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United States v. District Council of New York City

August 13, 2007


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


This case is on remand from the Second Circuit. See 2007 WL 1157143 (2d Cir. Apr. 18, 2007). The question on remand is the appropriate remedy for the violation by defendant District Council of the Consent Decree entered in the case. In addition to submissions on the remedy issue, the District Council has also moved to modify the Consent Decree. The government has made a motion for remedies which, if granted by the Court, would impact collective bargaining agreements ("CBAs") entered into in 2006 between the District Council, as bargaining agent for its constituent local unions of carpenters, and associations of building contractors who employ carpenters. Principally for that reason, the Court granted the motions of four contractors' associations to intervene in the action (the "Intervenors" or "the Associations") so that they might be heard on the question of remedy.

Officers and representatives of the District Council and of the Intervenors have recently filed sworn declarations and other submissions addressing these aspects of the case. The government has not filed its responsive papers because it takes the position that before doing so, it is entitled to discovery. The District Council and the Intervenors resist the government's request for discovery and say that none should be allowed. In the alternative, these parties contend that if the government is granted discovery, such discovery should be strictly limited and the Intervenors should be entitled to reciprocal discovery. This opinion resolves that dispute.


The government's request for discovery was first contained in a letter to the Court dated June 4, 2007. The government stated in broad terms that it "seeks the authority to issue document subpoenas and take depositions of the witnesses whose declarations were included as part of the most recent submissions to the Court," discovery that "will enable the Government to explore the truth of these and other allegations and their relevance vel non to the proceedings now before the Court." Govt.'s June 4, 2007 Letter at 1. This request prompted a number of objections in letter form from counsel for the District Council and the Intervenors which I will consider infra. But the scope of the government's intended discovery was narrowed somewhat in its reply letter dated June 15, 2007, which states in relevant part at 2:

With respect to the District Council's letter, the Government does not anticipate taking any depositions of the individuals who provided declarations on the District Council's behalf in support of their motion to terminate the consent decree. At this time, we anticipate seeking from the District Council*fn1 only notes and other documents evidencing the Associations' knowledge of the consent decree and the job referral rules.

Therefore it appears that the government's focus in discovery, for the present at least, is upon the assertions contained in declarations submitted by officers and representatives of the four Intervenor contractors' associations. Thus the government says that it "is seeking discovery because the Associations have submitted declarations in support of their motions with respect to the contempt remedy, and because it is entitled to test the accuracy of those representations." Id. I will now summarize those declarations, some submitted in support of an Association's motion to intervene, others specifically addressing the government's proposed contempt remedies. Thereafter I will consider the letter briefs of counsel for the District Counsel and the Intervenors, which oppose the government's discovery requests, and the government's reply letter brief supporting them.

Joseph Olivieri is the executive director of The Association of Wall-Ceiling & Carpentry Industries of New York, Inc. ("WCCI"), whose president, Michael Weber,describes in his own affidavit as "an employer association of approximately one hundred forty contractors and sub-contractors engaged in any phase or phases of gypsum drywall construction, acoustical ceiling construction, and/or general carpentry construction doing business in the State of New York." Weber Aff. ¶ 2. Olivieri is also one of the "management trustees" for the District Council's benefit funds, which depend upon contributions mandated by the CBAs from employers. Olivieri's affidavit states that beginning in 1993, the funds' trustees have engaged in "a concerted effort to eradicate corruption," Olivieri Aff. ¶ 3, and goes on to describe the particulars of that effort, ¶¶ 4-8.

