UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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UNITED STATES OF AMERICA,
Plaintiff,
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DISTRICT COUNCIL OF NEW YORK CITY AND VICINITY OF THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, et al.,
Defendants.
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90 Civ. 5722 (CSH)
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PRETRIAL MEMORANDUM IN SUPPORT OF
MOTION TO ENFORCE CONSENT DECREE
Pursuant to the Court's scheduling orders of December 14 and 15, 2005, Eugene Clarke respectfully submits this memorandum setting forth his case-in-chief in support of his motion to enforce the Consent Decree. The documents referenced in the memorandum are attached as exhibits to the accompanying affidavit of counsel. As shown below, the evidence is clear and convincing that Michael Forde, the former business manager of Local 608 and current Executive Secretary-Treasurer ("EST") of the District Council, and his cronies have systematically violated the Consent Decree's referral rules on an ongoing basis. Clarke respectfully requests that the Court sanction Forde for committing and aiding and abetting these violations and order him to reimburse the District Council for expenses that it incurred in defending the motion on his behalf.
Clarke alleges that Forde and John Greaney, the individual Forde appointed as his successor as Local 608's business manager, manipulated the referral system in order to insure that their political cronies got plum assignments as shop stewards. The recipients of the manipulated referrals herein were John Corrigan, John Hearty, and Edward Maudsley. Corrigan and Hearty co-chaired the fundraiser for Forde's criminal defense that was held on or about March 25, 2001, after he was indicted in state court for allegedly accepting a bribe from a contractor.[1] While still business manager of Local 608, Forde appointed Maudsley as the local's representative to the District Council committee that oversaw the 1999 election for EST. Forde later appointed Maudsley to the position of business agent for Local 608.
Under the Consent Decree, stewards had to be selected from the out-of-work list ("OWL"). Steward selections were supposed to be based upon length of unemployment and the skills needed for the job. Forde and Greaney allowed Corrigan and Hearty to keep their names on the out-of-work list while they were employed. By "riding the list," Corrigan and Hearty moved ahead of other carpenters who were actually unemployed and were therefore on it legitimately. When a plum assignment did become available, Forde and Greaney "gamed" the OWL computer, which was supposed to match carpenters to incoming steward requests according to skills. To this end, Forde and Greaney falsified the manning request forms to list various skills besides those actually requested by the employers involved in order to make Corrigan and Hearty, as well as Maudsley, "unique" for purposes of being matched by the computer.
As shown below, Forde, while business manager of Local 608, falsified the referral request that resulted in a steward appointment on April 23, 1999 for Maudsley. The employer, Eurotech, asked for a steward with ceiling skills. Forde, however, added two skills that Eurotech did not need or request -- laboratory furniture installation and layout foreman -- in order to insure that the OWL computer matched Maudsley with this referral request.
Greaney submitted the requests that resulted in steward appointments for Hearty on July 13, 2000 to 22 River Terrace and on February 5, 2001 to 110-120 Church Street. On both requests, Greaney omitted the one skill that was required (protection) and wrote instead that the employer involved, Hi-Rise, had asked for a certified steward with a welder's certificate and window and storefront installation skills. Hi-Rise, however, did not request a welder or window or storefront installer for either job. By falsifying the requests, Greaney rigged these two referrals to insure that Hearty got them.
Corrigan received steward appointments on November 1, 1999 to Trump West and on March 21, 2001 to the Time Warner/AOL project on the basis of his purported possession of a 40 Hour OSHA certificate that made him unique among all the certified stewards on the OWL on those two dates. Corrigan, however, never possessed this so-called skill because such a certificate did not exist.
As shown below, Forde aided and abetted the four violations involving Hearty and Corrigan. Thus, by late 2001, Forde had learned that Hearty and Corrigan were riding the list when they received referrals on February 5, 2001 to 110-120 Church and March 21, 2001 to Time Warner. On the basis of that knowledge, he was obligated to remove them from these two jobs; instead, he did nothing and they continued in their respective steward positions for several more months. At the same time, Forde had also been in a position to have prevented them from receiving steward appointments on November 1, 1999 and July 13, 2000; again, however, he did nothing.
Finally, in January 2002, Forde presented to the Court a report that purported to set forth the findings of an internal investigation into Clarke's allegations. In the report, Forde chose to conceal from the government and the Court both the falsified request scam and the riding-the-list scam and the role that he and Greaney played in insuring the success of both scams. By doing so and failing to suspend or terminate Greaney as Local 608's business manager, Forde facilitated the continued use of these scams to favor his cronies and defraud other qualified carpenters out of plum steward appointments. Indeed, according to the reports of Walter Mack, the Independent Investigator, these two scams continued to be used into 2005.
The motion alleges that the referrals violated Rule 5F of the Consent Decree's Referral Rules as interpreted by IRO Decision No. #1[2] and District Council By-Law 16.
Rule 5F stated as follows:
When the Local Union determines that the member who is first on the out-of-work list cannot be referred because of refusal, unavailability, or lack of required skills, the Local Union shall then refer the next member on the out-of-work list who is willing, available and has the required skills.
(Ex. 1, Bates # 28).
Insofar as shop stewards were concerned, Rule 5F was interpreted by the IRO in his Decision No. #1 as follows:
Shop stewards must be selected from the individuals referred from the out-of-work list to a given job. If there is no individual among those referred who is qualified to serve as a steward, the next available individual on the out-of-work list in order of priority who either has served as a steward, or who is qualified to serve as a steward, shall be referred to the job as steward.
(Ex. 2, Bates # 35).
A carpenter was "available" only if he or she was not working, for as Rule 4C provided:
Only members who are not currently employed at the trade may register their availability for referral.
(Ex. 1, Bates # 27).
The Consent Decree's referral rules were incorporated into the District Council's by-laws under Section 15 thereof. (Ex. 3, Bates # 49). Section 16 of the by-laws re-states the rule insofar as stewards are concerned: "Stewards shall be appointed according to their skills and position on the out-of-work list… No worker shall be referred from the out-of-work list out of turn to fill a steward position." (Id., Bates # 50).
The Consent Decree’s referral rules “were intended to eliminate the corruption, favoritism and cronyism that existed under the old system" by providing that union members would be "referred to work on the basis of length of unemployment.” (Ex. 6, First Interim Report of IRO Conboy, at 9).
Local 608's jurisdiction covers the Bronx and Manhattan's west side. There are separate general construction locals for Manhattan's east side, Brooklyn, Queens, and Staten Island as well. There are also five specialty locals: floor coverers, dock builders, timbermen, millwrights, and inside shop workers. (Ex. 55, Forde Dep. at 15).
The OWL office listed 60 different skills that were recognized for the District Council's five general construction unions. (Ex. 5, Bates # 639-640). Each registrant on the OWL listed the skills that he or she allegedly possessed, thereby creating his or her own skills portfolio. (Ex. 11 at n.1).
One of the 60 recognized skills was "certified steward," which was designated by the abbreviation "CSS" on the out-of-work list. To obtain certification as a steward, a carpenter was required to complete ten courses offered by the District Council's Labor Technical College: 10-Hour OSHA, First aid, CPR, sexual harassment, hazardous communication, Hilti-Ramset powder tool, fire prevention, laser safety, and I.D. process. (Ex. 26, Bates 745, Ex. 25, Greaney Dep. at 59).
The duties of the shop steward "are to enforce the collective bargaining agreement… to make sure that other trades are not doing carpentry work, help members with disputes with the foreman or the company. They are basically the union's representative on the job." (Ex. 55, Forde Dep. at 12). As a result, a carpenter cannot serve simultaneously as both a steward and a foreman on the same job (Ex. 49, Early Dep. at 38), "[b]ecause a man can't wear two hats" (Ex. 25, Greaney Dep. at 58) at the same time. The steward is the first person sent out on a job from the union and stays "[u]sually until the job is pretty much wrapped up. " (Ex. 55, Forde Dep. at 12).
