BY HAND   May 2, 2005

Hon. Charles S. Haight, Jr.

United States Senior District Judge Southern District of New York 500 Pearl Street

New York, New York 10007

Re: United States of America v. District Council of New York City and Vicinity of the United Brotherhood of Carpenters and Joiners of America, et al.

90 Civ. 5722 (CSH)

Dear Judge Haight:

Enclosed is a revised version of the report I submitted on April 15, entitled Report on Unreported Cash Payments to Carpenters by Boom Construction Enterprises, Inc. This version reflects changes made in response to comments in Gary Rothman's April 21 letter to the Court and also incorporates additional or updated material reflected in the transcript I received, after the report was filed, of the deposition of Carpenter Feanny Smith. (Mr. Smith's testimony is referred to without citations in the original version of the report.) I also enclose two additional exhibits: the Smith deposition transcript (Exhibit 29) and the transcript I recently received of the District Council's disciplinary hearing against Mr. Smith (Exhibit 30.) Enclosed too, are pages inadvertently omitted from the April 15 filing; these are the exhibits to the Paul Tyzner Interview notes that were submitted as Exhibit 28.

The new material appears at pages: 3, n.3; 5-6; 34-35, n. 26; 36-37 n. 27; 37-38 and n. 28.

I do not intend to refute each of the comments in the April 21 Rothman letter. But, in addition to the changes reflected in the revised report, I would like to respond to one comment. I am troubled by the view, expressed in the second paragraph of page 2, that it is the rank and file Carpenter journeymen who accept cash who should bear the brunt of the responsibility for their wrongful conduct. While I certainly share the view that these people are not blameless, I cannot agree that ". . . these workers were only too willing to compromise themselves. . . . " In fact, many of these workers were not at all willing to compromise themselves and did so only because they worked under corrupted shop stewards and careless business agents who would not protect them and because they were desperate for work due to the unfair manner in which the "out of work" list functions.

While it is understandable that the District Council has chosen to characterize events in a manner flattering to itself, I am hopeful that now that it has prevailed in its efforts to replace me with a new Independent Investigator and need no longer maintain an adversarial posture, the leadership may appraise its anti-corruption efforts and achievements with more objectivity. I would like to see the District Council create a truly effective anti-corruption program; at this point, however, they have considerable work to do. I wish the new Independent Investigator well in assisting the District Council to achieve this goal.

Thank you for permitting this Independent Investigator team to be of service.

Walter Mack, Independent Investigator

cc: Gary Rothman, Esq. (By hand) AUSA Ed Scarvalone (By hand) AUSA Lisa Zornberg (By hand)

CONFIDENTIAL: NOT FOR PUBLIC FILING
PENDING COURT REVIEW

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

UNITED STATES OF AMERICA,

Plaintiff,   90 Civ. 5722 (CSH)

-against-

DISTRICT COUNCIL OF NEW YORK CITY AND VICINITY OF THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, et al.,

Defendants.

REVISED

INDEPENDENT INVESTIGATOR'S REPORT ON
UNREPORTED CASH PAYMENTS TO CARPENTERS
BY BOOM CONSTRUCTION ENTERPRISES, INC

TABLE OF CONTENTS

Introduction         1

1.    The Jacobi Hospital Jobsite    2

A.   Cash Payments at O'Shea's Emerald Bar    20

2.   The Boom Job at Columbia Medical Center    21

3.  The Boom Job at Brooklyn Tabernacle    24

Other Boom Jobs    26

Oversight by the District Council and its Business Agents    27

VI.   The Impact of the Request System on Contractors' Ability to Violate the CBA and the

Law by Paying Cash   39

Introduction

The following report to the Court, my fourth since my appointment as Independent Investigator for the District Council of New York City and Vicinity of the United Brotherhood of Carpenters and Joiners ("the District Council"), summarizes the findings of my investigation into one contractor's practice of paying cash, "off the books," to some number of Carpenters it employed. My conclusion is that Boom Construction Enterprises, Inc. ("Boom") routinely paid a number of its Carpenters off the books. This practice was dependent on the cooperation of corrupt shop stewards who agreed to omit from their shop steward reports names of some of the Carpenters working at Boom job sites in exchange for additional, unreported compensation.' Although this corrupt activity existed at many Boom job sites, my investigation focused primarily on Boom's Jacobi Hospital job site because of the large number of Carpenters who worked off the books at this site. Because of the pervasiveness of this conduct and the District Council's failure or inability to address it, I also include in this report a cursory discussion of other jobs for which Boom paid cash to Carpenters.

