U.S. v. International Longshoremen's Ass'n

Decision Date01 November 2007
Docket NumberNo. 05-CV-3212.,05-CV-3212.
Citation518 F.Supp.2d 422
PartiesUNITED STATES of America, Plaintiff, v. INTERNATIONAL LONGSHOREMEN'S ASSOCIATION, et al., Defendants.
CourtU.S. District Court — Eastern District of New York

Thomas R. Ashley, Newark, NJ, for Gerald Owens.

George T. Daggett, Daggett, Kraemer, Elliades, Vander Wiele & Ursin, Sparta, NJ, for Harold J. Daggett.

Michael G. Considine, Terence Joseph Gallagher, III, Day Pitney LLP, Stamford, CT, for Edward L. Brown, Sr., Clyde Fitzgerald, Perry C. Harvey, James T. McCleland, Jr., James H. Paylor, Jr., Kenneth Riley, and Richard Hughes.

Gerald J. McMahon, Law Office of Gerald J. McMahon, New York, NY, Thomas Aloysius Tormey, Jr., Law Offices of Thomas A. Tormey Jr., New York, NY, for Arthur Coffey.

Donato Caruso, James Robert Campbell, The Lambos Firm, Kevin Marrinan, John P. Sheridan, Gleason & Matthews New York, NY, for Management-International Longshoremen's Association Managed Health Trust Fund, Board of Trustees of the Management-International Longshoremen's Association Health Care Trust Fund.

James P. Corcoran, Victor J. Rocco, Heller Ehrman LLP, New York, NY, for Metropolitan Marine Maintenance Contractors Association, Board of Trustees of the Metro-ILA Fringe Benefit Fund.

Victor J. Rocco, Heller Ehrman LLP, New York, NY, for Metro-ILA Fringe Benefit Fund, Metro-ILA Individual-Account Retirement Fund, Board of Trustees of the Metro-ILA Individual-Account Retirement Fund.

Robert Henry Bogucki, Robert H. Bogucki, P.C., Garden City, N.Y., Victor J. Rocco, Heller Ehrman LLP, New York, NY, for Metro-ILA Pension Fund, Board of Trustees of the Metro-ILA Pension Fund.

John R. Wing, Lee Renzin Lankier Siffert & Wohl LLP New York, NY, for John Bowers.


GLASSER, Senior District Judge.

In this civil Racketeer Influenced and Corrupt Organizations Act of 1970 ("RICO") action, the defendants identified in the margin1 have, moved to dismiss the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) ("Rule 12(b)(6)") for failure to state a claim on which relief can be granted.2 The ILA also moves, pursuant to Federal Rule of Civil Procedure 12(f) ("Rule 12(f)"), to strike certain allegedly immaterial historical allegations from the Amended Complaint, a motion in which some other defendants join. The defendants raise a number of challenges to the sufficiency of the Amended Complaint, arguing primarily that the Government has failed to adequately plead the necessary elements of a civil RICO conspiracy in several ways, including failure to allege a cognizable association-in-fact RICO enterprise and failure to adequately allege the predicate acts of extortion, mail fraud, and wire fraud. For the reasons stated below, the ILA's motion to dismiss the Amended Complaint pursuant to Rule 12(b)(6) is granted. All other pending motions are denied as moot.

I. Allegations in the Amended Complaint

This action is the latest episode in a decades-long effort by the United States to curtail the influence of the La Cosa Nostra organized crime families over the vehicles of interstate commerce operating along the waterfront areas in the Port of New York and New Jersey and the Port of Miami.3 The Government's prolix, 85-page Amended Complaint, with its hundreds of pages of attached exhibits, alleges in essence that from 1995 onward, the Genovese and Gambino crime families conspired with their associates occupying high-ranking positions in legitimate Waterfront operations, particularly the ILA and several associated labor organizations, to extend and maintain the influence of organized crime through a pattern of racketeering activity including extortion, money laundering, and mail and wire fraud. The Amended Complaint is burdened with lengthy discussions of the history and operations of La Cosa Nostra generally, as well as discussions of Government investigations and prosecutions of organized crime activity on the Waterfront going back several decades. While the Government argues that all of this historical material is necessary to place the allegations regarding the charged conspiracies in their proper context, the Court shall ignore much of this material and focus its discussion of the relevant facts on the allegations comprising the charged offenses as well as the relatively recent related civil and criminal litigation that directly preceded this action.4

