The opinion of the court was delivered by: Edelstein, District Judge:
This decision arises from the implementation of the rules
for the International Brotherhood of Teamsters ("IBT")
International Union Delegate and Officer Election promulgated
by the Election Officer (the "election rules") and approved by
this Court by Opinion & Order dated July 10, 1990, 742 F. Supp. 94
(S.D.N.Y. 1990), and the Court of Appeals United States v.
International Brotherhood of Teamsters, 931 F.2d 177 (2d Cir.
1991). These election rules provide a "framework for the first
fully democratic, secret ballot election in the history" of the
IBT. July 10, 1990 Opinion, supra, 742 F. Supp. at 97.
Petitioners Western Conference of Teamsters Pension Trust
Fund (the "Trust") and Joseph Ballew, an employee of the
Western Conference of Teamsters and Co-chairman of the Trust
appeal decision 91-Elec. App.-106 of the Independent
Administrator, which affirmed as modified the Election
Officer's decision P-291A-LU278-CSF pursuant to Article X,
§ 1(a)(8) of the election rules. The Election Officer and
Independent Administrator determined that Ballew had violated
Article X, § 1.b.(1) of the election rules in connection with
the preparation and distribution, at Trust expense, of written
materials about Ron Carey, an accredited candidate for IBT
General President. Petitioners seek to overturn the findings of
the Independent Administrator. This petition was ripe for this
Court's review on April 25, 1991. Petitioners twice moved this
Court to stay the decision of the Independent Administrator.
This Court denied the first application on April 11, 1991, and
the second on May 10, 1991.
The decision of the Independent Administrator is affirmed.
I. Background and Procedural History
The Trust is affiliated with the Western Conference of
Teamsters ("WCT"), a subordinate entity of the IBT. The Trust
is a multi-employer pension plan established pursuant to §
302(c) of the Labor Management Relations Act ("LMRA"),
29 U.S.C. § 186(c), and a pension plan as defined in the Employee
Retirement Income Security Act ("ERISA"),
29 U.S.C. § 1002(2)(A). The Trust has 14 employee trustees, including
Ballew, two other employees of the WCT, with the remaining
employee trustees being officers or officials of the WCT. Four
of the 14 employee trustees, Arnie Weinmeister, Chuck Mack, Ben
Leal, and Michael Riley, are announced candidates for
International Office on the "Durham-Mathis Unity Team" slate.
(Decision of Independent Administrator [Dec.In.Ad.] at 2).
Ron Carey is the president of IBT local 804 in Long Island
City, New York, and a Trustee of the Local 804 IBT/Local 447
IAM United Parcel Employees Pension Plan (the "Local 804
plan"). A notable feature of the Local 804 plan is the "30 and
out" feature, where participants may begin receiving full
benefits after 30 years of service, rather than benefits being
tied to reaching a certain age. Carey negotiated the Local 804
plan. Carey is an accredited candidate for IBT General
President. (Dec.In.Ad. at 3).
The following facts were found by the Election Officer and
affirmed by the Independent Administrator. On January 23,
1990, Ballew wrote to Mr. Richard Pirnke, an independent trust
administrator, asking Pirnke to review and comment on the
Local 804 plan. In that letter, Ballew wrote "Since this plan
will be the one that our WCT plan will be compared to, I am
sending this to you for your review and comments." (Dec.In.Ad.
at 3). That inquiry was not made for the purpose of any
pending collective bargaining negotiations, or at the request
of any participant in, or beneficiary of the Trust. That
inquiry was found to be in response to Carey's campaign and
candidacy. (Dec.In.Ad. at 4-5).
On March 19, 1990, Pirnke responded, adversely comparing the
local 804 plan to the Trust (the "Pirnke letter"). That
comparison noted in particular the demographic differences
between the WCT and Local 804 memberships that made the "30
and out" feature less attractive to Trust participants.
(Dec.In.Ad. at 5).
In November, 1990, Jack R. Bookter, Secretary-Treasurer of
Local 278 in San Francisco, California (affiliated with the
WCT), sent Ballew a videotape of a campaign presentation by
Carey. In that videotape, Carey makes specific reference to
the Trust, and the Local 804 plan's "30 and out" feature.
(Dec.In.Ad. at 6-7).
