Chicago Laborers Trusteeship Transcripts 09-22-1997

 
	1     OFFICE OF THE INDEPENDENT HEARING OFFICER
	2   LABORERS' INTERNATIONAL UNION OF NORTH AMERICA
	3 
	4 
	5   IN RE:		     	   )
	6   TRUSTEESHIP PROCEEDINGS        ) No. 97-30T
	7   CHICAGO DISTRICT COUNCIL       )
	8 
	9 
	10		    September 22, 1997
	11		        9:45 a.m.
	12 
	13 
	14	    The hearing resumed pursuant to
	15   adjournment at the Days Inn, 644 North Lake Shore
	16   Drive, Erie Room, Chicago, Illinois.

 
	1   PRESENT:
	2        COMEY, BOYD & LUSKIN,
	3        (1025 Thomas Jefferson Street, N.W.,
	4        Washington, D.C.  20007-5243), by:
	5        MR. ROBERT M. THOMAS, JR.,
	6	    appeared on behalf of the GEB
	7	    Attorney;
	8 
	9        CARMELL, CHARONE, WIDMER,
	10        MATHEWS & MOSS, LTD.,
	11        (225 West Washington Street, Suite 1000,
	12        Chicago, Illinois  60606), by:
	13        MR. SHERMAN CARMELL,
	14        MR. MARTIN P. BARR,
	15        MS. SUZANNE M. LAW,
	16	    appeared on behalf of the Chicago
	17	    District Council of Laborers.
	18 
	19 
	20 
	21 
	22   REPORTED BY:  MARY KAY BELCOLORE, CSR 84-1813
	23	       JULIANA F. ZAJICEK, CSR 84-2604
	24

 
	1        MR. CARMELL:  Do you want to swear the
	2   witness.
	3	        (WHEREUPON, the witness was duly
	4	        sworn.).
	5	        JOSEPH J. HARTNETT,
	6   called as a witness herein, having been first
	7   duly sworn, was examined and testified as
	8   follows:
	9	        DIRECT EXAMINATION
	10   BY MR. CARMELL:
	11        Q.    Would you pull the mic just closer to
	12   you.
	13	    Would you state your name and spell
	14   your last name, please?
	15        A.    My name is Joseph J. Hartnett,
	16   H-a-r-t-n-e-t-t.
	17        Q.    And what is your profession?
	18        A.    I am a certified public accountant.
	19        Q.    And with whom are you associated?
	20        A.    Grant Thornton LLP.
	21        Q.    And how long have you been associated
	22   with Grant Thornton?
	23        A.    From 1980, with the exception of '82
	24   when I left the firm for 10 months.

 
	1        Q.    During the period of time that you
	2   were with Grant -- that you have been with Grant
	3   Thornton, have you had occasion to have -- render
	4   services with respect to the Laborers' Pension
	5   Fund, Laborers' Welfare Fund?
	6        A.    I have.
	7        Q.    And for what period of time?
	8        A.    From the entire period of employment
	9   with Grant Thornton through -- from 1980 through
	10   1993.
	11        Q.    And after 1993, what did you do?
	12        A.    I left the country.  I was relocated
	13   to our London office and I was no longer
	14   associated with the fund at that point.
	15        Q.    And since returning, have you had any
	16   relationship with the services that Grant
	17   Thornton renders to the Pension Fund and Welfare
	18   Fund?
	19        A.    In connection with the most recent
	20   audited financial statement, I have been asked to
	21   be the impartial reviewer by the accountant
	22   partner.  That's the only association.
	23        Q.    Now, during the time that you were
	24   working with the Pension Fund and Welfare Fund,

 
	1   did Grant Thornton issue audit reports?
	2        A.    Yes, they did.
	3        Q.    And were those audit reports two
	4   financial statements of the Pension Fund and of
	5   the Welfare Fund?
	6        A.    That's correct.
	7        Q.    And would you briefly describe what an
	8   audit report is and its connection to the
	9   financial statement?
	10        A.    An audit is a process of applying
	11   generally accepted auditing standards and forming
	12   an opinion on which the financial statements
	13   present fairly in all material respects the
	14   financial position, the results of operation and
	15   its cash flows in accordance with generally
	16   accepted accounting principles.
	17        Q.    Go ahead.
	18        A.    The financial statements in effect are
	19   the responsibilities of management.  Our role is
	20   to issue an opinion on the fairness with which
	21   those financial statements present their
	22   position.
	23        Q.    Now, first with respect to what duties
	24   Grant Thornton will perform in preparing the

 
	1   audit report, and then we'll move on to what the
	2   responsibilities are with management, would you
	3   describe what the responsibilities of Grant
	4   Thornton are?
	5        A.    As I have indicated, we are
	6   responsible for applying generally accepted
	7   auditing standards.  Those standards are the
	8   procedures that an auditor follows in forming an
	9   opinion on financial statements.  They include
	10   examining on a test basis evidence supporting the
	11   amounts in the financial statements as well as
	12   the disclosures.  We are governed -- or we are
	13   required to follow generally accepted auditing
	14   standards.
	15        Q.    And what responsibilities does
	16   management have?
	17        A.    Management is responsible for the
	18   financial information that is reported.
	19        Q.    Is management responsible for internal
	20   controls and procedures?
	21        A.    That's correct.
	22        Q.    And in the event that Grant -- I am
	23   using Grant Thornton in the generic.
	24	    In the event that an accountant would

 
	1   see that internal controls and procedures are
	2   inadequate, what, if any, responsibility does the
	3   accountant have?
	4        A.    We would communicate those
	5   observations to the management of the fund.
	6        Q.    And if a -- and if management did not
	7   address or correct any defect, what would be the
	8   alternatives of the accountant?
	9        A.    We would have to consider that on the
	10   procedures that we would employ during the
	11   conduct of our audit and, in fact, consider that
	12   in continuing the relationship.
	13        Q.    In deciding whether to continue the
	14   relationship?
	15        A.    That's correct.
	16        Q.    Does management have a responsibility
	17   to adopt sound accounting?
	18        A.    Yes, they do.
	19        Q.    And what does that involve?
	20        A.    Management -- management is
	21   responsible for adopting an internal control
	22   structure that encompasses the procedures and the
	23   policies that are designed to achieve the
	24   objectives of the fund.  Those objectives are to

 
	1   assure that from an accounting standpoint
	2   transactions are recorded, they are reported,
	3   they are analyzed and summarized properly.
	4        Q.    Mr. Hartnett, I want to take you
	5   through several areas, if I can, and if you would
	6   tell the Hearing Officer what steps Grant
	7   Thornton performs.
	8	    The first would be in respect to cash
	9   flow, inflow and outflow, what does Grant
	10   Thornton do before it issues its audit report to
	11   financial statements of the funds?
	12        A.    As part of our examination, we review
	13   probably four principal areas, and that is cash
	14   receipts, cash disbursements, participant records
	15   and investment activity.
	16	    On the cash receipt side, we examine
	17   on a test basis certain fund reports and the
	18   information that has been reported on those fund
	19   reports for mathematical accuracy, for
	20   consistency, for thoroughness.  We also trace the
	21   cash deposits into the cash accounts, the
	22   depository accounts and from the depository
	23   accounts to the respective investment accounts or
	24   other accounts that operate as part of the funds'

 
	1   internal control structure.
	2	    In addition to that, we test
	3   eligibility data.  The information that is

	4   reported on those funds' reports is then
	5   summarized in the fund's accounting records and
	6   that information is critical in determining the
	7   eligibility of either pension heirs or insureds
	8   on the Welfare Fund.  That information is then
	9   tested.
	10	    In addition to that on the investment
	11   areas, we would trace in the transfers from
	12   investment or from the depository accounts to the
	13   investment accounts and track the investment
	14   transactions.
	15	    And then, finally, on the disbursement
	16   side, we look at the underlying documentation for
	17   any administrative expenses as well as for
	18   determining eligibility and testing other records
	19   with regard to pension heirs or insureds or
	20   insureds' dependents on the welfare side.
	21        Q.    Does Grant Thornton solicit from
	22   attorneys who perform legal services for the
	23   Funds what is called attorneys's letters?
	24        A.    Yes, we do.

 
	1        Q.    And do those attorneys' letters
	2   include requests for any information concerning
	3   prohibited transactions within the, that the
	4   attorney is aware of?
	5        A.    That's correct.
	6        Q.    And does it also solicit advice from
	7   the attorney as to any matter which the attorney
	8   deems would be significant to the financial
	9   operation of the Fund?
	10        A.    I would suggest that we solicit
	11   information, not necessarily advice.
	12        Q.    The information.  And would that
	13   include any litigation or matter that the
	14   attorney is handling?
	15        A.    That's correct.
	16        Q.    Does Grant Thornton in the, before it
	17   prepares its audit report to the Funds' financial
	18   statements, read minutes of the trustees
	19   meetings?
	20        A.    Yes, we do.
	21        Q.    Now, would you describe the types of
	22   audit reports, such as qualified, unqualified,

	23   for us, please?
	24        A.    There are a number of different

 
	1   reports that are issued or described in the
	2   professional literatures.  One report is an
	3   unqualified opinion, or a clean opinion.  There
	4   is a qualified opinion.  There is an adverse
	5   opinion.  There is a disclaimer of opinion.  And
	6   there are opinions that emphasize certain
	7   matters.
	8        Q.    During the period of time that you
	9   were with the Grant Thornton and the Funds, was
	10   there a time, any time that you know of when
	11   other than a clean letter was issued?
	12        A.    The only time that may have taken
	13   place was in the '80s, when the welfare fund had
	14   negative reserves.  And a going concern emphasis
	15   may have been addressed in the opinion.  That
	16   would be the only time.
	17        Q.    Mr. Hartnett, with all the accepted
	18   accounting principles, and all of the adopting of
	19   sound accounting procedures and internal controls
	20   and procedures, is there any way, to your
	21   knowledge, that a fund or a client can prevent
	22   any type of financial malfeasance; that is, there
	23   still remains an opportunity for an individual to
	24   embezzle funds from a client, is that correct?

 
	1        A.    That's correct.
	2        Q.    And in the process of issuing the
	3   audit report, is it true that Grant Thornton does
	4   not have knowledge of whether a provider has
	5   given a kickback or any other illegal sum to a
	6   trustee or a fund employee?
	7        A.    We would have no knowledge of that.
	8        Q.    If Grant Thornton became aware of any
	9   financial malfeasance with respect to a fund,
	10   what would be its responsibility?
	11        A.    We would have to consider that
	12   information in planning and designing the audit
	13   procedures that would be applied.  Additionally,
	14   we would then also consider its impact on
	15   continuing the relationship with the Fund.
	16        Q.    And would such malfeasance be noted in
	17   any of the reports that Grant Thornton might
	18   issue?
	19        A.    It would depend.
	20        Q.    Would it be reported to the, in this
	21   case, to the Fund administrator, the Fund
	22   trustees?
	23        A.    Of course.
	24        Q.    Nothing further.

 
	1		CROSS-EXAMINATION
	2   BY MR. THOMAS:
	3        Q.    Good morning, Mr. Hartnett.  How are
	4   you?
	5        A.    Good morning.  Fine, thank you.
	6        Q.    We have not spoken before, have we?
	7        A.    No, we have not.
	8        Q.    Let me follow up on that last series
	9   of points Mr. Carmell was raising with you.
	10	    I take it that despite all solid and
	11   professional work that you would do on behalf of
	12   a client, there are certain range of matters that
	13   are simply not within your control, with respect
	14   to information flow and activity that the client
	15   may be involved in, that's not part of the audit,
	16   correct?
	17        A.    Correct.
	18        Q.    And so for example, when Mr. Carmell
	19   asked you about embezzlement, there are forms of
	20   simple embezzlement that would go undetected in a
	21   regular audit?
	22        A.    That's correct.
	23        Q.    Even despite, you know, a considerable
	24   degree of thoroughness on your company's part,

 
	1   isn't that right?
	2        A.    That's correct.
	3        Q.    Similarly, with respect to kickbacks,
	4   if there are service providers who have
	5   relationship to a fund, who are making cash
	6   kickbacks to trustees or to employees of the
	7   fund, that might not even impact on the numbers
	8   that you are analyzing as part of the audit,
	9   correct?
	10        A.    That's correct.
	11        Q.    In other words, that may be service
	12   providers' money that is being compromised, and
	13   not the Funds' money, correct?
	14        A.    Correct.
	15        Q.    It would, however, bear fairly
	16   directly on the question of fiduciary
	17   responsibilities of either the trustees or the
	18   employees who are receiving that kind of money,
	19   would it not?
	20        A.    It could, yes.
	21        Q.    Now, you said something that I think
	22   deserves to be expanded upon, and that is, the
	23   question of the impact of a finding of such
	24   conduct on your future relationship with the

 
	1   fund.
	2	    If I heard you correctly, you said
	3   that would cause at a minimum certain extra
	4   procedures to be put into place, and it may even
	5   impact the firm's relationship with the Fund, is
	6   that right?
	7        A.    That's correct.
	8        Q.    Your firm has been doing work for the
	9   Chicago District Council affiliated funds since
	10   at least 1980, is that right?
	11        A.    That's correct.
	12        Q.    Is it since before 1980?
	13        A.    Yes, it is.
	14        Q.    Sir, are you familiar with the case of
	15   United States vs. Pilotto and Caporale?
	16        A.    I have read something to that effect,
	17   yes.
	18        Q.    In connection with these hearings?
	19        A.    Yes.
	20        Q.    Prior to this hearing process being
	21   initiated, did you know anything about that?
	22        A.    As a young auditor, I was aware that
	23   there were some events that took place involving
	24   Caporale and Pilotto.