The direct result of this corrupt conduct is that Carpenters whose names are
omitted from the shop steward reports are not paid their health and pension benefits, are

' The shop steward reports are filed with the Local Union and transmitted to the District Council for record-keeping purposes. They are used to account for the identity and hours of Carpenters on a job site, to determine whether Carpenters are being paid the wages and benefits to which they are entitled under the CBA, and to monitor whether the "50/50" requirement is being met. Because of the significance of shop steward reports to the job referral system, the subject of how they are maintained and accounted for – a subject about which serious questions have arisen during my investigation of Tri-Built Construction – should be addressed in a separate report, whether written by me or a successor.

usually paid less than the union wage, and can avoid income tax on the unreported income. There are several indirect results of this practice and they are devastating to the protections that the District Council — or any union — is expected to provide. I discuss these results — which seriously undermine, if not eviscerate, the job referral provisions of the 1994 Consent Decree — in the final section of this report.

I. The Jacobi Hospital Jobsite

I began to take a preliminary look at Boom in June of 2003, after receiving a call on my dedicated Carpenter "Hot Line" advising that a business agent for one of the local District Council unions had received an anonymous call from a Carpenter saying that Boom was paying Carpenters at the Jacobi Hospital job site in cash. Donald Sobocienski, the Chief Investigator for the Independent Investigator ("II"), visited the job site along with another investigator working on the II team at the end of June, 2003. They visited the Jacboi office of the prime contractor, T. A. Ahern Contractors Corp.("Ahern"), which had retained Boom as a subcontractor. Ahern made available records it maintained at the site pertaining to Boom's workforce.2

The Ahem records shown to the II team consisted of "headcount" records made by Ahern's project superintendent and a few certified payroll reports submitted by Boom, via Ahern, to the Dormitory Authority of the State of New York ("DASNY"), the overseer of

2 I serve as Monitor of Ahem and the investigative team has a good working relationship with Ahern personnel.

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the Jacobi project.3 The investigators compared the Ahern headcounts and the certified payroll reports with corresponding District Council shop steward reports, and found significant discrepancies. In comparing the documents available from Ahern to the shop steward reports, we found that Ahern's headcount documentation and certified payroll reports showed more Boom Carpenters at the site than were reflected on the Boom shop steward reports.4

I made this information available to the District Council, which met with DASNY representatives and shared with them the discrepancies between the certified payroll

3 Because DASNY is a state agency, it requires contractors and sub-contractors it retains to submit all payroll rosters, certified as to accuracy. The primary purpose of this is to insure that the contractors are complying with the prevailing wage statute.

4 By contrast, the certified payroll reports showed more Carpenters on the site than Ahem had counted. Because DASNY pays its contractors and subcontractors on a flat fee basis, regardless of the number of workers employed, it is not clear to me why Boom padded the certified payroll reports. However, it is possible that the Boom owners needed more names on the payroll reports in order to camouflage the discrepancy between the headcounts and the number of Carpenters listed on the shop steward reports. (The additional names on the payroll reports were those of Boom workers at other sites. Therefore, an auditor might be satisfied in confirming that the workers listed on the headcount reports worked for Boom, without identifying the specific Boom job site at which those workers had been employed.) The DASNY Inspector General provided another possible explanation for Boom's padding of its certified payroll. He explained that dishonest contractors may do this in anticipation of claiming, at the end of a job, additional compensation for hiring "extra" workers who assertedly were forced to sit idle while another trade delayed the contractor's work. Or, he theorized, the additional expense of the extra workers on the certified payroll report might have been an attempt to generate false additional business expenses for tax purposes.

Contrary to the comment in n.3 of Gary Silverman's April 21 letter to the Court, we do not say here that the Ahern headcounts contained names. But the headcount reports do show numbers of Carpenters and those numbers can be compared to the numbers of names listed on the shop steward reports. In any event, some of the Ahern headcount reports did contain names. And where they did not, our interviews of the Ahern foreman allowed us to obtain names.

