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U.S. v. LOCAL 1804-1

United States District Court, Southern District of New York


January 30, 2003

UNITED STATES OF AMERICA, PLAINTIFF,
v.
LOCAL 1804-1, INTERNATIONAL LONGSHOREMEN'S ASSOCIATION, ET AL., DEFENDANTS.

The opinion of the court was delivered by: John S. Martin Jr., United States District Judge

ORDER

WHEREAS, on January 3, 1992, the Court approved a Consent Decree concerning Local 1588 of the International Longshoremen's Association ("ILA") which, among other things, permanently enjoined all present and future officers, agents, representatives, employees, and members of Local 1588 from: engaging in any act that constitutes or furthers an act of racketeering activity; knowingly associating with members and associates of organized crime; and obstructing or interfering with the relief ordered pursuant to the Decree; and

WHEREAS, on December 6, 2002, plaintiff United States of America (the "Government"), alleging violations of the Decree, moved the Court pursuant to Rule 60(b) of the Federal Rules of Civil Procedure and the Court's inherent authority for an order appointing an administrator to govern the affairs of Local 1588; and

WHEREAS, on December 23, 2002, the Court gave notice to the parties that on January 16, 2003, the Court would hold a hearing on the issue of whether Local 1588 was in contempt of the Consent Decree and whether, as a remedy for contempt, the Court should grant the Government's motion for the appointment of an administrator; and WHEREAS, on January 16, 2003, the Court conducted a hearing at which the following witnesses testified: Special Agent Dennis Bolles of the Federal Bureau of Investigation, former Local 1588 President John Angelone, former Local 1588 President John Timpanaro, ILA Vice President John Baker, and Local 1588 attorney Ralph Lamparello; and at which Nicholas J. Furina and Ralph Esposito, per stipulation and order, declined to answer any questions on the basis of their privilege against self-incrimination under the Fifth Amendment to the United States Constitution; and

WHEREAS, the Court finds that the permanent injunctions of the Consent Decree are clear and unambiguous; and

WHEREAS, the Court finds that Local 1588, through its officers, blatantly and repeatedly violated the permanent injunctions of the Consent Decree; and

WHEREAS, the Court finds, based upon their criminal convictions, that Local 1588 Executive Board members John Angelone and Eugene G'Sell engaged in acts of racketeering after entry of the Consent Decree; and

WHEREAS, the Court finds that Joseph Lore and Nicholas Furina are associates of the Genovese Family of La Cosa Nostra; and

WHEREAS, the Court finds that, after entry of the Consent Decree, Local 1588 members John Angelone and Eugene G'Sell engaged in prohibited associations with Lore while Angelone and G'Sell were serving as members of the Executive Board of Local 1588; and

WHEREAS, the Court finds that, beginning prior to entry of the Consent Decree and continuing for years after entry of the Decree, the Genovese Crime Family, through Lore, dominated and controlled Local 1588, through its Executive Board; and

WHEREAS, the Court finds that Local 1588 member John Timpanaro engaged in prohibited associations with Furina before and after Timpanaro assumed office as President of the Local; and WHEREAS, the Court finds that Local 1588 has not been reasonably diligent in attempting to comply with the Consent Decree and knowingly tolerated violations of the Decree; and

WHEREAS, the Court finds that the Government has proven, by clear and convincing evidence, that Local 1588 is in civil contempt of the Consent Decree; and

WHEREAS, the Court finds that, based on the evidence presented at the hearing, the efforts taken to date by Local 1588 and by its parent organization, the ILA, to achieve the stated goals of the Consent Decree, including the ILA's December 2002 imposition of a trusteeship, are not likely to be effective in ensuring compliance with the Decree and in ridding Local 1588 of the influence of organized crime; and

WHEREAS, the Court finds that the appointment of an Administrator with the authority set forth in this order is necessary to achieve compliance with the Consent Decree and to prevent further violations of the Decree; and

WHEREAS, the Court finds that, given the extent of organized crime's historic domination of this Local, the continuing and extremely serious nature of the threat of organized crime influence at the Local, the violations of the Consent Decree established by the Government in its papers and at the contempt hearing, and, in particular, the wilful obstruction by the Local 1588 Executive Board members of the efforts of the Court-appointed ombudsman, any other means would not be as effective at achieving compliance with the Consent Decree and preventing future violations of the Decree; and

WHEREAS, to bring about compliance with the Consent Decree and to prevent future violations of the Decree, the Court has authority to enter this Order pursuant to its contempt powers, its inherent authority, and Rule 60(b) of the Federal Rules of Civil Procedure;