 
	1        Q.    Did you learn or come to learn that
	2   they were convicted of a conspiracy involving the
	3   scheme to accept kickbacks with respect to this
	4   Chicago Laborers' District Council's Health and
	5   Welfare Fund?
	6        A.    Yes.
	7        Q.    Sir, did your firm undertake -- well,
	8   let's break it down.  Did your firm sever its
	9   relationship with the Health and Welfare Fund
	10   after those convictions?
	11        A.    No.
	12        Q.    Did you put in place any of the
	13   special procedures that you mentioned earlier in
	14   your direct testimony?
	15        A.    That information was considered in
	16   planning and designing the audit procedures that
	17   were performed after the information was made
	18   available, yes.
	19        Q.    So you're saying that in some way
	20   Grant Thornton amended its audit process after
	21   those convictions?
	22        A.    We certainly considered that
	23   information as part of our audit procedures, yes.
	24        Q.    Okay.  You considered it.  But did you

 
	1   do anything?
	2        A.    I believe -- I don't know at this
	3   point.  I was a young auditor in 1982.
	4        Q.    Okay.  I understand that.  But from,
	5   but as you think back on that process today, you
	6   are not sure whether any procedures were actually
	7   implemented?
	8        A.    I'm sure that we extended our
	9   procedures with regard to certain administrative
	10   expense vouching, as well as with the investment
	11   testing.
	12        Q.    But even in that circumstance, your
	13   testimony would still be the same, in that there
	14   are certain things that you are simply not going
	15   to be able to police, for lack of a better word,
	16   correct?
	17        A.    Yes, correct.
	18        Q.    There are certain types of conduct
	19   that can occur outside of the vision of a
	20   professional auditor?
	21        A.    Correct.
	22        Q.    You also mentioned, if I heard you
	23   correctly, that the Fund administrator and the
	24   Fund trustees would be notified in the event of

 
	1   the discovery of some form of misfeasance,
	2   correct?
	3        A.    Correct.
	4        Q.    Did that happen back in 1982?
	5        A.    I was not in a position to know at
	6   that point what would take place.  I was as a
	7   young auditor responsible for performing certain
	8   tasks.  And with regard to the relationship of
	9   the Fund, I did not have that responsibility.
	10        Q.    But I take it you have seen no
	11   document in which Grant Thornton issued any kind
	12   of formal notification to either the trustees or
	13   to the Fund administrator?
	14        MR. CARMELL:  I'm just objecting to that on
	15   the basis that it was a matter which has not been
	16   established that Grant Thornton had knowledge of
	17   or would have had knowledge of, namely, kickbacks
	18   as opposed to some internal malfeasance.
	19        MR. THOMAS:  Well, your objection is noted.
	20        MR. CARMELL:  Thank you.
	21        MR. THOMAS:  I think he testified that he
	22   was aware of it at the time.  And the record will
	23   speak for itself on that.
	24   BY MR. THOMAS:

 
	1        Q.    Did you get my question?

	2        A.    Could you repeat it, please?
	3        MR. THOMAS:  Could the court reporter help
	4   us on that?
	5	        (WHEREUPON, the record was read
	6	        by the reporter as requested.)
	7   BY THE WITNESS:
	8        A.    I'm not aware of any.
	9   BY MR. THOMAS:
	10        Q.    You also mentioned as part of the
	11   gathering of information that you do in an audit
	12   process that you receive letters from attorneys
	13   with respect to how the funds are doing,
	14   correct?  And whether there are any contingent
	15   liabilities out there, or any information that
	16   the attorneys have that might impact on the
	17   health of the Fund?
	18        A.    Correct.
	19        Q.    In the case of the Pension and the
	20   Health and Welfare Funds for the Chicago District
	21   Council, the attorney in question has been Hugh
	22   Arnold, isn't that right?
	23        A.    Correct.
	24        Q.    There have been no other lawyers or

 
	1   law firms involved in supplying that information
	2   to you?
	3        A.    Not that I'm aware of.
	4        Q.    Sir, how often does Grant Thornton
	5   perform its auditing functions?
	6        A.    We perform an annual audit for both
	7   the Pension and the Welfare Fund.  In addition to
	8   that, we perform an investment and cash receipts
	9   and disbursements audit on a monthly basis for
	10   both funds.
	11        Q.    Could you give us a sense of how much
	12   time you are actually -- you or your colleagues
	13   are actually on site?
	14        A.    A fair amount of time.  I mean, during
	15   the conduct of our field work, we would be on
	16   site for the entire portion of that work.
	17        Q.    And that might last how long?
	18        A.    For the annual audit, maybe four weeks
	19   and for the monthly audit, it may be a week.
	20        Q.    Do you -- you do not interview
	21   employees except with respect to the knowledge of
	22   information you are seeking from them with
	23   respect to the finances, is that right?
	24        A.    That's correct.

 
	1        Q.    You don't interrogate anyone as to
	2   whether they are embezzling funds, for example?
	3        A.    That's correct.
	4        Q.    You don't put anyone under oath?
	5        A.    That's correct.
	6        Q.    No depositions are taken?
	7        A.    No.
	8        Q.    There is no examination of whether
	9   fiduciary responsibilities in a broader sense are
	10   being complied with?
	11        A.    No.
	12        Q.    Similarly, the firm does no analysis
	13   of any ownership interests that trustees or
	14   employees may have in service providers who are
	15   corporations that own service providers?
	16        A.    Correct.
	17        Q.    Sir, did your fund do any analysis of
	18   the circumstances in which Mr. Frank Caruso
	19   became administrator of the Pension Fund?
	20        A.    I am not aware of any.
	21        Q.    Do you know what the circumstances
	22   were?
	23        A.    Could you repeat the question again,
	24   please?

 
	1        Q.    Do you know what the circumstances
	2   were of Mr. Frank Caruso becoming head of the
	3   pension funds?
	4        A.    No, I do not.
	5        Q.    Sir, in the event that Mr. Vaira, the
	6   Hearing Officer in this case, decides to put this
	7   District Council under trusteeship, is there any
	8   reason why you would not cooperate with the
	9   trustee who was placed?
	10        MR. CARMELL:  Objection.  This has nothing
	11   to do with the case itself.  It has to do with
	12   the ultimate remedy in the event that Mr. Vaira
	13   does it.  I think maybe the best way we could do
	14   this, since it is not such a critical question,
	15   is to let him answer it with the understanding
	16   that the -- Mr. Vaira can rule on the objection.
	17        MR. THOMAS:  That's fine.  We will treat it
	18   more like a deposition.
	19        MR. CARMELL:  Yes.
	20        MR. THOMAS:  The objection is noted.

	21   BY MR. THOMAS:
	22        Q.    And you can answer the question.
	23        A.    Can I have the question repeated,
	24   please?

 
	1        Q.    I will rephrase it or repeat it.  The
	2   court reporter doesn't need to read it back.
	3	    In the event that Mr. Vaira were to
	4   grant the relief that is requested here and place
	5   a trustee in charge of the Chicago District
	6   Council, is there any reason why Grant Thornton
	7   would not cooperate fully with the trustee?
	8        A.    No.
	9        Q.    Sir, let me ask you, is there any role
	10   for the mob in the administration of pension or
	11   health and welfare funds?
	12        MR. CARMELL:  Object.  Are you talking about
	13   within the scope of his -- of Grant Thornton or
	14   just a general opinion from an individual sitting
	15   there?
	16        MR. THOMAS:  We can take it either way, but
	17   if you are more comfortable with the latter, we
	18   will treat it that way first.
	19        MR. CARMELL:  Well, I am not more
	20   comfortable one way or the other.  I am just
	21   trying to ascertain on what basis you are asking
	22   him before I do anything with respect to letting
	23   it go or making an objection, that's all.
	24   BY MR. THOMAS:

 
	1        Q.    Let's deal first with the question in
	2   connection with your professional capacity.  As
	3   an auditor of pension funds or health and welfare
	4   funds, do you feel it is appropriate under any
	5   circumstances that organized crime or the mob or
	6   LaCosa Nostra, whatever term you wish to use,
	7   should play any role with respect to those funds?
	8        A.    I think they ought not to play a
	9   role.
	10        Q.    Is there any circumstance under which
	11   you would change that answer?
	12        A.    I don't know.
	13        Q.    Sir, does your fund -- excuse me.
	14	    Does your firm do any analysis of
	15   whether the funds comply with their internal
	16   trust agreements, the rules that they have set up
	17   that govern the funds?
	18        A.    That would not be a significant
	19   portion of the audit procedures that we perform.
	20        Q.    So if there were any variation in the
	21   fund's self-management according to its own trust
	22   agreement documents, that really would not be a
	23   high priority on your list?
	24        A.    Not unless it affected the accounting

 
	1   information within the fund.
	2        Q.    And similarly, if there were any
	3   improper relationships between fund trustees or
	4   fund employees, particularly with respect to
	5   affiliation to mob members, that would not be
	6   something that you analyze as part of your work?
	7        A.    That's correct.
	8        MR. THOMAS:  Nothing further.
	9        MR. CARMELL:  Nothing.
	10        MR. THOMAS:  Thank you very much.
	11        MR. CARMELL:  Thank you.
	12	        (Witness excused. )
	13	        (WHEREUPON, the witness was duly
	14	        sworn.)
	15	        CHARLES LOVERDE, JR.,
	16   called as a witness herein, having been first
	17   duly sworn, was examined and testified as
	18   follows:
	19	        DIRECT EXAMINATION
	20   BY MR. CARMELL:
	21        Q.    Would you state your name and spell
	22   your last name?
	23        A.    Charles LoVerde.  It is L-o capital
	24   V-e-r-d-e.  Junior put on there.

 
	1        Q.    And what local are you affiliated
	2   with?
	3        A.    Water pipe extension, Bureau of
	4   Engineering, Laborers' Local 1092.
	5        Q.    What position do you hold with that
	6   local?
	7        A.    President and business manager.
	8        Q.    How long have you been president and
	9   business manager?
	10        A.    Well, '65.
	11        Q.    1965?
	12        A.    Yeah.
	13        Q.    Does Local 1092 represent employees of
	14   the City of Chicago?
	15        A.    Yes, we do.
	16        Q.    And turning your attention to 1993,
	17   did Local 1092 represent employees at -- in the
	18   City Department of Aviation?
	19        A.    Yes, we did.
	20        Q.    And which ones of the airports did
	21   Local 1092 represent employees?
	22        A.    The construction laborers.  Can you
	23   hear me?
	24        Q.    Yeah.  At what airports?

 
	1        A.    Both airports and hopefully the third
	2   one.
	3        Q.    All right.  For the record, one was at
	4   O'Hare Field?
	5        A.    O'Hare Field, yeah, and at Meigs.
	6   There is three.  Meigs and out at Midway.
	7        Q.    And out at Midway.  All right.
	8	    What classifications generally did
	9   1092 represent at that time?
	10        A.    The majority of the classifications
	11   are prevailing rate construction laborers and
	12   then we have clerks and there is various titles
	13   that we represent.
	14        Q.    In 1993, did Local 1001 of the
	15   Laborers' make a claim for the employees that
	16   were represented by 1092 at the airports?
	17        A.    Specifically I don't know if it was in
	18   '93.  I think it was later, but anyways, it was
	19   talked upon many, many times and what it really
	20   was was simply that Ernie Kumerow, okay, wanted
	21   me to give up some jurisdiction.
	22        Q.    And Ernie Kumerow at that time was
	23   president of Local 1001?
	24        A.    Yes, he was president, business

 
	1   manager.
	2        Q.    And was he also business manager of
	3   the District Council?
	4        A.    Yes, he was.
	5        Q.    And Mr. Kumerow wanted 1001 to have
	6   jurisdiction over some of these employees, is
	7   that correct?
	8        A.    Yes, he did.
	9        Q.    Would you tell the Hearing Officer
	10   what occurred?
	11        A.    Well, when I say numerous times, I
	12   mean a lot of times, okay.  There were times that
	13   me and Ernie didn't disagree, but the nice thing
	14   about the District Council is it is a place where
	15   you can disagree a lot.
	16	    He wanted it -- he thought that it
	17   would benefit his local, okay.  And really it
	18   probably would of, okay.  But he was persistent.
	19   He kept -- we kept having disagreements about it
	20   and finally he come to the conclusion that he was
	21   just going to do it, and he told me in a
	22   ultimatum, he says, "Well, Charlie, that's it.  I
	23   am not going to hear it anymore.  I have sent a
	24   letter to the City of Chicago.  From now on when

 
	1   somebody leaves, the jurisdiction is ours,
	2   okay."  And I said, "Well, it wouldn't happen in
	3   my lifetime.  You can send all of the letters in
	4   the world, okay."
	5        Q.    Mr. LoVerde, I'm going to show you a,
	6   I'm going to show you a series of letters, which
	7   are going to be District Council Exhibit 39-A, B
	8   and C.  Unfortunately, we don't have -- back at
	9   the office are the copies.  I'm going to show
	10   them first to Mr. Thomas, and then I'll show them
	11   to you.
	12        MR. CARMELL:  I'm sorry, Bob, but we'll get
	13   copies.
	14        MR. THOMAS:  That's fine.
	15   BY MR. CARMELL:
	16        Q.    I'm going to show you the letters,
	17   which are Exhibit 39.  And I want you to look --
	18        A.    Here is a set of copies.  You want to
	19   give them to him?
	20        Q.    No.  Then you can read off of them --
	21        A.    All right.
	22        Q.    -- as we go along.  The first letter
	23   is dated June 17, 1993, from the District Council
	24   to you.