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reports that had been submitted to DASNY and the shop steward reports. At that point in my tenure as Independent Investigator (roughly six months into it), I still was of the view that the District Council and its Anti-Corruption Program should be capable of undertaking and resolving information of this kind. I therefore deferred to the union's investigative process for some months. While Chief Investigator Sobocienski consulted with and kept himself apprized of the steps taken by the District Council (for instance, Mr. Sobocienski attended the meeting between the District Council and DASNY representatives), we did not aggressively pursue this investigation until November of 2003, when I became frustrated with the pace of the District Council's inquiry. I noticed the deposition of Jason Flaherty ("Flaherty"), the Carpenter who had served as the shop steward for Boom at the Jacobi site from almost the beginning of the job until mid-August, 2003, when the District Council removed him as shop steward.5

In the interim, the District Council had taken several steps. In mid-July of 2003, the District Council interviewed Flaherty and obtained from him an affidavit in which he

5 The District Council is unclear concerning the precise basis upon which it removed Flaherty from the shop steward position. Mr. Flaherty testified that he was told that the reasons for his removal were that: (1) he did not maintain a written daily headcount and (2) he permitted a non-union Boom employee to be present in the shanty used by the Carpenters to store their tools. (Deposition of Jason Flaherty, taken January 8, 2004 and June 9, 2004 ["Flaherty Deposition" submitted herewith as Exhibit 1 A and B, respectively, at A 140, 146.) The District Council has not provided me with any paperwork associated with this action and has conceded that it did not have any written (or oral) criteria or procedures for removing a shop steward. With input from me, the District Council is in the process of drafting a procedural protocol. In any event, as detailed below, I have no doubt that Jason Flaherty was submitting fraudulent shop steward reports by omitting the names of Boom Carpenters working at Jacobi.

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asserted that his shop steward reports were accurate to the best of his knowledge. In August of 2003 interns working at the District Council constructed a chart tracking those Carpenters reported in Boom's certified payroll records for Jacobi with shop steward reports for all of Boom's jobs, and benefit payments made by Boom to the Benefit Funds. These data confirmed that certain Carpenters Boom listed for the Jacobi site had in fact worked at Boom job sites other than Jacobi. At the end of October, the District Council interviewed three Carpenters who had worked for Boom as shop stewards on sites other than Jacobi; Mr. Sobocienski attended these interviews. Meanwhile, in August of 2003, I received an anonymous call on the Hot Line, informing me that Boom was paying Carpenters cash at a job at Macy's in Brooklyn.

Also in August of 2003, as noted above, the District Council removed Jason Flaherty as the shop steward at Jacobi. The District Council points out in footnote 3 to Mr. Silverman's April 21, 2005 letter to the Court, that I may not have expressed sufficiently my appreciation of the efforts of Thomas McKeon, one the business agents responsible for the Jacobi site. I take this opportunity to commend him for his attention to his responsibilities. I believe that his diligence stemmed in part from the fact that he (alone, among all of the District Council business agents) was willing to meet directly with me and II staff to review evidence and exhibits that were relevant to the performance of his duties. I would encourage the next Independent Investigator to be more vigorous in forging close relationships with the business agents and to insist that they communicate

directly with him concerning Hot Line matters which he refers to the union. I believe that such meetings would enhance business agents' understanding of how to detect corruption at the jobs they supervise and would underscore the agents' appreciation for the importance of this aspect of their jobs.

By November of 2003, as noted above, I decided that the II team should become more actively involved and that sworn testimony was appropriate. After a lengthy adjournment over the holidays, I deposed Jason Flaherty in early January 2004. Flaherty lied to me under oath, insisting that his shop steward reports had been accurate and that he was unaware of any improprieties on the Jacobi job site. (Flaherty Depostion, Exhibit 1, at A 91, 94, 113.) Flaherty persisted in this untruth even after he returned to give additional testimony five months later, when I gave him the opportunity to purge his false testimony (Exhibit 1 at B 214-15, 218-19, 229.)6 Given Flaherty's refusal to tell the truth even after he was given a second chance to do so, I respectfully recommend that the Court refer Flaherty's conduct to the Government for criminal prosecution.

At the end of January 2004, I subpoenaed DASNY for all documents relating to Boom's work at Jacobi and in early May 2004, Mr. Sobocienski and I traveled to Albany

6 Once I had irrefutable proof that Carpenters had been working for Boom at Jacobi off the shop steward reports, I gave each of the witnesses who I believed had committed perjury and obstruction of justice in their initial depositions an opportunity to return for another deposition session at which they might correct their testimony. I did so in a letter explaining my conclusions about their testimony, my intention to recommend a criminal referral and an invitation to return to my office for another deposition. A sample of this form letter is submitted herewith as Exhibit 2.