NOW, THEREFORE, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED as follows:

1. Appointment of Administrator. The Court hereby establishes the office of Administrator for Local 1588 and appoints Robert J. McGuire to serve as Administrator.
2. Term of Office. The authority of the Administrator established pursuant to this Order shall continue until eighteen months after certification of the results of the next Local 1588 election, provided, however, Local 1588, the Government, or the Administrator may petition the Court to extend the term of the Administrator upon a showing of good cause, and provided further that, at any time following certification of the election, Local 1588, the Government, or the Administrator may petition the Court to terminate the authority of the Administrator on the grounds that Local 1588 has been brought into compliance with the Consent Decree, Local 1588 members are no longer violating the Consent Decree, and the goals of the Consent Decree and this Order have been achieved.
3. Authority. Upon appointment by the Court and continuing until certification of the next Local 1588 election, the Administrator appointed by this Court shall have the authority to conduct the affairs of Local 1588. The Administrator's authority to conduct the affairs of Local 1588 shall include all authority that the ILA Constitution, the Local 1588 Constitution and By-Laws, and any and all provisions of law confer upon the President, Secretary-Treasurer, and the Executive Board of Local 1588. The Administrator may in the Administrator's discretion delegate such authority as is necessary to direct the daily operations of the Local. In addition, the Administrator shall have the following authority, which the Administrator shall retain after certification of the election and until further order of the Court.
a. Disciplinary Authority. The Administrator shall have the responsibility and authority to ensure that Local 1588 develops, implements, and maintains effective procedures to discipline Local 1588 members for misconduct. The Administrator shall exercise such disciplinary authority as the Local Executive Board and Local Secretary-Treasurer are presently authorized by the Local 1588 Constitution and By-Laws and by the Article XVIII of the ILA Constitution, as well as any and all applicable provisions of law. The Administrator shall have the authority to initiate disciplinary charges against any officer, member, or employee of Local 1588, and shall have the right and power to remove, suspend from office or membership, expel from office or membership, disqualify to run for office, or forfeit benefits (except as prohibited by law) or otherwise discipline any union member, officer, employee, or agent who (1) violates the injunctive provisions of the Consent Decree; (2) furthers the direct or indirect influence of organized crime or the threat of such influence now or in the future; or (3) violates the ILA or Local 1588 Constitution. Any decision of the Administrator shall be final and binding, subject only to the Court's review as provided herein.
b. Monitoring Authority. The Administrator shall have authority to take such reasonable steps that are lawful and necessary to be fully informed about the activities of Local 1588. The Administrator shall have the following rights and powers:
i. To examine all books and records of Local 1588, including, without limitation, books and records of Local 1588 in the possession or control of third-parties;
ii. To attend all meetings of Local 1588, including, without limitation, all meetings of the Executive Board and meetings of the general membership. The Executive Board shall provide the Administrator with reasonable advance notice of all meetings;
iii. To take and require sworn statements or sworn in-person examinations of any officer, member, or employee of Local 1588, provided that the Administrator shall give the person to be examined no less than five business days notice of the time and place of the examination.
iv. To take, upon notice and application for cause made to this Court, the sworn statements or sworn in-person examinations of persons who are not officers or members of Local 1588, including, without limitation, officers and employees of any entity that employs Local 1588 members, and including, without limitation, hiring agents for Local 1588 employers.
c. Veto Authority. The Administrator shall have the authority to veto (1) any expenditure of union funds, transfer of union property, contract (other than a collective bargaining agreement); (2) appointment and continued employment of any union officer, agent, representative or employee; and (3) any proposed change to the Constitution and By-Laws of Local 1588. The Administrator may exercise veto authority if the Administrator has reason to believe that the expenditure, transfer, contract, appointment, or proposed change to the Constitution and By-Laws (1) constitutes or furthers an act of racketeering activity within the definition of 18 U.S.C. § 1961; (2) constitutes or contributes to the association, directly or indirectly, of Local 1588 or any of its members or employees or agents with any member or associate of organized crime; (3) constitutes or furthers fraud or abuse of Local 1588 funds or property, or (4) is manifestly unreasonable.
d. Reports to Membership. The Administrator shall have the authority and the responsibility to communicate with the membership, and to distribute information and materials to the membership about the Consent Decree, this Order, the Administrator's activities, and members' rights and responsibilities under the Consent Decree and this Order.
e. Reports to the Court. The Administrator shall have authority to communicate with the Court whenever the Administrator sees fit, but, in any event, the Administrator shall have the responsibility to file with the Court a report of the Administrator's activities every four months. A copy of the Administrator's report shall be served upon counsel for the Government and Local 1588.
f. Hiring Authority. The Administrator, upon application to the Court and for good cause shown, shall have the authority to employ accountants, consultants, experts, investigators, attorneys, or other personnel and delegate any of his/her powers or duties to such persons, where in the Administrator's discretion, such personnel and delegation are necessary to execute the Administrator's duties as set forth herein.
4. Elections.

