Hoff, ex-boss of Teamsters Local 786 in Chicago, admitted Dec.
21 to taking $16,000 in bribes from government mole John Christopher to
let Christopher's financial debts to the union slide. Hoff pleaded guilty
to two criminal counts, mail fraud and tax evasion, in exchange for having
seven charges dismissed.
In return for an $8,000 bribe in Sept. 1993 and a second $8,000 payment in May 1994, Hoff made it appear on paperwork that Christopher's companies were unionized in a way that enabled him to qualify for certain contracts. It enabled Christopher to sidestep payment of over $70,000 in union dues and other employee benefits. Before the first payoff, Hoff unwittingly hired an FBI agent posing as a Christopher business associate to sweep Local 786's offices for concealed listening devices. After the agent pretended to search the office for electronic bugs, Christopher paid Hoff the first $8,000 cash bribe in a bathroom in the building.
Before the second payment, Christopher walked into the union office of Hoff, who held up a sign that read "Don't talk." Hoff lifted his hand in the air and rubbed his fingers together, which Christopher took to be a gesture that he wanted his bribe. Christopher handed over $8,000 in cash.
Hoff is scheduled to be sentenced Mar 9 and faces 2 years in prison, but reportedly he may receive a lighter sentence because of his terminal cancer. He ran Local 786 from 1982 to 1997. [Chi. Trib. 12/22/99]
New Jersey Local Placed in Trusteeship
Int'l Bhd. of Teamsters placed IBT Local 815 in Englewood Cliffs, N.J.
in trusteeship Dec. 27 and removed two union bosses -- president
Larry Plotnick and secretary-treasurer Benjamin Camadeco accused of defrauding
it of $144,000. Local 815 is the fifth local in the nation to be placed
in trusteeship since James P. Hoffa became IBT president in Mar. and the
first N.J. local taken over by IBT in eight years.
"An investigation of the local union has uncovered a systematic pattern of financial mismanagement by the officers of this local union," Hoffa said. "We have taken the necessary action to ensure this local union protects the members' dues monies."
After investigating Local 815 for six months, IBT's Independent Review Board concluded in Nov. that Plotnick and Camadeco engaged in a "long-running scheme to defraud the local into reimbursing them for improperly incurred, if not fictitious, expenses," totaling $83,000 in questionable meal reimbursements for Camadeco and $61,000 for Plotnick from Jan. 1996 to July 1999. All of Camadeco's 649 meals and all but one of Plotnick's 528 meals were not charged to a credit card, and most, 67% of Camadeco's and 90% of Plotnick's, were documented with generic receipt stubs bearing handwritten notations. Both submitted consecutively numbered check stubs from different restaurants. On several occasions, Plotnick and a second local boss were reimbursed for the same meal. Camadeco prepared the reimbursement checks for himself and Plotnick. Many of the meals were in excess of $100, and one, submitted by Camadeco for a July 1998 meal at an Italian restaurant, cost $220.
Financial controls were also lax. In 1996, for example, Plotnick signed 200 blank checks, and Camadeco's salary, currently $176,000, was paid from a payroll account not subject to review by union trustees. Camadeco's son was also paid $17,500 from two union funds on which he is the Local 815-appointed trustee.
Further, the children of Local 815's founder George Barasch are administrators of the local's affiliated benefit funds, and in 1997, the companies owned were paid over $2 million from four of the affiliated funds. For 20 years, Barasch has been leasing the local its offices under an agreement that requires the local to pay rent and 40% of the landlord's taxes, utilities, maintenance, and insurance costs. The allegations involving Barasch and his children are similar to those from 35 years ago. In 1965, Barasch was called before a U.S. Senate subcommittee investigating allegations that $4 million in funds had been transferred to foundations affiliated with him or his relatives. He invoked the 5th Amendment.
Also, the local entered into at least three "sham" collective bargaining agreements with companies owned by union bosses; it has held only eight membership meetings since 1994; and it hasn't had a contested election for 25 years. [Record (Bergen Co., N.J.)12/29/99]
HOTEL & RESTAURANT EMPLOYEES (HERE)
HERE Alters Controversial Rule
At a Dec. 15 Hotel Employees & Restaurant Employees Int'l Union
meeting in Chicago, trustees of HERE's health and welfare fund rescinded
their highly-controversial 800-hour rule for
health insurance coverage for union members. The new rule requires 224
hours a year to qualify. The former rule was implemented several months
ago required members to work at least 800 hours a year to qualify for self-pay
insurance and was intended to stop abuse. But, it hurt many members.
