US v. INTERNATIONAL BROTH. OF TEAMSTERS, 88 Civ. 4486 (DNE).
| Decision Date | 30 November 1993 |
| Docket Number | No. 88 Civ. 4486 (DNE).,88 Civ. 4486 (DNE). |
| Citation | 838 F. Supp. 800 |
| Parties | UNITED STATES of America, Plaintiff, v. INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA, AFL-CIO, et al., Defendants. In re APPLICATION CXVII OF the INDEPENDENT ADMINISTRATOR. |
| Court | U.S. District Court — Southern District of New York |
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Charles M. Carberry, Investigations Officer of Intern. Broth. of Teamsters (Marla S. K. Gale, Celia A. Zahner, of counsel), Mary Jo White, U.S. Atty., S.D.N.Y. (Steven C. Bennett, Asst. U.S. Atty., of counsel), for U.S.
Yelsky & Lonardo Co., L.P.A., Cleveland, OH (Leonard W. Yelsky, Angelo F. Lonardo, of counsel), for respondent Harold Friedman.
Berkman, Gordon, Murray, Palda & DeVan, Cleveland, OH (Brooke F. Kocab, J. Michael Murray, Jeremy A. Rosenbaum, of counsel), for respondents Gerald Yontek, William Jurevicius, Barbara Walden, Paul LaBuda, Ed Thomas, John Letner, Daniel Kolar, Douglas Schuetz, Stephen Kapelka, Philip Lukic, and Rudy Nativio.
This opinion emanates from the voluntary settlement of an action commenced by plaintiff United States of America (the "Government") against defendants International Brotherhood of Teamsters (the "IBT" or the "Union") and the IBT's General Executive Board (the "GEB") embodied in the voluntary consent order entered March 14, 1989 (the "Consent Decree"). The Consent Decree provides for three Court-appointed officials: the Independent Administrator to oversee the Consent Decree's remedial provisions, the Investigations Officer to bring charges against corrupt IBT members, and the Election Officer who supervised the electoral process that culminated in the 1991 election for International Officers. The goal of the Consent Decree is to rid the IBT of the influence of organized crime through the election and disciplinary provisions.
Application CXVII presents for this Court's review the decision of the Independent Administrator regarding disciplinary charges brought by the Investigations Officer against Harold Friedman ("Friedman"), former president of IBT Local 507 in Cleveland, Ohio, and against officers and agents of IBT Local 507 including Gerald Yontek, William Jurevicius, Barbara Walden, Paul LaBuda, Ed Thomas, John Letner, Daniel Kolar, Douglas Schuetz, Stephen R. Kapelka, Philip Lukic, and Rudy Anthony Nativio ("respondent officers and agents"). The Investigations Officer charged Friedman with violating the IBT Constitution by violating the terms of his one-year suspension from any officer or trusteeship position with the IBT or any IBT-affiliated entity, and violating 29 U.S.C. § 504, which bars Friedman from advising or acting as consultant to any labor organization as a result of his 1989 criminal conviction. The Investigations Officer charged respondent officers and agents with violating the IBT Constitution by facilitating Friedman's ongoing imposition of influence and control over IBT Local 507 in violation of his suspension and of 29 U.S.C. § 504. The Independent Administrator found that respondent Friedman had violated his one-year suspension as well as his statutory debarment. The Independent Administrator also found that respondent officers and agents acquiesced to, and in some instances actively assisted, Friedman's improper involvement in IBT Local 507.
For these violations, the Independent Administrator permanently barred Friedman from membership in the IBT. Furthermore, the Independent Administrator ordered that the IBT and IBT-affiliated persons and entities not make contributions to employee benefit plans on Friedman's behalf, regardless of whether such plans are under the exclusive control of the IBT. Consistent with prior rulings in this case, see, e.g., June 10, 1993 Memorandum & Order, 824 F.Supp. 406, 409 n. 3 (S.D.N.Y.1993), the Independent Administrator did not alienate Friedman's vested benefits. The Independent Administrator barred respondent officers and agents from holding or drawing compensation from any IBT-affiliated officer or trusteeship position for terms varying in accordance with each individual's culpability. The Independent Administrator directed that contributions by the IBT or any IBT-affiliated entities to the employee benefit plans of each of these individuals attributable to his or her position as an officer or agent cease during his or her period of suspension. Finally, the Independent Administrator ruled that respondents are not entitled to have any of their legal expenses paid by the IBT or any IBT-affiliated entity. The Independent Administrator stayed the imposition of penalties pending this Court's review.
