United States v. Lanni

• Decision Date: 14 August 1972
• Docket Number: No. 72-1028/9.,72-1028/9.
• Citation: 466 F.2d 1102
• Parties: UNITED STATES of America, Appellee, v. Louis LANNI, Sr. Appellant in No. 72-1028, and Mary Maiale. Appeal of Mary MAIALE, in No. 72-1029.
• Court: U.S. Court of Appeals — Third Circuit

466 F.2d 1102 (1972)

UNITED STATES of America, Appellee, v. Louis LANNI, Sr. Appellant in No. 72-1028, and Mary Maiale Appeal of Mary MAIALE, in No. 72-1029.

No. 72-1028/9.

United States Court of Appeals, Third Circuit.

Argued June 20, 1972.

Decided August 14, 1972.

Lester J. Schaffer, Zink, Shinehouse & Holmes, Philadelphia, Pa., for appellants.

Jill Wine Volner, Dept. of Justice, Washington, D. C., Carl Melone, Acting U. S. Atty., E. D. Pa., Philadelphia, Pa., Michael C. Sloane, Atty., U. S. Dept. of Justice, Washington, D. C., for appellee.

Before GIBBONS, JAMES ROSEN and HUNTER III, Circuit Judges.

OPINION OF THE COURT

JAMES ROSEN, Circuit Judge.

Growing concern with corruption between management and labor representatives prompted Congress to enact Section 302 of the Taft-Hartley Act, 29 U. S.C. § 141 (1947). Initially, as passed by the House of Representatives, the bill "made it an unfair labor practice for employers to give favors to `any person in a position of trust in a labor organization * * *' H.R. 3020, 80th Cong., 1st Sess., § 8(a)(2). The scope of this bill was enlarged when it reached the Senate to include, in the words of Senator Taft, a `case where the union representative is shaking down the employer * * *' 93 Cong.Rec. 4746." The resulting bill "outlaw ed all payments, with stated exceptions, between employer and representative," imposing criminal liability on both the employee representatives and those members of management who indulged in the forbidden transactions. United States v. Ryan, 350 U.S. 299, 305-306, 76 S.Ct. 400, 100 L.Ed. 335 (1956).¹

The Taft-Hartley Bill did not succeed in stamping out the corruption problem, however. Many of those dishonest enough to betray the employees' interests prior to the legislation were devious enough to avoid the reach of the Taft-Hartley Act. "Widespread public concern" with "racketeering, crime, and corruption"² continued; and the Eighty-Sixth Congress responded by enacting the Labor Management Act of 1959. By so doing, Congress hoped to "close loopholes" which "both employer representatives and union officials had turned to advantage at the expense of employees."³ The bill was intended to make certain that employer representatives, like other trustees, would not profit from their positions of trust:

For centuries the law has forbidden any person in a position of trust to hold interests or enter into transactions in which self-interest may conflict with complete loyalty to those whom they serve. Such a person may not deal with himself, or acquire adverse interests, or make any personal profit as a result of his position. The same principle has long been applied to trustees, to agents, and to bank directors. It is equally applicable to union officers and employees. The ethical practices code of the American Federation of Labor and Congress of Industrial Organizations states —

It is too plain for extended discussion that a basic ethical principle in the conduct of union affairs is that no responsible trade union official should have a personal financial interest which conflicts with the full performance of his fiduciary duties as a workers\' representative.

After the McClellan committee hearings no one can dispute the simple fact that although the vast majority of union officials are honest and conscientious men, a small number have ignored this basic standard of conduct. No one would deny that the conduct is wrong. The wrongs should not be ignored by the Federal Government. The national labor policy is founded upon collective bargaining through strong and vigorous unions. Playing both sides of the street, using union office for personal financial advantage, undercover deals, and other conflicts of interest, corrupt and thereby undermine and weaken the labor movement. The Congress should check the abuses in order to foster the national labor policy. The Government which vests in labor unions the power to act as exclusive bargaining representative must make sure that the power is used for the benefit of workers and not for personal profit.⁴ (emphasis supplied.)

The part of that Act which is of particular concern to us in this case is Section 302(a)(1) and (4) and (b), 29 U.S.C. 186(a) (1) and (4) and 186(b). Subsection (a) proscribes payments by employers "to any representative of any of his employees * * *" or to "any officer * * * of a labor organization * * * with intent to influence him in respect to any of his actions, decisions, or duties as a representative." Subsection (b) imposes a parallel prohibition on those who might receive such funds, and makes it "unlawful for any person to * * * receive, or accept * * * any payment, loan, or delivery of any money or other thing of value prohibited by section (a)."⁵ Since (b) incorporates (a)'s prohibitions, it forbids any employee representative to accept money from any employer or to accept any payment made with the intent to influence his behavior as a representative.