As shown below, the general contractor or project manager for a construction project would often retain various other contractors to perform different aspects of the actual construction, e.g., one to pour concrete foundations and floors, a second to erect interior walls from drywall (sheetrock), a third for ceilings, a fourth to install the windows, a fifth to install storefronts, a sixth to perform protection work, etc. (Id., Dep. at 13). Upon starting work, each contractor that is a signatory to a collective bargaining agreement with the District Council must "call[] in the job to the local union or the District Council and a steward is sent to the contractor." (Id., Dep. at 14). Where are several contractors on a jobsite, each one is assigned its own steward. (Id., Dep. at 14).
The District Council's 1996-2001 collective bargaining agreements ("CBAs") with contractors that were members of the Wall-Ceiling Association and the Cement League[3] or were "independents" provided as follows:
The first carpenter on the jobsite shall be referred by the Union. The second carpenter shall be the Employer's selection. The balance shall be 50% from the Union and 50% from the Employer… A working Job Steward on each shift shall be appointed by the Union.
(Ex. 7, Bates # 78; Ex. 8, Bates # 137; Ex. 9, Bates # 193).
As per the CBAs, the first carpenter referred from the District Council is the steward, who is also the last to be laid off as the job is completed. (Ex. 55, Forde Dep. at 12). Typically, a contractor starting a job telephones a manning request for a steward into the local union in whose geographic jurisdiction the jobsite is located. (Ex. 12, Danielson Dep. at 21-22). The manning request is put into writing on a standardized form by the local's business manager or one of its business agents, who then faxes it over to the OWL office. (Id.). The form contains a blank line for listing the skills requested by the contractor for the position[s] being filled. (Ex. 16, Bates # 1131). The OWL computer is then supposed to match the request with the lowest carpenter on the out-of-work list (whoever was unemployed for the longest period) with the skills listed on the manning form. (Ex. 12., Danielson Dep. at 23).
In 1997, Forde and Greaney formed a political slate and won election as president and vice-president, respectively, of Local 608.[4] (Ex. 25, Greaney Dep. at 12-13). At the time, Forde was the appointed business manager of Local 608; Greaney became one of the Local's appointed business agents in 1998. (Id. at 11 & 13).[5] For several years prior to his appointment as business manager, Forde had served as an elected business agent for Local 608. (Ex. 55, Forde Dep. at 6).
When Forde was elected EST in December 1999 and took office in January 2000, Greaney succeeded him as president of Local 608.[6] (Ex. 25, Greaney Dep. at 12). In February 2000, Forde, as EST, appointed Greaney to succeed him as business manager of the Local as well. (Id. at 11).
While still president of Local 608, Forde appointed Maudsley as the local's representative to the District Council committee that oversaw the 1999 election for District Council EST. (Ex. 55, Forde Dep. at 11). As EST, Forde later appointed Maudsley to the position of business agent for Local 608. (Id. at 9).
In an interview with the staff of IRO Conboy conducted in April 1997, Forde admitted that he had frequently appointed members who were not on the out-of-work list as stewards in violation of the Consent Decree's referral rules. (Ex. 56, ¶'s 3-8). He also admitted that he often appointed specific carpenters to the position of steward at the request of certain contractors, including Eurotech and North Berry, frequently allowing them to travel as a steward from jobsite to jobsite. (Id., ¶'s 9 & 10). Forde further admitted that "he told many members the location of job sites and where to look for work" with the result that at many jobsites "50% of the carpenters do not come from the hall as is required in the collective bargaining agreement, but are instead manned by members shaping their own jobs." (Id., ¶ 14).
The IRO's investigation lead to charges being filed against Forde and eventually to a settlement agreement, dated March 1998, in which he agreed to pay a $5,000 fine for each new violation of the referral rules. (Ex. 4).
After executing the settlement agreement, Forde, as shown below, continued to violate the rules, while fabricating a paper trail that created the appearance that he had complied with them.
After not receiving any referrals as a steward for a number of months, Clarke, in early May 2001, met with Scott Danielson, the supervisor of the OWL office, and Maurice Leary, the District Council's Director of Operations, to try to find out why. (Ex. 10). They acknowledged that his name had been omitted from the steward lists for Local 608 and Local 157, which two locals covered all of Manhattan and the Bronx. (Ex. 11). They claimed these omissions were the result of a clerk's input errors. (Id. at 1-2).
Soon thereafter, Clarke asked to review steward referral records. By letter dated July 24, 2001 to the District Council's Executive Committee (Ex. 16), Clarke challenged steward referrals to seven of Forde's political cronies, among them Corrigan, Hearty, and Maudsley. As to the seven, a definite pattern emerged. For example, Corrigan received steward referrals on November 1, 1999, July 11, 2000, August 4, 2000, August 25, 2000, and March 21, 2001. (Id., Bates # 1071, 1077, 1079, 1081, & 1087). In each instance, he made last minute additions to his portfolio that enabled him to match the incoming request. (Id., Bates # 1063-1066).
In his letter, Clarke also asked the Executive Committee to review the records of the District Council's Benefit Funds Office "for these individuals to determine which employers made contributions for them and for what periods of time." (Id. at 7, Bates # 1059). As it was later revealed, the records showed that Corrigan was ineligible for all 5 of the afore-mentioned steward referrals and that Hearty was ineligible for the two he received on July 13, 2000 and February 5, 2001.
As shown below, the Executive Committee authorized that internal union charges be brought against Corrigan and Hearty for riding the list in the weeks and months preceding the referrals of November 1, 1999, July 13, 2000, February 5, 2001, and March 21, 2001. Forde's opposition to Clarke's motion, however, concealed this fact from the Court.
On April 13, 1999, Maudsley added his name to the out-of-work list. (Ex. 16, Bates # 1129).[7] On April 22, 1999, Maudsley added "layout foreman" and "laboratory furniture installer" to his list of skills, which already included certified steward and acoustical ceilings. (Id. - Two entries designated by "Skill Add" notations.). According to Danielson, the manning request form that led to Maudsley's referral to Eurotech at 111 8th Avenue "was called in by then Local 608 Business Manager Michael Forde" on April 23, 1999. (Ex. 17, Bates # 778). On the form, Forde listed four skills that Eurotech had purportedly requested: certified steward, acoustical ceilings, layout foreman, and laboratory furniture installer. (Ex. 16, Bates # 1131). The OWL computer matched Maudsley for this referral. (Id., Bates # 1132, the Referral/Dispatch Notice from Danielson's office.)
As business manager, Forde received a copy of the weekly OWL for Local 608. (Ex. 12, Danielson Dep. at 35; Ex. 25, Greaney Dep. at 62). It listed all the carpenters who had registered as out of work and the skills portfolios they had selected for themselves. (Ex. 19 - List for 4/19/99). Forde therefore had access to information that allowed him to make a carpenter "unique" for purpose of insuring the OWL computer would match a crony for a particular job.
On the OWL for April 19, 1999, (Ex. 19, Bates # 1205-1371), only 7 out of 159 certified stewards listed laboratory furniture as a skill in their portfolios: #1073-Routier, #1416-Toal, #1436-Barlow, #1642-Ventimiglia, #1675-Brown, #1682-Simon, and #1795-Lym. (Id., Bates # 1272, 1295, 1296, 1310, 1312, 1313, & 1321). Including laboratory furniture as one of the requested skills therefore eliminated from consideration 96% of the certified stewards on the OWL. Of the 7, 3 (Routier, Toal, and Barlow) had already received referrals by April 22.[8] Of the remaining four, only one, Lym, included laboratory furniture in his portfolio. Lym, however, did not list layout/foreman as one of his skills. (Id., Bates # 1321).
The project at 111 8th Avenue involved the renovation of the thirteenth floor. Henegan, the general contractor for the project, subcontracted work within the District Council's jurisdiction to two companies, Eurotech Construction Corp. and Donaldson Acoustics, Inc., awarding the drywall work to the latter (Ex. 27, Bates # 2839-2841) and the ceiling work to the former. (Id., Bates # 2833-2835). According to Henegan, it "does not perform furniture installation on any of its projects." (Ex. 28, Bates # 2830). Consistent with its practice, Henegan's subcontracts with Eurotech and Donaldson did not provide for either to install laboratory furniture at 111 8th Avenue. (Id.).