 
	1        A.    Yes.
	2        Q.    And it's signed by Joseph A. Lombardo,
	3   Jr., and Ernest Kumerow?
	4        A.    Right.
	5        Q.    And it's titled Transfer of
	6   Jurisdiction?
	7        A.    Right.
	8        Q.    And what was your understanding, what
	9   this letter was?
	10	    That's a good one, isn't it, what this
	11   letter was.
	12        A.    My understanding of this letter, it
	13   was a wet dream, okay?  No.  Excuse me.  I know.
	14        Q.    Is your understanding --
	15        A.    No.  It's a wet dream.  Let me explain
	16   the letter.
	17        Q.    No, Charlie.  First, first --
	18        A.    Okay.  Go ahead.
	19        Q.    -- is it your understanding of what,
	20   what did the -- what was the District Council
	21   telling Local 1092 in this letter?
	22        A.    They were telling me simply that, what
	23   I have already stated, is that in the future, he
	24   was going to represent these people by this

 
	1   jurisdiction.
	2        Q.    1001?
	3        A.    Meaning Ernie Kumerow, 1001.
	4        Q.    Okay.  Now, I want to go to the next
	5   letter, which would be 39-B.  Then we will get
	6   back to it all, which is dated June 25, 1993 --
	7        A.    Um-hmm.
	8        Q.    -- from Local 1001 to the City of
	9   Chicago, titled Transfer of Jurisdiction.  Is
	10   this the letter of which you testified concerning
	11   that Ernie Kumerow said he was going to tell the
	12   City of Chicago about the jurisdiction?
	13        A.    Yes, it is.
	14        Q.    All right.  And did you get a copy --
	15   did you see a copy of that letter?
	16        A.    No.  I'll tell you the truth.  I
	17   didn't see a copy of it, because he just did it.
	18   Okay?  The courtesy wasn't given to me.
	19        Q.    Did you hear about it?
	20        A.    I heard it exactly from Ernie
	21   Kumerow.  He told me what he was going to do.
	22        Q.    And did you hear after it was sent
	23   from anyone at the City of Chicago or anyone else
	24   that it had been sent?

 
	1        A.    The City of Chicago didn't notify me.
	2   And they didn't have the opportunity to even
	3   notify me, because it wasn't too long after that
	4   that it was rescinded.
	5        Q.    Before I let you rip, because I know
	6   you are anxious to do so --
	7        A.    Oh, yeah.
	8        Q.    -- did you agree to the transfer of
	9   jurisdiction which is contained in the letter of
	10   June 17, 1993, 39-A, and the letter of June 25,
	11   1993, 39-B?
	12        A.    If I would have agreed, I would have
	13   bent over in the street and let him have it to
	14   me, okay?
	15        Q.    Is that a yes or no?
	16        A.    No, I didn't.  Is there doubt in your
	17   mind?
	18        Q.    Well, it's not my mind that's the
	19   interest, Charles.
	20        A.    Okay.
	21        Q.    It's what we have to put on the
	22   record.
	23        A.    Go ahead.
	24        Q.    What happened after you heard that

 
	1   Ernie Kumerow had sent the letter to the City of
	2   Chicago?
	3        A.    I got another letter.
	4        Q.    No; what happened then?
	5        A.    What happened after I heard what now?
	6        Q.    When you heard that Ernie Kumerow had
	7   sent the letter to the City of Chicago, what if
	8   anything did you do or say?
	9        A.    Well, it wasn't too long after that,
	10   that I went to the District Council, okay?  And
	11   the International happened to be there on some
	12   business, whatever it was.
	13	    And I met with Ernie Kumerow, and I
	14   believe it was John Matassa, Joe Lombardo, and
	15   myself.  And Ernie presented his case, okay?  And
	16   he says, you know, we have been friends for a
	17   long time, blah, blah, blah, but I got to do
	18   this, and that was it.  Okay?
	19	    And he told his story.  And then I
	20   believe it was John Matassa said, well, geez, he
	21   says, Joe, what do you think?  And I had, I told
	22   him explicitly at the time, you know what?  Like
	23   I told you before, it won't happen in my
	24   lifetime.  And I says, and that's it.

 
	1	    And then Joe Lombardo turned around,
	2   and we think it was John that asked Joe, what do
	3   you think you ought to do about this?  And Joe
	4   says --
	5        MR. THOMAS:  Let me stop for a second here.
	6   I'd like to place on the record an objection to
	7   the multiple levels of hearsay that we are
	8   hearing; if we could be a little more careful
	9   about it.
	10        MR. CARMELL:  No.  The way I understand it,
	11   I'll try to clarify, he is in the room.
	12        MR. THOMAS:  Does that remove the hearsay
	13   problem?
	14        MR. CARMELL:  He is in the room listening to
	15   what Matassa says to Lombardo in front of him.
	16        MR. THOMAS:  You are saying it's not offered
	17   for the truth of the matter asserted?  I think
	18   that's okay as long as we have that
	19   understanding.
	20        MR. CARMELL:  No, wait.
	21        MR. THOMAS:  What Mr. Matassa says and what
	22   Mr. Lombardo says are hearsay, unless you are
	23   saying it's not offered for the truth of the
	24   matter asserted.

 
	1        MR. CARMELL:  You can make whatever you want
	2   out of it.  It's for the truth, that this is what
	3   was said.
	4        MR. THOMAS:  That's fine.  If that's all you
	5   are offering it for, that's fine.
	6   BY MR. CARMELL:
	7        Q.    And Mr. Matassa made a statement to
	8   Mr. Lombardo.  And what did Mr. Lombardo say as
	9   far as you can recall?
	10        A.    He says, I think you heard Charlie,
	11   and he is not going to change his mind, so that's
	12   it.
	13        Q.    Now, after that meeting -- I want you
	14   to look at what is 39-C, a letter dated July 8,
	15   '93, from the District Council to General
	16   President Arthur E. Coia, concerning the transfer
	17   of jurisdiction.  You received a copy of that
	18   letter?
	19        A.    Yes.
	20        Q.    And what was your understanding of
	21   this letter?
	22        A.    That it was over.
	23        Q.    Okay.
	24        A.    I'd like to clear the record.

 
	1        Q.    What can I tell you.
	2        A.    We got three documents that you have
	3   entered.  No, I really want to clear the record,
	4   because I think it's unfair if I don't, because I
	5   want it absolutely clear.
	6	    With the persistence of Ernie Kumerow
	7   over and over and over again, I'm not the only
	8   one that he give a headache to.  He gave a
	9   headache to Joe Lombardo.  And he kept on and
	10   kept on and persisting and persisting.  You
	11   wouldn't have these documents in front of you, if
	12   it wasn't that I told Joe Lombardo, when he kept
	13   telling me, would you talk to Ernie, please, you
	14   know, stop him or whatever, and I says, look it,
	15   Joe, you know what you do?  Sign the fucking
	16   letter.  And I'll tell you what.  Let's get it on
	17   and get it over with.  And that's what really
	18   happened.
	19	    And I want to say something on the
	20   behalf of Joe Lombardo.  He is the conscience of
	21   everybody.
	22	    Excuse me.  Am I boring you, sir?
	23        Q.    Charlie, just --
	24        A.    No.  I mean, he is making a face,

 
	1   okay?
	2        Q.    Charlie --
	3        A.    No.  I wanted to tell you something.
	4   It's fact, it's not theory, that Joe Lombardo is
	5   the Council's conscience.  He is a pain in the
	6   ass at times.  But I'm telling you one thing.  He
	7   listens to everybody.  And then when he makes a
	8   decision, okay, that's it, period.
	9        Q.    Now, Mr. LoVerde, turning to another
	10   subject, was the 1092 engaged in collective
	11   bargaining negotiations with the City of Chicago?
	12        A.    Yes, we were.
	13        Q.    And did you do it individually, or as
	14   a group?  And if it's a group, could you explain
	15   as best you can the type of group that was
	16   involved?
	17        A.    Well, first of all, there was the
	18   coalition agreement that came first.  And it's
	19   roughly 43 unions.  And then as far as the
	20   Laborers', we all did it individually, but we
	21   negotiated as a group.
	22        Q.    And the coalition was made up of, was
	23   it made up of all the local unions basically who
	24   had contracts with the city?

 
	1        A.    Yes, it was.
	2        Q.    And was there a, were there co-chairs
	3   to the coalition?
	4        A.    Yes, there was.  There was two
	5   co-chairs.  One was Ernie, and the other one was
	6   the Teamster co-chair.
	7        Q.    Now, as far as the bylaws of the
	8   coalition went, to the best of your recollection,
	9   what was the understanding as far as what it took
	10   to get an agreement signed by the coalition?
	11        A.    If one is unhappy, all are unhappy.
	12   Okay?  And we negotiated that way.
	13        Q.    And in the negotiations with the city,
	14   do you remember approximately what year that was?
	15        A.    We started with the recognition
	16   agreement in '93.
	17        Q.    '93 or '83?
	18        A.    No.  '83.  I'm sorry.
	19        Q.    And what happened with respect to
	20   Local 1092 in those negotiations?
	21        A.    Well, in respect of 1092, is that the
	22   coalition at one point were, they were tired, and
	23   they wanted to conclude their portion.
	24	    And at that time, they even went to

 
	1   the extent that they called a meeting of the
	2   principals.  And they were going to pass the
	3   coalition agreement.
	4        Q.    Let me stop there for a moment.  Does
	5   that -- what do you mean by that?  Do you mean
	6   that they were all satisfied and ready to sign an
	7   agreement?
	8        A.    They were all satisfied as far as the
	9   principals, and then they would have to bring it
	10   back to the full coalition, okay?
	11	    In fact, I received a call, and I will
	12   not give the name, but said, Charlie, tomorrow
	13   when they have that meeting, I've been called,
	14   that the lawyers have called, these young
	15   lawyers, and told them, keep quiet, that we are
	16   going to pass this thing.
	17	    And I told the party, well, come to
	18   the meeting, and learn something.  Okay?  I was
	19   really disappointed that Ernie was firm; he was
	20   going to sign the agreement.
	21	    So they had the meeting.
	22        Q.    Excuse me just a moment.  What problem
	23   did 1092 have at that time, why it appeared that
	24   they wouldn't sign the agreement?

 
	1        A.    Well, the agreement that they had, and
	2   I referred to it at the meeting, is a package of
	3   shit.  Anybody that would agree to what they had
	4   on the table at the time should get out of the
	5   business.
	6        Q.    All right.  Was there any particular
	7   matter that concerned 1092?
	8        A.    There was a lot of particular matters,
	9   there was a lot of things that -- first of all,
	10   the theory was that management has its rights.
	11   Okay?  And the management right clause stunk.
	12   And I said, if they have all these rights, okay,
	13   well, then let them just do them; they don't need
	14   a contract to do what they have a right to do.
	15   They could cover that under past practices.
	16	    But what they wanted to do, in the
	17   broad scope that they wanted to do, my men
	18   couldn't be, they couldn't get representation.
	19        Q.    Okay.  And what occurred at that
	20   meeting?  Did you speak at the meeting of the
	21   principals?
	22        A.    Yes, I did.
	23        Q.    And go ahead.
	24        A.    What actually happened was, everybody

 
	1   at the table in every trade wanted this
	2   agreement.  We were visited by other trades;
	3   please do it, do it, do it, trying to sell it.
	4   Ernie had told them that he couldn't sell it to
	5   me.  And they wanted to persuade me to do it.  So
	6   anyways --
	7        Q.    Did Ernie Kumerow talk to you, asking
	8   you to change your position?
	9        A.    I don't want to say hundreds of times,
	10   but I'll tell you what, it felt like it, but
	11   many, many days.
	12        Q.    And what did you answer him?
	13        A.    I told him that he was easily
	14   pleased.  And actually, I want it to be
	15   understood that Ernie Kumerow was my best friend,
	16   okay?  And he still is my friend.
	17	    I had a nickname for him, Gerber baby,
	18   because he was as sweet as sweet could be.  And I
	19   want to tell you something, he just didn't have
	20   it to hang in there.
	21        Q.    What finally occurred with respect to
	22   the coalition agreement?
	23        A.    I took over the meeting by saying,
	24   point of order.  Okay?  And then I turned around

 
	1   and said, first of all, everybody isn't here.
	2	    Secondly, that I would like to make a
	3   motion, and the motion is this, that in the
	4   future, that any time that anybody, the
	5   principals, feel again that they should pass
	6   something, that they first of all give us the
	7   document that they want to pass to the full
	8   coalition 14 days ahead of time, have a meeting,
	9   and then they can make an agreement with the City
	10   of Chicago.
	11	    It was seconded by the painters.  And
	12   all those that wanted to pass the coalition
	13   agreement at that time, I asked for ayes, and
	14   everybody that was against it.  They all said
	15   ayes.  Then I asked for nays.  And the ayes
	16   weren't too loud.  I asked for nays.  There were
	17   none.  And then I says, well, in the future, I
	18   hope you can say "aye" instead of "aye," okay?
	19   (Indicating.)
	20        Q.    Did there come a time then when 1092
	21   was satisfied and agreed to sign the agreement?
	22        A.    Yeah.  That was 1986, I believe.
	23   Now -- no, no.  Excuse me.  Yeah, 1986.  In
	24   February or something.  I don't have the exact

 
	1   date.
	2        Q.    Now, did there come a time when there
	3   was another set of negotiations in which Bruno
	4   Caruso was the co-chair?
	5        A.    Yeah.
	6        Q.    And did there come a time in that one
	7   when there was an issue regarding seasonal
	8   employees and 1092 with the City of Chicago?
	9        A.    Yes, there was.
	10        Q.    And would you tell the Hearing Officer
	11   what the issue was and what happened with 1092
	12   and the coalition?
	13        A.    Well, what had happened is they wanted
	14   to get this thing passed and we wound up in the
	15   health club over there off of Chicago Avenue.
	16   And, in fact, we were there so long that they
	17   shut the air-conditioning off.
	18        Q.    This was in negotiations with the
	19   city?
	20        A.    Yes, it was.  And the finality of the
	21   thing was when it got down to seasonal employees,
	22   Ernie Kumerow turned around and said, "Look.
	23   It" --
	24        Q.    Is this Kumerow or Caruso?