The affidavit of Michael Weber, WCCI's president, describes the manner in which the changes the 2001 and 2006 CBAs made in the job referral system came about and the importance of those changes to contractors. Weber's analysis is echoed by the declarations of officers of other Associations. Stated succinctly, the Associations' position is that prior to the 2001 CBAs, when the 50/50 Rule governed job referrals and employer requests for carpenters on the out-of-work list were often not heeded, the District Council's referrals, i.e., carpenters selected by the District Council and sent to a jobsite, were often "unqualified to do the work at issue, were unreliable, were unfamiliar with local standards and had never worked on the particular job before" and had to be replaced, which resulted in delaying the project and increasing the contractor's costs, consequences "especially troubling because the Association's members were increasingly competing against nonunion construction management firms." Weber Aff. ¶¶ 5-7. Weber states: "The completion of construction jobs that have workforces made up of 50% of the District Council's selection, which does not include the employer's requests, will take longer; this delay in carpentry work will affect every aspect of a construction job, such as electrical work, plumbing, etc. Entire jobs, many of which consist of some of the largest construction projects in New York City, will be held up and delayed." Id. ¶ 15. Moreover, contractors are presently performing or have bid out work for future jobs in reliance upon the Request System contained in the 2001 and 2006 CBAs. Weber asserts that "[i]f the employers are denied their right to choose the most efficient, skilled, reliable and productive carpenters, their costs skyrocket, their timelines change and their already submitted bids become inaccurate and a liability." Id. ¶ 17.

These problems recurred despite provisions in the previous CBAs that "the District Council would consider employer requests for specific workmen"; in practice, "the District Council often was not heeding such requests." Weber Aff. ¶ 5. Weber was a member of WCCI's bargaining committee for the 2001 CBA re-negotiation. The parties began the negotiations taking extreme positions. The District Council wished to revise the CBAs by eliminating all employer requests for particular carpenters as part of the Union's 50 percent jobsite share and requiring a strict 50/50 allocation system. The Associations wished to revise the CBAs so that all employer requests for specific carpenters would be honored.*fn2 The 2001 CBAs that emerged represented a compromise. The employers gained the right to select all carpenters for a job: the "Request System."*fn3 But the employers were required to limit their requests to New York City District Council carpenters (previously they could hire carpenters from other union jurisdictions), and the carpenters gained a

25.75% wage increase, a shorter workweek with increased breaks, and modifications in the union apprentice system. Weber says that his Association only agreed to these concessions "as part of the give-and-take of the collective bargaining process because it was receiving the benefit of having all specific requests for District Council carpenters on the out-of-work list honored. The Association would not have agreed to these terms if the Request System was not included in the CBA." Id. ¶ 11. Weber makes the point that if a Court-imposed remedy does away with the Request System, the employers will lose the benefit of their bargain while remaining liable for the increased Union wages and benefits.

Weber also states explicitly that "[a]t no time during the collective bargaining negotiations did the District Council discuss the requirements of the Consent Decree that a requested carpenter need to have worked with the employer in the previous six-month period." Weber Aff. ¶ 12. Weber adds that the Association "was not aware of the contempt proceedings brought by the Government as a result of the Request System in the CBA"; that "when the Association and the District Council entered into the collective bargaining for the 2006-2011 CBA, the Association did not know that the Request System was potentially prohibited by the Consent Decree"; and that the Association "was made aware of this case and its potential effect on the associations' collective bargaining agreements only after the Court of Appeals issued its summary order on February 20, 2007." Id. ¶ 13.

Raymond G. McGuire is a lawyer and the managing director of the Contractors Association of Greater New York ("CAGNY"), formed in 1984 "as a multi-employer bargaining association of the leading construction managers and general contractors operating in the metropolitan New York area," McGuire Aff. ¶ 2. McGuire submitted his affidavit to support WCCI's motion to intervene and in support of WCCI's position on an appropriate remedy for the District Council's contempt of the Consent Decree. He makes essentially the same factual assertions as Weber's about the genesis of the Request System in the 2001 and 2006 CBAs and the deleterious effect of a remedy that would eliminate the Request System in its present form.

Joseph S. Kaming is a lawyer whose firm represents another Intervenor, The Cement League, Incorporated ("Cement League"), a multi-employer association whose members "are engaged in the construction of building structures," particularly in "the placement of reinforced concrete." Kaming Aff. ¶¶ 2, 3. Kaming's affidavit, filed in support of the Cement League's motion to intervene, makes the same substantive points as did Weber. Thus Kaming asserts that "a modification of the present hiring practices under the 50/50 rule, which permits the employer to request specific skilled workers as a portion of the Union's 50% share, would have a most harmful effect on Cement League contractors, reduce union employment, threaten safety and cause New York City economic loss." Id. ¶ 6. Kaming also makes the ...

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