United States v. Dougherty, CRIMINAL ACTION NO. 14-69

• Decision Date: 31 March 2015
• Docket Number: CRIMINAL ACTION NO. 14-69,CRIMINAL ACTION NO. 14-435,CRIMINAL ACTION NO. 14-501,CRIMINAL ACTION NO. 14-436
• Court: United States District Courts. 3th Circuit. United States District Court (Eastern District of Pennsylvania)
• Parties: UNITED STATES OF AMERICA v. JOSEPH DOUGHERTY, et al. UNITED STATES OF AMERICA v. SHAWN BAILEY UNITED STATES OF AMERICA v. GREGG SULLIVAN UNITED STATES OF AMERICA v. JAMES ZINN

UNITED STATES OF AMERICA
v.
JOSEPH DOUGHERTY, et al.

UNITED STATES OF AMERICA
v.
SHAWN BAILEY

UNITED STATES OF AMERICA
v.
GREGG SULLIVAN

UNITED STATES OF AMERICA
v.
JAMES ZINN

CRIMINAL ACTION NO. 14-69
CRIMINAL ACTION NO. 14-435
CRIMINAL ACTION NO. 14-436
CRIMINAL ACTION NO. 14-501

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA

March 31, 2015

Baylson, J.

MEMORANDUM RE SENTENCING OF DEFENDANTS

"All punishment is for Example's Sake" - Francis Bacon¹

Deterrence of defendants, and others, is a major goal in the imposition of criminal sentencing; and is, without question, a most important sentencing factor in these cases.

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I. Introduction

The defendants' conduct, arising out of their membership in Ironworkers Local 401, established a culture of crime for many years. Of the twelve individual defendants, eleven have pled guilty to criminal conduct and one, the union leader, Joseph Dougherty, was convicted on six counts after a jury trial.

This Memorandum is being filed, as of the first sentencing, to set the background and to assure that all defendants, their families, the victims, and the public at large are aware of the totality of criminal circumstances that enveloped this City and are relevant in determining the sentence of each defendant. Philadelphia area contractors and businesses, who needed ironworkers' skills, suffered significant financial loss, personal danger, and property damage; the public suffered from a wave of crime committed with motives of retaliation, retribution, greed, and violence.

Labor unions evolved after many years of deprivation for low wage workers in the United States, eventually achieving a significant role in our economy. Unions serve their members with higher wages, productivity, opportunities for education and advancement, and wellbeing for their families.

To be sure, the criminal activities of these ironworkers, as developed in this case, were aberrational, but not novel. In particular, much of the history of construction unions in Philadelphia has been one of strife, corruption, violence, and discrimination.²

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In sentencing these defendants, the Court will, of course, fully abide by the sentencing factors set forth in 18 U.S.C. § 3553(a), as follows:

" (a) Factors to be considered in imposing a sentence. - The court shall impose a sentence sufficient, but not greater than necessary, to comply with the purposes set forth in paragraph (2) of this subsection. The court, in determining the particular sentence to be imposed, shall consider -

(1) the nature and circumstances of the offense and the history and characteristics of the defendant;

(2) the need for the sentence imposed -

(A) to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense;

(B) to afford adequate deterrence to criminal conduct;

(C) to protect the public from further crimes of the defendant; and

(D) to provide the defendant with needed educational or vocational training, medical care, or other correctional treatment in the most effective manner;"

The Court will take into account all of these factors and will also follow the procedures required by the Third Circuit, which, stated briefly, require:

1. Determining the offense level pursuant to the United States Sentencing Guidelines;

2. Ruling on any motions for departures or variances from the applicable guidelines that may be made by the government and/or the defendant; and

3. Applying the sentencing factors set forth above to each defendant and the resulting sentence as determined by the Court. United States v. Flores-Mejia, 759 F.3d 253, 255-56 (3d Cir. 2014) (citing United States v. Gunter, 462 F.3d 237, 247 (3d Cir. 2006)).

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In addition, restitution to the victims is required by law and will be imposed, and victims may be heard. The Court will consider the Presentence Reports prepared by the Probation Office, copies of which will have been provided to defense counsel and their clients in advance of the sentencing hearing. Defendants are welcome to present factual or character testimony, and other relevant material, and to speak in the nature of an allocution, prior to the imposition of sentence.

The conduct alleged in the Superseding Indictment, and thus admitted as to those defendants who pled guilty to one or more counts of the Superseding Indictment, or in the separate Informations, established a pattern of violence that is simply unacceptable in a civil society. In our nation's free-market economy, competition is just as welcome, and expected, between General Motors, Ford, and Chrysler as it is between union and non-union contractors and their employees. Union membership brings many benefits to union members, contractors, and building owners - but some owners and contractors prefer non-union workers. Their reasons may be faulted or their policies misguided, but in a free economy, they have that right.

