CORE TERMS: consent decree, disciplinary, organized crime, certificates, constituent, discipline, gift, knowingly, conversation, impose discipline, racketeering, proscribed act, social club, decree, fat, contractor, Proscribed Acts, person aggrieved, right of appeal, person charged, involvement, captain, expel, disciplinary hearing, motion to strike, job site, disciplined, recording, fireproofing, arbitration
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HeadnotesCOUNSEL: APPEARANCES:
HONORABLE MARY JO WHITE, United States Attorney for the Southern District of New York, Attorney for United States of America, New York, NY, By: MANVIN S. MAYELL, ESQ., Assistant US Attorney, Of Counsel.
CURTIS, MALLET-PREVOST COLT & MOSLE, Attorney for Salvatore Lanza, New York, NY, By: PETER FLEMING, JR., ESQ., MICHAEL MOSCATO, ESQ., Of Counsel.
LEWIS & FIORE, Attorney for Joseph Giardina, New York, NY, By: DAVID L. LEWIS, ESQ., Of Counsel.
LATHAN & WATKINS, MICHAEL CHERTOFF, Investigations Officer, New York, NY.
JUDGES: ROBERT W. SWEET, U.S.D.J.
OPINIONBY: ROBERT W. SWEET
OPINION: OPINION
Sweet, D.J.,
Salvatore Lanza ("Lanza") has appealed from the decision of the Court-appointed Monitor dated August 14, 1996, and amended on September 18, 1996 (the "Lanza Opinion").
Joseph Giardina ("Giardina") has moved to strike the Investigations Officer's notice of appeal of the Monitor's decision not to impose discipline on Giardina.
For the reasons set forth below, Lanza's appeal will be denied and Giardina's motion to strike will be granted.
The parties, facts and prior proceedings have [*2] been set forth more fully in several prior opinions of the Court, familiarity with which is assumed. See United States v. Mason Tenders District Council, 909 F. Supp. 891 (S.D.N.Y. 1995); United States v. Mason Tenders District Council, 1995 U.S. Dist. LEXIS 17049, 1995 WL 679245 (S.D.N.Y. Nov. 15, 1995). Those facts and prior proceedings relevant to the instant opinion are set forth below.
Parties
The Mason Tenders District Council (the "MTDC") is chartered by The Laborers' International Union of North America ("LIUNA"), a national labor organization, to oversee the operations of LIUNA's constituent local unions in the New York City metropolitan area.
Until August of 1996, Salvatore Lanza was a member and the Business Manager of Mason Tenders Local 30 ("Local 30") and a trustee of several benefit funds maintained by Local 30 on behalf of its membership. Lanza also served as the Recording Secretary of the MTDC until November of 1994.
Giardina is a former member of the Mason Tenders Local 23, and a current member of the recently consolidated local union.
Facts
I. The Consent Decree
On September 8, 1994, the United States instituted a civil action pursuant to the [*3] Racketeering Influenced and Corrupt Organizations Act, 18 U.S.C. § 1964 ("the RICO statute") and the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. ("ERISA") (the "Civil Rico Suit"), alleging, among other things, that over a period of twenty years, executives and appointees of the MTDC had: (1) extorted payoffs from employers in exchange for those officials and their appointees condoning the employers' use of non-union labor and the employers' failure to make payments to the MTDC Trust Funds in accordance with collective bargaining agreements; (2) embezzled and converted MTDC Trust Fund monies through fraudulent real estate transactions; (3) engaged in kickback schemes with companies and individuals providing services to the MTDC and its constituent local unions; and (4) failed to police and knowingly condoned similar activities on the part of certain officials of the constituent local unions of the MTDC.
On December 27, 1994, the government, the MTDC and the employer-trustees of the MTDC Trust Funds entered into a Consent Decree approved by the Court. The Consent Decree sets forth the following three categories of prohibited conduct (hereinafter "Proscribed [*4] Acts"): (a) any acts of racketeering as defined in the RICO Statute; (b) any knowing association with any member or associate of any La Cosa Nostra crime family ("LCN") or any other criminal group, or with any person prohibited from participating in union affairs; and (c) any obstruction or interference with the work of the court-appointed officers or with the purposes of the Consent Decree. See Consent Decree PP 3, 4(a).
The Consent Decree permanently enjoins all current and future officers, agents, representatives, employees, and members of the MTDC and its constituent locals from engaging in any Proscribed Acts. The Consent Decree provides for the appointment of an Investigations Officer to investigate any Proscribed Acts and to bring charges based on such conduct before a court-appointed Monitor for a hearing. n1
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n1 On January 17, 1995, this Court appointed Lawrence B. Pedowitz, Esq. and Michael Chertoff, Esq. to act as Monitor and Investigations Officer, respectively, under the Consent Decree.
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The Monitor has all "powers set forth in the Uniform MTDC Constitution of LIUNA and the Uniform Local Constitution of LIUNA with respect to discipline, and shall have the right to fine, suspend and expel members, officers, agents, representatives and employees . . . ." Consent Decree P 4(e). In addition, the Consent Decree grants to the Monitor jurisdiction to ensure compliance with the Consent Decree and the union constitutions and to impose sanctions for violations of the Consent Decree and union constitutions. Id. P 4(a). The Monitor is empowered to hear disciplinary charges brought by the Investigations Officer and impose sanctions, including expulsion from the MTDC and its constituent local unions. (See id. P 7.)