a. The Administrator shall schedule elections no later than eighteen months following the Administrator's appointment. All candidates for elective office at Local 1588 must be free from corruption and the influence of any criminal group. The Administrator will review the candidacy of any individual seeking union office. In the event the Administrator discovers information indicating that any potential candidate has (1) violated the injunctive provisions of the Consent Decree; (2) furthered the direct or indirect influence of organized crime or the threat of such influence now or in the future, the Administrator may disallow the particular nomination or election of the individual.
b. The Administrator shall supervise, or appoint an election supervisor, to supervise the nomination and election of the officers of Local 1588 in the next election. The Administrator shall certify to the Court the election results for such election as promptly as possible after balloting. Upon such certification, the duly elected officers shall constitute the lawful representatives of the union. The term "supervise" shall have the same meaning as given to that term in cases arising under Title IV of the Labor-Management Reporting ans Disclosure Act, 29 U.S.C. § 481, et seq.
5. Duty to Cooperate with Administrator. All officers, members, employees, agents and representatives of Local 1588 shall cooperate fully with the Administrator. Failure to cooperate with the Administrator shall be a violation of this Order punishable by contempt of Court, and shall be deemed conduct detrimental to the welfare of the ILA within the meaning of Article XVIII of the ILA Constitution.
6. Compensation and Expenses. The compensation and expenses of the Administrator shall be paid by Local 1588, provided, however, that nothing in this Order shall prevent the ILA from contributing to the compensation and expenses of the Administrator. The Administrator shall submit to the Court monthly his bill for his services and expenses, with a copy to Gleason & Matthews, counsel to the ILA. Unless an objection is filed with the Court within two weeks of the date in which the Administrator's bill is filed in this Court, the Administrator is authorized to pay the amount due from the accounts of Local 1588.
7. Indemnification. Local 1588 shall purchase a policy of insurance and/or bonds in an appropriate amount to protect Local 1588, the Administrator, and any persons hired by or acting on behalf of the Administrator, from personal liability for any of their action on behalf of Local 1588 or the Administrator. If such insurance is not available, or if Local 1588 so elects, Local 1588 shall indemnify the Administrator and any persons hired by the Administrator from any personal liability (and any costs incurred to defend against any claim of liability) for any of their actions on behalf of Local 1588 or the Administrator pursuant to this Order. In addition, the Administrator and any persons designated or hired by him/her to act under this Order shall enjoy whatever privileges and immunities may exist under the law for court officers.
8. Continuing Jurisdiction and Applications. The Court shall retain exclusive jurisdiction to supervise the activities of the Administrator and to entertain any applications by the Administrator, the Government, and ILA Local 1588. This Court shall have exclusive jurisdiction to decide any and all issues relating to this Order. Within thirty (30) days after receipt of any decision by the Administrator imposing discipline, exercising veto authority, or disqualifying a candidate from running for office, any person aggrieved by any decision of the Administrator shall have the right to seek review in this Court. In reviewing decisions of the Administrator, the Court shall give substantial deference to the Administrator's decisions, and shall apply the same standard applicable to judicial review of final federal agency action under the Administrative Procedure Act.
9. All Writs Act. The Government and/or the Administrator may apply to this Court at any time pursuant to the All Writs Act, 18 U.S.C. § 1651(a), for relief as against non-parties to the Consent Decree or this Order, including the ILA, employers of Local 1588 members, and any other non-party who may be in a position to interfere with the implementation of the Consent Decree or this Order. Upon such application, the Court may grant such relief as may be necessary or appropriate to effectuate and prevent the frustration of the Consent Decree and this Order. The Government and/or the Administrator may apply to the Court for the issuance of subpoenas necessary to obtain any information, documents, or testimony relevant to such an application.
10. Modification and Enforcement. Either party may apply to the Court to modify or enforce this Order, and the Court may grant such relief as may be equitable and just, having due regard for the purposes of the underlying litigation, the remedial purposes of the Consent Decree, and the circumstances existing at the time of the Government's application for this Order.
11. Prior Decree. Nothing in this Order is to be construed as affecting the validity of the Consent Decree entered in this action on January 3, 1992, in this action.
SO ORDERED

20030130

© 1992-2003 VersusLaw Inc.



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