 
	1        A.    No, no.  I mean -- well, you know
	2   what, I am a little confused here because when
	3   you said Bruno Caruso, when we -- first of all,
	4   the seasonal, it was Ernie.
	5        Q.    I am sorry.
	6        A.    It was Ernie.  I think you are wrong
	7   in that.  I didn't want to tell you that.
	8        Q.    You just did.
	9        A.    Yeah, I guess so.  So anyways, Dick
	10   Lainer was there and they were --
	11        Q.    Richard Lainer was the attorney for
	12   the city?
	13        A.    Yeah.
	14        Q.    Okay.
	15        A.    And they kept pushing for the seasonal
	16   factor and I wouldn't agree to it.  I said that
	17   my local didn't have any seasonal people and I am
	18   not going to agree to it.  Well, it even got to
	19   where Ernie Kumerow gave me an ultimatum, "You
	20   better do that or I am going to whatever."
	21        Q.    What; I am going to do whatever?
	22        A.    He is going to go to the District
	23   Council and I'll have to do it.  He is going to
	24   tell everybody that I wouldn't sign the

 
	1   agreement, okay.  So, anyways, I told him he
	2   could go wherever he wanted to do, do whatever he
	3   wanted to do, but even at the time after that was
	4   over when we walked outside, Toomey, which was
	5   there at the meeting --
	6        Q.    Was that John Toomey?
	7        A.    Yeah, yeah.  He says, you know, you
	8   are stupid, but isn't that nice?  Excuse me.  I
	9   said let me tell you something, John.  I says,
	10   you know what, I says, the first thing you do is
	11   keep your mouths shut.  Second thing, I'll tell
	12   you this, you, Arnold, anybody that wants me to
	13   sign it, it is never going to happen in your
	14   lifetime, so go to hell and do whatever you want,
	15   okay.
	16        Q.    Did there come a time when the
	17   agreement was signed and 1092 was satisfied?
	18        A.    Yeah.  We were excluded from the
	19   seasonal.
	20        Q.    From the seasonal?
	21        A.    Um-hum.
	22        MR. CARMELL:  I have no further questions.
	23	        CROSS EXAMINATION
	24   BY MR. THOMAS:

 
	1        Q.    Good morning Mr. LoVerde.
	2        A.    Good morning.
	3        Q.    You said something about Mr. Kumerow
	4   which I was not sure I understood.
	5        A.    What?
	6        Q.    At one point you indicated that he was
	7   your best friend or one of your best friends.
	8        A.    He is still my best friend.
	9        Q.    Wait until the question.
	10        A.    Oh, okay.
	11        Q.    And your exact words were "he just
	12   didn't have it to hang in there."  What did you
	13   mean by that?
	14        A.    Well, you know how people -- if we are
	15   going to have a conversation here, it takes about
	16   four or five minutes after that you are talking
	17   to yourself.  Well, he just got weak.
	18        Q.    So you mean physically he didn't have
	19   it to hang in there?
	20        A.    Well, no.  Physically, he was
	21   physically fit.  Okay.  He worked out most of the
	22   time until he hurt his back and what have you,
	23   but no, that isn't what I am talking about.
	24   Mentally.  Physically he didn't have it.  If they

 
	1   kept persisting on doing something, he really
	2   always believed the other guy wasn't going to
	3   screw him.
	4        Q.    I am still not --
	5        A.    What aren't you clear on?
	6        Q.    I am still not getting what you
	7   referred to.
	8        A.    You asked about weak.
	9        Q.    You mean the politics of the union, is
	10   that what you mean, he didn't have it to hang in
	11   there, to deal with union problems?
	12        A.    No.  If he was aggressively -- what I
	13   am referring to, if he was aggressively -- if the
	14   people on the other side, the employer were
	15   saying what a good friend they were of his and
	16   they are not going to screw him, honest to God,
	17   just sign the contract and I am not going to --
	18   you know what, he would believe them, okay.
	19        Q.    So, in other words, if I am
	20   understanding you, he wasn't maintaining a strong
	21   advocacy position with respect to the union in
	22   say contract negotiations?
	23        A.    Wrong.  He was an advocate and he done
	24   his job, but when it come down to the bottom line

 
	1   and push come to shove, he'd get tired, see.  He
	2   didn't -- I'll say this to you.  It is like
	3   everybody says how and the hell do you get your
	4   energy, okay.  And simply I have my energy
	5   because I represent my people and I don't care
	6   what people say.  I am going to do the right
	7   thing and I am not going to give anything to
	8   anyone that they can come later and harm any of
	9   my members.
	10        Q.    And are you contrasting that with what
	11   you were describing in Mr. Kumerow's performance?
	12        A.    Yes.  He would ask for it, but he got
	13   tired, okay.  He gets tired, all right.  "Come
	14   on, Charlie, agree, you know, this ain't going to
	15   hurt you.  I promise you.  They told me this or
	16   they told me that."
	17	    I say, "You know what, you go to bed
	18   with them.  You love them.  You do whatever you
	19   want, but I am not about to turn around and harm
	20   a member of my union, okay.  Period.  Okay."
	21	    You know, you have to realize this
	22   went on, my friend, from '93 until '96.  You have
	23   to realize that we turned around and would day in
	24   and day out put 10 and 12 hours into this.  You

 
	1   have to realize the contract we have, and you
	2   have one in front of you, I believe, that I don't
	3   think there is a contract in the world that's
	4   better, okay.  And it was because of
	5   preparation.  It was because of representing
	6   people, okay.
	7        Q.    Let me ask you something.  What was
	8   the question you were just answering?
	9        A.    Oh, you know what, gee, why don't you
	10   have the girl repeat it.  I forgot.  I was
	11   telling you for so long.
	12        Q.    Mr. Witness, Mr. LoVerde --
	13        A.    Give me the question.
	14        Q.    I want you to listen.
	15        A.    Go ahead.
	16        Q.    You have given -- you had plenty of
	17   opportunities to speak your mind here.
	18        A.    Oh.
	19        Q.    And I asked you just then what
	20   question it was that you were answering.  It is
	21   not a question of whether the court reporter
	22   wrote it down.  I want to know what in your head
	23   you were responding to.
	24        A.    Well, you know what, why don't you

 
	1   repeat the question.
	2        MR. CARMELL:  I am going to object.  That's
	3   not a basis for proper cross-examination.  If you
	4   are not satisfied with his answer to the
	5   question, you certainly can move to strike or do
	6   anything you want with him or pursue it, but to
	7   ask him what the question was, he gave you the
	8   answer.  His answer.  And it is obvious that
	9   Mr. LoVerde has a stream of consciousness and
	10   that that is the way he does answer.  You
	11   certainly are entitled to parse it or to restrict
	12   a little more.
	13   BY MR. THOMAS:
	14        Q.    Mr. LoVerde, did the answer you gave
	15   have anything to do with the question I asked?
	16        A.    Why don't you ask me the question?
	17   Did you forget?
	18        MR. CARMELL:  Charlie, come on.
	19        THE WITNESS:  I am asking him to ask the
	20   question.
	21   BY MR. THOMAS:
	22        Q.    So you don't know what the question
	23   was?
	24        A.    Let the reporter read it back and read

 
	1   my answer and then I'll tell you if I answered
	2   your question.
	3        Q.    I think we'll let the record speak for
	4   itself on that.
	5        A.    Thank you.
	6        Q.    So I take it after all of that, what
	7   you were saying is that you did not feel that
	8   Mr. Kumerow was doing all of the things that he
	9   could have done if you had been in the same
	10   position, for example?
	11        A.    Let me say this --
	12        Q.    Just a yes or no?
	13        A.    Oh, okay.  No.
	14        Q.    That's not what you are saying?
	15        A.    What do you mean not what I am
	16   saying?  I said no.  You asked a question and I
	17   said no.
	18        Q.    Mr. LoVerde, we started off with my
	19   trying to get a simple explanation to a simple
	20   question which is what did you mean when you said
	21   "he just didn't have it to hang in there."  And
	22   we have been trying to get to the bottom of
	23   that.  You have given some examples, and I just
	24   asked you again based on those examples did it

 
	1   mean that Mr. Kumerow didn't seem to be doing all
	2   of the things that you would like to have seen
	3   him do, and you say that's not what you meant?
	4        A.    No, I didn't say this.  That is not
	5   what I meant.  I explained myself and now you
	6   want a direct answer to it.  But you know what,
	7   No. 1, he done his job every day.  I tried to
	8   explain that to you.  But there comes a point to
	9   where he happened to think that we should do it
	10   and at that time I happened to think we
	11   shouldn't.
	12        Q.    So there were some things where you
	13   disagreed, is that what you are saying?
	14        A.    I disagree every day of my life.
	15        MR. CARMELL:  Charlie, try not to --
	16   BY THE WITNESS:
	17        A.    Yes, I do.  Yes.
	18   BY MR. THOMAS:
	19        Q.    I take it based on your experience
	20   with the city employee contract, specifically the
	21   airport contract, that you felt Mr. Kumerow had
	22   been fairly heavy handed with you?
	23        A.    He wasn't heavy handed in the contract
	24   himself.  What he was heavy handed in when he

 
	1   tried to take something that belonged to me.  The
	2   contract itself was fine.
	3        Q.    But you indicated a considerable
	4   degree of displeasure with the fact that he was
	5   basically telling you that he was taking some of
	6   your union members into his own?
	7        A.    He was changing the contract.
	8        Q.    And you weren't happy about that?
	9        A.    He didn't have the right to.
	10        Q.    And it was because of his stature that
	11   he was able to do that, right?
	12        A.    He wasn't able to do it.
	13        Q.    Didn't he ultimately succeed?
	14        A.    No, he didn't.
	15        Q.    What about those documents you just
	16   were shown by Mr. Carmell?
	17        A.    If you had read them, it would have
	18   showed you that he didn't succeed.
	19        Q.    So that conversation that you had with
	20   Mr. Lombardo where you indicated that it was just
	21   going to happen, that's going to be the way it
	22   is --
	23        A.    Oh, no.  That was Ernie's opinion.
	24   That was Ernie's opinion.

 
	1        Q.    So Mr. Kumerow was unsuccessful
	2   ultimately?
	3        A.    He sure was.  Read the documents.
	4        MR. CARMELL:  Now, don't answer --
	5   BY THE WITNESS:
	6        A.    Okay.  I am trying to -- yes, he was
	7   very unsuccessful.
	8   BY MR. THOMAS:
	9        Q.    So it didn't happen?
	10        A.    No, it didn't.
	11        Q.    Sir, your Union 1092 involved city
	12   employees, is that right?
	13        A.    Yes, it does.
	14        Q.    Is there any circumstance under which
	15   it would be proper for city employees under your
	16   union to not show up for work repeatedly?
	17        MR. CARMELL:  I am going to object because
	18   it is not within the scope of the direct
	19   examination, not even remotely related to it.
	20        MR. THOMAS:  The objection is noted.
	21   BY MR. THOMAS:
	22        Q.    Go ahead.
	23        MR. CARMELL:  Well, let me ask this,
	24   counsel, if I may, so that I will know where to

 
	1   go from here, if we have to go to Vaira, is it
	2   simply going to be a single question or a whole
	3   line of questions?
	4        MR. THOMAS:  Single question.
	5        MR. CARMELL:  Fine.  Then subject to the
	6   objection, go.
	7   BY THE WITNESS:
	8        A.    Repeat the question.
	9   BY MR. THOMAS:
	10        Q.    Sure.  Is there any circumstance under
	11   which it is appropriate for members of your union
	12   as city employees to repeatedly not show up for
	13   work?
	14        A.    No.
	15        Q.    I mean, leaving aside whether they are
	16   sick or have some excuse, but if they just sign
	17   in and leave, that's not proper, is it?
	18        A.    No.
	19        Q.    Sir, you have been a delegate since
	20   when?
	21        A.    I have been a delegate since 19 -- let
	22   me think about this.  '52.
	23        MR. CARMELL:  Objection again that he has
	24   only been called to the stand for the purpose of

 
	1   the jurisdictional issue with 1001 and the
	2   collective bargaining agreement.  Again, are we
	3   going to go into a long series?
	4        MR. THOMAS:  On this one we will and I have
	5   strong feelings about the admissibility of this
	6   line of questioning.
	7        MR. CARMELL:  I guess we should somehow
	8   resolve it with Vaira because it is not within
	9   the scope of what he is brought for.  You are
	10   certainly free to call him for any of the issues
	11   with respect to that.
	12        MR. THOMAS:  Let me ask a few foundational
	13   questions and we will see if we can't narrow the
	14   dispute before we have to do that, if we have to
	15   do that.
	16   BY MR. THOMAS:
	17        Q.    Sir, as a delegate, you exercise your
	18   democratic rights as a union member to express
	19   your opinion, correct?
	20        A.    You betcha.
	21        Q.    And you do so in part because you have
	22   a fiduciary obligation to your own union and to
	23   your members to look out after their interests,
	24   correct?

 
	1        A.    I do it because it is the right
	2   thing.
	3        Q.    And you do so because you want to
	4   achieve the best for your union and for the
	5   District Council as a whole, correct?
	6        A.    You are absolutely right.
	7        Q.    And when there are things that come up
	8   in the District Council that need to be aired
	9   out, you don't hesitate to do that, do you?
	10        A.    That's right.
	11        Q.    And you have -- have you ever spoken
	12   out on the question of mob influence in this
	13   union?
	14        A.    What do you mean by that, have I ever
	15   spoken out?  Where?
	16        Q.    In a District Council meeting, have
	17   you ever spoken out and said that this union
	18   should not be infiltrated in any way by mob
	19   members or mob associates?
	20        MR. CARMELL:  Before you answer that,
	21   besides the objection that is continuing, this is
	22   an objection that that's a negative pregnant of
	23   when did you stop beating your wife.  It assumes,
	24   in fact, that, A, there is mob influence and, B,

 
	1   that it should be -- that there is mob influence
	2   or that he believed there was mob influence or
	3   knew there was mob influence.  That's the form of
	4   the question.
	5        MR. THOMAS:  Mr. Carmell, we either ask the
	6   question the way I asked it or we can go through
	7   if you want the entire list of things that's in
	8   the public record that's publicly available
	9   information on that subject.
	10        MR. CARMELL:  If you rethink your question,
	11   it makes an assumption which is the ultimate --
	12   one of the ultimate findings that the Hearing
	13   Officer has to make.  I am not going to -- I have
	14   already objected to the whole range of it.
	15        MR. THOMAS:  I will phrase it to put it in
	16   terms of an allegation or a question.
	17        MR. CARMELL:  Fine.
	18   BY MR. THOMAS:
	19        Q.    Mr. LoVerde, at a District Council
	20   meeting, have you ever spoken up with respect to
	21   the question or the allegation of whether or not
	22   this union is infiltrated by the mob?
	23        A.    No.
	24        Q.    And that's despite repeated instances

 
	1   in the public record where officials of this
	2   union have been linked to the mob, isn't that
	3   right?
	4        A.    You know, you speak about records and
	5   about articles and whatever, okay.  The way that
	6   I would address that to you, sir, is not too long
	7   ago -- I mean, I don't believe what's in the
	8   paper.  I believe that everybody should have due
	9   process, go through the system.  They are either
	10   guilty or not.
	11        Q.    Excuse me right there if I could.  If
	12   somebody has due process and they are given the
	13   full constitutional protections of the criminal
	14   law and they are convicted of a serious crime and
	15   the press reports the mere fact that they have
	16   been convicted, no commentary, just the fact that
	17   the person has been convicted beyond a reasonable
	18   doubt by a jury, you would accept that, would you
	19   not?
	20        A.    No.  If the law says so, I don't have
	21   to do a damn thing.  He immediately, if he is in
	22   our business, would go to jail.
	23        MR. CARMELL:  Let me stop a minute.
	24        MR. THOMAS:  I think you know where we are.