Pursuant to the Consent Decree, the Investigations Officer is authorized to "investigate and to prosecute any Proscribed Acts that either have occurred since January 1, 1982 or occur in the future at any time prior to the expiration of the Consent Decree, and to propose appropriate sanctions for such conduct." Consent Decree P 5(a). The Consent Decree further provides, "any proscribed act involving membership in or knowingly associating with La Cosa Nostra or [*6] any other criminal group shall be subject to investigation by the Investigations Officer regardless of when such offense occurred." Id.
The Consent Decree extends to the Investigations Officer "all the rights and powers of the MTDC and any of its constituent locals and any of its members or officers including, without limitation, the powers set forth in the Uniform MTDC (sic) Constitution of LIUNA, and the Uniform Local Constitution of LIUNA with respect to investigation . . . ." Id. P 5(c). The Investigations Officer also has the right "to propose that the Monitor impose fines upon, and/or suspend or expel members, officers, agents, representatives and employees" of the MTDC and its constituent local unions. Id.
Upon detecting and investigating Proscribed Acts or violations of the union constitution, the Investigations Officer is directed to initiate disciplinary charges against the persons who committed such acts. Consent Decree P 7(a). Upon the filing of any objection in accordance with the terms of the Consent Decree, the Monitor shall schedule a disciplinary hearing within forty-five (45) days, which shall be conducted "in conformity with the rules and procedures [*7] generally applicable to labor arbitrations." Id. P 7(b)(2).
The procedures generally applicable to labor arbitrations do not require adherence to any formal rules of evidence. The rules relating to labor arbitrations promulgated by the American Arbitration Association state that "the parties may offer such evidence as is relevant and material to the dispute . . . conformity to legal rules of evidence shall not be necessary." American Arbitration Association, Labor Arbitration Rules, P 28. See also United States v. International Bhd. of Teamsters, 19 F.3d 816, 823 (2d Cir. 1994)(evidentiary rules are relaxed at disciplinary proceedings); Frank Elkouri, How Arbitration Works 296 (4th ed. 1985) (same). Hearsay statements are admissible if they are reliable and if they can gain reliability through corroboration by other evidence. International Bhd. of Teamsters, 19 F.3d at 823; see also United States v. International Bhd. of Teamsters, 998 F.2d 120, 124 (2d Cir. 1993) ("hearsay may be admitted in IBT disciplinary proceedings, provided it is reliable"); United States v. International Bhd. of Teamsters, 824 F. Supp. 410, 414 (S.D.N.Y. 1993) (same); Elkouri, [*8] supra, at 325 ("evidence of a hearsay character is often presented at arbitration hearings").
The Monitor shall decide charges at a disciplinary hearing according to the "just cause" standard. Consent Decree P 7(c)(1). The preponderance of the evidence standard is used to determine if violations have occurred. International Bhd. of Teamsters, 814 F. Supp. 1165 at 1168 ("the Investigations Officer has the burden of establishing just cause by a preponderance of the evidence"); United States v. International Bhd. of Teamsters, 754 F. Supp. 333, 337 (S.D.N.Y. 1990). Violations of the Consent Decree or of the union constitution proven by a preponderance of the evidence are just cause for discipline. See International Bhd. of Teamsters, 19 F.3d at 820; International Bhd. of Teamsters, 814 F. Supp. at 1185; International Bhd. of Teamsters, 754 F. Supp. at 339-40.
With respect to the right of appeal from the Monitor's decisions, the Consent Decree provides as follows:
Upon the Monitor's determination that the person charged has committed any proscribed act, the Monitor shall discipline the person charged (the "disciplinary decision"). The Monitor's disciplinary decision [*9] shall be effective immediately upon issuance. The Monitor's disciplinary decision shall be final and binding, subject only to the Court's review as provided herein at paragraph 4g(2). All discipline imposed under this Consent Decree, whether upon consent or by decision of the Monitor, shall be so ordered by the Court.
For a period of up to ten calendar days after mailing of the Monitor's disciplinary decision concerning a disciplinary charge, any person aggrieved by the disciplinary decision with the exception of any person who fails to contest the charge under the terms of paragraph 7, shall have the right to seek review in this Court.
Prior Proceedings
I. Salvatore Lanza
A. The Charges Against Lanza
On July 25, 1995, the Investigations Officer filed fourteen disciplinary charges against Lanza pursuant to paragraph 5(c) of the Consent Decree. The Investigations Officer alleged that Lanza committed acts of racketeering by demanding and receiving payments from two contractors, HRF Surface Cleaning Corporation and Morrell-Brown, both of which employed or would employ members of Local 30.
The Investigations Officer also charged Lanza with knowingly involving [*10] members and associates of La Cosa Nostra in union affairs by recommending the placement of Ernest Muscarella for a position at the MTDC trust funds and by discussing union business with and soliciting the support of Genovese organized crime family (the "Genovese Family") bosses Anthony "Fat Tony" Salerno ("Salerno") and Liborio "Barney" Bellomo "(Bellomo"). The Investigations Officer charged that Lanza's knowing association with those individuals violated the union constitution, his statutory duty of undivided loyalty to the union and the Consent Decree.
