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U.S. v. INTERNATIONAL BROTH. OF TEAMSTERS

October 29, 1991

UNITED STATES OF AMERICA, PLAINTIFF,
v.
INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA, AFL-CIO, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Edelstein, District Judge:

  OPINION AND ORDER

This decision arises from the implementation of the rules for the International Brotherhood of Teamsters ("IBT") International Union Delegate and Officer Election (the "Election Rules"), promulgated by the Election Officer and approved as modified by this Court and the Court of Appeals. July 10, 1991 Opinion & Order, 742 F. Supp. 94 (S.D.N.Y. 1990), aff'd, 931 F.2d 177 (2d Cir. 1991). The Government brought an Order to Show Cause why this Court should not: (1) affirm the September 18, 1991 decision of the Independent Administrator in Election Appeal 91 — Elec.App.-187, which affirmed the September 9, 1991 decision of the Election Officer in Election Office Case No. P-760-LU25-ENG; (2) enter an order directing Star Market, Inc. ("Star Market") to comply fully, within twenty-four hours, with the September 18, 1991 decision of the Independent Administrator in Election Appeal 91 — Elec.App.-187; (3) in the event that Star Market fails to comply with this Court's order, adjudge Star Market in civil contempt and impose coercive sanctions, including substantial daily fines of at least $10,000 per day until Star Market complies as directed; and (4) award the Government, the Election Officer and the Independent Administrator such other relief, including attorney's fees, as this Court deems appropriate.

I. BACKGROUND

The Election Officer was appointed by the Court pursuant to its March 14, 1989 Order (the "Consent Decree"), which was agreed to by the plaintiff United States of America (the "Government") and the defendant IBT in settlement of the bulk of this civil racketeering action. The Election Officer is empowered to supervise the implementation of the Consent Decree's electoral provisions, culminating in the first-ever direct rank and file election of IBT International officers. See Consent Decree, ¶ 12(D); October 18, 1989 Opinion & Order, 723 F. Supp. 203, 206-07 (S.D.N.Y.), appeal dismissed, No. 89-6252 (2d Cir. Dec. 13, 1989), cert. denied, ___ U.S. ___, 110 S.Ct. 2618, 110 L.Ed.2d 639 (1990). Pursuant to his supervisory authority, the Election Officer promulgated the Election Rules, which were approved as modified by this Court and the Court of Appeals. July 10, 1991 Opinion & Order, 742 F. Supp. 94 (S.D.N.Y. 1990), aff'd, 931 F.2d 177 (2d Cir. 1991). The Election Rules are the linchpin of the Consent Decree's efforts to cleanse the IBT of La Cosa Nostra's corrupt influences. October 18, 1989 Opinion & Order, 723 F. Supp. at 206-07; October 25, 1991 Order, slip opinion at 1 (S.D.N Y 1991). The Election Rules protect, inter alia, the rights of IBT members to participate in union election campaign activities, see Art. VIII, § 10(a), and enable the Election Officer to respond to violations of the Election Rules, or any other conduct preventing a fair, honest, and open election, with a wide range of remedial measures. See Art. XI, § 2.

This matter involves the election protest of Neal J. Henderson, who is a member of IBT Local 25 in Boston, Massachusetts.*fn1 The principle officer of Local 25 is IBT General President William J. McCarthy. Before his discharge, Henderson had been employed by Star Market since 1977 as a warehouseman in the perishables department of one of its Boston-area facilities. Henderson has been a union steward at Star Market since 1986.

Last spring Henderson was elected as a delegate to the IBT International Union Convention on a slate supporting the candidacy of Ron Carey for IBT General President. Henderson and his slate were opposed by an incumbent-officer slate headed by McCarthy, which supported the candidacy of R.V. Durham for IBT General President.

After winning election as a Local 25 delegate to the International Union Convention, Henderson continued to engage openly, and with Star Market's knowledge, in pro-Carey campaign activities at his place of employment. Star Market's supervisors made disparaging remarks to Henderson about his candidacy for delegate and his other pro-Carey campaign activities.

At about 9:00 p.m., Henderson completed his pre-shift overtime assignment. After checking with his fellow employees whether his services were needed, he left the Star Market facility to buy some cold medicine, get something to eat, and conduct some union business. Upon returning for his regular shift at 10:00 p.m., Star Market supervisory personnel suspended Henderson. On May 13, 1991, Star Market management terminated Henderson because he "stole company time" by leaving the facility before his pre-shift overtime period ended.