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to review DASNY's documents and meet with the DASNY Inspector General. Mr. Sobocienski and I were then able to compare several months worth of headcount records submitted to DASNY by Bovis Lend Lease ("Bovis"), the construction manager for the Jacobi project; the certified payroll reports submitted to DASNY; and the shop steward reports that we had obtained from the District Council. This comparison confirmed my preliminary conclusion that the shop steward reports did not list all of the Carpenters working for Boom at the Jacobi job site.

In February of 2004 I deposed Derek McKenna ("McKenna"), the owner of Boom who oversaw the Jacobi job site.7 At that time McKenna, too, lied when I asked him to explain the discrepancies I found between: (a) the shop steward reports and the certified payroll forms filed with the DASNY and (b) the shop steward reports and the general contractor's headcount. He swore that Boom did not pay Carpenters cash (Deposition of Derek McKenna, taken February 26, 2004, July 13, 2004 and December 6, 2004 ["McKenna Deposition" ], submitted herewith as Exhibit 3 A, B and C, respectively, at A 78-79, 80-81)8 and that discrepancies between the shop steward reports and the certified

7 Boom's other 50% owner, Sean Doherty, appears not to have had a substantial presence at the Jacobi job site.

8 I am providing the last two instalments of McKenna's deposition (Exhibit 3 B and C) only to the Court and to McKenna's counsel, pending the Court's review of this report and counsel's opportunity to be heard, before the Court determines what, if any, action it wishes to take with respect to McKenna. I am treating these transcripts in this fashion because of my representation to McKenna and his counsel that, although I cannot commit either the Court or the Government, I would recommend that McKenna not be prosecuted for perjury or obstruction of justice as long as he testified truthfully in his second and third deposition instalments. I believe

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payroll reports were due to "clerical errors" caused, for example, by the fact that Boom workers sometimes were sent back and forth between the Jacobi job site and the job site at the Columbia Medical Center. (Exhibit 3 at A 185, 191-93.) At this first deposition session, Mr. McKenna claimed that he could not explain how these "clerical errors" could have occurred, asserting that he simply signed the documents that were given to him and did not know how they were prepared. (Id. at 193.)

On March 12, 2004, the Hot Line received an anonymous voicemail message stating that the Boom shop steward at the Jacobi site and other Carpenters working there were "on the take." On March 18, the OWL supervisor related the substance of a call he had received that day from a union member who provided more detailed information obtained from an unidentified Jacobi Carpenter. On March 19, the II team received from the District Council a shop steward report prepared by a substitute shop steward, Horace Kerr, for a week during which the then-shop steward, Delroy Haughton, was on vacation. Mr. Kerr's shop steward report for the week of February 23, 2004 (the only full week he was on the job) showed 987 Carpenter hours. By comparison, Mr. Haughton's shop steward reports for March 1 (which the II team received on April 20) showed only 735 Carpenter hours and his shop steward reports for the full week prior to his vacation, the

that McKenna's subsequent testimony was substantially truthful (see n. 18, below) and I respectfully request that the Court hear from McKenna's counsel and from me before permitting these transcripts to be used for criminal prosecution of McKenna.

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week of February 9, showed only 695 Carpenter hours.9

Mr. Kerr's shop steward reports also contained several names that had not appeared on Mr. Haughton's previous shop steward reports. The District Council served notices to appear and began interviewing those Carpenters suspected of working for cash in late March and early April. Mr. Sobocienski participated in these interviews. I served notices of deposition on most of the same Carpenters and began taking their depositions in early April.