Finally, the Investigations Officer charged Lanza with obstructing the Investigations Officers' efforts by refusing to produce certain records and answer certain questions, and by denying his involvement in certain events.
B. The Disciplinary Hearing
On April 8, 1996, the Monitor held a hearing on the disciplinary charges against Lanza. The Investigations Officer and Lanza, who was represented by counsel, presented testimony and documentary evidence concerning the charges of racketeering and associations with organized crime against Lanza.
1. Evidence of Racketeering
Special Agent William Davidson of the United [*11] States Department of Labor testified about interviews he had with Robert Henkel, the owner of HRF Surface Cleaning Corporation ("HRF") after Henkel's arrest. Davidson testified about Henkel's description of a request by Lanza for kickbacks in connection with a job HRF was doing at Mt. Sinai Hospital in Manhattan between 1982 and 1984. Davidson testified that Lanza instructed Henkel to make the payoffs by hiring specified subcontractors to perform fireproofing work at the site. The Investigations Officer also introduced Henkel's testimony, offered during his criminal trial in the Eastern District of New York, that he had paid money to Lanza at the Mt. Sinai job site.
To corroborate Henkel's allegations, the Investigations Officer introduced copies of Lanza's business cards found in Henkel's possession after Henkel's arrest in 1988. The cards contained the names and telephone numbers of the subcontractors through which Henkel was to funnel the kickbacks to Lanza. During his testimony at the hearing, Lanza acknowledged that the cards were his. Lanza also acknowledged that he knew Henkel and recalled that Local 30 was involved in the spray fireproofing job at the Mt. Sinai location. [*12]
Special Agent Davidson also testified that an attorney representing Morrell-Brown, another contractor doing business with Local 30, asserted in a proffer session that from 1987 to 1991 Morrell-Brown had made payoffs of $ 65,000 worth of Macy's gift certificates to Lanza and Frank LoPresti, an official with LIUNA Local 60. Davidson's review of Morrell-Brown's records confirmed that Morrell-Brown purchased about $ 65,000 of Macy's gift certificates during the 1987-1991 period.
Lanza admitted that he accepted Macy's gift certificates from Morrell-Brown, but claimed that Morrell-Brown left about $ 800 worth of gift certificates at Local 30's offices, of which Lanza kept and redeemed $ 100 to $ 200 worth. Lanza claimed that he distributed the remainder of the certificates to his office staff. Lanza also acknowledged that he had dinner "maybe twice" with the principals of Morrell-Brown and LoPresti at a restaurant in the Bronx owned by Vincent DiNapoli, a member of the Genovese Family whom Lanza had known for years.
2. Evidence of Knowing Associations With LCN
At the hearing, the Investigations Officer submitted transcripts of various recordings of conversations during 1989 [*13] and 1990 in a Genovese Family social club located at 262 Mott Street in Manhattan. In those conversations, Genovese Family associates and members, including Genovese Family "capo" James Messera, discussed Genovese Family Bosses Salerno and Bellomo's role as Lanza's patrons in the union and Lanza's attempt to influence the Genovese Family's selection of the leadership of the District Council after the death of Gaspar Lupo, the former head of the Genovese Family.
Messera detailed various disputes he had with Lanza. Messera's statements reflect that Lanza received his union position at Salerno's behest. For example, Messera described how after one dispute with Lanza, he told Gaspar Lupo, then-president of the District Council, to warn Lanza not to "fuck[] with me." Messera next stated, "Now who the fuck knows, Gaspar never told him because he came from Fat Tony you know." According to Vincent "Fish" Cafaro, former Underboss of the Genovese Family, Salerno was the "'figurehead' Boss of the Genovese Family."
Lanza's affiliation with organized crime is also evidenced by the events following Messera's attempt to remove Lanza from the District Council in 1989. Messera states that after [*14] he removed Lanza, Lanza's "friends" came to see him. Messera later states that "Barney" and another person visited him to "see if they can do something" about Lanza's departure from the council. "Fish" Cafaro identifies Bellomo as a member of the Genovese Family who took over as "capo" of the crew of Sammy Santora.
Another conversation a few months later in the social club supports the inference that Lanza received the protection of Bellomo in his dispute with Messera. After discussing union business, two Genovese Family associates, Anthony Sclafani and Onofrio Macchio, discussed the fact that "Barney" took the place of "Sammy" and "Fat Tony." The following conversation ensued:
SCLAFANI: And BARNEY's got uh, those brothers there, that we used to have trouble with all the time. Those, their name the District Counselor, that fat motherfuck, what's his name?
MACCHIO: Oh, NINO you mean.
SCLAFANI: NINO and his brother SAL.
MACCHIO: SAL, SAL. Yeah.
SCLAFANI: JIMMY was throwing 'em out . . .
MACCHIO: Yeah, yeah, yeah.
SCLAFANI: . . . BARNEY said, JIMMY, we need a favor.
MACCHIO: Yeah, yeah, I know.
