U.S. v. Boffa

Decision Date25 August 1982
Docket NumberNos. 81-2660,s. 81-2660
Citation688 F.2d 919
Parties111 L.R.R.M. (BNA) 2901, 95 Lab.Cas. P 13,903 UNITED STATES of America, Appellee, v. Eugene BOFFA, Sr., Robert Boffa, Sr., Louis S. Kalmar, Sr., and Chandler Lemon, Appellants. to 81-2666.
CourtU.S. Court of Appeals — Third Circuit

Ronald G. Cole, U. S. Dept. of Justice, Philadelphia Strike Force, Philadelphia, Pa., Joseph J. Farnan, Jr., U. S. Atty., Dist. of Del., Wilmington, Del., Kenneth F. Noto, William C. Bryson, Frank J. Marine (argued), Attys., Dept. of Justice, Washington, D. C., for appellee.

Seymour Margulies (argued), Maurice Brigadier, Robert E. Margulies, Margulies & Margulies, P. A., Jersey City, N. J., for Eugene Boffa, Sr.

Ronald F. Kidd (argued), Michael M. Mustokoff, Philip N. O'Reilly, Duane, Morris & Hecksher, Philadelphia, Pa., for Robert Boffa, Sr.

Thomas C. Carroll (argued), John R. Carroll, Carroll & Carroll, Philadelphia, Pa., for Louis Kalmar, Sr.

Thomas A. Bergstrom (argued), Philadelphia, Pa., for Chandler Lemon.

Before SEITZ, Chief Judge, and SLOVITER and BECKER, Circuit Judges.

OPINION OF THE COURT

SEITZ, Chief Judge.

Eugene Boffa, Sr., Robert Boffa, Sr., Louis Kalmar, Sr., and Chandler Lemon appeal from judgments imposing sentences of imprisonment, fines, and forfeitures entered after their convictions of racketeering offenses. 18 U.S.C. § 1962(c) & (d) (1976). Eugene Boffa, Sr. and Lemon also appeal from judgments imposing sentences of imprisonment entered after their convictions of mail fraud. 18 U.S.C. § 1341 (1976). This court has jurisdiction under 28 U.S.C. § 1291 (1976).

I.

Appellants were tried before a jury on an eleven-count indictment, which also names as co-defendants Francis Sheeran, David Mishler, and Robert Rispo. 1 Count I charges appellants with conspiring to violate the Racketeer Influenced and Corrupt Organization Act (RICO), 18 U.S.C. § 1962(d). Count II alleges that appellants violated the substantive provisions of RICO, 18 U.S.C. § 1962(c). Counts V through XI charge appellants Eugene Boffa, Sr. and Chandler Lemon with violating the mail fraud statute, 18 U.S.C. § 1341. 2

Before describing the factual allegations in the indictment, we will briefly outline the statutory scheme of RICO as it relates to this case. Section 1962(c) of the Act provides It shall be unlawful for any person employed by or associated with an enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity.

Section 1962(d) makes it unlawful for any person to conspire to violate section 1962(c).

The term "enterprise" includes not only legal entities such as partnerships, corporations, and associations, but also any group of individuals "associated in fact." 18 U.S.C. § 1961(4). Section 1961 of RICO enumerates the racketeering activities, or "predicate acts," that are necessary to establish a RICO offense. These predicate acts include violations of 18 U.S.C. § 1341 (mail fraud), 29 U.S.C. § 186 (Taft-Hartley Act), and 18 U.S.C. § 1503 (obstruction of justice). To establish a "pattern" of racketeering activity, the Government must prove that at least two of these acts occurred within a ten-year period. 18 U.S.C. § 1961(5).

The indictment in this case is a complex document. It alleges sixty-two racketeering acts based on violations of three federal statutes, involving different combinations of appellants who were engaged in various transactions. The common strand running through the indictment is appellants' association with the enterprise, comprising "a group of individuals associated in fact for the purpose of making money and obtaining other financial benefits through the business of labor leasing and motor vehicle leasing." The enterprise was operated through nine separate corporations engaged in the labor leasing business and one corporation in the business of leasing motor vehicles. The indictment alleges that Eugene Boffa, Sr., along with one or more of the other appellants, "would control and participate in the operation" of all ten corporations.

The predicate acts alleged in the indictment include violations of the mail fraud statute, the Taft-Hartley Act, and 18 U.S.C. § 1503 (obstruction of justice). We will summarize the factual allegations contained in the indictment as they relate to each predicate offense.