Just before the depositions began, on March 31, 2004, the Hot Line received an anonymous call from a union member who repeated the allegation that Boom had cash workers at Jacobi and that the shop steward was aware of this. More importantly, this caller also told us that the cash payments were made on Fridays at a bar in the Bronx and described its location. The caller further advised that the Boom Carpenters received their pay from Boom's foreman in the back of the bar. This allowed the II team to arrange for video surveillance inside and outside the bar in question on the next Friday, April 2. The

9 McKenna testified, on his second visit to my office when he decided to admit that he paid cash at Jacobi, that Horace Kerr performed his job diligently and attempted to list all of the Carpenters on his shop steward report but that he missed two or three workers because he did not see them. (McKenna Deposition, Exhibit 3, at B 306-07.) Other honest District Council shop stewards whose names were mentioned by Boom foreman Mark McMorrow or other Carpenters are: Vincent Ciaramella at a Boom job at P.S. 129; Mark Landesberg at P.S. 128; Edward Ortega at Brooklyn Tabernacle (Deposition of Mark McMorrow, ["Mark McMorrow Deposition") submitted herewith as Exhibit 6, at B 251-53, 288-89); Eldridge Brown at the Verizon job on 125th Street (Deposition of C. Simon, ["C. Simon Deposition"] submitted herewith as Exhibit 7, at B 91-92); and an unidentified African-American shop steward at a Verizon job in Brooklyn (Deposition of Hank Simon, ["H. Simon Deposition"] submitted herewith as Exhibit 8, at 57-58).

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videotape of the outside of the bar (submitted herewith as Exhibit 4) shows several Boom employees entering the bar and then exiting within minutes. The videotape of the bar's interior (submitted herewith as Exhibit 5), coupled with the observations of the investigator inside the bar, show that "Shanty Martin"10 obtained envelopes from the bartender and walked, carrying a sheet of paper, into a backroom into which he was followed, one by one, by several Boom/Jacobi workers who then quickly exited that room, sometimes clutching envelopes.

As noted above, I began taking depositions of Carpenter journeymen in early April, 2004. Between April 9 and June 22, I conducted seven depositions of Carpenter journeymen working at Boom's Jacobi site. I selected these Carpenters because I had information leading me to believe that they had worked at the site for cash; some of them had appeared in the video made during surveillance of Shea's Emerald Bar. During these depositions, I played the videotape that had been had made outside O'Shea's Emerald Bar on April 2, showing Boom Carpenters entering and then quickly leaving the bar.

Just as there had been an increase in the number of Carpenter hours on the Boom/Jacobi shop steward reports during the full week for which Horace Kerr was the temporary shop steward, once Carpenters were shown this videotape, the shop steward reports started to become more complete. The number of names on the shop steward

10 Shanty Martin" was the nickname assigned to a non-union Boom worker named Martin Murray, to distinguish him from the Martin Murray who was a Carpenter working for Boom (frequently off the shop steward reports) at Jacobi.

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reports continued to increase as more Boom Carpenters were called in to testify.

Also during this period, I deposed shop steward Delroy Haughton (and, as noted above, former shop steward Jason Flaherty); Mark McMorrow, the Boom foreman at the Jacobi site (and a District Council member); and "Shanty Martin", the non-union Boom employee who worked in the Jacobi "shanty" from which he dispensed and collected tools.

It was my hope that these witnesses, or at least some of them, when confronted with the warnings I gave with respect to perjury and obstruction of justice, would testify truthfully about cash payments by Boom. However, to a person, these witnesses lied under oath. They each said that they had been paid their proper wages and benefits, denied having been paid in cash (or, in the case of Mark McMorrow and Shanty Martin, denied having delivered any cash payments), and denied having any reason to suspect that anyone else on this job was kept off the shop steward reports and paid cash. Even when confronted with the videotape showing themselves and/or co-workers entering and exiting the bar we surveilled within time spans as short as ninety seconds, these witnesses denied that there had been cash payments made at the bar. Rather, they maintained that they or their colleagues had been at the bar purely for social reasons. (See, Depositions of Jeremiah Casey, ["Casey Deposition"] submitted herewith as Exhibit 9, at A 35, 60, 79; Alex Frederick Deposition, ["Frederick Deposition"] submitted herewith as Exhibit 10, at A 67,96-100; C. Simon Deposition, Exhibit 7, at A 65-60, 117-21; Glensworth Culzac,

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["Culzac Deposition"] herewith submitted as Exhibit 11, at A 39, 71; "Carpenter" Martin Murray Deposition, ["Carpenter Murray Deposition"] herewith submitted as Exhibit 12, at A 100, 133, 136; and Recaldo Joseph, ["Joseph Deposition"] herewith submitted as Exhibit 13, at A 93, 130-31, 139; see also, Mark McMorrow Deposition, Exhibit 6, at Al22.)