Michael Purser, the job superintendent for Eurotech, confirmed that when he called Local 608 to request a steward for this project, he did not list "laboratory furniture installer" as one of the skills he wanted the steward to possess. (Ex. 29, Purser Dep. at 6). Moreover, although he could not specifically recall requesting a layout foreman in his request, Purser was sure that by April 22, he had already hired Tom McHugh as the foreman for this job, that layout was normally the function of the foreman, and that McHugh was skilled at layout work (id. at 7-8); for these reasons, Eurotech had no need for a steward with either layout or foreman skills, a conclusion confirmed by the fact that when Maudsley was replaced as steward a few weeks later (Ex. 13, Bates # 822-834),[9] his replacement, Anthony Zava, did not list either layout foreman or laboratory furniture installer as a one of his skills. (Ex. 19, Bates # 1307).[10]
As noted above, on April 22, 1999, Maudsley added the exact two skills that (1) made him unique among the available stewards with ceiling skills and (2) that Forde had added to Eurotech's request without Purser's direction to do so.
For the week of April 19, 1999, the OWL listed four certified stewards who were unemployed longer than Maudsley was, who were still available for referral, and who also possessed ceiling skills: #1634 Scipio; #1720 Dolan; #1795 Lym; and #1895 Wronge. (Id., Bates # 1309, 1315, 1321, 1327). Forde's falsified request enabled Maudsley to jump over all four of them.
On January 5, 1999, Corrigan received a steward referral to North Berry Concrete at the Planet Hollywood jobsite at 47th Street and Broadway. (Ex. 16, Bates # 1068 & 1069). The manning request form for this assignment as a steward with North Berry listed only one requested skill: concrete. (Id.). Corrigan worked the following hours for North Berry at this job: January - 97, February - 140, March - 183, April - 163, May - 191, June - 213, July - 161, August - 136, September - 203.5, and October - 174.5. Ex. 15, Bates # 1024 & 1025; Ex. 59, Bates # 2845).
The regular workweek was 35 hours, or 5 seven-hour days. (Ex. 25, Greaney Dep. at 44). Excluding weekends and one holiday, there were 20 regular workdays in the month of October 1999. (Ex. 23). To reach 174.5 hours for the month, Corrigan therefore worked all 20 days, plus 34.5 hours overtime. When he put his name on the out-of-work list on October 4, 1999, Corrigan was ineligible to do so because he was still working as the steward at North Berry's Planet Hollywood job. On November 1, 1999, a Monday, Corrigan received a referral as a steward to North Berry's Trump West jobsite. (Ex. 16, Bates # 1070 & 1071).
North Berry was a concrete contractor. (Ex. 30, Excerpts from Deposition of John Vecchione, at 29, 47). The manning request form for November 1, however, did not list concrete as one of the required skills. (Ex. #16, Bates # 1070 & 1071). The request form did list a 40-Hour OSHA certificate as a required skill, an obvious falsification, because, as Walter Mack later found, such a certificate did not exist. (Ex. 18, Bates # 1567).
On the morning of November 1, 1999, Corrigan called the OWL office and added wood framing ("WD Frame") to his list of skills. (Ex. 16, Bates #1063). This last-minute change, when combined with his fictitious 40 Hour OSHA skill, enabled Corrigan to match this request. (Id., Bates # 1071). The referral therefore followed the same pattern that Forde had used to rig Maudsley's referral of April 23, 1999: a falsified manning request form that made Corrigan unique for matching purposes when combined with a last-minute addition to his portfolio.
The Planet Hollywood job continued until mid-January 2000 (Ex. 22, Bates # 1724-1740),[11] another two and one half months, so Corrigan was not laid off for lack of work on November 1, 1999, which would be the usual explanation for a steward to leave a job, as the steward is the first carpenter referred to a job and the last one to be laid off as the work is completed. The vacancy at Planet Hollywood was instead the result of the fact that Corrigan, although ineligible, was matched for the steward's position at Trump West.
On October 29, 1999, a Friday, Greaney submitted a request for a steward replacement for Corrigan at Planet Hollywood to start on November 1. (Ex. 31, Bates # 2895). Greaney therefore knew that the steward's job at Planet Hollywood was going to be vacant three days before the OWL computer created the vacancy by purportedly matching Corrigan "blindly" for the Trump West job. He could have only known this vacancy would occur if in fact he knew that the referral to Trump West was being rigged in Corrigan's favor.
Corrigan, as a shop steward, brought the weekly shop steward reports to the offices of Local 608 every Thursday or Friday. (Ex. 25, Greaney Dep. at 64-65). His weekly visits did not go unnoticed; "He was a pretty large man. You couldn't miss him at that time." (Id. at 66). Forde also received a copy of the out-of-work list every week. (Ex. 12, Danielson Dep. at 35). On the evening of November 1, 1999, a copy of Corrigan's dispatch notice was faxed to the Local. (Id.). For these reasons, Forde had ample reason to know that Corrigan had received a referral while he was riding the list.
The referral was timed to coincide with Forde's nomination as EST. According to the shop steward reports that Corrigan completed, the job employed 40 carpenters (Ex. 24, Bates # 1741-1742); obviously, Forde would benefit from a strong supporter as steward to campaign for him at the jobsite.
By riding the list between October 4, 1999 and November 1, 1999, Corrigan had risen from #1268 to #609 on the list. (Ex. 16, Bates # 1062-1063). The OWL for the week of November 1, 1999 shows that there were at least eight other stewards with the concrete skill that North Berry requested and who were actually unemployed: McCarthy (#779), Sexton (#971), Connolly (#993), Griffin (#1002), M. Muller (#1149), Perrone (#1365), Molloy (# 1396), and Rodriguez (#1495). (Ex. 32, Bates # 2953, 2966, 2968, 2978, 2993, 2998, & 3002).
Corrigan worked the following hours for North Berry at Trump West: November - 174.5; December - 163.5; January - 126; February - 194; March - 223.5; April - 167.5; May - 213; June - 188; and July - 53. (Ex. 15, Bates # 1022-1024). Danielson admitted that the July hours were worked between July 3 and 11, 2000. (Ex. 12, Danielson Dep. at 135). Corrigan therefore put his name back on the list on May 3, 2000, while he was working and ineligible to do so. (Id. at 132-133). Danielson further admitted that Corrigan was therefore riding the list on July 11, 2000, when he received a referral to R&J Construction. (Id. at 136). Corrigan worked 15 days for R & J: July 12, 13, 14, 17, 18, 19, 20, 21, 24, 25, 26, 28, 31, and August 1 and 2, 2000. (Ex. 15, Bates # 984; Ex. 12, Danielson Dep. at 137).
Greaney admitted that on July 11, 2000, he had directed Joe Firth, a business agent, to "'put everything down' in terms of the skills requested for the Shop Steward . . .'to get the right person'" at the R & J jobsite at Trump West. (Ex. 18, Bates #1580). The "right person" in this instance was Corrigan; "everything" included 40 Hour OSHA, framing, and drywall. (Ex. 16, Bates #1077). On the morning of July 11, 2000, Corrigan added framing and drywall to his skills portfolio. (Id., Bates # 1063).
Corrigan reported that while he was working at Trump West for North Berry, "a non-signatory company had tried to deliver kitchen cabinetry to the Trump buildings and offered him a bribe of between $10,000 and $20,000 to permit the cabinets to be delivered to the site." (Ex. 18, Bates 1579). R & J was the drywall contractor that was apparently responsible for installing kitchen cabinets at the site. Greaney admitted that he met with Rothman and Leary and that "it was determined by Local 608 and the District Council that the Shop Steward assigned to R & J… should be somebody good to make sure nothing happens." (Id., Bates # 1579-1580).[12]
Having received the green light to rig a referral for the ineligible Corrigan on July 11, Greaney went ahead and did the same thing for Hearty two days later.
Hearty put his name on the list on May 31, 2000. (Ex. 16, Bates # 1091). In the following six-week period, he worked the following hours for Component Assembly Corp. or its Hi-Rise subsidiary[13] at the Sofitel jobsite: week ending June 20, 2000 - 50 hours; week ending June 27, 2000 - 50 hours; week ending July 4, 2000 - 41 hours; and week ending July 11, 2000 - 46 hours. (Ex. 14, Bates # 913 & 912).