It also produced negative publicity for HERE boss John W. Wilhelm and threatened his undeserved squeaky-clean media image. HERE Local 226 dissidents in Las Vegas questioned Wilhelm's apparent conflict of interest -- he is an insurance fund trustee and his wife is employed at the insurance office. [Las Vegas Rev.-J. 12/24/99]
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ADDITIONAL BRIEFS NOT INCLUDED ON THE FAX EDITION OF THIS UNION CORRUPTION UPDATE:
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TEAMSTERS (IBT)
Judge Rejects Emergency Trusteeship of Pennsylvania Local
U.S. Dist. Judge John Padova Dec. 28 ordered the Int'l Bhd. of Teamsters
and James P. Hoffa to return control of IBT Local
115 in Philadelphia to its duly elected officers, finding no emergency
situation warranting imposition of a trusteeship without a hearing. Temporarily
enjoining Hoffa from exercising the emergency trusteeship that was imposed
on the local in Nov., Padova ruled that the information available to Hoffa
when he appointed an emergency trustee "does not support a reasonable or
good faith belief that an emergency situation existed."
Padova emphasized that he was not looking at the truth of IBT's charges against the local or the propriety of the leadership of Local 115. "Rather, the sole question this court is deciding is whether the international removed plaintiffs from office and imposed the emergency trusteeship in a manner consistent with the democratic process embodied in the legislative scheme of the Labor-Management Reporting and Disclosure Act," and the Teamsters' constitution and bylaws, the judge wrote.
Citing allegations of abuse of members' rights and failure to protect union finances, Hoffa Nov. 15 ordered the trusteeship of Local 115 and the removal of secretary-treasurer John P. Morris, the local's principal executive officer, as well as several members of the local's executive board. Morris was also removed from his other positions as president of the Pa. Conference of Teamsters and president of Joint Council 53. Morris previously was an int'l vice president for the eastern region under former IBT President Ron Carey. In the Teamsters 1996 election, he ran on the slate headed by Carey.
In a notice informing the officers of the reasons for the trusteeship, Hoffa specifically charged that Morris and his business agents viciously abused, physically threatened, and physically assaulted members Morris viewed as disloyal. The notice further claimed that Morris was preparing to wage a war against his enemies and directed Local 115 to purchase stun guns, military clothing, and a variety of tractors, trailers, and buses. The notice also charged Morris with various financial improprieties and alleged that he instigated the termination of 12 members from their jobs at a Kurz-Hastings plant because of suspected disloyalty.
One week after the trusteeship was imposed, the appointed trustee scheduled a formal hearing for Dec. 9, but the local requested that the hearing be postponed. Morris and the other terminated officers filed suit, alleging that IBT violated the LMRDA by imposing a trusteeship without a prior hearing and asking the court to issue a preliminary injunction. IBT has scheduled a hearing for Jan. 5-7, 2000, before a three-member panel that will make a recommendation to Hoffa on whether a trusteeship should be imposed. IBT's constitution provides that once the case is heard, the panel must issue a report to Hoffa within 60 days. Hoffa then has 15 days to make a decision. That decision can be appealed to the union's general executive board.
In finding that an emergency situation did not exist in this case, Padova explained that most of the international's charges are "longstanding: many are not dated to a specific point in time, and many others are noted to have gone on for years. Most of the charges, therefore, do not describe situations that appeared to be developing suddenly and unexpectedly, and therefore, the circumstances do not reasonably appear to demand immediate action." As an example, Padova cited that IBT alleged various financial improprieties, but it audited the local's finances in May and June 1999 and did nothing about the results for five months. Also, the international alleged that there was an emergency because Morris was stockpiling weapons and military supplies and making statements about an impending war. "The local purchased these materials prior to the June audit," Padova said. "Regardless of the true purposes of these materials, the IBT again waited over five months before acting on this information."
Padova also noted that since 1993 eight emergency trusteeships have been imposed by the Teamsters and six of those cases were based on a report and recommendation by the Independent Review Board. In one case where there was no IRB report, the trusteeship was imposed based on a request by the local's executive board. In the other case, Hoffa imposed the trusteeship two months after his attempts to obviate the need for a trusteeship failed. "Thus, in all eight prior cases of emergency trusteeships, the general president based his decision to institute the trusteeship on more substantial information than was available in the instant case," Padova wrote. "Here, by contrast, Hoffa lacked an IRB report." [BNA 12/30/99]
ELECTIONS & POLITICS
Union Soft Money Update
In the latest soft money reports, three
unions made huge payments to Dem. Sen. Campaign Committee, according to
Public Disclosure, Inc. On Nov. 2, the Communications Workers of Am. gave
DSCC $50,000. On Nov. 8, the Int'l Ass'n of Fire Fighters gave DSCC
$30,000. And on Nov. 11, the Sheet Metal Workers Int'l Ass'n gave DSCC
$25,000.
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