On November 28, 1990, Ballew wrote back to Bookter, on Trust
stationery, in his capacity as co-chairman/secretary of the
Trust (the "Ballew letter"). In that letter, Ballew made
unfounded and pejorative remarks about Carey, stating that
Carey took unfounded liberties in describing the Local 804
plan. The Ballew letter went on to set out the "limitations of
significance" in the Local 804 plan, and then emphasized
positive features of the Trust. (Dec.In.Ad. at 6-7).
The Election Officer and Independent Administrator found
that Ballew did not circulate the information in the Pirnke
letter or use that information for collective bargaining
purposes until he was contacted by Bookter. (Dec.In.Ad. at
Ballew then sent copies of his letter to all other employee
trustees of the Trust. No employer trustee received a copy.
Bookter distributed copies of the Ballew letter to members of
his local who inquired about the Carey presentation at local
278 expense. Chuck Mack, a member of the WCT policy committee,
distributed the Ballew letter to all members of his Local 70,
at IBT expense. (Dec.In.Ad. at 6-7).
After considering the facts as found by the Election Officer
and Independent Administrator, the Independent Administrator
concluded the following:
[I]t is readily apparent that Ballew's November
28, 1990 letter was designed to refute Carey's
campaign statements regarding pensions and the
Local Union 804 plan. In short, the Ballew letter
is intended to influence the election of Carey as
General President. Stated more plainly, the
Ballew letter constitutes anti-Carey campaign
literature. Given the fact that the Trust is
prohibited from making any campaign contribution,
its distribution of the November 28, 1990 letter
violates the Election Rules.
The Election Officer ordered the Trust and Ballew to take
curative steps (the "curative steps"). These steps were
affirmed as modified by the Independent Administrator. Those
steps are as follows:
1. The Trust is prohibited from making any further
contributions of value, including distribution of the Ballew
letter where the purpose, object, or foreseeable effect of
that contribution is to influence the election of a candidate
for delegate, alternate delegate or International Officer of
2. Ballew is to reimburse the Trust for the cost and expense
of the preparation and disbursement of the Ballew letter.
3. Ballew is to bear the expense and distribute copies of a
notice to be sent to all persons to whom he had sent his
letter advising the recipients of the subject Election Rules
violation and a disclaimer by the Trust of the Ballew letter.
(Dec.In.Ad. at 13-16). The Trust and Ballew appeal the
findings of the Independent Administrator to this Court.
With respect to the electoral provisions of the Consent
Decree, the Court of Appeals and this Court have now
determined that the Investigations Officer and Independent
Administrator are stand-ins for the General President and GEB,
who properly delegated their power to those Court Officers
pursuant to Article XXVI, § 2 of the IBT Constitution. United
States v. International Brotherhood of Teamsters, supra,
931 F.2d 177 aff'g July 10, 1990 Opinion & Order, 742 F. Supp. 94;
May 6, 1991 Opinion & Order, 764 F. Supp. 787, 789 (S.D. N Y
1991); January 17, 1990 Opinion & Order, 728 F. Supp. 1032,
1048-57, aff'd 907 F.2d 277 (2d Cir. 1990);
This Court and the Court of Appeals have interpreted ¶ K.16
to mean that decisions of the Independent Administrator "are
entitled to great deference." 905 F.2d 610, 616 (2d Cir. 1990)
aff'g March 13, 1990 Opinion and Order, 743 F. Supp. 155
1990); May 9, 1991 Memorandum & Order, 764 F. Supp. 797
(S.D.N.Y. 1991); May 6, 1991 Opinion & Order, supra, 764
F. Supp. at 789; December 27, 1990 Opinion & Order, 754 F. Supp. 333,
337 (S.D.N.Y. 1990); September 18, 1990 Opinion & Order,
745 F. Supp. 189, 191-92 (S.D.N.Y. 1990); August 27, 1990
Opinion & Order, 745 F. Supp. 908, 911 (S.D.N.Y. 1990); March
13, 1990 Opinion & Order, supra, 743 F. Supp. at 159-60, aff'd
905 F.2d 610, 622; January 17, 1990 Opinion & Order, supra, 728
F. Supp. at 1048-57, aff'd 907 F.2d 277 (2d Cir. 1990); November
2, 1989 Memorandum & Order, 725 F. Supp. 162, 169 (S.D.N Y
1989); Joint Council 73, et al. v. Carberry, et al.,
741 F. Supp. 491, 493 (S.D.N.Y. 1990); Local 27 v. Carberry, et al.,
July 20, 1990 at 3-4, 1990 WL 108348 (S.D.N.Y. 1990).