Respondents contend that the Independent Administrator's decision is arbitrary and capricious, an abuse of discretion, contrary to law, and unsupported by the evidence. These arguments are without merit. The decision of the Independent Administrator is both legally sound and well supported by the evidence. Accordingly, the decision of the Independent Administrator is affirmed in all respects.
The Investigations Officer charged that, while suspended from all officer and trusteeship positions in IBT Local 507, respondent Friedman brought reproach upon the IBT, interfered with and induced others to interfere with the performance of the Union's legal obligations, and violated his membership oath, in violation of Article II, Section 2(a) and Article XIX, Section 7(b)(1), (2), and (5) of the IBT Constitution. The Investigations Officer further charged that respondent officers and agents brought reproach upon the IBT, interfered with and allowed others to interfere with the performance of the Union's legal obligations, and violated their membership oaths, in violation of Article II, Section 2(a) and Article XIX, Section 7(b)(1), (2) and (5) of the IBT Constitution. Article II, Section 2(a), the IBT membership oath, provides in relevant part that every IBT member shall "conduct himself or herself at all times in such a manner as not to bring reproach upon the Union." Article XIX, Section 7(b) is a non-exhaustive list of disciplinary charges that may be filed against IBT members. The three specific Section 7(b) charges brought against respondents are: (1) violating the IBT Constitution, a Local Union Bylaw or other Union rule; (2) violating the IBT membership oath; and (3) engaging in conduct that is disruptive of, interferes with, or induces others to disrupt or interfere with, the performance of any Union's legal or contractual obligations. See IBT Const., Art. XIX, § 7(b)(1), (2), and (5).
Pursuant to Section F.12(c) of the Consent Decree, the Independent Administrator must adjudicate disciplinary charges using a "just cause" standard. The Investigations Officer has the burden of establishing just cause by a preponderance of the evidence. December 27, 1990 Opinion & Order, 754 F.Supp. 333, 337 (S.D.N.Y.1990). After conducting a hearing (the "hearing") at which respondents were represented by counsel, and after receiving post-hearing submissions, the Independent Administrator issued a thirty-six page decision. The Independent Administrator found that the Investigations Officer had satisfied his burden of proving that Friedman brought reproach upon the Union by continuing to interject himself in the affairs of IBT Local 507, playing a significant role in the running of IBT Local 507, and holding himself out as a figure of continuing authority, in violation of his suspension and his statutory bar from union activity. (Decision of the Independent Administrator ("Ind.Admin.Dec.") at 2). The Independent Administrator also found that the Investigations Officer had satisfied his burden of proving that respondent officers and agents brought reproach upon the Union by permitting Friedman to interject himself in the affairs of IBT Local 507. (Ind.Admin.Dec. at 2).
In an earlier action, Harold Friedman ("Friedman"), president of IBT Local 507 and president of Bakery, Confectionery and Tobacco Workers International Union, Local 19 ("Bakers Local 19") in Cleveland, Ohio, was charged by the Investigations Officer with bringing reproach upon the IBT by: (1) embezzling funds from Bakers Local 19 in 1981 while he was the president of that Local; (2) conspiring to and engaging in racketeering activity in connection with Bakers Local 19; and (3) filing a false form LM-2 with the Department of Labor on behalf of Bakers Local 19. On January 11, 1990, the Independent Administrator ordered Harold Friedman "to remove himself from all of his IBT affiliated Union positions and draw no money or compensation therefrom, or from any other IBT affiliated source," for a period of one year. This Court affirmed the Independent Administrator's ruling, at which time the one-year suspension commenced. March 8, 1990 Opinion & Order, 735 F.Supp. 506 (S.D.N.Y.), aff'd, 905 F.2d 610 (2d Cir. 1990). Although Friedman was prohibited by the Independent Administrator's ruling from assuming any officer or trusteeship position within IBT Local 507, he was permitted to retain his IBT membership. Because of the Consent Decree's limited application, Friedman retained his position as president of Bakers Local 19.
In addition, Friedman's conduct as president of Bakers Local 19 resulted in his criminal conviction in 1989 in the United States District Court for the Northern District of Ohio. United States v. Friedman, 86 Cr. 114 (N.D.Oh.1989). As a result of that conviction, Friedman was prohibited from acting as a consultant or advisor to any labor organization for a period of three years beginning on January 3, 1991, pursuant to 29 U.S.C. § 504. This prohibition applies to Friedman's status in IBT Local 507 as well as in Bakers Local 19.
In the current action, the Investigations Officer charged that Friedman continued to exert substantial influence and...
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