A. The Defendants

The Amended Complaint separates the numerous defendants into three classifications: the Nominal Defendants, who are not charged with wrongdoing but are named as defendants, presumably pursuant to Federal Rule of Civil Procedure 19(a) ("Rule 19"),5 "for purposes of effecting the full relief sought in this action," Gov. Mem. at 4, the ILA Officer Defendants, and the La Cosa Nostra ("LCN") Defendants. The ILA Officer Defendants and the LCN Defendants, who are alleged to have conspired together to conduct the pattern of racketeering activity set forth in the Amended Complaint, are sometimes referred to collectively as the "Racketeering Defendants." Before proceeding to recount the factual allegations underlying the Government's claims, it shall be useful to provide an overview of the numerous defendants identified in this action.

1. The Nominal Defendants

The International Longshoremen's Association is a labor union that represents approximately 59,000 longshoremen and other laborers working in ports around the United States.6 Am. Compl. ¶ 15. The ILA is divided into two regions, the Atlantic Coast District and the South Atlantic & Gulf Coast District, each of which is comprised of an unspecified number of local unions. Id. Each ILA local and district organization is governed by a group of officers, and the entire organization is governed by the ILA Executive Council, which is comprised of the President, Secretary-Treasurer, Executive Vice-President, General Vice-President, General Organizer, Assistant General Organizer, and twenty-six Vice-Presidents. Id. ¶¶ 15-16. Executive Council Members are elected at the ILA's Conventions, which occur every four years; if a vacancy occurs on the Executive Council during a non-Convention year, the remaining Executive Council members elect an individual to occupy the vacant position until the next Convention, either from the general ILA member population, if the vacant position is not the Presidency, or from the remaining Executive Council members, if the President is being replaced. Id. ¶¶ 95-96.7 The duties of these positions are generally self-evident, so the Court shall not dwell on their descriptions except to note that the Executive Vice President "shall act on behalf of the President whenever the International President shall be ill, absent, incapacitated, or unable to serve," and that the General Organizer, Assistant General Organizer, and the Vice-Presidents "shall ... assist [the International President] during the session of the Convention and in other such manner and form as the International President may ... request or direct...." Am. Compl. ¶ 16 (quoting ILA Constitution Article IX, §§ 2, 4). The Executive Council possesses the ultimate authority to impose disciplinary measures, ranging from fines to the suspension or cancellation of individual membership or an organizational charter, upon all ILA members and subordinate labor organizations. Id. ¶ 16 (citing ILA Constitution Art. XVIII).8 The top six Executive Council officers — i.e., the President, Secretary-Treasurer, Executive Vice President, General Vice President, General Organizer, and Assistant General Organizer — are well-compensated: in 2004, the annual salaries associated with those positions ranged from $257,120 for the General Vice-President to $413,556 for the President. Am. Compl. ¶ 17.9 In addition, Executive Council members typically hold office at the local or district level and receive a salary associated with that office as well. Id.

The Management-International Longshoremen's Association Managed Health Care Trust Fund ("MILA") is a benefit fund that provides health insurance nationally for ILA members. MILA was established by the ILA and companies employing ILA labor ("Management") in 1996, pursuant to a Master Contract between the ILA and Management providing for health benefits for longshoremen on the Atlantic and Gulf Coasts. Id. ¶¶ 115-116. MILA provides health care benefits, including prescription drug coverage and mental health benefits, to the majority of ILA Members. Id. ¶ 120. MILA is governed by its Board of Trustees ("MILA Board"), id. ¶¶ 27-28, which is comprised of 18 ILA representatives and 18 Management representatives, and has two Co-Chairmen. Id. ¶¶ 117-118.

The Metropolitan Marine Maintenance Contractors' Association ("METRO") is an association of employers engaged in interstate commerce on the Waterfront, who directly or indirectly employ ILA members. Id. ¶ 33. METRO and ILA Locals 1804-1 and 1814 have established three funds for the benefit of the members of those locals — the METRO-ILA Fringe Benefit Fund, the METRO-ILA Pension Fund, and the METRO-ILA...

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