 
	1        MR. CARMELL:  I know where you are.  But
	2   this goes back to the whole original matter of
	3   the whole line of questioning.  And now the line
	4   of questioning is in his capacity as a delegate.
	5	    And this can go on for a very long
	6   time, or it can be ended in a question or two, in
	7   which there won't be any more point in breaking
	8   it off and going to the Hearing Officer.
	9	    But if it's going to get into
	10   substantially more questioning, then I think I
	11   would, because I just don't want to let this keep
	12   going with an objection, saying, we'll deal with
	13   it.
	14        MR. THOMAS:  Well, Mr. Carmell, I can be
	15   very curt in the questioning, and very short in
	16   the questioning.
	17	    But I do think that he has already
	18   expressed a view as to his fiduciary, his
	19   understanding of his own fiduciary
	20   responsibilities as a delegate.  He cast certain
	21   votes in that capacity, that you are well aware
	22   of.  And I think I'm entitled to explore that
	23   briefly.  I'm not going to go on at length.
	24        MR. CARMELL:  But that's what I'm saying.

 
	1   All of that was the beginning, after I made the
	2   objection concerning the delegate.  And you said,
	3   let's go on and see how shortly we can do this.
	4   And I said, before I say, let's stop and go to
	5   Vaira, I will.
	6	    If you are saying to me, you have two,
	7   three more questions, then I'll let it stand, and
	8   subject to the, subject to what Mr. Vaira will do
	9   with it.
	10	    But if it's going to go on for a
	11   period of time, I'd rather have the Hearing
	12   Officer make a ruling on it, than spend another
	13   20 minutes, half hour, whatever it may be.
	14   That's all I'm, that's what I'm saying.
	15        MR. THOMAS:  Well, I'll represent to you,
	16   Mr. Carmell, it's not going to be 20 minutes or a
	17   half an hour.
	18	    But I just don't agree with you on the
	19   scope question.  This is, you can't limit a
	20   cross-examination when you don't know what the
	21   witness will say in response to a particular
	22   answer.  If he says X, I may have to follow that
	23   answer to a, to where it goes.
	24        MR. CARMELL:  Then maybe at some point, we

 
	1   should get the Hearing Officer's ruling on the
	2   line, and rather than go on this way, because as
	3   you say, it can lead to a lot of places.
	4        MR. THOMAS:  Why don't we take a five-minute
	5   break.
	6        MR. CARMELL:  Okay.
	7	        (WHEREUPON, a recess was had.)
	8        MR. THOMAS:  Let's go back on the record.
	9	    During the break, Mr. Carmell and I
	10   spoke.  We have reached a tentative agreement
	11   that the GEB Attorney reserves its right to
	12   question Mr. LoVerde with respect to his capacity
	13   as delegate.
	14	    Mr. Carmell takes the position that he
	15   is not being called in his capacity as a
	16   delegate, and for the limited purpose of the
	17   testimony with respect to negotiations with Mr.
	18   Kumerow.
	19	    The GEB Attorney's office reserves its
	20   right to call Mr. LoVerde back at the time of
	21   hearing, when the other members of the District
	22   Council will be called as witnesses for the
	23   express purpose of questioning him with respect
	24   to votes he has taken as delegate, and the

 
	1   exercise of his fiduciary duties as a delegate.
	2	    Mr. Carmell, have I correctly stated
	3   this?
	4        MR. CARMELL:  That is correct.
	5        MR. THOMAS:  Nothing further.
	6        MR. CARMELL:  Nothing more, Charlie.  Step
	7   down.
	8	    I would like to offer District Council
	9   Exhibits 39-A, B and C.
	10        MR. THOMAS:  No objection.
	11        MR. BARR:  Mr. Robert LoVerde.
	12	        (WHEREUPON, the witness was duly
	13	        sworn.)
	14		 ROBERT LOVERDE,
	15   called as a witness herein, having been first
	16   duly sworn, was examined and testified as
	17   follows:
	18		DIRECT EXAMINATION
	19   BY MR. BARR:
	20        Q.    Would you state your name, please?
	21        A.    Robert LoVerde, L-O, capital
	22   V-E-R-D-E.
	23        Q.    Are you employed by the Laborers'
	24   Union, Mr. LoVerde?

 
	1        A.    I'm secretary/treasurer of Laborers'
	2   Local 1092.
	3        Q.    How long have you been
	4   secretary/treasurer for Local 1092?
	5        A.    Since '71.
	6        Q.    When did you first become a member of
	7   the Laborers' Union?
	8        A.    '56, February of '56.
	9        Q.    And what were the circumstances at the
	10   time?
	11        A.    I applied with the City of Chicago.
	12   At that time, they had a Civil Service Board that
	13   would review applications.  I was hired by the
	14   city.
	15        Q.    And at that time did you become a
	16   member of the Laborers' Union?
	17        A.    Yes.
	18        Q.    Was that Local 1092 at that time?
	19        A.    Yes.
	20        Q.    Have you held union positions with
	21   Local 1092 other than that of recording -- excuse
	22   me -- secretary/treasurer?
	23        A.    Before secretary/treasurer, I was the
	24   recording secretary.

 
	1        Q.    For about how many years, do you
	2   remember?
	3        A.    Since 1962, I believe, to '71.
	4        Q.    And what were the duties of recording
	5   secretary that you performed during that time
	6   period?
	7        A.    We would take minutes, review
	8   correspondence, things to be discussed at the
	9   meetings.
	10        Q.    You personally did as recording
	11   secretary?
	12        A.    Yes.
	13        Q.    Can you tell us what your duties are
	14   as secretary/treasurer of Local 1092?
	15        A.    The duties of secretary/treasurer vary
	16   from -- I take care of the financial business of
	17   the local, I also work in the field at times,
	18   processing grievances and preparing for
	19   arbitrations.
	20        Q.    About what percentage of your time do
	21   you typically spend in the office during the
	22   normal working day?
	23        A.    During the normal working day, two to
	24   three hours.

 
	1        Q.    And how much time do you typically
	2   spend outside of the office during a typical
	3   working day?
	4        A.    Sometimes 8, sometimes 10, depending
	5   on setting up certain meetings and meeting with
	6   the city officials.
	7        Q.    Are you related to Charles LoVerde who
	8   just finished testifying a few minutes ago?
	9        A.    Yes.  He is my older brother.
	10        Q.    About how many members does Local 1092
	11   have at the moment?
	12        A.    Approximately 950.
	13        Q.    And do a number of your members work
	14   for the City of Chicago?
	15        A.    All of them do except for three
	16   people.
	17        Q.    And under what classification do most
	18   of your members fall?
	19        A.    Construction laborers.
	20        Q.    And can you tell us about that
	21   classification, what your members do as
	22   construction laborers for the City of Chicago?
	23        A.    Well, we have the sewer department
	24   which they install and maintain sewers, water

 
	1   department which they install water mains,
	2   maintain water mains, Bureau of Bridges which
	3   they repair these bridges in the downtown area
	4   and Department of Aviation we have construction
	5   workers there.  And we also -- general services,
	6   we have construction laborers.
	7        Q.    Do any of your members work in salvage
	8   yards?
	9        A.    We have one in the Department of
	10   Purchases works the salvage yard, yes.
	11        Q.    How many collective bargaining
	12   agreements does Local 1092 have with the City of
	13   Chicago?
	14        A.    One.
	15        Q.    Are there other laborers locals that
	16   are also party to a collective bargaining
	17   agreement with the City of Chicago?
	18        A.    1001 and Local 76.
	19        Q.    And who is the business manager of
	20   Local 1001?
	21        A.    Bruno Caruso.
	22        Q.    And who is the business manager of
	23   Local 76?
	24        A.    Al Naimoli.

 
	1        Q.    Generally what sort of work do the
	2   members of Local 1001 perform, just in a few
	3   words?
	4        A.    Department of Streets and Sanitation,
	5   refuse collectors, watchman general services,
	6   park laborers, aviation, asphalt, Department of
	7   Transportation.  That's about it, I think.
	8        Q.    You mentioned aviation with respect to
	9   Local 1001?
	10        A.    Yes.
	11        Q.    What classifications or what sort
	12   of -- do the members fall under or what kind of
	13   work do they do for the aviation department?
	14        A.    They have park laborers which do the
	15   maintenance at the airport, cutting the grass,
	16   stuff like that.  They also have the airport
	17   operation offices which maintain -- which are in
	18   charge of the running of the airport.
	19        Q.    Local 76, what sort of work do those
	20   members do -- its members do?
	21        A.    They work out of the Department of
	22   Transportation, curb and gutter.
	23        Q.    There has been some reference during
	24   the hearing to a coalition.  Can you describe for

 
	1   us what the coalition is, what it consists of?
	2        A.    Yes.  After we concluded our historic
	3   recognition, we put together a coalition of
	4   unions with members -- who have members with the
	5   City of Chicago.  This coalition in the beginning
	6   was about 40 people.  I think it is down to about
	7   38 or 37 now.  For the unions I mean.  It is down
	8   to about 38 or 37.
	9        Q.    You mentioned historic recognition by
	10   the City of Chicago.  What are you referring to
	11   there?
	12        A.    Correct.  Well, we went through a
	13   period of getting to -- having the city -- after
	14   the state law was passed, we went through a
	15   period of where we had to negotiate and prove our
	16   historic recognition, who we represented within
	17   the City of Chicago.
	18        Q.    So essentially there was a state law
	19   passed that authorized collective bargaining on
	20   behalf of municipal employees, is that what you
	21   are referring to?
	22        A.    Correct.
	23        Q.    And approximately when did that occur,
	24   Mr. LoVerde?

 
	1        A.    In '83, I believe.
	2        Q.    You described for us what the
	3   coalition consists of.  Does the coalition engage
	4   in collective bargaining with the City of
	5   Chicago.
	6        A.    Yes, it did.  The coalition had two
	7   cochairman.
	8        Q.    Who are -- what unions supplied a
	9   cochairman for the coalition negotiations with
	10   the city?
	11        A.    The Laborers and the Teamsters.
	12        Q.    Is that a particular local of the
	13   Teamsters that has supplied --
	14        A.    76.
	15        Q.    How many collective bargaining
	16   agreements have been negotiated with the city
	17   since the state law was passed authorizing
	18   collective bargaining?
	19        A.    I think there's four at the present.
	20        Q.    For up through the present?
	21        A.    Including the present.
	22        Q.    So has a Teamsters Local 76
	23   representative co-chaired each of the
	24   negotiations for the four contracts?

 
	1        A.    Correct.
	2        Q.    And you mentioned the Laborers'
	3   provide a co-chair.  Who has that been?
	4        A.    Who is Ernie Kumerow.  The last
	5   negotiations, it was Bruno Caruso.
	6        Q.    Do you recall how many negotiations
	7   were chaired, co-chaired by Ernie Kumerow?  Would
	8   it have been three, the difference between four
	9   and one?
	10        A.    I don't -- what was the question
	11   again?
	12        Q.    Sure.  You said Bruno Caruso was the
	13   co-chair on behalf of Laborers' during
	14   negotiations for the most recent contract?
	15        A.    Yeah.
	16        Q.    About how many times --
	17        A.    First three, it was Ernie.  And last
	18   one was Bruno.
	19        Q.    During the four, and we will assume
	20   it's four contracts that have been executed
	21   between the city and the coalition, what matters
	22   has the coalition bargained with the city for the
	23   four contracts?
	24        A.    The way the coalition was set up was

 
	1   that the coalition would handle like issues, that
	2   would affect all unions the same.
	3        Q.    Can you give us some examples of those
	4   like issues?
	5        A.    Layoff recall provisions, grievance
	6   provisions, discipline, personnel rules, things
	7   like that issue.
	8        Q.    So the city wanted to --
	9        A.    Holiday, vacation.
	10        Q.    The city insisted on keeping certain
	11   matters uniform with respect to all the unions
	12   that it dealt with?
	13        A.    Yes.
	14        Q.    When were the last negotiations held
	15   between the coalition and the city?
	16        A.    '95.
	17        Q.    What is the term of the current
	18   collective bargaining agreement?
	19        A.    I believe to '99.
	20        Q.    And did it become effective in 1995?
	21        A.    '96.
	22        Q.    Approximately how many meetings were
	23   held between the coalition bargaining team and
	24   the city for negotiations for that particular

 
	1   contract?
	2        A.    There was all together about 40.
	3        Q.    Does each member of the coalition send
	4   a representative to the bargaining sessions?
	5        A.    The coalition breaks down, from the
	6   total membership of say 38 or so unions, into
	7   mini-coalitions, which would be people of, that
	8   had, like the Laborers' was a mini-coalition by
	9   itself.  The Teamsters was a mini-coalition by
	10   itself, because of the numbers.
	11	    The building trades will be a group,
	12   that is maybe six different building trades who
	13   would get together, and they would have like a
	14   building trades, service employees union, the
	15   nurses.  They were all broken down into smaller
	16   groups that would negotiate their local issues.
	17        Q.    But at the same time, does the
	18   coalition have representatives from each of its
	19   member unions, and negotiate with the city over
	20   those common items that you referred to?
	21        A.    Yes.
	22        Q.    And you mentioned a mini-coalition
	23   consisting of the Laborers' locals, and which
	24   locals of the Laborers' are involved?