Petitioners make the following four arguments on appeal to
this Court: (1) There is no jurisdiction over the Trust; (2)
carrying out the curative steps would interfere with the
Trust's fiduciary duties to its participants and
beneficiaries; (3) Ballew did not violate the election rules;
and (4) the curative steps are improper. These arguments will
be addressed in turn.
A. Jurisdiction over the Trust and Ballew
The Trust and Ballew argue that since they were not parties
to the underlying litigation and non-signatories to the
Consent Decree, they cannot be held bound by the Election
Rules. They further argue that the Trust and its employees are
legally independent from the IBT. This Court and the Court of
Appeals have rejected virtually identical arguments numerous
The Court of Appeals has repeatedly ruled that IBT
affiliated local unions, joint councils and area conferences
— which specifically argued that they were (i) not parties to
the underlying litigation, (ii) non-signatories to the Consent
Decree, and (iii) legally independent of the IBT — are subject
to the Consent Decree, and the election rules promulgated
pursuant to the Consent Decree. United States v. International
Brotherhood of Teamsters, supra aff'g July 10, 1990 Opinion &
Order, supra; United States v. International Brotherhood of
Teamsters, supra, 905 F.2d 610, aff'g March 13, 1990 Opinion &
Order, supra; United States v. International Brotherhood of
Teamsters, 907 F.2d 277, aff'g January 17, 1990 Opinion &
Order, supra; Local 27 v. Carberry, supra.
This Court has determined that it may extend the reach of
the election rules to reach entities which could jeopardize
the IBT membership's right to a fair, free and honest
election, pursuant to its authority under the All Writs Act,
28 U.S.C. § 1651. This Court has ruled that Yellow Freight
System, Inc., ("Yellow Freight") a company employing IBT
members but not affiliated with the IBT, was subject to the
election rules because they were in a position to frustrate the
implementation of the Consent Decree and the election rules,
lawful orders of this Court. April 3, 1991 Memorandum & Order,
slip op., at 4-6, 1991 WL 51065 (S.D.N.Y. 1991) ("Yellow
Freight"). An injunction was issued under the All Writs Act
requiring that all Consent Decree related litigation must be
before this Court. January 17, 1990 Opinion & Order, supra,
728 F. Supp. 1032 (S.D.N.Y.), aff'd 907 F.2d 277 (2d Cir. 1990).
The need to assert jurisdiction over the Trust and Ballew is
even more compelling than in Yellow Freight. The Trust is an
affiliated IBT entity, and Ballew its employee. Four of its
trustees are candidates for International Office and have a
direct stake in the outcome of this election. The Trust
administers the pension benefits of over 300,000 WCT members.
Like Yellow Freight, the Trust and Ballew are in a position to
frustrate the membership's right to a free, fair and honest
The Trust and Ballew argue that they cannot be bound by the
Consent Decree's election process by the Supreme Court
decision in Martin v. Wilks, 490 U.S. 755, 109 S.Ct. 2180,
2184, 104 L.Ed.2d 835 (1989), since by that decision
non-parties to a Consent Decree cannot be bound by its terms.
The Second Circuit has twice held that Martin v. Wilks is
inapplicable to this ongoing case, United States v.
International Brotherhood of Teamsters, supra; United States v.
International Brotherhood of Teamsters, supra, 905 F.2d at 622
(2d Cir. 1990), and this Court has so held in five published
opinions. See Yellow Freight, supra; January 29, 1991 Opinion &
Order, 754 F. Supp. 333, 134 F.R.D. 50 (S.D.N.Y. 1991); Joint
Council 73 v. Carberry, et al. supra; January 17, 1990 Opinion
& Order, supra; November 2, 1989 Memorandum & Order,
Martin v. Wilks concerns the procedural fairness due entities
affected by a Consent Decree. By the election rules, the Trust
and Ballew have had a full and complete opportunity to argue
the substance of their claims before the Election Officer, the
Independent Administrator, and this Court. In addition, they
have twice moved this Court for stays of the curative steps,
and have filed a notice of appeal, and petitions for a stay
pending appeal and mandamus to the Court of Appeals. The Trust
and Ballew have had their day in Court.