Henderson filed a grievance pursuant to the collective bargaining agreement between Local 25 and Star Market. On June 12, 1991, an arbitrator held a hearing on Henderson's grievance. In a decision dated July 17, 1991, that was based solely upon the terms of the collective bargaining agreement, the arbitrator found that Star Market was justified in discharging Henderson and therefore denied his grievance. Henderson also filed a protest under the Election Rules, asserting that his discharge was politically motivated. The Election Officer deferred action on Henderson's protest pending the arbitrator's decision.

Because the arbitrator's decision did not address Henderson's claims of retaliation in violation of the Election Rules, the Election Officer decided to go forward with Henderson's protest. The Election Officer's investigation of the protest revealed that on May 2, 1991, Star Market employees other than Henderson who worked pre-shift overtime in the perishables department left their work stations before the overtime period ended. Only Henderson, however, was terminated for doing so. The investigation further revealed that the discipline imposed on Henderson was far more severe than that imposed on others who had committed similar infractions.

In his September 9, 1991 decision, the Election Officer found that Star Market had retaliated against Henderson for engaging in Union Election campaign activity that is protected by the Election Rules. Accordingly, the Election Officer directed Star Market to reinstate Henderson to his former position with full seniority, full back pay, and full restoration of all other benefits, and to cease and desist from discriminating against Henderson or any other employee on account of campaign or other activities protected by the Election Rules.

Exercising its rights under the Election Rules, Star Market appealed the Election Officer's September 9, 1991 decision to the Independent Administrator. See Election Rules, Art. XI, § 1(a)(5). On September 18, 1991, the Independent Administrator issued a decision affirming the Election Officer's decision in all respects. In that decision, the Independent Administrator found that "[g]iven the background here, there can be only one explanation for Star Market's actions. It was retaliating against Mr. Henderson because of his political activity and his support of Carey. The Election Rules simply do not tolerate such action." (Ind.Admin.Dec. at 10.)

Star Market has neither complied with the Independent Administrator's directive to reinstate Henderson, nor has it appealed the Independent Administrator's decision to this Court. Pursuant to Article XI, § 1(a)(8), the Independent Administrator's decision "must be followed unless it is stayed or overturned by the Court." In a letter to the Government dated September 26, 1991, counsel for Star Market expressly stated that Star Market would not comply, whereupon the Election Officer requested that the Government initiate appropriate contempt proceedings against Star Market. By letter dated October 3, 1991, the Government informed Star Market's counsel that unless the company complied with the Election Officer's directives by October 7, the Government would initiate civil contempt proceedings before this Court. By letter dated October 10, 1991, Star Market's counsel informed the Government that the company would not comply.

On October 24, 1991, the Government brought an Order to Show Cause why this Court should not: (1) affirm the September 18, 1991 decision of the Independent Administrator in Election Appeal 91 — Elec. App.-187, which affirmed the September 9, 1991 decision of the Election Officer in Election Office Case No. P-760-LU25-ENG; (2) enter an order directing Star Market to comply fully, within twenty-four hours, with the September 18, 1991 decision of the Independent Administrator in Election Appeal 91 — Elec.App.-187, which affirmed the September 9, 1991 decision of the Election Officer in Election Office Case No. P-760-LU25-ENG; (3) in the event that Star Market fails to comply with this Court's order, adjudge Star Market in civil contempt and impose coercive sanctions, including substantial daily fines of at least $10,000 per day until Star Market complies as directed; and (4) award the Government, the Election Officer and the Independent Administrator such other relief, including attorney's fees, as this Court deems appropriate. This Court signed the Order to Show Cause and made it returnable for October 28, 1991, at which time this Court heard argument from both the Government and Star Market.

II. DISCUSSION

Star Market, although it did not appeal the Independent Administrator's decision to this Court, now objects to that decision. Specifically, Star Market asserts that: (1) this Court lacks subject matter jurisdiction because Star Market is not subject to the Consent Decree; (2) this Court lacks personal jurisdiction over Star Market; (3) the Election Officer and the Independent Administrator's handling of this matter deprived Star Market of due process; (4) the arbitrator's decision is a final and binding adjudication of this matter that pre-empts the decisions of the Election officer and the Independent Administrator; and (5) the Election Officer violated the Election Rules. This Court finds that Star Market waived its objections to the Independent Administrator's decision, and, in the alternative, that Star Market's objections are wholly without merit.

A. Waiver

Pursuant to the Election Rules, Article XI, § 1(a)(8), the Independent Administrator's decision "must be followed unless it is stayed or overturned by the Court." The Election Rules have the force of Court Orders and are "enforceable upon pain of contempt." July 10, 1990, Opinion & Order, 742 F. Supp. 94, 108 (S.D.N.Y. 1990), aff'd, 931 F.2d 177 (2d Cir. 1991). Star Market did not take the opportunity to appeal the Independent Administrator's decision to this Court. Rather, it brazenly disregarded that decision. Only now that the Government has moved for ...


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