 
	1        A.    1001, 76, 1092.
	2        Q.    And what items does the, we will call
	3   it the Laborers' mini-coalition, bargain with,
	4   with the city?
	5        A.    Wages, special, we have salaried
	6   employees.
	7        Q.    I'm sorry?
	8        A.    We have salaried employees.
	9        Q.    Salary?
	10        A.    Clerical employees, we negotiate wage
	11   rates for them.  Any changes, we took the
	12   position that even though we are bound by the
	13   coalition, issues that were addressed at the
	14   coalition were not supposed to be addressed at
	15   the local level; but we from time to time did
	16   address them at the local level, get different
	17   language.
	18        Q.    Well, can you explain for the Hearing
	19   Officer, did the -- well, did the negotiations
	20   for the mini-coalition result in the same
	21   provisions, contract provisions for all three
	22   locals?
	23        A.    Yes.  There's one or two different
	24   things that are in our contract, that don't

 
	1   pertain to certain -- like there is a sanitation,
	2   there is a premium for a guy lifting 55-gallon
	3   drums, garbage drums.
	4        Q.    So that would apply to 1001, but not
	5   the other two?
	6        A.    Only 1001, not the other two.
	7        Q.    But nevertheless, that would wind up
	8   in the collective bargaining agreement?
	9        A.    Yes, it would.
	10        Q.    And which of the three unions has the
	11   most classifications that are covered by the
	12   collective bargaining agreement?
	13        A.    1001.
	14        Q.    Can you estimate how many
	15   classifications 1001 has?
	16        A.    I just would be guessing off the top
	17   of my head, maybe 30, 35, something like that.
	18        Q.    Is that a reasonable estimate, or a
	19   wild guess?
	20        A.    It's a wild guess.
	21        Q.    You shouldn't make a wild guess; only
	22   if you have some reason for estimating.
	23        A.    I'd say about 40, maybe 40 to 50.  I
	24   don't know.  I'd be -- there is a number of them.

 
	1        Q.    What about Local 76?  How many
	2   classifications does that cover?
	3        A.    He has two; he has cement mixers, and
	4   he has concrete dispatchers.
	5        Q.    And Local 1092, how many
	6   classifications are covered by 1092?
	7        A.    Maybe 30, 25, 30, somewhere in there.
	8        Q.    Now, I believe you mentioned that
	9   Bruno Caruso was the -- maybe you didn't.  Who
	10   was the chairperson for the mini-coalition for
	11   this most recent contract that was negotiated in
	12   '95 or '96?
	13        A.    We, at the local level, we usually
	14   operate individually, the three locals there.
	15   There wasn't no set officers, like we did at the
	16   coalition meeting.
	17        Q.    Do you have a spokesperson?  Did you
	18   have a spokesperson?
	19        A.    We had spokespersons.  We would speak
	20   up on, whichever the local, that pertained to the
	21   issues.  If it was curb and gutter issue, Al
	22   Naimoli would speak up.  Issues that concern
	23   1001, Bruno would speak up.  1092, we would.
	24        Q.    Now, is there a construction laborer

 
	1   classification that fits within the membership of
	2   any of the three locals?
	3        A.    Yes.
	4        Q.    And does it fit within all three
	5   locals or, if not, which ones?
	6        A.    There's construction laborers working
	7   for all three locals.  They have different title
	8   codes, which are varied by department.
	9        Q.    Does the mini-coalition negotiate with
	10   the city over the wage rate for the construction
	11   laborer classification?
	12        A.    Yes, it does.
	13        Q.    And describe what's involved in those
	14   negotiations.
	15        A.    Well, the city --
	16        MR. THOMAS:  Objection, objection.  Excuse
	17   me, Mr. LoVerde.
	18        THE WITNESS:  Sure.
	19        MR. THOMAS:  Mr. Barr, this is very
	20   interesting.  But it doesn't relate to the issues
	21   in the case.  And while I don't want to cut off
	22   your ability to give certain amount of
	23   background, I think that this level of detail is
	24   really not necessary for the Hearing Officer.

 
	1        MR. BARR:  It's my recollection you made the
	2   same objection when Mr. Vaira was here one day,
	3   and he allowed me to go forward.
	4        MR. THOMAS:  You are quite right.  But we
	5   are all interested in getting to the issues in
	6   the case.
	7        MR. BARR:  Well, we are going to go forward
	8   subject to your objection.
	9	    Did the witness fully answer that
	10   question?
	11        MR. THOMAS:  No, he did not.
	12        MR. BARR:  Could you read the question,
	13   please?
	14	        (WHEREUPON, the record was read
	15	        by the reporter as requested.)
	16   BY MR. BARR:
	17        Q.    Mr. LoVerde, the question had to do
	18   with the mini-coalitions' negotiations with the
	19   city over the wage rate for the construction
	20   laborer classification.  How was that determined
	21   between the mini-coalition and the city?
	22        A.    We had negotiated provisions in which
	23   the city would adopt or accept whatever wage
	24   increases were, whichever wage increases that

 
	1   District Council obtained on the outside with
	2   their negotiations.
	3        Q.    Are you referring to the Chicago
	4   District Council's negotiations with MARBA, the
	5   employer representative?
	6        A.    MARBA and other associations, yes.
	7        Q.    And so the Chicago District Council
	8   would negotiate a wage rate with MARBA covering
	9   the construction laborer?
	10        A.    Yes, they would.
	11        Q.    And then what did those laborers
	12   locals and the mini-coalition do at that point?
	13   Did they notify the city?
	14        A.    Have to be notified by the District
	15   Council to what the wage rate is.  We would in
	16   turn notify the city, and would establish the
	17   wage rate.
	18        Q.    And what is that rate called?  What
	19   does the city call that rate?
	20        A.    Prevailing rate.
	21        Q.    And then do the locals go on to
	22   bargain rates for other classifications other
	23   than the construction laborer classification?
	24        A.    Yes, we do.

 
	1        Q.    And what other items do the three
	2   locals then bargain with the city other than wage
	3   rates?
	4        A.    Well, we -- personnel leaves, various
	5   leaves of absences.  That's a coalition item, but
	6   we have negotiated return from leaves, that the
	7   individual will go back to their original
	8   assignment if this was within one year, which is
	9   not at the coalition level.  It is one of those
	10   things that we negotiated other than with the
	11   coalition.
	12        MR. BARR:  Just one moment.  Can we go off
	13   the record for just one moment.
	14	        (WHEREUPON, discussion was had
	15	        off the record.)
	16   BY MR. BARR:
	17        Q.    Mr. LoVerde, I have handed you three
	18   letters which are marked as District Council
	19   Exhibits 39-A, 39-B and 39-C.  39-A is dated June
	20   17, 1993, 39-B is dated June 25, 1993.  And
	21   what's the date of the third letter?
	22        A.    July 8th, '93.
	23        Q.    Now, before today, before being handed
	24   those letters, were you aware of the existence of

 
	1   those letters?
	2        A.    Yes, I am.
	3        Q.    Were you aware, at or about the dates
	4   shown on the letters, of the issues that are
	5   described within those letters?
	6        A.    Yes, I was.
	7        Q.    How did you become aware of those?
	8        A.    Well, we received copies of the
	9   letters.  And I have a file in my office with the
	10   letters.
	11        Q.    So after your local received the
	12   letters, you saw them sometime soon afterwards?
	13        A.    Correct.
	14        Q.    Did you attend any of the meetings
	15   that are -- that addressed the issues contained
	16   in those letters?
	17        A.    No, I didn't.
	18        Q.    Your brother Charles did them?
	19        A.    Yes.
	20        Q.    Going back to the first collective
	21   bargaining agreement that was negotiated with the
	22   city and involving your union, in what year did
	23   that happen?
	24        A.    It was signed in 1986.

 
	1        Q.    Now, did an issue arise during those
	2   negotiations concerning seasonals?
	3        A.    Yes, it did.
	4        Q.    Did you attend negotiation sessions
	5   involving the coalition and the city where the
	6   issue of seasonals came up?
	7        A.    Yes, I did.
	8        Q.    What was the issue as you recall it
	9   that came up during those negotiations?
	10        A.    The city during those negotiations
	11   were reserving the right to hire people as
	12   seasonal employees for a maximum of 180 days.  We
	13   were fearful that if we allowed the city to do
	14   that, they were going to reduce the career
	15   service employment and supplement their work
	16   force with seasonals instead of career services.
	17        Q.    You said "we were fearful."  Who were
	18   you referring to?
	19        A.    Well, the three locals.
	20        Q.    And did the three laborers' locals
	21   agree that there should be the language that the
	22   city wanted concerning seasonals included in the
	23   collective bargaining agreement?
	24        A.    1001 did, 76 did and we refused.

 
	1        Q.    Why did 1092 refuse to sign or agree
	2   to that language?
	3        A.    Why did we agree to it eventually?
	4        Q.    I am sorry.  Why did you not agree to
	5   the language that the city wanted for seasonals?
	6        A.    Because all indications from the city
	7   at that point in time was that they were going to
	8   change the work force and introduce seasonals as
	9   a way of saving money.
	10        Q.    So was there finally a resolution or a
	11   compromise reached with respect to this
	12   situation?
	13        A.    Yes.  We finally agreed at the end.
	14   The city promised that they would not convert any
	15   jobs -- career service jobs to seasonal
	16   employment, and if you didn't have -- if you
	17   didn't historically have seasonal employees in
	18   the past, they wouldn't convert those positions
	19   in the future.
	20        Q.    And was any retaliation or retribution
	21   taken against Local 1092 for not going along with
	22   that seasonal language from the beginning?
	23        A.    No.
	24        MR. THOMAS:  Mr. Barr, I don't want to

 
	1   interrupt you any more.  I would just like to
	2   place a continuing objection as to all of these
	3   questions that don't have any bearing on the
	4   District Council.  If we can just have that
	5   understanding, I won't speak up.
	6        MR. BARR:  So noted.  We have only a few
	7   more questions about negotiations.
	8   BY MR. BARR:
	9        Q.    Mr. LoVerde, over the four collective
	10   bargaining agreements that you have referred to,
	11   have you participated in coalition negotiations
	12   for each of the four agreements?
	13        A.    Yes, I did.
	14        Q.    Have you participated in and observed
	15   negotiations for the Laborers' mini coalition for
	16   each of the four?
	17        A.    Yes.
	18        Q.    And you testified that you saw Ernie
	19   Kumerow cochair three of those negotiations.
	20   From your observations of Mr. Kumerow, what
	21   appeared to be his purpose or objectives as he
	22   went about the negotiations?
	23        A.    The betterment of the union
	24   employees.

 
	1        Q.    And was that true for each of the
	2   three negotiations?
	3        A.    Yes, it was.
	4        Q.    And for the negotiations that were
	5   most recently cochaired by Mr. Caruso, Bruno
	6   Caruso, what did it appear to you were his
	7   objectives from your observations?
	8        A.    The betterment of union employees from
	9   the coalition level.  That would involve
	10   everybody.
	11        Q.    Mr. LoVerde, how many delegates does
	12   Local 1092 have to the District Council?
	13        A.    Three.
	14        Q.    Are you one of them?
	15        A.    I am one of them, yes.
	16        Q.    Do you recall when you first became a
	17   delegate?
	18        A.    February of '65.
	19        Q.    There has been testimony that the
	20   Council has monthly meetings.  How often has it
	21   had monthly meetings?
	22        A.    They have them once a month.
	23        Q.    From what period of time?  From as far
	24   back as February of '65?

 
	1        A.    That far back and maybe before.
	2        Q.    What percentage of meetings have you
	3   attended over the years?
	4        A.    I guess, but approximately 95 percent
	5   of them.
	6        Q.    Where are they located?
	7        A.    Currently they are at 6121 Diversey.
	8        Q.    Could you describe for us the
	9   attendance at the meetings by other delegates?
	10        A.    They get a very good turnout.  Roll
	11   call is taken to establish that every local is
	12   represented.
	13        Q.    And what else happens at the usual
	14   meeting?  Can you describe a typical meeting for
	15   us?
	16        A.    Well, first there would be a roll call
	17   of officers and delegates.  After the roll call,
	18   normally the financial -- the finances of the
	19   District Council and their expenditures for the
	20   previous month would be addressed at the
	21   meeting.  The portion where they call good and
	22   welfare of the members, where the people could
	23   speak out, bring any new problems, new business,
	24   old business on the previous meeting.  Generally

 
	1   just following what's set forth in the
	2   international guidelines for holding the
	3   meeting.
	4        Q.    Are there committee reports commonly
	5   given at the meetings?
	6        A.    Yes.  There is two committees, the
	7   north and south side committee, who give the
	8   reports as to what they've done for the last
	9   week -- month.
	10        Q.    And what do those concern?  What
	11   activities do those concern?
	12        A.    Going out on job sites and checking
	13   contractors, if they are good contractors, bad
	14   contractors, things of that nature.
	15        Q.    Do those reports directly concern your
	16   Local 1092 which has almost entirely city
	17   workers?
	18        A.    Correct, no.
	19        Q.    Are delegates allowed to speak and

	20   present their opinions concerning any subject
	21   that the delegates -- or at the Council meeting?
	22        A.    Yes, they are.
	23        Q.    You stated earlier some reference to
	24   Council negotiations with MARBA, the employer

 
	1   negotiating association?
	2        A.    Yes.
	3        Q.    Before the Council enters negotiations
	4   with MARBA, does the Council seek any input from
	5   the delegates about what its bargaining demands
	6   should be?
	7        A.    Yes, they do.
	8        Q.    Can you tell us typically how that has
	9   been done?
	10        A.    Well, delegates that have certain
	11   problems, certain area, classifications,
	12   different things like that, they bring them to
	13   the attention of the Council and those are the
	14   issues that will be addressed during the
	15   negotiation.
	16        Q.    And is there any particular officer of
	17   the Council who speaks on the Council floor and
	18   asks for the input?
	19        A.    Well, what they do is they set up a
	20   committee to negotiate the contract and that
	21   committee would take care of it.  Normally Bruno
	22   is in charge with Joey and there are other
	23   members on the committee.
	24        Q.    So is this input given by the

 
	1   delegates on the Council floor at the regular
	2   meeting?
	3        A.    Yes.
	4        Q.    Are you familiar with informational
	5   surveys that have been presented to the delegates
	6   concerning pension fund allocations?
	7        A.    Yes, I am.
	8        Q.    I believe you have up there a folder
	9   which includes District Council Exhibit 38-A and
	10   38-B.
	11        A.    Yes.
	12        Q.    Would you take a look at those?
	13        A.    Yes.
	14        Q.    Have you seen those before, Mr.
	15   LoVerde?
	16        A.    Yes, I have.
	17        Q.    When did you see them, under what
	18   circumstances?
	19        A.    Well, whenever it is that there are
	20   going to be an increase in benefit levels or --
	21        Q.    But where, where did you first see
	22   these particular surveys?
	23        A.    They were sent to the local, or handed
	24   out at a District Council meeting by Joey.