A. Mail Fraud

The indictment charges Eugene Boffa, Sr. and Chandler Lemon with ten violations of the mail fraud statute in connection with a "labor switch" at the Inland Container Corporation's facility at Newark, Delaware. In essence, the indictment alleges that appellants switched the labor leasing contracts at Inland from one corporation they controlled to another that was ostensibly independent, but which in fact they also controlled. By providing benefits to the official of the union that represented employees of the first corporation, the enterprise obtained his cooperation in the scheme. The indictment alleges that, as a result of the switch, employees were deprived of 1) the loyal, faithful, and honest services of the union official; 2) economic benefits they enjoyed through rights guaranteed them by the National Labor Relations Act (NLRA), 29 U.S.C. § 157; and 3) economic benefits they enjoyed through rights they had under an existing collective bargaining agreement.

The indictment describes the scheme in some detail. Between 1971 and 1977, Universal Coordinators, Inc. (UCI), a New Jersey Corporation controlled by Eugene Boffa, Sr. leased truck drivers to Inland's Newark facility. These drivers were represented by the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America (Teamsters) Local 326, headed by co-defendant Francis Sheeran. Concerned about recurring labor disputes at the Inland plant, appellant Eugene Boffa, Sr. and Sheeran agreed that after the election of officers of Local 326 in November, 1976, Boffa would terminate the leasing contract between UCI and Inland and substitute for UCI a second leasing company controlled by the enterprise. The purpose of the switch was to "cause the employees of UCI ... to be fired and not rehired by the second leasing company."

In furtherance of this scheme, Eugene Boffa, Sr. and Chandler Lemon incorporated Preferred Personnel of Miami, Florida and Boffa terminated UCI's leasing contract with Inland. Shortly thereafter, Lemon contacted Inland on behalf of Preferred Personnel, and offered to provide drivers following the expiration of the UCI contract. Lemon stated that neither he nor the company were in any way associated with Eugene Boffa, Sr. or UCI. He offered to provide drivers represented by the Brotherhood of Railway and Airline Clerks, who he claimed would demand substantially lower wages and fringe benefits than the Teamsters. After Inland accepted Lemon's offer, Preferred Personnel supplied an entirely new group of drivers, and the UCI employees who had been working at Inland lost their jobs. The mails were used to effectuate the scheme when appellants caused termination notices to be sent to UCI drivers. The Inland Container labor switch also formed the basis for Counts V through XI of the indictment, which allege substantive violations of the mail fraud statute.

The indictment charges appellant Robert Boffa, Sr. with nine mail fraud violations in connection with a similar labor switch at the Van Wert, Ohio facility of Continental Can Corporation. From at least 1967 until 1975, UCI leased truck drivers, who were represented by Teamsters Local 908, to Continental Can. In 1975, Continental Can expressed dissatisfaction with the service provided by UCI, and UCI agreed to provide better service if its fees were increased by 25%. When Continental Can refused, Robert Boffa, Sr., acting through UCI, decided to terminate the contract and provide drivers to Continental through Country Wide Personnel of Chicago (CWP), which he controlled as well. The alleged purpose of this switch was to enable CWP to obtain higher fees from Continental Can than had been paid to UCI, while paying less to Teamsters Local 908 drivers.

Robert Boffa, Sr. directed co-defendants Mishler and Rispo to meet with the drivers at the Continental Plant and inform them that they would be losing their jobs with UCI because of the contract termination. On behalf of CWP, Mishler and Rispo offered to hire the UCI drivers, but at lower wage rates. Both men denied that there was any relationship between CWP and UCI. The scheme was completed when UCI sent termination notices to each of the drivers. After CWP had negotiated a contract with Continental Can, the former UCI employees, now employed by CWP, continued to work at the Van Wert, Ohio facility, but at lower wage and mileage rates than they had been paid by UCI. The mailing of the termination notices in furtherance of the scheme formed the basis for the mail fraud allegations. As a result of this scheme, the indictment alleges that UCI employees at Continental Can were deprived of 1) economic benefits they enjoyed through rights guaranteed by the NLRA; and 2) economic benefits they enjoyed under the collective bargaining agreement between UCI and Local 908.

B. Taft-Hartley

The indictment alleges that on four occasions, Eugene Boffa, Sr. and appellant Louis Kalmar, Sr., co-owners of UCI, "did cause UCI to deliver the free use for a month ... of a 1975 Lincoln Continental ... to Francis Sheeran ... with intent to influence (Sheeran) in respect to his actions and duties as president of (Teamsters) Local 326, all in violation of (29 U.S.C. § 186(a)(4) & (d) )." Further, the indictment charges that Boffa and Kalmar, through All Purpose Leasing Inc., agreed to sell Sheeran the automobile at a price below its market value, also in an attempt to influence Sheeran in violation of § 186(a)(4) & (d).

C. ...

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