Lanza's brother is Anthony "Nino" Lanza, [*15] who was the former administrator of the Mason Tenders trust funds.
The evidence adduced at the hearing demonstrated that Lanza attempted to participate in the Genovese Family's selection of the leadership of the District Council following the death of Gaspar Lupo. On the tapes, Messera described how Frank Lupo asked Messera to allow his brother, James Lupo, to become the Business Manager of the District Council at Gaspar's funeral. Messera then recounted that Lanza suddenly appeared stating, "My allegiance lies with these two Lupo brothers." Frank Lupo stated that at Gaspar's funeral Lanza "showed his support" for Frank and James Lupo to Messera. Lanza himself confirms that he spoke in support of Frank Lupo to James Messera at the funeral of Gaspar Lupo.
Lanza's association with organized crime is further confirmed by Lanza's admissions that he had been at the Palma Boy Social Club in Manhattan around a half dozen to a dozen times. Lanza stated he had met Fat Tony Salerno when at the club, and that he was aware that Salerno was a bookmaker connected to organized crime. Moreover, Lanza admitted that the Palma Boy Social Club was only open to "people that the people on the inside knew" [*16] and that Lanza knew "any number of people" inside the Palma Boy Social Club. Lanza also admitted to having met Genovese Family members "Fish" Cafaro and Vincent DiNapoli inside the Palma Boy Social Club.
The Lanza Opinion
The Opinion adopted four of the fourteen disciplinary charges submitted by the Investigations Officer against Salvatore Lanza. Those four charges are: (1) Charge 2: Racketeering; (2) Charge 5: Interference with the proper conduct of union business; (3) Charge 7: association with organized crime member Anthony Salerno; and (4) Charge 8: association with organized crime member Liborio Bellomo.
The Monitor found those four charges sufficient to warrant Lanza's permanent expulsion from the Mason Tenders Union, and did not consider the other charges, except insofar as evidence submitted in support of those charges was relevant to consideration of the charges adopted in the Opinion.
The charges adopted by the Monitor are based on allegations that Lanza has had a long history of association with high-ranking members of the Genovese Family. The Monitor concluded that Lanza's association with Salerno, former head of the Genovese Family, and Bellomo, acting [*17] head of the Genovese Family, allowed Lanza to maintain his position at the MTDC and within Local 30, even after Lanza repeatedly angered James Messera, a "captain" in the Genovese Family and former delegate to the MTDC. In addition, the Monitor concluded that Lanza committed acts of racketeering by accepting department store gift certificates from a union contractor and distributing other gift certificates from the contractor to employees of Local 30. As a sanction for his conduct, the Monitor has barred Lanza permanently from membership in, association with, or employment by the MTDC or any affiliated unions or trust funds.
Lanza filed notice of his appeal on August 23, 1996. Oral argument on Lanza's appeal was heard on December 17, 1996, at which time the appeal was considered fully submitted.
II. Giardina
By Opinion dated January 9, 1997, following a hearing on seventeen charges filed against Giardina by the Investigations Officer, the Monitor declined to impose discipline on Giardina. The Monitor found that under the just cause standard, the investigations had failed to sustain any of the charges against Giardina.
By letter motion dated January 10, 1997, Giardina [*18] filed a motion to strike the Investigations Officer's notice of appeal, dated January 9, 1997, of the Monitor's decision not to impose discipline on Giardina. Oral argument on Giardina's motion was heard on January 22, 1997, at which time it was considered fully submitted.
Discussion
I. Standard of Review
The Consent Decree provides that disciplinary decisions of the Monitor shall be final and binding, subject only to this Court's review. Consent Decree, P 7(c)(2). In reviewing decisions of the Monitor, the Court shall apply the same standard applicable to review of final federal agency action under the Administrative Procedure Act, 5 U.S.C. § 701 et seq. (the "APA"). Consent Decree, P 4(g)(2).
The APA provides that a district court may set aside an agency's findings, conclusions, or actions only if they are arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. Henley v. Food and Drug Admin., 77 F.3d 616, 619 (2d Cir. 1996).
Under section 10(e) of the APA, a reviewing court determines de novo "all relevant questions of law." 5 U.S.C. § 706; see also United States v. District Council of New York City, 941 F. Supp. 349, 361, 1996 [*19] WL 520907 at *10 (S.D.N.Y. 1996). In considering a relevant question of law under the APA, "the reviewing court asks whether the agency's action was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." District Council, 941 F. Supp. at 362, 1996 WL 520907 at *10; see also 5 U.S.C. § 706(2)(A).
An agency's findings of fact "are entitled to affirmance on review if they are reasonable and supported by substantial evidence in the record as a whole." District Council, 941 F. Supp. at 362, 1996 WL 520907 at *10, quoting NLRB v. Gordon, 792 F.2d 29, 32 (2d Cir. 1986). The APA "permits agency findings to be set aside only if they are 'unsupported by substantial evidence.'" United States v. International Bhd. of Teamsters, 964 F.2d 1308, 1311 (2d Cir. 1992). Substantial evidence is more than a mere scintilla, id. at 1311-12, but "something less than the weight of the evidence, and the substantial evidence standard may be met despite the possibility of drawing two inconsistent conclusions from the evidence." United States v. International Bhd. of Teamsters, 19 F.3d 816, 820 (2d Cir.) (citations omitted).