B. The Trust and Ballew's Fiduciary Duties
Ballew and the Trust argue that the curative steps would
force them to violate their duties as fiduciaries of the
Trust. Ballew and the Trust also argue that the Ballew letter
was an appropriate exercise of Ballew's responsibilities under
The status of the Trust, and the duties of Ballew as a
fiduciary of the Trust are set by §§ 404-06 of ERISA, 29 U.S.C. § 1104-06.
The fiduciary duty to provide plan comparisons is
set out at § 102 of ERISA, 29 U.S.C. § 1022. Section 102 of
ERISA requires trustees to furnish participants with "summary
plan descriptions" upon request, and contains no statutory
requirement to specifically compare one plan with another, as
done by Ballew here. Id. Thus, the relief ordered would not
hinder the Trust's duty to provide plan information.
The record established by the Election Officer and
Independent Administrator demonstrate that the Ballew letter
was not an appropriate response to a participant inquiry, but
instead a partisan attack on the Carey campaign. It was found
that there was no prior Trust practice of selectively
comparing the Trust with another plan outside of collective
bargaining or organizing efforts. (Dec.In.Ad. at 8-10).
Rather, it was found that the timing and content of the Ballew
letter were done only to respond to the Carey campaign.
(Dec.In.Ad. at 8). Thus, enjoining such future action would
not infringe on any fiduciary duties.
Accordingly, no part of the curative steps would prevent the
Trust or Ballew from responding to appropriate inquiries by
Trust beneficiaries for information as is their right under
§ 102 of ERISA.
C. Violations of the Election Rules
Ballew and the Trust argue that the record does not support
the finding of the Election Officer and Independent
Administrator that Ballew's actions constituted a contribution
that had a direct or indirect effect on Mr. Carey's candidacy
in violation of Article X, § 1.b.(1) of the election rules. The
record before this Court is to the contrary. Ballew and the
Trust violated the election rules.
The Court finds no basis for finding that the conclusion
that the Trust and Ballew violated the election rules is
arbitrary and capricious. In fact, the evidence before the
Independent Administrator is credible to support the finding
that the Ballew letter was a contribution intended to
influence the 1991 IBT election.
Further, the Independent Administrator also determined that
Article XI, § 2 of the election rules gives the Election
Officer authority to correct conduct:
[I]f the Election Officer determines that these
rules have been violated or that any other
conduct has occurred which may prevent or has
prevented a fair, honest, and open election, the
Election Officer may take whatever remedial
action is necessary.
The Independent Administrator and Election Officer determined
that the Ballew letter was anti-Carey campaign literature that
would have the effect of preventing a fair, honest and open
election. The finding is supported by the record.
D. The Propriety of the Curative Steps
The Election Officer ordered the curative steps in the
context of an ongoing IBT election that will not be over until
December, 1991. Well-tailored remedies for violations of the
election rules should have the effect of (i) discouraging
future violations of the election rules, and (ii) curing the
improper taint of the conduct. The curative steps are
calculated to bring these about.
The curative step that prevents the Trust and Ballew from
future violations of the election rules only preclude the
Trust and Ballew from violating the Consent Decree and
election rules, lawful orders of the Court. The curative steps
do not prevent the Trust or Ballew from carrying out any of
their lawful duties.
The curative step that directs Ballew to reimburse the Trust
for the cost of the plan comparison, and that he circulate a
disclaimer by the Trust is reasonable step to restore the
status quo ante.
The curative steps do not implicate Ballew's first amendment
right to free speech. Ballew sent his letter in his official
capacity as trustee of the Trust. An ERISA trustee has no
right to influence an election for union office. Further, the
Consent Decree bars anyone from taking any improper action
which would influence the 1991 election. Additionally, the
Trust and Ballew cannot establish the state action necessary
for a first amendment violation. This Court has held many
times for state action purposes that the Court officers act as
stand-ins for the IBT General President and GEB, and not as
the Government. May 9, 1991 Opinion & Order, supra, 764 F. Supp. 797
(S.D.N.Y. 1991); Cozza v. Lacey, 740 F. Supp. 285 (S.D.N Y
1990); January 17, 1990 Opinion & Order, supra.
Ballew and the Trust have not demonstrated that the curative
steps were arbitrary or capricious, and ...