Hi-Rise's payroll records show that Hearty worked at 22 River Terrace on July 12 and 13, 2000. (Ex. 34, Bates # 2604). Thus, he had already been hired by Component/Hi-Rise as a company man at 22 River Terrace, when the computer "matched" him as the steward for that job on July 13, 2000.
Hearty admitted that although he had a relationship with the general foreman for the job, Manny Dominguez, neither of them saw the weekly out-of-work lists (Ex. 33, Hearty Dep. at 30), so they did not have access to the information they needed to draft the manning request in such a way as to insure a computer "match" with Hearty's skills set. For this task, they needed help.
The manning request form for the July 13, 2000 referral listed 5 requested skills: "hollow-metal storefronts," "windows," "layout foreman," "welder," and "CPR." (Ex. 16, Bates # 1098). As of July 11, Hearty listed only two (CPR and layout) of the five in his portfolio. (Ex. 36, Bates # 3028). On July 12, 2000, however, he added "hollow metal storefronts," "windows," and "welder" to his portfolio. (Ex. 16, Bates # 001091). Out of 60 possible skills to choose from, Hearty, on the same day the request was submitted to the OWL, added the exact three that enabled him to qualify for this referral. Greaney admitted that he submitted the request form to the OWL office. (Ex. 25, Greaney Dep. at 50; Ex. 16, Bates # 1100).
Rockrose, the general contractor, subcontracted the carpentry, drywall and protection work for the project to Component. (Ex. 37, Bates # 3426-3559). It subcontracted the installation of windows and storefronts to K & M Architectural Windows and Lynbrook Glass, respectively, not to Component/Hi-Rise. (Id., Bates # 3425, 3560-3678, 3679-3750). Component/Hi-Rise therefore did not perform the window and storefront installation for this jobsite and so did not need carpenters with window and storefront installation skills. Nor did Component/Hi-Rise request a welder from the District Council for the 22 River Terrace project either. (Ex. 40, Bates # 3356). Hearty, moreover, did not even possess the certificates or licenses needed to work as a welder. (Ex. 41, Bates # 3777-3797).[14]
As noted above, Component subcontracted the protection work for this jobsite to Hi-Rise. (Ex. 38, Bates # 2700-2712). While on Hi-Rise's payroll, Hearty performed protection work exclusively and did not do any layout work. (Ex. 33, Hearty Dep. at 30 & 54). Hearty worked the following hours for Hi-Rise: August - 122.5, September - 148, October - 133, November 154, December - 133, and January - 172. (Ex. 14, Bates 948 & 947).
For the week of July 10-14, 2000, only 8 out of 157 certified stewards listed welder as a skill in their portfolios: #114 - Corrigan; #636 - Imperati; #702 - Martino; #757 - Gallagher; #801 - Reidy; #966 - Gabrielsen; #1033 - McCarthy; and #1082 - Coogan. (Ex. 36, Bates # 3011, 3048, 3052, 3057, 3060, 3072, 3076, & 3080). Including welding as one of the requested skills therefore eliminated from consideration 95% of the certified stewards on the OWL. Of the 8, four, Corrigan, Imperati, Martino, and Gallagher, had already received referrals by July 13, 2000. Of the remaining 4, three - Reidy, McCarthy, and Coogan (Id., Bates # 3060, 3076 & 3080) - did not list windows as a skill. Adding layout to the list of requested skills eliminated the one remaining certified steward -- Gabrielsen -- with both welder, hollow metal storefront, and window skills. (Id., Bates # 3072).
Greaney therefore doctored the manning request form by adding skills that were not needed -- welder, windows, hollow metal storefronts, and layout -- in order to insure Hearty was selected as the steward. The referral of July 13, 2000 therefore involved a falsified request and last-minute changes that were exactly tailored to insure a computer match, following the same modus operandi as the R & J referral of July 11, 2000.
By riding the list between May 31, 2000 and July 13, 2000, Hearty had risen from #1253 to #279 on the list. (Ex. 16, Bates # 1091). As noted above, Hearty worked full-time for Hi-Rise, which only performed protection work. The OWL for the weeks of July 10, 2000 show that there were at least seven other stewards with protection skills who were actually unemployed: Davis (#586), Spenser (#705), Reidy (#801), Brennan (#827), Gabrielsen (#966), Leonard (#1012), & Thornton (#1018). (Ex. 36, Bates # 3044, 3053, 3060, 3062, 3072, & 3075).
As noted earlier, Corrigan and Hearty co-chaired the fundraiser that was held on March 25, 2001 for Forde's criminal defense. (Ex. 33, Hearty Dep. at 8). In the weeks leading up to the fundraiser, both of them received rigged referrals.
On July 28, 2000, Hearty's name was dropped from the OWL. (Ex. 16, Bates # 1091). Hearty put it back on the list on November 22, 2000. (Id., Bates # 1092). On November 22, 2000, and continuing through Monday and Tuesday, February 5 and 6, 2001, however, he was working for Hi-Rise at 22 River Terrace. (Ex 34, Bates # 2606-2608). Despite the fact that he was working on February 5, 2001, he received a referral as a steward to Component/Hi-Rise's 110-120 Church Street project on that date. (Ex. 16, Bates # 1101).
On February 5, 2001, Greaney submitted the request for a steward for Component's job at 110-120 Church Street with foreman/layout, framing, welder, and window skills. (Id., Bates # 1100).
Marson Contracting Co., the general contractor, subcontracted the drywall, carpentry, ceiling, and protection work for the project to Component. (Ex. 42, Bates # 3360-3393). It subcontracted the window and storefront installation, respectively, to SAS Architectural Systems and Architectural Building Associates. (Id., Bates # 3394-3422 & 3423-3424). Component again subcontracted the protection work for this jobsite to Hi-Rise. (Ex. 43, Bates # 2713-2724).
Component/Hi-Rise did not request a welder from the District Council for 110-120 Church Street. (Ex. 40, Bates # 3356-3357). As it also did not install the windows or storefronts for this project, it did not need or request a steward with window installation or storefront installation skills. (Id.)
The "welder/windows" combination had eliminated 155 out of 157 certified stewards on July 13, 2000 and was likely to produce similar results 6 months later. Sure enough, for the week of February 5, 2001, only 7 out of 255 certified stewards listed welder as a skill in their portfolios: #204 - Hearty, #501 - Corrigan, #557 - Gabrielsen, #1140 - Benn, #1177 - Donahue, #1600 - Williams, and #1616 - Imperati. (Ex. 44, Bates # 3099, 3121, 3125, 3170, 3173, 3204 & 3205). Including welding as one of the requested skills therefore eliminated from consideration 97% of the certified stewards on the OWL.
The only skill required to work for Hi-Rise was protection. [15] At least a dozen other certified stewards with this skill were available for referral ahead of Hearty: Leonard (#374), Jackson (#426), Walsh (#856), Largotta (#892), Delponte (#897), Perry (#985), Thornton (#1063), Semper (#1068), Campo (#1086), Mascellino (#1099), and Benn (#1140). (Ex. 44, Bates # 3111, 3115, 3119, 3148, 3151, 3158, 3164, 3166, 3167, 3170). [16]
On August 25, 2000, Corrigan received a steward referral to Sorbara's jobsite at 26th Street and Sixth Avenue. (Ex. 16, Bates # 1081). Corrigan's name was dropped from the OWL on August 30, 2000.[17] (Id., Bates # 1064). On December 26, 2000, he added it back on the OWL (id.), even though he was still working on the project at 26th and 6th Avenue and continued working there through January and February, 2000, up until and through March 16, 2000. (Ex. 15, Bates # 1019-1020; Ex. 20, Bates # 2058-2087). On March 21, 2001, Corrigan was dispatched as the steward for Sorbara's AOL jobsite at Columbus Circle (Ex. 16, Bates # 1087), just two business days before he conducted the fundraiser for Forde's criminal defense, which was held on Sunday, March 25, 2001. (Ex. 33, Hearty Dep. at 8).
The manning request form for the March 21, 2001 steward referral to AOL listed George Fitzgerald as the Sorbara superintendent who called it in. (Ex. 16, Bates 1086 & 1087). The form listed five required skills: 40-Hour OSHA, wood framing, protection, concrete, and certified steward. Fitzgerald, however, never asked for a specific skill other than concrete and never requested a steward with a fictitious 40-hour OSHA certificate. (Ex. #18, Bates #1558-1560 & 1562). Without question, the form for the AOL job was falsified.