In sum, the scope of review is narrow, and the reviewing [*20] court must ensure only that the agency has examined the relevant data and articulated a satisfactory explanation for its action, including a rational connection between the facts found and the choice made. Motor Vehicle Mfrs. Ass'n. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 77 L. Ed. 2d 443, 103 S. Ct. 2856 (1983); accord Henley, 77 F.3d at 620; RSR Corp., 924 F. Supp. 504 at 510. The district court is not to substitute its own judgment for that of the agency. Henley, 77 F.3d at 620; RSR Corp., 924 F. Supp. at 510; see also United States v. International Bhd. of Teamsters, 981 F.2d 1362, 1368 (2d Cir. 1992)("the district court must give 'great deference' to the decisions of the Independent Administrator") (quoting United States v. International Bhd. of Teamsters, 970 F.2d 1132, 1137 (2d Cir. 1992)).
II. Lanza Appeal
A. Lanza May Be Disciplined Based on Conduct That Occurred Before the Signing of the Consent Decree
Lanza argues that the Monitor lacks authority to discipline him for conduct occurring prior to December 27, 1994, when the Consent Decree was signed, because the prohibitions contained in the Consent Decree are prospective [*21] only and do not contemplate the discipline of members based on prior conduct.
The Consent Decree enjoins union members and officers from committing racketeering acts, from knowingly associating with organized crime and from obstructing the efforts of the Monitor and Investigations Officer. Consent Decree P 3(b). The Monitor is charged with imposing sanctions against union members and officers for commission of "proscribed act[s]", defined as a violation of the Consent Decree as well as any violation of applicable union constitutions. Consent Decree P 4(a).
The Investigations Officer appointed under the Consent Decree has the express duty to prosecute any proscribed acts that have occurred since January 1, 1982 and to propose to the Monitor appropriate sanctions for such conduct. See Consent Decree P 5(a). The Investigations Officer's specific power to investigate associations with organized crime is even broader, as it is not limited with respect to time: "any proscribed act involving membership in or knowingly associating with La Cosa Nostra or any other criminal group shall be subject to investigation by the Investigations Officer regardless of when such offense occurred." [*22] Consent Decree P 5(a).
Thus, the parties to the Consent Decree explicitly agreed that the Monitor would expel officers and members from the union based on conduct that took place prior to the effective date of the decree. This agreement reflects the primary purpose of the Consent Decree -- to rid the MTDC and its constituent local unions of the influence of organized crime. n2
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n2 See Consent Decree, at 4 ("WHEREAS, the MTDC and its trustees agree that there should be no criminal element or La Cosa Nostra corruption of any part of the MTDC").
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The Supreme Court has recognized that consent decrees are equivalent to contracts between the parties. See United States v. ITT Continental Baking Co., 420 U.S. 223, 237 n.10, 43 L. Ed. 2d 148, 95 S. Ct. 926 (1975); see also United States v. Local 359, United Seafood Workers, 55 F.3d 64, 68 (2d Cir. 1995) ("consent decrees 'should be construed basically as contracts'"). Therefore, consent decrees "must be interpreted according to their terms." United States [*23] v. Int'l Broth. of Teamsters, 728 F. Supp. 920, 922 (S.D.N.Y. 1989).
As this Court recognized in United States v. Mason Tenders District Council, 1995 U.S. Dist. LEXIS 17049 (S.D.N.Y. Nov. 14, 1995), the scope of the prohibitions contained in a Consent Decree are not limited to the relief available to a court in a typical proceeding, but are to be found in the terms of the Consent Decree itself:
Relief granted by a federal court in entering a consent decree may exceed the scope of the relief that it might have awarded without consent of the parties, for 'in addition to the law which forms the basis of the claim, the parties' consent animates the legal force of a consent decree,' and 'a federal court is not necessarily barred from entering a consent decree merely because the decree provides broader relief than the court could have awarded after a trial.
See id. at *37 quoting Local No. 93 v. City of Cleveland, 478 U.S. 501, 92 L. Ed. 2d 405, 106 S. Ct. 3063 (1985).
Pursuant to the Consent Decree, the Investigations Officer is obligated to prosecute any of the prohibited conduct by filing charges with the Monitor. Each of the charges adopted by the Monitor [*24] against Lanza was based on conduct occurring within the time frame specified by the Consent Decree, and thus Lanza was properly disciplined based on conduct that occurred prior to the signing of the Consent Degree but was specifically encompassed in the Consent Decree.
The Government and the MTDC expressly agreed that officers and members who had engaged in proscribed acts during a reasonable time period prior to the date the decree was entered would be subject to appropriate disciplinary sanctions by the Monitor. Accordingly, the Monitor's finding will not be reversed based on its imposition of discipline on Lanza for conduct pre-dating the entry of the Consent Decree.
