United States v. Silva

• Decision Date: 13 June 1980
• Docket Number: Cr. No. 79-0057.
• Parties: UNITED STATES of America v. Raymond J. SILVA.
• Court: U.S. District Court — District of Rhode Island

517 F. Supp. 727

UNITED STATES of America v. Raymond J. SILVA.

Cr. No. 79-0057.

United States District Court, D. Rhode Island.

June 13, 1980.

Edwin Gale, U. S. Dept. of Justice, Providence, R.I., for plaintiff.

Lincoln Almond, Providence, R.I., for defendant.

OPINION AND ORDER

PETTINE, Chief Judge.

The indictment on which this defendant was tried charges him in seven counts with violating the Taft-Hartley Act, 29 U.S.C. § 186(b)(1) and in ten counts with embezzlement of union funds while serving as president of Local Unions 1329 and 1996, International Longshoremen's Association, 29 U.S.C. § 501(c).

FACTS

During the years in question, most of the loading and offloading of ships in the Port of Providence was done by members of the Rhode Island Shipping Association (Association); it is a group of five stevedoring companies that have a collective bargaining agreement with Local 1329. The stevedoring companies, as employers engaged by shippers to load or offload their vessels, hire union longshoremen members of Local 1329 to do this work. The collective bargaining agreement between the union and the Shipping Association establishes, among other things, as is required by 29 U.S.C. § 186, trust funds for health and welfare, and pension and vacation benefits which accrue by virtue of their contract and the withholding of union dues. The benefit payments are administered and the trust funds are managed by trustees, the defendant being the trustee for Local 1329. In addition to the stevedoring companies in the Rhode Island Shipping Association, there are other nonmember companies which do not have any collective bargaining agreement with Local 1329.

The defendant represented the longshoremen in the Port of Providence and was elected president of Local 1329 in 1975; a position he still holds. He was the moving force in organizing and having chartered Local 1996; though not elected to any office, he has been its principal spokesman and officer de facto since its inception in 1975. Local 1996 was organized so that members of Local 1329 who joined Local 1996 could be hired as line handlers, a job not authorized under the charter held by Local 1329. There is no collective bargaining agreement between the Association and Local 1996.

This case concerns activities of the defendant with two stevedoring companies, namely Mohawk Trucking and Salvage, Inc. (Mohawk) and Promet Marine Services Corporation (Promet), that are not members of the Association.

In 1977, Diamond Salt Company, an importer of salt from various foreign ports, engaged Mohawk to stevedore two of its vessels. In turn, Mohawk entered into an oral agreement with the defendant whereby Local 1329 was to provide for longshoremen to offload the ships in exchange for prevailing Port of Providence wages and benefits. It is clear that no trust agreements were drawn up relative to the handling of health and welfare, pensions and vacation benefits; nor did Mohawk obtain written authorization to withhold dues from the longshoremen.

Pursuant to the agreement with Local 1329, the two ships were unloaded by longshoremen provided by the defendant. A timekeeper and checker marked off all pertinent money matters credited to each worker, such as hours, health and welfare benefits, and union dues. Mohawk issued separate checks in each category for which money was due: paychecks to the men who performed the work; dues to Local 1329 which were deposited into the union's account in the normal course of business; and the benefit monies, which were forwarded to the Association for deposit in its appropriate trust fund. This last check was returned by the Association to Mohawk because Mohawk was not a member. After the two ships were serviced, Mohawk discontinued further stevedoring activities.

Mr. Silva then met with a Mr. David Cohen, President of Promet, who had obtained the stevedoring business for certain ships coming into the Port of Providence for the 1978 shipping season. Mr. Cohen was aware of Mohawk's experience with the Association and he advised the defendant that Promet planned to become a member. Promet then entered into an oral agreement with the defendant to offload the incoming ships, but no written trusts were executed relative to pensions, vacation/holiday, and welfare benefits; nor was any written authorization obtained from individual longshoremen for the withholding of union dues.