The 1959 amendments:

remove any doubt that all forms of bribery which might escape the provisions of the then existing law would be prohibited under pain of criminal penalties. * * * The intent of these amendments to sections 302(a) and (b) is to forbid any payment or bribe by an employer of anyone who acts in the interest of an employer whether technically an agent or not and to forbid the receipt of any such bribe by any person, whether an individual, an officer or employee of a labor organization or a committee representing employees. Payment to and receipt of such payments by any union officer or employee having the intent of influencing such officer or employee in respect to any of his actions, decisions, or duties as a representative of employees or as such union officer or employee would also be made a criminal offense.⁶

With these basic principles in mind, we can proceed to the case at hand. The appellant Louis Lanni, Sr., was convicted under amended § 302(b), 29 U. S.C. § 186(b), for receiving and accepting $16,300, from D'Agata National Trucking Company (D'Agata Trucking) while he was Secretary-Treasurer of Teamsters' Local No. 830 and while that local represented D'Agata Trucking's employees. Both Lanni and appellant Mary Maiale were convicted of a separate count of conspiring to obtain and receive the money.⁷ 18 U.S.C. § 371. Lanni was sentenced to eight months imprisonment and put on probation for the year following his release. He was also fined $5000. Maiale was fined $2500. and sentenced to one year probation.

On this appeal three issues are presented for review: (1) did the court below err in construing 29 U.S.C. § 186 (b); (2) is that statute unconstitutionally vague, and (3) did the court err in refusing defendants' requested instructions on willfulness.

The facts leading to the appellants' convictions are admirably set forth in the thorough opinion of Judge Becker.⁸ The appellants, who did not testify, do not challenge his findings and we see no reason to reiterate them in detail. Instead, we limit ourselves to recounting only the most critical facts and to setting forth the legitimate inferences which the jury could reasonably have drawn from them. United States v. Hamilton, 457 F.2d 95, 99 (3d Cir. 1972), United States v. Moraites, 456 F. 2d 435 (3d Cir. 1972).

The evidence established that Mary Maiale received $16,300. from D'Agata Trucking, ostensibly for her work as a bookkeeper.⁹ Maiale was, however, a full time bookkeeper for the Health and Welfare Fund of Lanni's Local 830 and "never performed any bookkeeping * * * or any other services" for D'Agata Trucking.¹⁰ At the time she was receiving these payments, Lanni had full knowledge that she was not performing any services in exchange for her "salary." This is not surprising as Maiale was Lanni's "girlfriend,"¹¹ and shared a Miami Beach condominium apartment with him. The down payment check on that apartment was drawn on the account where Maiale deposited her "salary" checks. Nonetheless, Lanni openly referred to the apartment as "my place."¹²

The appellants "had other business dealings and * * * in them Maiale was a `straw man' for Lanni."¹³ When Lanni and two partners established a truck leasing company, Lanni chose to place his interest in Maiale's name. Similarly, when Lanni contemplated entering the realty field, his plan called for Maiale's holding his interest, but in name only. Together, these transactions gave the jury reasonable ground to believe that "what was nominally Maiale's was, in reality, Lanni's".¹⁴

Soon after Maiale was placed on the D'Agata Trucking payroll, she and Lanni began making very frequent visits to Joe D'Agata, an officer of the Trucking Company. Lanni took a strong interest in D'Agata Trucking and began to refer to it as being partly his. The Lanni-D'Agata ties were publicized enough for Joe D'Agata to become known as "Lou Lanni's boy."¹⁵

Lanni repaid D'Agata's salary to Maiale by forcing local businesses to hire D'Agata Trucking. C. Schmidt & Sons breweries, for example, were told to switch to D'Agata and they complied because they recalled how on a prior occasion, when they had refused to accede to Lanni's wishes, Lanni had exercised his power over their Teamster employees to shut down their plant. D'Agata Trucking underwent a sudden growth, which continued until Lanni chose to destroy D'Agata's business by forcing Schmidt and other companies to replace D'Agata Trucking.¹⁶

I

In his charge, Judge Becker told the jury that section 302 did not require that the government show Lanni had actually received the money D'Agata had paid Maiale. In his view, Maiale's receiving money from D'Agata as the "agent, intermediary, go-between or front" for Lanni would come within the ambit of 302(b) if all three parties contemplated that (1) Maiale would receive the money and "like a conduit" transmit it to Lanni; or that (2) she would receive the money on his "behalf" and hold it "for his use."¹⁷

The appellants...