B. The Evidence Supported the Monitor's Conclusions
1. Charge 2: Racketeering
In Charge Two, the Investigations Officer alleged that Lanza committed racketeering activity by receiving Macy's gift certificates from Morrell-Brown, a union contractor. Lanza concedes that the evidence in the record supports the Monitor's finding with respect to Charge Two, but contends that his acceptance of "low value" Macy's gift certificates does not warrant his expulsion from the union as a matter of "equity and decency." [*25]
The Monitor expressly concluded that there is reason to believe that Lanza's account of the incident involving the gift certificates was incomplete, and it is likely that Lanza accepted more gifts than he acknowledged. Moreover, the Monitor's decision to expel Lanza permanently was based not only on this admission of racketeering activity, but on Lanza's long history of association with high-ranking members of the Genovese Family in connection with the affairs of the MTDC and its constituent locals. Such associations are precisely what the Consent Decree was designed to remedy, and thus expulsion is appropriate under the Consent Decree.
Moreover, even if Lanza had only taken a few hundred dollars in gift certificates, such an acceptance nonetheless constitutes a violation of the Taft-Hartley Act. See District Council of New York City, 941 F. Supp. at 362, 1996 WL 520907 at *27 (upholding decision of hearing panel to expel member of carpenters union permanently because member coerced contractor into giving him $ 300 worth of window blinds). Accordingly, the decision of the Monitor to impose a lifetime ban on Lanza's contact with the Mason Tenders union will be affirmed.
2. Charge 5: Interference [*26] with the Proper Conduct of Union Business
As an initial challenge to Charge Five, Lanza argues that, even if true, his involvement of members and associates of La Cosa Nostra in the affairs of the MTDC and its constituent local unions does not violate Article III, § 3(d) of the LIUNA Uniform Local Union Constitution, which prohibits interfering in the "proper conduct of the business of the organization."
Lanza contends that the term "organization" in Article III, § 3(d) refers only to LIUNA, and not to LIUNA's subordinate local unions. According to Lanza, the members of Local 30 owed a duty not to interfere with the proper conduct of the business of LIUNA through the involvement of organized crime, but were under no such restriction with respect to the affairs of constituent LIUNA organizations such as the MTDC and Local 30.
Article III, § 3(d) of the LIUNA Uniform Local Union Constitution states that all local union members have a duty "to refrain from interfering with the proper conduct of all the business of the Organization." The term "Organization" is defined in Article I, Section 1 of the LIUNA International Union Constitution, which provides:
This Organization [*27] shall be known as Laborers' International Union of North America, and shall consist of the members of Local Unions affiliated with ... said International Union...
As the Monitor properly concluded, even accepting Lanza's position that the term "organization" refers solely to LIUNA and its individual members, and not to intermediate organizations such as the local unions, a local union officer who involves organized crime in union activity is, indeed, adversely affecting LIUNA and "the [individual] members of Local Unions." Article III, Section 3(d), therefore, has been violated even under Lanza's interpretation.
Lanza further contends that, even assuming that the LIUNA Constitution prohibits interference with the Local 30's affairs, there was no evidence that Lanza involved members of organized crime in the union.
The Monitor concluded that Lanza's history of disputes with Genovese "captain" James Messera evidences Lanza's involvement of Salerno and Bellomo in union affairs. At Lanza's disciplinary hearing, sworn testimony and electronic surveillance evidence was presented to the Monitor detailing Lanza's longtime association with Salerno, former head of the Genovese Family, [*28] to whom Lanza owed his positions within the MTDC and Local 30. Moreover, the evidence in the intercepted recordings revealed a long series of disputes between Lanza and Genovese "captain" James Messera. Lanza contends that this dispute merely reveals Lanza's efforts to thwart the designs of Messera. The evidence supports the inference that if Lanza had not obtained the backing of Salerno and Genovese Family "captain" Bellomo he could not have challenged Messera over control of the MTDC. In each dispute with Messera, Lanza carried the backing and support of Salerno and/or his successor Bellomo.
The pivotal dispute involved succession at the MTDC upon the death of MTDC President Gaspar Lupo in June of 1989. Gaspar's son and successor, Frank Lupo, enlisted Lanza's support in a dispute with Messera over the appointment of other officers. On June 18, 1989, Messera recalled (in a Title III intercepted recording) that when he met with Frank Lupo to discuss his anger towards Lanza over Lanza's defiance of Messera, Lupo reminded Messera that Lanza had Salerno's backing. Accordingly, Messera agreed to delay, at least temporarily, his efforts to remove Lanza from the MTDC. In another Title III [*29] conversation, Messera recalled a meeting with Gaspar Lupo after Lanza had rebuffed Messera's luncheon invitation. According to Messera, Messera explained to Lupo that he was aware that Lanza had been placed in his union position by Salerno and that Salerno's backing had given Lanza "the confidence to talk like a tough guy."
Considering this, and other evidence concerning Lanza's disputes with Messera, the Monitor concluded that the record revealed that Lanza "actively participated in [Genovese] family politics and had to rely on his organized crime allies to shield him from reprisals at the hand of his rivals." Thus, each time Lanza fought with Messera -- whether it was over a job site or the leadership at the MTDC -- Lanza involved Salerno in the affairs of the union.
Lanza's association with Salerno's "uptown" faction of the Genovese Family reveals at least three additional examples of Lanza actively involving members of organized crime in the affairs of the Union. This evidence also formed part of the basis of the Monitor's decision to adopt Charge Five.