According to Greaney, he saw Corrigan on a regular basis, before the AOL job, bringing the weekly shop steward reports for the Sorbara job at 26th Street to the offices of Local 608 every Thursday or Friday. (Ex. 25, Greaney Dep. at 66). Greaney also received a copy of the out-of-work list every week. (Id. at 62). Because it was obvious that he had ample reason to know that Corrigan had been riding the list in the period January through mid-March 2001, Greaney attempted to explain away his inaction by claiming that when faced with a riding-the-list violation, he did "nothing" because "it's not my job" (Id. at 62), an obvious falsehood given the previous directives that business agents and managers not tolerate deviations from the policy that all stewards be dispatched from the out-of-work list. [18]
On March 20, 2001, Corrigan called in and added concrete to his portfolio of skills. (Ex. 16, Bates # 1065). This last-minute change, when combined with the bogus 40 Hour OSHA skill, enabled Corrigan to match this request. (Id., Bates # 1087) and followed the same modus operandi as the R & J referral of July 11, 2000.
The dispatch to AOL was made on March 21 for a job that started on April 18, 2001, 28 days later. (Ex. 21, Sorbara payroll for AOL job for April 2001 and Ex. 46, letter from Sorbara's counsel confirming that "first payroll date for the Project in question was for the week ending April 24, 2001."). According to Danielson, dispatches are made today for jobs that start tomorrow. (Ex. 12, Danielson Dep. at 16). The only exceptions are immediate dispatches, when a carpenter is sent out on the same day the dispatch is received. (Id.) The dispatch therefore should not have been made until April 17, 2001. Obviously, the referral was timed to coincide with Forde's fundraiser.
Because his last day of work at 26th Street and Sixth Avenue was at the earliest March 16, 2000, he was not eligible to put his name on the list until March 19, 2001. Had he put his name on the list on March 19, 2001, Corrigan would have been no better than #1788. (Ex. 47, Bates # 3351). By riding the list illegally for 3 months he was instead #211 and by March 21, he had risen to #180 and jumped ahead of 5 other certified concrete stewards who had been unemployed since before March 16: Davis (#1070), Aldrich (#1536), Mathews (#1602), Boudreau (#1606), and Robinson (#1699). (Id., Bates # 3293, 3329, 3334, 3335, 3342).
Forde purportedly appointed Rothman and Danielson to investigate Clarke's complaint "about out-of-turn referrals… to see if there was any truth to the matter." (Ex. 55, Forde Dep. at 29).
Danielson thereupon compiled separate files containing the referral and employment histories of Maudsley, Hearty, and Corrigan -- Exhibits 13, 14, and 15, respectively. (Ex. 12, Danielson Dep. at 8-9). Rothman made an oral presentation of the contents of the investigatory files to the Executive Committee. (Id. at 128).
The Executive Committee is made up of an elected delegate from each local, the EST, and the District Council's president and vice-president. (Ex. 3, Bates # 43). Early, a member of the Executive Committee along with Forde, testified that in connection with Clarke's complaint of July 24, 2001, "we must have" looked at specific documents in the course of a discussion about "whether or not some [referrals] were good and some weren't good" (Ex. 49, Early Dep. at 6, 29 & 33) and recalled that the Executive Committee authorized specific action against Hearty and Corrigan:
Q. Do you recall whether the executive committee voted to authorize charges against Mr. Hearty?
A. John Hearty was referred to trial by the executive committee.
Q. Now… did the executive committee also authorize that charges be brought against Corrigan?
A. Yes.
Q. … Were you aware that Corrigan was working throughout the whole month of October, 1999?
A. We were made aware of that, yes.
Q. Were you aware that Mr. Corrigan was employed throughout January, February, and the first three weeks of March, 2001?
A. Well, I would have been from reading the previous paragraph.
(Id. at 16, 17, 33 & 34).
Under the Constitution of the United Brotherhood of Carpenters & Joiners of America, charges "must be read at the [monthly membership] meeting… and the member must be notified by registered or certified mail [of the meeting], and at the same time shall be furnished… with a copy of the charges specified." (Ex. 58 at 69). Hearty denied that he had ever seen -- and therefore ever been served with -- any charges relating to the referrals of July 13, 2000 and February 5, 2001. (Ex. 33, Hearty Dep. at 18-20; Ex. 35). Forde admitted that no charges were filed against Corrigan until 2004. (Ex. 55, Forde Dep. at 43-44). The charges that were filed three years later moreover arose from the investigation of Walter Mack into Corrigan's referrals, not from Clarke's letter of July 24, 2001.[19]
On January 3, 2001, Clarke filed the motion to enforce the consent decree. On January 28, 2002, Forde filed his opposition papers, which consisted of a brief and an affidavit from Danielson with the "Report to the Executive Committee of the Investigation Committee Into the Complaint of Eugene Clarke" ("Report") attached as an exhibit. (Ex. 17, Bates #759-788). The brief, at 1, stated that it "is submitted on behalf of the District Council . . . and its Executive Secretary-Treasurer ("EST") Michael J. Forde." (Ex. 48). The brief, at 16, concludes with the representation that the "Investigation Report deals squarely with the challenged referrals… The Court is respectfully referred to the report for a complete treatment of each referral. No consent decree violations are raised by Clarke's complaints and accordingly his motion should be denied." (Id.). These representations were false, as Danielson was compelled to admit at his deposition when confronted with the contents of Exhibits 14 and 15, the files that he had compiled regarding Hearty and Corrigan. [20]
First, the Report found that "there does not appear to be a problem with" the referral of November 1, 1999, (Ex. 17, Bates #763), a conclusion that Danielson directly contradicted. Thus, on January 5, 1999, Corrigan received a steward referral to North Berry Concrete at Planet Hollywood. (Ex. 16, Bates #1069). The benefit funds' records that Danielson collected as part of his investigatory file, Ex. 15, showed Corrigan worked the following hours for North Berry at this job: January-97, February-140, March-183, April-163, May-191, June-213, July-161, August-136, September-203.5, October-174.5. (Ex. 15, Bates #1024-1025). Corrigan therefore kept his name on the for the entire month of October while he was working. (Ex. 16, Bates #1062). Danielson admitted that Corrigan should not have been on the list in October 1999. (Ex. 12, Danielson Dep. at 120). Danielson further admitted that "[i]f his name was on the list and he was working, correct, he was not supposed to get a referral" (id. at 126), which meant that Corrigan's steward appointment of November 1, 1999 to North Berry's Trump West jobsite violated the rules.
Second, the Report also falsely asserted that there were no allegations of wrongdoing raised by Clarke with respect to the referral of March 21, 2001 (Ex. 17, Bates # 768), although Clarke's motion clearly alleged that it "violated Rule 5F, IRO Decision No. 1, and By-Law Section 16." (Clarke's Memorandum In Support Of Motion To Enforce Consent Decree, dated December 27, 2001, at 14). This misrepresentation again concealed what the records that Rothman and Danielson reviewed actually disclosed.
Thus, on August 25, 2000, Corrigan received a steward referral to Sorbara at a jobsite at 26th Street and Sixth Avenue (Ex. 16, Bates # 1081), where he worked the following hours: September-153, October-221, November-186, December-215, January 2001-190.5, February-176.5, and March-116.5. (Ex. 15, Bates # 1019-1022). The March hours were worked between March 1 and 20, a Tuesday. (Id.; Ex. 20, Bates # 2087). Corrigan, however, put his name back on the out-of-work list on December 26, 2000 (Ex. 16, Bates # 1064), again while he was working, and left it on the list until March 21, 2001, when he received a steward referral to Sorbara's job at AOL Time-Warner. Danielson admitted that the Report did not disclose Corrigan kept his name on the list while he was working in January and February and most of March 2001. (Ex. 12, Danielson Dep. at 147).
Third, the Report also omits any discussion whatsoever of the referral of July 13, 2000 (Ex. 17, Bates # 776-777) Danielson, however, admitted that because Hearty worked the entire month of June 2000 and the first eleven days of July 2000 (Ex. 14, Bates # 912 & 913), he was ineligible for the steward referral he received on July 13, 2000. (Ex. 12, Danielson Dep. at 77).