Union membership does not bring exclusivity, the opportunity for monopolization of the labor force, or a license to commit crimes purportedly for the benefit of union members.

For many years, the ironworkers conducted a campaign of violence against building owners and building contractors who dared to hire non-union labor. Ironworkers Local 401 decided that employment of non-union ironworkers was a scourge, a plague, and adopted many lawless and criminal activities to combat the competition from non-union ironworkers. Those rights guaranteed by the First Amendment -- the right of assembly, the right of free speech, and the right of petition -- are to be enjoyed by union members, to be sure. However, defendants ignored the line between lawful and criminal conduct. For this, they must be punished.

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This Memorandum will detail some prior Philadelphia-area examples of violence by union workers, such as the roofers union, against non-union contractors. Despite these past incidences, criminal prosecutions, and civil injunctions, the ironworkers either were not listening, didn't care, or thought they couldn't be caught. However, justice has caught up with them, and it is my duty to impose sentences.

II. Deterrence as a Sentencing Factor

Deterrence must play an important role in sentencing defendants because of union violence in Philadelphia must become a relic of the past, not to be repeated. The criminal acts of many ironworkers, as detailed in the Superseding Indictment and placed on the record as part of the guilty plea colloquies for the eleven defendants who pled guilty, and in greater detail at the Dougherty trial (summarized below), showed that for a number of years, ironworker violence continued without drawing much focus of law enforcement. Prior to this case, review of media reports show only sporadic prosecution of ironworkers by local law enforcement - despite their numerous crimes -- which is not stated as criticism, but rather as reflective of the methodology used by the ironworkers to avoid detection.³

The need for defendants' sentences to "afford adequate deterrence to criminal conduct" is one of the sentencing factors that the Court must consider. 18 U.S.C. § 3553(a)(2)(B). Indeed, multiple Courts of Appeal have commented that "general deterrence . . . is one of the key purposes of sentencing." United States v. McQueen, 727 F.3d 1144, 1158 (11th Cir. 2013) (quoting United States v. Medearis, 451 F.3d 918, 920-21 (8th Cir. 2006)). As the

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Supreme Court has explained, deterrence is "[a]n important function of the corrections system." Pell v. Procunier, 417 U.S. 817, 822 (1974). One of the premises of the penal system is that "by confining criminal offenders in a facility where they are isolated from the rest of society, a condition that most people presumably find undesirable, they and others will be deterred from committing additional criminal offenses." Id.

Both Congress and the federal courts have recognized that deterrence is especially relevant to so-called "white collar" crimes and defendants with an economic motive to commit crimes, such as defendants. In this case, the evidence clearly warrants a conclusion that the defendants acted with an economic motive, but their crimes can hardly be called "white collar."

In enacting Section 3553, Congress noted that deterrence can be "particularly important" for crimes where small fines or other minor punishments would otherwise "be written off as a cost of doing business." S. Rep. No. 98-225, at 76, 1984 U.S.C.C.A.N. 3182, 3259 (discussing white collar crimes). Similarly, "economic and fraud-based crimes" are "prime candidates for general deterrence" because they "are more rational, cool, and calculated than sudden crimes of passion or opportunity." United States v. Musgrave, 761 F.3d 602, 609 (6th Cir. 2014) (internal quotation marks omitted). In a recent non-precedential opinion, the Third Circuit affirmed a sentence for conspiracy to commit extortion that "cited deterrence as a major consideration" because of the nature of the crime and the defendant. United States v. Castro, 573 F. App'x 214, 218 (3d Cir. 2014) (defendant, a former high-ranking police official, received an upward variance in part because Judge Battle of this Court cited a need to "signal to the police and to the citizenry of Philadelphia that criminal conduct by police officers will

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not be tolerated").

Seventh Circuit Judge Richard Posner has frequently applied economic principles in his judicial decisions, see, e.g., U.S. v. Goldberg, 491 F.3d 668 (7^th Cir. 2007), and in his writings as a law professor, see Economic Theory of Criminal Law, 85 Columbia Law Review, 1193 (1985). Racketeering and extortion, as charged in this case, are basically economic crimes where the defendant has a profit motive. Defendants acted as a criminal cartel to prevent non-union contractors from taking ironworker wages away from union members. Posner's writings condemn exclusionary cartels as economically dangerous and support deterrence as a...