The first such involvement revolved around a dispute between Lanza and James Messera over a fireproofing job at the old Pan [*30] Am building, 200 Park Avenue in New York City. Lanza, who was annoyed that Messera's secretly-owned fireproofing company had obtained work on the job site without expressing appreciation to Lanza, initially blocked Messera's company from continuing to work. In response to a visit by some of Messera's associates, however, Lanza reversed his decision and, in the words of the Monitor, "arranged to have Messera's company re-installed on the job site." Thus, Lanza knowingly involved Genovese "captain" James Messera and his company in a union job. This conclusion in itself justifies the adoption of Charge Five.
Second, the Monitor concluded that Lanza approached James Messera at the funeral of former MTDC President Gaspar Lupo in order to declare his allegiance to Gaspar Lupo's sons, Frank and James, as successors to Gaspar Lupo as officers of the MTDC. In so doing, Lanza demonstrated his awareness that Messera had the power to dictate such appointments due to his position in the Genovese Family; Messera had no union position that would have given him control over such a position. Thus, Lanza involved Messera in the process of determining the leadership at the MTDC.
Third, the Monitor [*31] found credible Lanza's admission that he repeatedly visited Salerno's social club. Lanza testified that during these visits he discussed the status of union members with Salerno. This testimony confirmed sworn statements by former MTDC President Frank Lupo that he and Lanza made repeated visits to Salerno's social club in East Harlem.
Lanza's duty as a union official was to resist or report to authorities the influence of organized crime. Instead, he used his own organized crime associations to gain a position of prominence in the union, and he relied on his associations in contesting the control of James Messera. The Monitor correctly concluded that in doing so, Lanza involved members of organized crime in the affairs of the Mason Tenders union.
While Lanza has demonstrated that inconsistent conclusions might be drawn from the record presented to the Monitor, this demonstration is insufficient to warrant disturbance of the Monitor's conclusions. See International Bhd. of Teamsters, 19 F.3d at 820. Lanza has failed to show that the Monitor's interpretation of the Local 30 constitution is "arbitrary, capricious or otherwise not in accordance with law." See District Council of [*32] New York City, 941 F. Supp. at 362, 1996 WL 520907 at *10. The Monitor's decision to adopt Charge Five will therefore be affirmed.
3. Charges Seven and Eight: Association with Organized Crime Members Salerno and Bellomo
In Charges Seven and Eight, the Investigations Officer alleged that Lanza knowingly associated with Genovese Family members Anthony "Fat Tony" Salerno and Liborio "Barney" Bellomo. In considering these charges, the Monitor was directed to evaluate "knowing association" based on the meaning the Second Circuit ascribed that phrase in the context of the adjudication of disputes under the Consent Decree in United States v. International Bhd. of Teamsters, 88 Civ. 4486 (DNE) (S.D.N.Y.). Consent Decree P 3.
Under this standard, one may be said to "knowingly associate" when he or she makes a "calculated choice" to associate with one known to be a member or associate of La Cosa Nostra. See International Bhd. of Teamsters, 19 F.3d at 822. More must be shown than "incidental or fleeting" contact with such a person to establish knowing association. International Bhd. of Teamsters, 824 F. Supp. at 414. Contact, however, need not be for an illegal purpose; contact for a social [*33] or business purposes is prohibited as well. Id.
The Monitor concluded that Lanza knowingly associated with Salerno and Bellomo, and that Salerno and Bellomo were Lanza's patrons in the Mason Tenders union. The Monitor's determination was based not on a single conversation, as Lanza contends, but on testimony and Title III intercepted recordings that revealed Lanza's associations with Salerno, including the following:
Lanza was placed in the union by Salerno, giving him, in Messera's view, "the confidence to talk like a tough guy."
Messera sent Lanza a threat through MTDC President Gaspar Lupo but, according to Messera, the threat was not communicated because of Lanza's association with Salerno.
Angered over Lanza's decision to challenge Messera's choice to place Baldo Mule in an officer position at the MTDC, Messera instructed Frank Lupo to remove Lanza from the MTDC, where Lanza was a delegate. Frank Lupo reminded Messera that Lanza had been placed in his union position by Salerno.
Frank Lupo testified he made numerous trips to Salerno's social club with Sal Lanza.
Lanza himself admitted making several trips to Salerno's social club and discussing [*34] members of the union while he was there.
Set against this background, the conversation introduced at Lanza's hearing as Exhibit E can reasonably be viewed as a probative and well-corroborated discussion between Anthony Sclafani and Onofrio Macchio concerning the history of Lanza's disputes with Messera. Sclafani and Macchio, associates of Messera whose conversation was recorded at Messera's social club, also recount the intervention of Liborio "Barney" Bellomo, who saved Lanza's position at the MTDC by asking Messera for a "favor." This conversation evidences Lanza's association with Bellomo, and underscores Lanza's connection to Salerno, Bellomo's predecessor as head of the Genovese Family.
Accordingly, the Monitor's interpretation of the record and decision to adopt Charges Seven and Eight were supported by the evidence presented. See District Council of New York City, 941 F. Supp. at 362, 1996 WL 520907 at *10 (agency decisions should not be disturbed if reasonable and supported by evidence in the record as a whole); NLRB, 792 F.2d at 32 (same).