Fourth, the Report also concludes erroneously that "Hearty was lawfully eligible for dispatch on February 5, 2001" (Ex. 17, Bates # 777). According to Danielson, however, because Hearty worked throughout the month of January 2001 and the first week of February 2001 (Ex. 14, Bates # 906), he was also ineligible for the steward referral he received on February 5, 2001. (Ex. 12, Danielson Dep. at 84-85).
Danielson's admissions clearly and convincingly show that the report concealed that Corrigan and Hearty were riding the list. [21]
The report also asserted that certain stewards held "certifications in skills, such as welding, OSHA 40, or asbestos, which make them unique, even among other stewards." (Ex. 17, Bates # 780). When adding such a skill to his or her portfolio, a carpenter was required to present the certificate to the OWL office, which kept a copy of it. (Ex. 12, Danielson Dep. at 109-112). Danielson admitted that his office's files showed that Corrigan never presented an OSHA 40 certificate when the latter added this "skill" to his portfolio. (Id.). A review of the same office files containing copies of certificates from Hearty would have also showed that he never presented a welder's certificate of any kind either because he did not possess one. (Ex. 41, Bates # 3777-3797). The absence of these two certificates was also not disclosed by Rothman and Danielson's report.[22]
Hearty continued as the steward for Component/Hi-Rise until December 2002. (Ex. 34, Bates # 2618). Corrigan also remained the steward at the AOL job until December 2002. (Ex. 50, Mack Dep. of Corrigan, at 125). By November, 2001, however, Forde had learned that Corrigan and Hearty had secured these steward positions while riding the list. District Council policy is that "a steward found to have secured their position while 'riding the list' will be removed from that job and charged." (Ex. 53, Bates # 3807, Rothman Letter to Walter Mack, dated October 29, 2004, at 8). Contrary to that policy, Forde did nothing and Corrigan and Hearty enjoyed their ill-gotten gains for another 13 months. Forde also failed to process the charges that the Executive Committee had authorized be brought against Corrigan and Hearty for riding the list on November 1, 1999, July 13, 2000, February 5, 2001, and March 21, 2001.
Corrigan received five consecutive steward appointments -- on November 1, 1999, July 11, 2000, August 4, 2000, August 25, 2000, and March 21, 2001 -- that enabled him to work from November 1999 to December 2002 almost without interruption. Similarly, Hearty received steward appointments that enabled him to work without interruption from July 14, 2000 to December 2002. Corrigan and Hearty were not eligible for any of these seven appointments. The request forms for all 7 referrals were falsified and six of them were accompanied by last-minute portfolio changes that insured the OWL computer "matched" them for these appointments.
In response to Clarke's complaint, the government insisted that changes be made to the referral rules in order to prevent the type of gaming of the OWL computer that was evidenced by the pattern of last-minute changes made by Corrigan and Hearty. These changes were incorporated into a Stipulation and Order ("S&O"), dated December 17, 2002. The government, however, was unaware of Corrigan and Hearty's pattern of riding the list, because the Report concealed it. As a result of the concealment, the referral rules changes that were negotiated with the District Council did not address the problem of riding the list.
Under the S&O, the parties appointed Walter Mack as the Independent Investigator to investigate wrongdoing related to the referral rules. According to Mack, by 2004, the problem of members putting themselves on the OWL while they are in fact working was so widespread that he had concluded the term "out-of-work list was a "misnomer." (Ex. 53, Bates # 3754). The pattern of misconduct that Corrigan and Hearty had engaged in between 1999 and 2002 had, by 2004, become the paradigm for the entire District Council. Thus, a problem that could have been addressed and remedied in 2002 has festered into an epidemic three years later, a result that stemmed directly from Forde's decision to conceal the problem from the government, the Court, and Clarke.
A party may not be held in contempt unless (1) the order violated is clear and unambiguous, (2) the proof of non-compliance is clear and convincing, and (3) the contemnor was not reasonably diligent in attempting to comply. E.E.O.C. v. Local 638, 81 F. 3d 1162, 1171 (2d Cir. 1996).
There is no dispute that the rules unambiguously mandated that certified stewards be referred out in the order in which their names appeared on the out-of-work list, provided they possessed the skills required for the job and were unemployed ("available").
As noted above, for the 111 8th Avenue job, Forde submitted a request form that listed two skills -- laboratory furniture installation and layout/foreman, -- which were not included in the request from Eurotech, but which made Maudsley unique among the five available stewards with the one skill, ceilings, that was in fact required. As of April 22, 1999, Maudsley listed only five skills, one of which was ceilings, in his portfolio. On that date, of 55 remaining skills to choose from, he just happened to add laboratory furniture installation and layout/foreman -- to his portfolio, the exact two skills that (1) made him unique among the 5 available stewards with ceiling skills and (2) that Forde had added to Eurotech's request without Purser's direction to do so.
Working from the fact that Eurotech did not request a laboratory furniture installer for this job, it is a simple matter to reconstruct Forde's thought processes. Forde's choice of "laboratory furniture installer" is easy to explain: Only 7 out of 159 certified stewards even listed it in their portfolios, and only one of those 7, Lym, also listed "ceilings." To "break the tie" with Lym, Forde had dozens of skills to choose from; exactly which one he selected, however, was up to him.[23]
Maudsley did not read Forde's mind through the medium of telepathy when he simultaneously selected the exact two skills that Forde had chosen to falsify in order to enable him to jump over four other certified stewards with ceiling skills (#1634 Scipio; #1720 Dolan; #1795 Lym; and #1895 Wronge, Ex. 19, Bates # 1309, 1315, 1321, 1327); the evidence is therefore clear and convincing that Forde rigged Maudsley's referral himself.
The following facts are undisputed:
First, Hearty and Corrigan were ineligible for all four referrals.
Second, the request forms for all four referrals were falsified. Thus, North Berry was a concrete contractor, but the form for the referral of November 1, 1999 did not list concrete as a required skill. Similarly, Hi-Rise was a protection contractor, but the forms for the referrals of July 13, 2000 and February 5, 2001 did not list protection as a required skill either. Finally, Sorbara did not request a steward with a non-existent 40-hour OSHA certificate on March 21, 2001.[24]
The use of the falsified request scam and riding-the-list scam meant that the four referrals at issue here violated the rules in the following ways:
The "required skills" for the referral to North Berry of November 1, 1999 were certified steward and concrete; by falsifying the request form and allowing him to ride the list, Forde enabled Corrigan to jump over eight other carpenters who possessed these three skills and were ahead of him on the out-of-work list -- McCarthy (#779), Sexton (#971), Connolly (#993), Griffin (#1002), M. Muller (#1149), Perrone (#1365), Molloy (# 1396), and Rodriguez (#1495). (Ex. 32, Bates # 2953, 2966, 2968, 2978, 2993, 2998, & 3002) -- in violation of the rules.
The "required skills" for the two referrals to Hi-Rise were certified steward and protection; by falsifying the request forms and allowing him to ride the list, Greaney enabled Hearty to jump over other carpenters who possessed these two skills and were ahead of him on the out-of-work list: seven on July 13, 2000 -- Davis (#586), Spenser (#705), Reidy (#801), Brennan (#827), Gabrielsen (#966), Leonard (#1012), & Thornton (#1018). (Ex. 36, Bates # 3044, 3053, 3060, 3062, 3072, & 3075) and (2) a dozen or more on February 5, 2001 -- Leonard (#374), Jackson (#426), Walsh (#856), Largotta (#892), Delponte (#897), Perry (#985), Thornton (#1063), Semper (#1068), Campo (#1086), Mascellino (#1099), and Benn (#1140) (Ex. 44, Bates # 3111, 3115, 3119, 3148, 3151, 3158, 3164, 3166, 3167, 3170) -- in violation of the rules.
The "required skills" for the referral to Sorbara of March 21, 2001 were certified steward and concrete; by falsifying the request form and allowing him to ride the list, Greaney enabled Corrigan to jump over five other carpenters who possessed these two skills and were ahead of him on the out-of-work list -- Davis (#1070), Aldrich (#1536), Mathews (#1602), Boudreau (#1606), and Robinson (#1699) (Ex. 47, Bates # 3293, 3329, 3334, 3335, 3342) -- in violation of the rules.