Under the contract with Promet approximately six ships were serviced. The defendant contends that when he negotiated with Promet it was understood that the contract was with Local 1996 and not 1329. Because Local 1329 had a collective bargaining agreement with the Association, he feared the Association might retaliate against Local 1329 if it again entered into a contract with a non-member stevedoring company; since Local 1996 had no such collective bargaining agreement with the Association, he decided to use it in order to secure the loading and offloading of these ships that were coming into the Port of Providence, for otherwise others might take over the jobs and thus deprive his men of this work.

The ships came in as scheduled and were unloaded; all the necessary and proper deductions were made. However, the checks were retained by Promet. The defendant had a number of conferences with Mr. Cohen concerning the welfare and pension monies and though Mr. Cohen initially stated Promet would create a trust, it was not done; there came a point when Mr. Silva demanded of Promet and Mohawk that he be given the checks totaling approximately $30,000. The first series of checks issued by Promet and given to the defendant were payable to Local 1996; these were deposited in a bank in the name of Local 1996. Some of the other checks were made out to Local 1329; the defendant claims he told Cohen it was a mistake, whereupon the payee was readily changed from Local 1329 to Local 1996. The defendant contends that it was always understood with Promet that Local 1996 was being used and that at no time did he order the payee on their checks to be changed from Local 1329 to Local 1996. He states, and the Court accepts as a fact, that when Promet handed him checks payable to Local 1329, it came as a surprise; that he told Cohen he evidently made a mistake, whereupon they changed the payee to Local 1996, saying, in essence, it was the fault of the bookkeeper. In all, Promet issued approximately twenty checks representing dues, check-offs, and vacation/holiday, pension and health and welfare contributions. Included in these checks are those covered by the various counts in the indictment. The checks received from Promet and Mohawk were co-mingled in two accounts in the Industrial National Bank in the name of Local 1996.

The evidence further established that not all the members of Local 1329 were members of Local 1996, nor did all of the members of these two Locals know that the monies were deposited in the Industrial National Bank. Though it is clear Mr. Silva never formally announced nor made it a matter of record in any of the Local 1996 Union minutes precisely what he did with the checks he received or even that he received them, he contends it was a matter of common knowledge among the union members; that it was well known that the Association had refused the Mohawk checks and that if they were going to "work this thing out" they "were going to be working under the jurisdiction of Local 1996 because of the fact that the shipping association was definitely on our back for work for a non-member."

The defendant further explained that he did not open separate accounts, i. e., one for the Mohawk money and another for the Promet money because the Association had refused the Mohawk money in spite of his protestations.

There was further evidence that for a number of years prior to the granting of the charter to Local 1996 the defendant was required to do substantial traveling to organize this Local and secure the charter. He personally advanced these costs but from and after the time the Local 1996 funds were established, he expended the co-mingled money for his activities on behalf of Local 1996 and Local 1996-1^* and also borrowed from this fund to purchase a home for himself. The government contends that these expenditures from the comingled fund were unauthorized and were in fact used by the defendant for his personal benefit. It is these expenditures that premise counts VIII-XIX.

CONCLUSIONS OF LAW

The first seven counts of the indictment charge the defendant with violating 29 U.S.C. § 186(b)(1) which reads:

(b)(1) It shall be unlawful for any person to request, demand, receive, or accept, or agree to receive or accept, any payment, loan or delivery of any money or other thing of value prohibited by subsection (a) of this section.

Subsection (a) reads:

(a) It shall be unlawful for any employer or association of employers or any person who acts as a labor relations expert, adviser, or consultant to an employer or who acts in the interest of an employer to pay, lend, or deliver, or agree to pay, lend, or deliver, any money or other thing of value —

(1) to any representative of any of his employees who are employed in an industry affecting commerce; or

(2) to any labor organization, or any officer or employee thereof, which represents, seeks to represent, or would admit to membership, any of the employees of such employer who are employed in an industry affecting commerce; or

(3) to any employee or group or committee of employees of such employer employed in an industry affecting commerce in excess of their normal compensation for the purpose of causing such employee or group or committee directly or indirectly to influence any other employees in the exercise of the right to organize and bargain collectively through representatives of their own choosing; or

(4) to any officer or employee of a labor organization engaged in an industry affecting commerce with intent to influence him in

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