 
	1        Q.    Do you recall if there was any
	2   discussion on the Council floor about the
	3   information surveys?
	4        A.    Yes, there was.
	5        Q.    Please describe for us what sort of
	6   discussion there was on the Council floor.
	7        A.    Well, this last time, I believe -- I
	8   don't know who it was -- somebody had some
	9   questions about the survey itself as to exactly
	10   what it meant.  And they were addressed on the
	11   Council floor.
	12        Q.    You say this last time; approximately
	13   when was that?
	14        A.    I think it was '65, '65, I believe.
	15        Q.    1965?
	16        A.    Right.
	17        Q.    Or '95?
	18        A.    '95, I'm sorry, '95.
	19        Q.    Does the Council Executive Board bring
	20   to the attention of the delegates the appointment
	21   of delegates to positions either on the Council
	22   or to one of its affiliated funds?
	23        A.    If there is a vacancy, it's brought up
	24   at the Council that there is a vacancy.

 
	1        Q.    How is it brought up?  By whom
	2   typically?
	3        A.    Typical, by the chair of the meeting,
	4   would be Bruno.
	5        Q.    And what does Bruno say to the
	6   delegates?
	7        A.    That there is a recommendation from
	8   the Executive Board that somebody be appointed to
	9   a position that's vacant.
	10        Q.    And are the delegates asked to do
	11   anything in response to that?
	12        A.    Yes.  They are asked to, if there is
	13   anybody else that was interested in the position,
	14   to come forward; if they want to appoint someone,
	15   the floor is open for suggestions for other
	16   people.
	17        Q.    Are the delegates asked to vote on the
	18   recommendation one way or another?
	19        A.    Yes, they vote them up, the yeas or
	20   nays.
	21        Q.    So by a voice vote, is that correct?

	22        A.    By voice.
	23        Q.    Do you recall that in 1991, there was
	24   a strike over negotiations with MARBA?

 
	1        A.    Yes.
	2        Q.    Was there a discussion on the Council
	3   floor prior to the strike about whether in fact
	4   there should be a strike?
	5        A.    Yes, there were.
	6        Q.    Can you recall who brought it up, and
	7   what was said and done about it?
	8        A.    I don't recall exactly if it was Bruno
	9   that came forward with the information, or Joey,
	10   or both of them, to explain what the situation
	11   was with the outside negotiations.
	12        Q.    Who was the business manager back in
	13   '91 for the Council?
	14        A.    Oh, '91 was Ernie Kumerow.
	15        Q.    What was said on the Council floor, to
	16   the best you can recall?
	17        A.    What?
	18        Q.    To the best of your recollection, what
	19   was said about whether there should be a strike
	20   effort as a result of failure to reach a contract
	21   with MARBA?
	22        A.    After results of the discussion on the
	23   floor, there was a vote that was taken, and we
	24   voted to go on strike.

 
	1        Q.    How long did the strike last, do you
	2   remember that?
	3        A.    Maybe a week, a little over a week.
	4        Q.    Now, did your city employees
	5   participate in this strike?
	6        A.    They, by contract they can't
	7   participate in the strike.  But there was a
	8   secondary effect by the strike on our city work,
	9   where we were no longer able to get material,
	10   asphalt, concrete, and stuff like that.  So it
	11   did affect our forces in some respect.
	12        Q.    Before the strike was all off or
	13   ended, was there further discussion about whether
	14   to end the strike?
	15        A.    Yes, there was.
	16        Q.    And was there a vote?
	17        A.    The vote was taken, and we agreed to
	18   end the strike.
	19        Q.    Since you have become a delegate, have
	20   you participated in elections for office to the
	21   District Council?
	22        A.    Yes, I have.
	23        Q.    Have you received advance notice of
	24   the nominations meetings, for each of the

 
	1   nominations meetings and elections?
	2        A.    We get notice by mail.
	3        Q.    Have you actually attended nominations
	4   meetings?
	5        A.    Yes, I have.
	6        Q.    Would you describe the typical
	7   procedure followed at a nominations meeting?
	8        A.    The meeting would open, and it would
	9   be explained to everybody that it was a special
	10   meeting only for nominations for the election.
	11	    After some brief words, the chair of
	12   the meeting would turn the meeting over to, we
	13   usually have an attorney there that would do the
	14   formality of running the election.
	15        Q.    Who normally was the chair of the
	16   meeting, who turned it over to an attorney?
	17        A.    Ernie Kumerow and Bruno.
	18        Q.    Go on.  Then what would be done by the
	19   attorney?
	20        A.    The attorney would follow, I believe
	21   it's article 5 of the Constitution, in
	22   progressing, open the floor for nominations for
	23   different offices, and go through the roll
	24   procedure.

 
	1        Q.    During any of these nomination
	2   procedures, either at the meeting or before the
	3   meeting, were you ever coerced from running for
	4   office?
	5        A.    No.
	6        Q.    Were you ever coerced or threatened
	7   from nominating some other delegate --
	8        A.    No.
	9        Q.    -- to run for office?
	10	    Have you felt inhibited for any reason
	11   over the years about running for office?
	12        A.    No.
	13        Q.    Have you felt inhibited for any reason
	14   over the years from nominating another delegate?
	15        A.    No, I haven't.
	16        Q.    And have you ever heard of any other
	17   delegate who has been coerced or threatened from
	18   running for office?
	19        A.    No.
	20        Q.    Have you ever heard that any other
	21   delegate has been coerced or threatened from
	22   nominating another delegate?
	23        A.    No.
	24        Q.    Have you seen or heard anything over

 
	1   the years which caused you to think that the
	2   District Council was run by members of organized
	3   crime?
	4        A.    No.
	5        Q.    Have you seen or heard anything since
	6   you became a delegate that led you to believe
	7   that the Council was not democratically run?
	8        A.    No.
	9        Q.    Have you seen or heard anything since
	10   becoming a delegate that led you to believe that
	11   the Council discouraged delegates from running
	12   for office?
	13        A.    No.
	14        Q.    Or from nominating other delegates for
	15   office?
	16        A.    No.
	17        Q.    Have you seen or heard anything since
	18   becoming a delegate that led you to believe that
	19   the Council discouraged delegates from expressing
	20   their opinions about any subject?
	21        A.    No.
	22        Q.    Based on your experience as a
	23   delegate, do you have an opinion as to why at
	24   least over the last 20 to 25 years there has been

 
	1   no contested elections for office within the
	2   Council?
	3        A.    Well, normally, the people elected and
	4   nominated to fill vacancies, everybody knows them
	5   to certain extent, because they are coming from
	6   one of the locals.  And as far as why there is no
	7   opposition, I've been, over the years I've been
	8   satisfied with the leadership and the people they
	9   have appointed or elected.
	10        Q.    There has been testimony at this
	11   proceeding that delegates are too afraid to voice
	12   opposition to the District Council.  Did you hear
	13   that testimony?
	14        A.    No, I haven't.
	15        Q.    Do you agree with that statement?
	16        A.    Do I agree with it?  No.
	17        Q.    Why not?
	18        A.    Because it's, in my view, I've never
	19   come across the situation in which that was the
	20   case, that somebody was or made knowledge that
	21   they were intimidated from running for office or
	22   accepting appointments, something like that.
	23        MR. BARR:  I have nothing further.  Mr.
	24   Thomas might ask you some questions, Mr.

 
	1   LoVerde.
	2		CROSS-EXAMINATION
	3   BY MR. THOMAS:
	4        Q.    Good morning, sir.
	5        A.    Good morning.
	6        Q.    In response to one of Mr. Barr's
	7   questions just a moment ago, I think you
	8   indicated that you believed this union has no
	9   ties to the mob, is that right?  Is that what you
	10   said?
	11        A.    Do I believe that?
	12        Q.    Yes.
	13        A.    Yes.
	14        Q.    Well, let's take a look at, for
	15   starters, just some of the things that are in the
	16   public record, okay?
	17        A.    Okay.
	18        Q.    And let's start, for example, with the
	19   list of events on one of these charts.  We can
	20   use this as a, to speed things along.  This is
	21   GEB Exhibit 184.
	22	    You were a delegate when Mr. Accardo
	23   and Mr. Pilotto and Mr. Caporale were indicted,
	24   were you not?

 
	1        A.    Yes.
	2        Q.    And you were a delegate when they were
	3   convicted?
	4        A.    Yes.
	5        Q.    And you were familiar with the fact
	6   that the allegations in that case very
	7   substantially were tied to organized crime
	8   allegations?
	9        A.    No, I wasn't.
	10	    Go ahead.
	11        Q.    Are you saying that you were unaware
	12   of the fact that the Pilotto and Caporale
	13   convictions were related to organized crime?
	14        A.    I was unaware that it was organized
	15   crime.  I know they had convictions.
	16        Q.    You had no understanding of what they
	17   were convicted of?
	18        A.    Yes, I do.  I did have an
	19   understanding of what they were convicted of.
	20        Q.    What was your understanding of what
	21   they were convicted of?
	22        A.    It was supposed to have been kickbacks
	23   from some vendors or something to do with the
	24   health and welfare services.

 
	1        Q.    And you did not understand that to be
	2   related to organized crime?
	3        A.    I did not relate it to organized
	4   crime.
	5        Q.    So I take it you didn't read the
	6   indictment then?
	7        A.    No, I didn't.
	8        Q.    And what was told to you in the
	9   District Council meetings when Mr. Caporale
	10   returned after that conviction?  Was there no
	11   mention of organized crime in connection with
	12   that?
	13        A.    I don't recall that.
	14        Q.    If it happened, would you recall it?
	15        A.    Probably.
	16        Q.    So to the extent Mr. Pilotto and Mr.
	17   Caporale's conviction was discussed at all at the
	18   District Council, there was never any mention of
	19   the fact that it was a conviction that related to
	20   organized crime?
	21        A.    Correct.
	22        Q.    And I take it the same is true at the
	23   discussion in the District Council where Mr.
	24   Caporale after his conviction was promoted to

 
	1   business manager?  There was still no discussion
	2   about the organized crime ties in that
	3   indictment?
	4        MR. BARR:  I have an objection to the word
	5   "promoted."  I'm not sure that is an accurate
	6   characterization.
	7   BY MR. THOMAS:
	8        Q.    You voted in October of 1992 for Mr.
	9   Caporale to go not only from a position, to be
	10   reinstated to the position of
	11   secretary/treasurer, but also to get the position
	12   of business manager, correct?
	13        A.    I don't recall.  But if I was at that
	14   meeting, I would have voted, yes.
	15        Q.    And business manager is considered to
	16   be a higher position than secretary/treasurer,
	17   correct?
	18        A.    It's a higher position, but also it's
	19   other duties.
	20        Q.    Okay.  But it is a higher position?
	21        A.    It's a higher position, yes.
	22        Q.    And when that discussion and that vote
	23   took place, no one mentioned the fact of
	24   organized crime in the underlying case that he

 
	1   had just been convicted of, correct?
	2        A.    Not that I recall.
	3        Q.    Again, just limiting ourselves to
	4   public record here, when you say that you were
	5   unaware of any ties of organized crime to this
	6   union, are you excluding the case of United
	7   States vs. Frank Caruso?
	8        A.    What is the first part of your
	9   question?
	10        Q.    When you say there is no mob ties to
	11   this union, are you excluding United States vs.
	12   Frank Caruso?
	13        MR. BARR:  Objection, Mr. Thomas.  That
	14   seems to assume a fact, that Mr. Caruso is
	15   involved in organized crime.  I don't think there
	16   is any showing of that in this record.
	17        MR. THOMAS:  Objection is noted.  You can
	18   answer the question.
	19   BY MR. THOMAS:
	20        Q.    Are you excluding that?  Are you not
	21   taking that into account?
	22        A.    No.  I'm taking that into account.
	23        Q.    So in other words--
	24        A.    I mean, I just don't know that.  I

 
	1   know Frank Caruso.  I don't know if anything was
	2   tied to organized crime.
	3        Q.    So you are not aware of what the
	4   allegations were in that case?
	5        A.    I'm familiar with what the allegations

	6   were, yes.
	7        Q.    What do you understand the allegations
	8   to have been?
	9        A.    Something to do with gambling.
	10        Q.    Did it also involve extortion?
	11        A.    I don't know if it did that.  I know
	12   it was gambling.
	13        Q.    Did you understand it was tied in any
	14   way to organized crime?
	15        A.    I don't, in my understanding, I don't
	16   know if it was tied to organized crime.  Not to
	17   my knowledge.
	18        Q.    Did you undertake any activities to
	19   look into that?
	20        A.    No, I didn't.
	21        Q.    Again, limiting ourselves to the
	22   public record, when you say that you don't
	23   believe that the mob is tied in in any way with
	24   this union, were you familiar with the

 
	1   Congressional testimony in which Vince Solano,
	2   the head of local, one of the locals in the
	3   Chicago District Council, and an officer of the
	4   District Council, was publicly named as being an
	5   organized crime boss here in Chicago?
	6        A.    Yes, I'm aware of that.  You are
	7   talking about Congressional hearings?
	8        Q.    Yes.
	9        A.    Yes.
	10        Q.    And do you simply discount that
	11   completely?
	12        A.    The Government didn't have a problem
	13   with it.  They never took no action or anything.
	14        Q.    That is not my question.
	15        A.    What?
	16        Q.    When there is a public statement that
	17   Vince Solano, an officer of this union, was an
	18   organized crime boss in the north side of
	19   Chicago, did you just simply disregard that
	20   completely?
	21        A.    Yes.
	22        Q.    So just if we are keeping score here,
	23   there are three things that we have gone over
	24   that you say are not persuasive in your view?