Corrigan was able to work continuously as a steward for three years on the basis of referrals that he received on November 1, 1999, July 11, 2000, August 4, 2000, August 25, 2000, and March 21, 2001. In each instance, he made last minute additions to his portfolio that enabled him to match an incoming request. The possibility that he did so 5 consecutive times by chance was one in 777,600,000 (1/60 x 1/60 x 1/60 x 1/60 x 1/60). Obviously, someone tipped off Corrigan regarding what skills to add.
Hearty jumped from job to job as a steward with the same employer without missing a day's work. He also brought in weekly shop steward reports to Local 608's offices every Thursday or Friday for three and a half consecutive years without missing a week. Similarly, Corrigan jumped from job to job as a steward while missing at most a few days between appointments. He, too, was religious about bringing in shop steward reports every week. Moreover, it was impossible for Corrigan to have gone unnoticed because, as Greaney pointed out, "you couldn't miss him" because of his size. Dumb luck again does not explain why Corrigan and Hearty did not get caught riding the list for three years and seven consecutive steward appointments.
The referrals of November 1, 1999, July 11, 2000, July 13, 2000, February 5, 2001, and March 21, 2001 followed the same pattern that Forde had established with Maudsley's referral of April 23, 1999: a falsified form that added an unnecessary skill -- laboratory furniture installer, 40 Hour OSHA, or welder -- that eliminated 95% to 100% of the other certified steward from consideration. Again, this pattern is not a matter of coincidence; these three skills were used precisely because so few stewards listed them in their portfolios.
The riding-the-list scam, the falsified request scam, and the last-minute tip-offs were therefore all clearly coordinated in a systematic scheme that was designed to evade the fair operation of the Consent Decree's referral rules.
The following is also undisputed:
First, Forde did not disclose that Corrigan and Hearty were repeatedly allowed to ride the list while working. Obviously, the seven referrals that Corrigan and Hearty received between November 1, 1999 and March 21, 2001 were not proper, because they were not eligible for any of them. Clearly, had the government known of the riding-the-list scam involving these seven referrals, it would have insisted on modifying the referral rules in order to prevent others from doing what Corrigan and Hearty did.[25]
By his own admission, Forde knew by late 2001 that riding-the-list violations were widespread.[26] Forde's deliberate concealment of the riding-the-list scam thereafter facilitated not only its continuation but also its expansion. Thus, according to Walter Mack, by 2004, the problem of members putting themselves on the OWL while they were in fact working was so pervasive that he had concluded the term "out-of-work list was a "misnomer." (Ex. 53, Bates # 3754). Indeed, the "vast majority" of stewards questioned by Walter Mack often routinely rode the list. (Ex. 54, Bates # 4051). The pattern of misconduct that Corrigan and Hearty had engaged in between 1999 and 2001 had, by 2004, become the paradigm for the entire District Council. Thus, a problem that could have been addressed and remedied in 2001 had festered into an epidemic three years later, a result that stemmed directly from Forde's decision to conceal the problem from the government, the Court, and Clarke.
Second, Forde did not disclose that the OWL office's files showed that Corrigan and Hearty lacked the very certificates -- OSHA 40 and welder -- that purportedly made them unique for the referrals of November 1, 1999, July 13, 2000, February 5, 2001, and March 21, 2001, because to do so might have put an end to the scam of gaming the computer with falsified manning requests, which scam continued, as evidenced by Corrigan's appointment as the steward at 7 World Trade Center in February 2003 on the basis of his fictitious 40 Hour OSHA certificate (Ex. 18, Bates # 1554-1557) and by the appointment of other stewards on the basis of falsified skills requests such as refrigeration, welding, laboratory furniture, and layout foreman. (Ex. 54, Bates # 4061, 4066, 4076, & 4078-4079).
When in late 2001, Forde, along with the other members of the Executive Committee, learned that Corrigan and Hearty had been appointed stewards at AOL and 110-120 Church while riding the list, he should have removed them from those positions immediately. This follows from the District Council policy that "a steward found to have secured their position while 'riding the list' will be removed from that job and charged." (Ex. 53, Bates # 3807, Rothman Letter to Walter Mack, dated October 29, 2004, at 8). Contrary to that policy, Forde did not remove them and thereby allowed Corrigan and Hearty to enjoy their ill-gotten gains for another 13 months, as both were allowed to remain as the stewards on these jobs until December 2002, obviously as reward for conducting the fundraiser for Forde's criminal defense fund. Forde therefore failed to remedy these two violations when there was ample time to do so under the policy.
Further, Forde should have processed the charges that the Executive Committee had authorized be brought against Corrigan and Hearty for the violations of November 1, 1999, July 13, 2000, February 5, 2001, and March 21, 2001. The parent Constitution allows expulsion from membership for carpenters such as Corrigan and Hearty who repeatedly defraud the brotherhood. (Ex. 58 at 65-66). Further, the District Council could have barred them from serving as a steward by suspending their steward certifications for a fixed period of time. (Ex. 52, Bates # 2868). Such penalties certainly would have prevented them and deterred others from resorting to either the riding-the-list scam and falsified request scam. As the "boss," Forde could have made certain that these charges were filed and properly served (Ex. 55, Forde Dep. at 37); instead, he did nothing for a long enough period of time to insure that such charges were time-barred.[27]
Who then tipped off Corrigan and Hearty, let them ride the list, and knew to select 40-Hour OSHA and welder as the key to eliminating other stewards from consideration? Greaney admitted using a scheme that was identical to the one Forde used for Maudsley to rig the referral of July 11, 2000 for Corrigan. This admission and the fact that he submitted a request to fill Corrigan's steward position at Planet Hollywood before the latter even vacated it together provide clear and convincing evidence that Greaney was able to game the OWL computer on a regular basis, while allowing Hearty and Corrigan to ride the list with impunity. Moreover, although the scheme was not 100% foolproof, Greaney was able quickly to correct any glitches, as happened at the 110-120 Church Street project, where Donahue was immediately removed under false pretenses to make room for Hearty, the intended recipient of the falsified request.
The evidence is also clear and convincing that Forde had knowledge of what Greaney was doing. First, as his handpicked successor, Greaney adopted Forde's modus operandi for using fictitious skills as the key to eliminating other stewards from consideration; the "craft" was thereby passed along from one leader to another. Second, there is also no dispute that when he gamed the computer, Greaney often did so in order to benefit Forde, as was the case when he rigged referrals for Corrigan and Hearty just before they ran the fundraiser for Forde's criminal defense fund. Third, Rothman also knew firsthand that Greaney rigged the referral of Corrigan to R & J on July 11, 2000, a fact that enables the Court to "assume[], sensibly enough" that Rothman shared this information with Forde. See United States v. District Council, Memorandum & Order, dated July 7, 2004, at 4.
Forde, as EST, on October 11, 2000, sent a memo to all the business managers and business agents warning them as follows: "Please be advised that it has come to my attention that the job referral rules as listed in the consent decree are possibly being violated by certain business agents. . . .Failure to follow these rules will result in charges from your Executive Board, and/or possible suspension or dismissal." (Ex. 45). On December 4, 2000, Forde in a second memorandum, reiterated to the business managers and business agents that "failure to strictly adhere to these [referral] rules will result in disciplinary action." (Id.). Thus, under Forde's stated policy, Greaney should have been suspended or terminated as business manager for rigging the referrals of November 1, 1999, July 13, 2000, February 5, 2001, and March 21, 2001. Removing Greaney would have brought an end to his and Forde's systematic scheme of defrauding the membership of Local 608.
Insofar as this last point is concerned, the Court should take into account the fact that the business managers and business agents are no longer elected at the local level, but are instead appointed by the EST and are employees of the District Council. As a general rule, such appointees do not have a right to a hearing under federal law before being suspended or dismissed from their positions. Finnegan v. Leu, 456 U.S. 431 (1982). More particularly, in the context of a RICO consent decree, because the termination of Greaney would have been designed to deter future violations of the Consent Decree's referral rules, it would not have constituted a form of discipline requiring a hearing under federal law. U.S. v. IBT, 156 F. 3d 354 (2d Cir. 1998).