I am pleased to report that eventually each of these witnesses, with the exception of Delroy Haughton and Jason Flaherty, returned and purged their perjury.11 It is clear to me that the only reason these workers were finally willing to admit the truth was that their employer, Boom co-owner Derek McKenna, had already done so and then advised them to the same.12

Although Mr. Haughton did not accept my invitation to return to my office to give truthful testimony, he did submit to an interview with the District Council on January 17, 2004. The District Council's summary of that interview is submitted as Exhibit 16. In that interview, Haughton admits to have taken cash in exchange for keeping Carpenters off the shop steward reports. Not surprisingly, there are discrepancies between McKenna

11 The depositions of Delroy Haughton and Jason Flaherty are submitted as Exhibits 14 A and B, and 1 A and B, respectively. On October 27, 2004, the District Council filed charges against Flaherty, alleging that he had violated the union's constitution by submitting fraudulent shop steward reports and lying to me. I submit a copy of those charges as Exhibit 15.

12 In fact, McKenna met with each of the Carpenter journeymen who had worked at Jacobi and been deposed by me, in an attempt to reconstruct the number of hours they had worked off the books.

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and Haughton as to who initiated the subject of money and how much money was paid.13

McKenna returned to my office to correct his testimony in mid-July, 2004, several weeks after I telephoned the attorney who had represented him at the time of his initial testimony. I had explained to McKenna's attorney that I intended to recommend to the Court that it make a criminal referral of this matter because I believed there to be substantial evidence that McKenna had committed perjury, obstruction of justice and perhaps other criminal acts. At this point, McKenna retained a criminal defense attorney and came in to revise his testimony.

When McKenna came back to testify in July of 2004,14 he admitted that there had been a cash payroll at Jacobi. He testified that there were as many as two to five Carpenters omitted from the shop steward report each day. (McKenna Deposition at B 350-51.) Three weeks into Flaherty's tenure as shop steward, in November of 2002 (shortly after the Jacobi job began), McKenna approached him with the request that

13 Haughton told the District Council that he had lied in his testimony before me because of a hostile attitude on my part and because he did not like the way I asked him questions. Gary Rothman, counsel for the District Council, who was present at the deposition and at the interview, stated that I had treated Haughton professionally and like a gentleman. Haughton responded that he was unhappy with the way I had spoken with him outside Mr. Rothman's presence prior to the deposition. (Exhibit 16 at 3.)

14 Contrary to my usual practice of inviting representatives of the Government and the District Council to attend the depositions I take in this matter, I did not invite either of the parties to be present when Mr. McKenna returned on July 13 (and again on December 6). Experience in the II position has taught me that there are occasions on which, in order to get at the truth, I need to limit a witness' direct exposure to other parties in order to alleviate the witness' fears or feelings of intimidation and/or to protect the confidentiality of the investigative process. I take full responsibility for these decisions and am prepared to discuss them further at the Court's convenience and in whatever setting the Court deems appropriate.

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"Shanty Martin," the non-union worker who gave out and collected tools and did paperwork, be allowed to get the Carpenters' coffee sometimes and to help unload trucks when there were deliveries, contrary to the CBA. (Id. at 278, 280.) Flaherty agreed. Within two weeks he asked for money in exchange for permitting these deviations from the CBA. McKenna began to give Flaherty an additional $300 per week. (Id. at 279.)

McKenna then hired five or six Carpenters to be paid in cash, based on an understanding with Flaherty that these workers' names would not appear on the shop steward reports. Flaherty demanded more money for this additional deception and began to receive between $500 and $700 per week. These payments were made in cash and sometimes were made off-site, usually on Fridays. (Id. at 279-83, 348-39.) McKenna testified that he believes that he paid Flaherty a total of approximately $7000 in exchange for keeping two to five Carpenters per day off the shop steward reports each week and allowing "Shanty Martin" to perform Carpenters' work15 (Id. at 347-351.)

Delroy Haughton, the shop steward assigned to Boom's Jacobi site after Flaherty was removed, was paid substantial cash bribes to keep Carpenter journeymen off the shop steward reports. (Id. at 346.) McKenna testified that three or four weeks after Haughton began as shop steward, Boom's foreman at Jacobi, Mark McMorrow, told McKenna that

15 Sometimes Carpenters were on the shop steward reports and therefore paid proper wages and benefits for some days of the week but not others. This typically occurred after a business agent had been to the job site and was aware how many Carpenters had been there. Casey Deposition, Exhibit 9, at B 178-79; Deposition of Shorn Pink ["Pink Deposition"],

herewith submitted as Exhibit 17, at 89-90; Deposition of Greg Duhig ["Duhig Deposition"], herewith submitted as Exhibit 18 at B 250.)