III. The Investigations Officer May Not Appeal the Monitor's Decision Not to Impose Discipline
Giardina has moved to strike [*35] the Investigations Officer's notice of appeal, dated January 9, 1997, of the Monitor's decision not to impose discipline on Giardina. Giardina contends that the Investigations Officer's powers under the Consent Decree are narrowly circumscribed and do not include the right to appeal the Monitor's decision, rendered after a full hearing, not to impose discipline upon an individual against whom the Investigations Officer has filed charges.
According to the Investigations Officer, the terms of the Consent Decree do not limit the right of appeal to individuals upon whom discipline has been imposed, but allow the Investigations officer to appeal a decision of the Monitor not to impose discipline.
In United States v. Armour & Co., 402 U.S. 673, 681-82, 29 L. Ed. 2d 256, 91 S. Ct. 1752 (1971), the Supreme Court held that "the scope of a consent decree must be discerned within its four corners, and not by reference to what might satisfy one of the parties to it." "In accordance with Armour, consent decrees are regularly interpreted by their plain meaning." Davis v. New York City Housing Authority, 839 F. Supp. 215, 225 (S.D.N.Y. 1993) (citing Suarez v. Ward, 896 F.2d 28 (2d [*36] Cir. 1990)).
The Consent Decree reads, in pertinent part:
Upon the Monitor's determination that the person charged has committed any proscribed act, the Monitor shall discipline the person charged (the "disciplinary decision"). The Monitor's disciplinary decision shall be effective immediately upon issuance. The Monitor's disciplinary decision shall be final and binding, subject only to the Court's review as provided herein at paragraph 4g(2). All discipline imposed under this Consent Decree, whether upon consent or by decision of the Monitor, shall be so ordered by the Court.
For a period of up to ten calendar days after mailing of the Monitor's disciplinary decision concerning a disciplinary charge, any person aggrieved by the disciplinary decision with the exception of any person who fails to contest the charge under the terms of paragraph 7, shall have the right to seek review in this Court.
Consent Decree PP 7(c)(2) & 7(c)(3).
Paragraph 4(g)(3) of the Consent Decree, which also addresses the right of appeal from the Monitor's decision, provides as follows:
g. Review of the Monitor's Decisions. Any decision of the Monitor shall be final and binding, subject [*37] only to the Court's review as provided herein:(1) Should the District Council's lawful representatives wish to challenge the Monitor's decision to suspend the operation of the Constitution of the MTDC, the lawful representatives, within ten calendar days of the Monitor's decision, shall have the burden of challenging before this Court any aspect of the Monitor's decision concerning any proposed suspension of the Constitution.
(2) In reviewing decisions of the Monitor, the Court shall apply the same standard of review applicable to review of final federal agency action under the Administrative Procedure Act, 5 U.S.C. § 701, et seq.
(3) The decisions of this Court with respect to the decisions of the Monitor shall be final and subject to appeal only as follows: any appellant who is unsuccessful in reversing the Court's decision shall be obligated to pay all reasonable attorneys' fees and costs incurred by the Monitor and/or Investigations Officer in connection with opposing the appeal. Accordingly, each such appellant shall be required to post a bond prior to prosecuting an appeal in an amount satisfactory to the Court, the Monitor and/or the Investigations officer, [*38] in accordance with Rule 7 of the Federal Rules of Appellate Procedure.
Paragraph 7(c)(3) provides that "any person aggrieved by the disciplinary decision . . . shall have the right to seek review in this Court." The Investigations Officer contends that when the Monitor has decided not to impose discipline, the Investigations Officer is "aggrieved" by the Monitor's decision are may appeal to this Court. The Investigations Officer claims that the more specific reference later in Paragraph 7(c)(3) to the subset of "any disciplined individual" n3 indicates that the "person aggrieved" provision includes both disciplined individuals and the Investigations Officer himself, where he was unsuccessful in seeking discipline.
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n3 This provision provides for the Monitor's and/or the Investigations Officer's attorney fees to be paid by a disciplined individual who is unsuccessful in reversing this Court's decision on appeal.
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A close and literal reading of the Consent Decree, however, reveals that by its terms, the Consent [*39] Decree grants the right of appeal only to individuals upon whom discipline was imposed. The Consent Decree explicitly defines the "disciplinary decision" as the "Monitor's determination that the person charged has committed any proscribed act" and his imposition of discipline. See Consent Decree, P 7(c)(2). When the Monitor's determines that no proscribed act has been committed and imposes no discipline, no "disciplinary decision" has been issued. Accordingly, "any person aggrieved by the disciplinary decision" only includes those individuals upon whom discipline was imposed. Because the right of appeal is granted only to those "aggrieved" by a disciplinary decision, the Investigations Officer has no such right.
Accordingly, Giardina's motion to strike the Investigations Officer's appeal will be granted.
Conclusion
For the foregoing reasons, Lanza's appeal is hereby denied and Giardina's motion to strike is hereby granted.
It is so ordered.
New York, N. Y.
March 4, 1997
ROBERT W. SWEET
U.S.D.J.