To prove aiding and abetting, "it is necessary that a defendant in some sort associate himself with the venture, that he participate in it as in something he wishes to bring about, that he seek by action to make it succeed." United States v. District Council, 778 F. Supp. 738, 748 (S.D.N.Y. 1991). More specifically, the elements of aiding and abetting are: (1) commission of the underlying violation, (2) by a person other than defendant, (3) a voluntary act or omission by the person charged as an aider and abettor, and (4) the specific intent that his act or omission bring about the underlying violation. Id.
As shown above, with respect to the referrals of November 1, 1999, July 13, 2000, February 5, 2001, and March 21, 2001, Corrigan and Hearty jumped ahead of other qualified carpenters who had been unemployed longer than they had been. Without question, these four referrals violated the rules. Because these four violations were committed by persons other than Forde (Greaney, Corrigan, and Hearty), the first two prongs of the aiding and abetting test have been satisfied.
As to the third and fourth prongs, insofar as referral rules are concerned, union officers have a "duty to disclose and remedy wrongdoing," Id. at 749 (quoting U.S. v. IBT, 708 F. Supp. 1388, 1401 (S.D.N.Y. 1989), because -- under federal labor law -- any departure from established referral procedures amounts to a fiduciary breach. Plumbers & Pipe Fitters Local 32 v. NLRB, 50 F. 3d 29, 32 (D.C. Cir. 1995); Boilermakers Local 374 v. NLRB, 852 F. 2d 1353, 1358 (D.C. Cir. 1988).
By failing to remove Corrigan and Hearty from the AOL and 110-120 Church Street jobs, while simultaneously concealing the riding-the-list scam and falsified request scam, disregarding the Executive Committee's decision to bring charges against them, and refusing to suspend or fire Greaney from his position of business manager of Local 608, Forde engaged in voluntary acts and omissions that demonstrated specific intent to allow these scams to continue as devices designed to defraud the membership out of the rights granted them under the Consent Decree's referral rules, thereby satisfying the third and fourth prongs of the test for aiding and abetting.[28]
His own violation and his efforts to aid and abet others demonstrate that Forde systematically sought to do the exact opposite of what the Consent Decree required of him, i.e., diligently make reasonable efforts to insure compliance with the referral rules. EEOC v. Local 638, 81 F. 3d 1162, 1176 (2d Cir. 1996).
Nor can the Court conclude that Forde made a good faith effort to comply with the Decree and thereby avoid an assessment of attorneys' fees. Id. Indeed, Forde's efforts clearly had the opposite intent, as he has acted throughout in complete and unadulterated bad faith.
The Court "has available to it a full arsenal of remedies," United States v. District Council, 2003 WL 21035292, *6 (S.D.N.Y.) for Forde's violations of the Consent Decree's referral rules. To this end, the Court should order Forde to reimburse the District Council for the cost, including lawyers' fees, of preparing the Report. The Report effectively concealed Forde's wrongdoing for the last three years and facilitated the ongoing success of both the riding-the-list scam and the falsified request scam. The victims of these scams should not have their dues money used to pay for a report that was essential to perpetuating the fraudulent regime that Forde and Greaney have imposed upon them. As its objective is to compensate the membership for its losses, this aspect of the reimbursement order falls within the parameters of appropriate civil, non-criminal contempt remedies that are available to the Court. Sheet Metal Wkrs. v. EEOC, 478 U.S. 421, 443 (1986).
Between January 2, 2002, the date it was filed, and February 25, 2004, the date Forde retained separate counsel (Dino Lombardi), the District Council's lawyers represented both Forde and the District Council in opposing Clarke's motion. In United States v. Local 1804-1, ILA, 732 F. Supp. 434 (S.D.N.Y. 1990), Judge Sand held that (1) the same law firm cannot simultaneously represent a union and an officer thereof who is charged with wrongdoing under RICO and (2) a union cannot advance funds to pay for the legal defense of the officer charged with wrongdoing prior to his exoneration. The District Council therefore should not have paid for Forde's legal defense during this two-year period.[29] Forde should therefore also be directed to reimburse the District Council for fees and costs charged the District Council by its law firm during this period in defending against Clarke's motion in excess of those relating to the preparation of the Report. As its objective is also to compensate the membership for its losses, an order directing Forde to reimburse the District Council for these fees and costs also constitutes one of many appropriate civil, non-criminal contempt remedies that are available to the Court. Sheet Metal Wkrs., 478 U.S. at 443-444. [30]
The Court has already held that a sanction of $5,000 per violation requested by Clarke is reasonable and designed to deter future violations, United States v. District Council, 2003 WL 21035292, *6-7 (S.D.N.Y.), which renders them civil in nature. UMW v. Bagwell, 512 U.S. 821, 829 (1994). As Forde committed one violation himself and aided and abetted four others, the total sanctions should be $25,000.
As a corollary to the objective of deterrence, the Court's order should also set conditions that allow Forde to purge the contempt. Id. Payment of the $25,000 sanction should therefore be suspended to provide Forde the opportunity to purge the contempt by taking action to curb further manipulation of the referral system.
To this end, Forde should be afforded the choice to avoid sanctions by taking the following two steps.
First, he should fire Greaney immediately from his position as business manager of Local 608 for committing the violations involving Corrigan and Hearty. Doing so should force the other business managers and business agents to recognize that the referral rules can no longer be violated with impunity.
Second, Forde should also fire Danielson immediately. The rationale for doing so is as follows.
Where a union is involved, the keystone to a successful RICO consent decree is the acceptance by its membership of "its responsibility to stand up to" corrupt practices. ("Final Report of the Court Appointed Liaison Officer for the Continued Supervision of Laborers' Local 210," at 18, attached hereto). Danielson, as the supervisor of the OWL, operated under the same statutory fiduciary obligation to disclose and remedy the rules violations described above as Forde did. Yet, Danielson signed the Report, which concealed the results of his and Rothman's investigation and falsely represented to the Court and the government that "[o]ur review of each of the referrals cited in the complaint have led us to conclude that the referrals were proper under the approved system… Where we found wrongdoing, we have reported it to you…." (Ex. 17, Bates # 779, 784). Making an example of Danielson should drive home to the membership the point that they and their officers and agents share in the responsibility of "standing up" to corruption and that the consequences of doing otherwise may be severe. The endemic corruption that is the culture of the District Council will never change until this sense of responsibility is instilled in the membership.
As noted above, Forde may take summary action against Greaney and Danielson because neither is entitled to a hearing. U.S. v. IBT, 156 F. 3d 354 (2d Cir. 1998). Upon Forde's satisfying the above two conditions, payment of the $25,000 sanction should be permanently suspended. In the event Forde fails to satisfy one or both of these two conditions, the full $25,000 will have to be paid to the District Council to help cover the cost of the Independent Investigator, whose appointment was necessitated by Forde's wrongdoing.
For the reasons set forth above, the Court should order Forde to pay a sanction of $25,000, subject to the purge provisions set forth above. The Court should also order Forde to pay Clarke's attorneys' fees and to reimburse the District Council for (1) the cost of the "Report to the Executive Committee of the Investigation Committee Into the Complaint of Eugene Clarke," dated January 2002, and (2) the cost the legal defense provided him herein by the District Council's law firm between January 2, 2002 and February 25, 2004.
Dated: February 17, 2006
VLADECK, WALDMAN, ELIAS &
ENGELHARD, P.C.
By: ____________________________
James Wasserman (JW-3717)
Attorneys for Eugene Clarke
1501 Broadway, Suite 800
New York, New York 10036
(212) 403-7300
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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UNITED STATES OF AMERICA,
Plaintiff,
- against -
DISTRICT COUNCIL OF NEW YORK CITY AND VICINITY OF THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, et al.,
Defendants. |
90 Civ. 5722 (CSH)
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PRETRIAL
MEMORANDUM IN SUPPORT OF MOTION TO
ENFORCE CONSENT DECREE
VLADECK, WALDMAN, ELIAS,
& ENGELHARD, P.C.
Attorneys for Eugene Clarke
1501 Broadway, Suite 800
New York, New York 10036
Of Counsel:
James Wasserman
TABLE OF AUTHORITIES....................................... iv