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Haughton was not working, interfering with other Carpenters' work, and leaving early. (Id. at 362-63.) When McKenna confronted Haughton about this, Haughton said "you help me, I'll help you."

McKenna told Haughton that he knew two Carpenters whom he wanted to hire and keep off the shop steward reports: Haughton's initial demand, McKenna testified, was half the money that Boom would save by not paying benefits and full wages for these workers. Ultimately, McKenna paid Haughton $300 to $500 per week for each Carpenter kept off the shop steward reports. (Id. At 366.) Haughton began to maintain two sets of shop steward reports: an accurate one to serve as a payroll sheet for McKenna and an inaccurate, abridged, version for the District Council, omitting the names of Carpenters who were getting paid cash, lower wages and no benefits. (Id. at 369.) In addition to the cash he received, Haughton took the liberty of doing little work and often arriving late and leaving early. (Id. at 370-71.)16 McKenna testified that he paid Haughton a total of more than $60,000. (Id. at 448.)

Indeed, Haughton apparently was so aggressive and persistent in his demands upon McKenna that he was charged by the United States Attorney's Office with accepting bribes from an employer in exchange for permitting the employer to contravene the CBA,

16 Haughton's casual attitude about work irritated other Carpenters on the job site (Id. at 363,] and even led to a physical confrontation between Haughton and Shanty Martin when Haughton, trying to leave early one day, tried forcibly to take from Shanty Martin the key to the shanty in which Haughton's personal belongings were locked. Duhig Deposition, Exhibit 18, at B 252-53, 255-56; Deposition of "Shanty" Martin Murray ["Shanty Martin Murray Deposition"], herewith submitted as Exhibit 19, at B 178-81.)

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in violation of 29 U.S.C. § 186. A copy of the criminal complaint, sworn on October 15, 2004, is submitted as Exhibit 20.17 Because of his unpurged perjury and obstruction of justice, I respectfully recommend that the Court refer this matter to the United States Attorney's office for consideration of possible criminal charges in addition to those with which Haugton has thus far been charged.

Aggressive conduct toward McKenna aside, the most egregious aspect of Haughton's conduct was his betrayal of the Carpenters on the job site. Haughton made a mockery of his shop steward's obligation to report to the District Council the names of all Carpenters on the job site so that they would be paid their proper wages and benefits. In fact, according to McKenna, there were occasions when Haughton left off even more Carpenters than McKenna had requested so that he could demand a larger cash pay-off. (Id. at 368.) Several Carpenters testified that when they asked Haughton to include them on the shop steward reports, Haughton either gave them an evasive answer or told them that they would have to get McKenna's approval first. (Pink Deposition, Exhibit 17, at 96-97; Frederick Deposition, Exhibit 10, at B 163,166-67; C. Simon Deposition, Exhibit 7 at B107-08.) One Carpenter journeyman testified that Haughton laughed in his face when confronted about the issue. (Deposition of Recaldo Joseph ["Joseph Deposition") at C 223-24.) Haughton's conduct is a disgrace to good Carpenter shop stewards and

17 Flaherty, too, was no shrinking violet. He continued to demand cash from McKenna even after he had been removed as shop steward. (Id. at 405-07; C at 502-06.)

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deserves the harshest form of Carpenter justice.

Consistent with McKenna's testimony that he had also paid off Haughton's predecessor, Jason Flaherty, one journeyman testified that when he asked Flaherty if he could be listed on the shop steward reports, Flaherty told him that only McKenna could make that decision. (Pink Deposition, Exhibit 17, at 88-89.) Similarly, Hank Simon testified that he knew it was pointless to talk to Flaherty about being listed on the shop steward reports because that decision rested with McKenna. (H. Simon Deposition, Exhibit 8 at 51-53.)

Clearly, it is outrageous for a Carpenter to have to obtain his employer's permission to obtain his basic CBA right to proper wages and benefits. And sadly, as I discuss in more detail below, the fact