 
	1        A.    I don't know what you are talking
	2   about, organized crime things.  I don't have the
	3   information there.  If you are asking me
	4   personally, fine.  I can answer personally.
	5   Whether these people also besides the charges
	6   were involved with organized crime, I don't
	7   know.
	8        Q.    When you say that you don't think the
	9   mob is tied in with this union, are you excluding
	10   the indictment of U.S. versus DiVarco and
	11   Matassa?  Did you know about that?
	12        A.    I didn't know about that until these
	13   hearings were going on.
	14        Q.    How about Mr. Guttadauro?
	15        A.    Yes.
	16        Q.    Does that factor into your
	17   consideration at all?
	18        A.    In my consideration as being organized
	19   crime?
	20        Q.    Yes.
	21        A.    I really don't know.
	22        Q.    How about the convictions of Palermo
	23   and Guzzino, does that factor into your analysis
	24   at all?

 
	1        A.    No, it doesn't.
	2        Q.    So the fact that they were indicted
	3   and convicted of a mob-related offense has no
	4   bearing on your view as to whether this union has
	5   a mob problem?
	6        A.    I am having a problem when you say
	7   mob-related offense.  They were convicted of a
	8   violation of some law.
	9        Q.    You didn't know what that was?
	10        A.    No, I don't know.  If the law says mob
	11   related, whatever they were convicted of.
	12        Q.    Are you familiar with what the
	13   allegations were in that case?
	14        A.    Yes.
	15        Q.    So you knew then that it involved
	16   multiple acts of extortion and racketeering
	17   involving among other things the murder of the
	18   Spilotro brothers in connection with the skimming
	19   of receipts from Las Vegas?
	20        A.    What?  Is that a question?
	21        Q.    It was a question.
	22        A.    Would you repeat that?
	23        Q.    So you knew then that the case
	24   involved allegations of multiple acts of

 
	1   racketeering and extortion including the murder
	2   of the Spilotro brothers and the skimming of
	3   receipts from -- and their involvement with the
	4   skimming of receipts from casinos in Las Vegas?
	5        A.    I was aware of them violating some law
	6   and being indicted and convicted.  That was it.
	7   Multiple offenses and stuff like that, I don't
	8   remember.
	9        Q.    So is it your view that there is no
	10   mob in Chicago?
	11        A.    Is it my view there is no mob in
	12   Chicago?
	13        Q.    Yes.
	14        A.    From -- basing on the information I
	15   received from newspapers and whatever, they
	16   contend there is.
	17        Q.    What's your view?
	18        A.    Well, my view, I don't know.  I don't
	19   have sufficient information that I can make an
	20   independent judgment on that.
	21        Q.    Okay.  So if indictments which lead to
	22   convictions describe a defendant's tie with the
	23   mob, that's not necessarily the answer for you.
	24   It is simply a case of a violation of a statute,

 
	1   and the question of whether or not it relates to
	2   the mob is sort of a separate question, is that
	3   what you are saying?
	4        A.    Yes.
	5        MR. CARMELL:  Objection.  That had about
	6   four components in it.
	7        MR. THOMAS:  The witness understood it and
	8   answered the question.
	9        MR. CARMELL:  Well, I don't think he did,
	10   but you can ask him if he did.
	11   BY MR. THOMAS:
	12        Q.    Do you understand what I was saying?
	13        A.    No, I don't.
	14        Q.    Let's go over it again.  If Mr. Barr
	15   wants to hear it again, we will do it again.
	16        MR. CARMELL:  I don't want to hear the same
	17   question again, but if you rephrase it, maybe it
	18   would make sense.
	19   BY MR. THOMAS:
	20        Q.    When we go over a whole list of
	21   cases --
	22        A.    Yes.
	23        Q.    -- in which the indictments themselves
	24   refer to the mob and relate the charged conduct

 
	1   to the mob, you are saying even when people are
	2   convicted of those offenses, that's not
	3   persuasive to you that the -- that it was a
	4   mob-related conviction, is that what you are
	5   saying?
	6        A.    If I had more information that would
	7   show me exactly what went on.  When I say I am
	8   knowledgeable of an offense that occurred, I am
	9   knowledgeable that it occurred maybe from a
	10   newspaper article or something like that.  As far
	11   as the details of the conviction or what was
	12   done, I have no knowledge of it.
	13        Q.    Well, let's just take these one at a
	14   time.  You were a delegate back in 1982, correct?
	15        A.    Yes.
	16        Q.    And so was your brother?
	17        A.    Yes.
	18        Q.    And in 1982, Mr. James Caporale came
	19   back to the Chicago District Council having just
	20   been convicted in a major trial down in Florida,
	21   correct?
	22        A.    Correct.
	23        Q.    You knew at least something about that
	24   trial, right?

 
	1        A.    Yes.
	2        Q.    And what did you know about that
	3   trial?
	4        A.    That there was a trial down in
	5   Florida.  They had the trial down in Florida.  It
	6   had to do with some sort of kickbacks with the
	7   welfare funds.
	8        Q.    Now, at the time, sir, as a delegate,
	9   you had a fiduciary responsibility not only to
	10   your own local union but also to the District
	11   Council, correct?
	12        A.    Yes.
	13        Q.    And despite that fiduciary
	14   responsibility, you welcomed back the man who had
	15   just been convicted of being involved in this
	16   scheme, correct?
	17        A.    I don't recall I was at that
	18   particular meeting, but if I was there, I would
	19   have -- I probably would have done the same as
	20   everybody else.
	21        Q.    Well, before we get to the document
	22   then, let me explore that answer.  Why would you
	23   have done what everybody else did?
	24        A.    Huh?

 
	1        Q.    Why would you have done what everybody
	2   else did?
	3        A.    Well, what you are contending that

	4   everybody else did as far as he was brought
	5   back -- let me see.
	6        Q.    Did you finish your answer?
	7        A.    I don't believe I did.  Can you give
	8   me the question again?
	9        Q.    Yes.  The question was why would you
	10   have done what everyone else did?
	11        A.    I says if I was at that meeting, I
	12   probably would have done.  I probably would have
	13   welcomed Jim Caporale back.
	14        Q.    And the question is why would you have
	15   done in your own words what everyone else did?
	16        A.    Well, what I am saying, what everyone
	17   else did is what you are contending what happened
	18   at that meeting.
	19        Q.    Well, I guess we are not getting
	20   anywhere.  Why don't we take a look at the
	21   minutes.  This is from GEB Exhibit 116, Bates
	22   stamped D00104A.  Okay.  The minutes from June
	23   30th, 1982.  And your name appears on the list of
	24   attendees, correct?

 
	1        A.    No, it doesn't -- oh, yes, it does.
	2        Q.    R.J. LoVerde?
	3        A.    Right.
	4        Q.    Bottom of the third column?
	5        A.    Um-hum.
	6        Q.    And your brother was there as well,
	7   correct, at the top of the left column?
	8        A.    Yes.
	9        Q.    Okay.  Now, if we turn the page, under
	10   the category unfinished business, the rank and
	11   file were happy indeed to see Brother Caporale
	12   back and a vote of confidence by a standing
	13   ovation was extended to him and any and all
	14   assistance would be afforded him upon motion made
	15   by Brother Lazzaretto and unanimously approved.
	16   Do you see that?
	17        A.    Um-hum.
	18        MR. BARR:  Excuse me.  The witness didn't
	19   answer audibly.  I guess he did, but he didn't
	20   answer --
	21   BY THE WITNESS:
	22        A.    Yes, I see it.
	23        MR. BARR:  He didn't answer in English.  No
	24   offense, Mr. LoVerde.

 
	1   BY MR. THOMAS:
	2        Q.    So that happened and you participated
	3   in the welcoming of him back and the standing
	4   ovation, correct?
	5        A.    Yes, I did.
	6        Q.    Now, again, this is a union to which
	7   you owed a fiduciary responsibility, correct?
	8        A.    Yes.
	9        Q.    And the man who is being welcomed back
	10   and given a standing ovation is a man who has
	11   just violated the trust of this union, correct?
	12        A.    Correct.
	13        Q.    Is there any more brazen way that
	14   Mr. Caporale could have violated the trust of
	15   this union other than taking kickbacks with
	16   respect to the Health and Welfare Fund of the
	17   union?
	18        MR. BARR:  Objection.  That's not a proper
	19   question.
	20        MR. THOMAS:  The objection is noted.
	21        MR. BARR:  Are you asking if the defendant
	22   might have committed murder, would that have been
	23   different?  I mean, that's just -- there is no
	24   call for such a question.

 
	1        MR. THOMAS:  I am entitled to explore with
	2   this witness the reasons for the vote.  Your
	3   objection is noted.
	4        MR. BARR:  Again, I don't think it is a
	5   proper question.
	6        MR. THOMAS:  Do you want to get Mr. Vaira on
	7   the line?
	8        MR. BARR:  If we have to, yes.
	9        MR. THOMAS:  Fine.  Let's take a break.
	10	        (WHEREUPON, a recess was had.)
	11        MR. THOMAS:  Let's go back on the record.
	12   BY MR. THOMAS:
	13        Q.    Mr. LoVerde, we were talking about
	14   before the break the conviction of Mr. Caporale
	15   and the response at the District Council when he
	16   came back to Chicago.  Okay?
	17        A.    Correct.
	18        Q.    Just to set the background.
	19	    Sir, is it not true that what
	20   Mr. Caporale did and what the jury found that he
	21   did was about as bad a thing as any officer and
	22   fiduciary of this union could have done?
	23        A.    Yes, but they also found people
	24   innocent at that trial.

 
	1        Q.    I am not talking about anybody who was
	2   acquitted.
	3        A.    Oh.
	4        Q.    I am just talking about Mr. Caporale.
	5   He was found guilty beyond a reasonable doubt by
	6   twelve jurors, ultimately affirmed on appeal.
	7   The question is, to you, what he did and what the
	8   jury found that he did was about as bad as
	9   anything an officer of this union could have
	10   done, isn't that right?
	11        A.    What he done, I believe when he came
	12   back to the Council, he still had his appeal
	13   rights going and at that portion I would reserve
	14   my judgment until we went through the whole
	15   gamut.
	16        MR. BARR:  I am sorry.  I didn't hear the
	17   last word.
	18        THE WITNESS:  Gamut.
	19   BY MR. THOMAS:
	20        Q.    Well, in earlier testimony if I heard
	21   you correctly, you indicated that you don't
	22   necessarily follow all of the details of these
	23   things and you don't necessarily assume an
	24   indictment is true until it is proven guilty, is

 
	1   that right?
	2        A.    Correct.
	3        Q.    But once a jury unanimously beyond a
	4   reasonable doubt says somebody is guilty, you
	5   have enough faith in the judicial system to
	6   accept that verdict?
	7        A.    The gentleman still had due process
	8   coming to him by his appeal process.
	9        Q.    What happened to him after his appeals
	10   were exhausted?
	11        A.    He went to jail.
	12        Q.    So it is your position or your view
	13   that until someone's appeals are exhausted, they
	14   ought to still be able to have a serious amount
	15   of control over this union even if they have been
	16   convicted of violating this union's trust?
	17        A.    At that time that's what I believed,
	18   yes.
	19        Q.    Do you still believe that?
	20        A.    Yes.
	21        Q.    So if hypothetically speaking one of
	22   the current officers of the present District
	23   Council were convicted by a jury of embezzling
	24   funds, you would say I've got no problem with

 
	1   that until their appeals are exhausted?
	2        MR. BARR:  Objection to the hypothetical.
	3        MR. THOMAS:  He gave us the hypothetical.
	4        MR. BARR:  He did?
	5        MR. THOMAS:  By his earlier answer.
	6   BY MR. THOMAS:
	7        Q.    Do you understand my question?
	8        A.    No, I don't.
	9        Q.    If one of the current leaders, one of
	10   the current officers of the District Council were
	11   convicted today of embezzling this union's money,
	12   you would say that that's no problem until his
	13   appeal is finalized?
	14        MR. BARR:  I still have an objection.  I
	15   will let the witness answer.
	16   BY THE WITNESS:
	17        A.    If I had enough information for me to
	18   make an independent judgment of that, then I
	19   would.
	20   BY MR. THOMAS:
	21        Q.    Well, sir, in the system that we have,
	22   is there anything more independent than a jury of
	23   twelve people?
	24        A.    Yes.  Probably a judge.

 
	1        Q.    So you don't buy Mr. Caporale's
	2   conviction because it wasn't a bench trial.  It
	3   would have had more credibility to you if it
	4   would have been a bench trial?
	5        A.    But that was an alternative.
	6        Q.    And the defendants are the ones who
	7   choose which is most advantageous to them, isn't
	8   that right?
	9        A.    I don't know.
	10        Q.    Well, let's go back to the other
	11   question though.  If -- and let me make
	12   absolutely clear there is no allegation out there
	13   along these lines.  This is more of a follow-up
	14   to your earlier question -- or your earlier
	15   response.
	16	    If a current officer stole money from
	17   this union and a jury found him guilty, you'd
	18   take a very distancing approach to that?
	19        MR. BARR:  I have two objections, one to the
	20   hypothetical and, two, it is unclear about what
	21   yo