Appendix — International Brotherhood of Teamsters v. United States

Supreme Court brief1991

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§0-19%4

The Supreme Court of the United States

upreme » ve

FILLED

JUN 13 1991

UNITED STATES OF AMERICA, } pcrice ge THE CLERK

er Pesabiinmamanne

INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUF-

FEURS, WAREHOUSEMEN AND HELPERS OF AMERICA, AFL-CIO,

THE COMMISSION OF LA COSA NOSTRA; ANTHONY SALERNO,

also known as Fat Tony; MATTHEW IANNIELLO, also known as Matty

the Horse; ANTHONY PROVENZANO, also known as Tony Pro; NUN-

ZIO PROVENZANO, also known as Nunzi Pro; ANTHONY CORALLO,

also known as Tony Ducks; SALVATORE SANTORO; CHRISTOPHER

FURNARI, SR., also known as Christie Tick: FRANK MANZO, CAR-

MINE PERSICO, also known as Junior, also known as The Snake; GEN-

NARO LANGELLA, also known as Gerry Lang; PHILIP RASTELLI,

also known as Rusty; NICHOLAS MARANGELLO, also known as Nicky

Glasses; JOSEPH MASSINO, also known as Joey Messina; ANTHONY

FICAROTTA, also known as Figgy; EJOGENE BOFFA, SR.; FRANCIS

SHEERAN; MILTON ROCKMAN, also known as Maishe; JOHN

TRONOLONE, also known as Peanuts; JOSEPH JOHN AIUPPA, also

known as Joey O’Brien, also known as Joe Doves; also known as Joey

Aiuppa; JOHN PHILLIP CERONE, also known as Jackie the Lackie,

(Continued on inside front cover)

OCTOBER, 1990 TERM

PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE SECOND CIRCUIT

APPENDIX

RUDOLPH F. PIERCE

Counsel of Record for

Defendant-Petitioner

International Brotherhood of Teamsters,

Chauffeurs, Warehousemen and Helpers of

America, AFL-CIO

GOULSTON & STORRS

A Professional Corporation

JAMES T. GRADY 400 Atlantic Avenue

JAMES F. O'BRIEN Boston, MA 02110-3333

Of Counsel (617) 482-1776

also known as Jackie Cerone; JOSEPH LOMBARDO, also knoqwn as

Joey the Clown; ANGELO LAPIETRA, also known as Nutcracker, The;

FRANK BALISTRIERI, also known as Mr. B; CAROL ANGELO DELUNA,

also known as Toughy; CARL CIVELLA, also known as Corky;

ANTHONY THOMAS CIVELLA, also known as Tony Ripe; GENERAL

EXECUTIVE BOARD, INTERNATIONAL BROTHERHOOD OF

TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF

AMERICA; JACKIE PRESSER, General President, WELDON MATHIS,

General Secretary-Treasurer, JOSPEH TREROTOLA, also known as

Joe T, First Vice President, ROBERT HOLMES, SR., Second Vice Pres-

ident; WILLIAM J. MCCARTHY, Third Vice President; JOSEPH W.

MORGAN, Fourth Vice President; EDWARD M. LAWSON, Fifth Vice

President, ARNOLD WEINMEISTER, Sixth Vice President, JOHN H.

CLEVELAND, Seventh Vice President; MAURICE R. SCHURR, Eighth

Vice President; DONALD PETERS, Ninth Vice President; WALTER J.

SHEA, Tenth Vice President; HAROLD FRIEDMAN, Eleventh Vice

President; JACK D. COX, Twelfth Vice President; DON L. WEST, Thir-

teenth Vice President; MICHAEL J. RILEY, Fourteenth Vice President;

THEODORE COZZA, Fifteenth Vice President, DANIEL LIGUROTIS,

Sixteenth Vice President; SALVATORE PROVENZANO, also known as

Sammy Pro, Former Vice President,

Defendants,

INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUF-

FEURS, WAREHOUSEMEN AND HELPERS OF AMERICA, AFL-CIO,

Defendant-Petitioner,

BARRY FEINSTEIN, CARROLL HAYNES, FRANK J. SCARPINA-TO,

MELANIO CUEBAS, LOUIS PARTENZA, RALPH PROSSIMO, WIL-

LIAM BROWN, JAMES BROCKWELL, PATRICIA WILLIAMS, CAR-

MINE CHIOCCARICLIO, HOWARD FORSTER, DAN ZAMBANINI,

LEROY FLEMING, WAYNE CRUZ, RUTH WILKERSON, LAW-

RENCE PODAIR, TODD RUBINSTEIN, EDDIE CULLEN, NAR-CIS-

SUS BRINSON, RUBY THOMAS, ALFRED KING, ARNETHIA MEL-

VIN, JOHN P. MORRIS, JOSEPH L. YEOMAN, JAMES E. SMITH,

DANIEL J. MCGINLEY, PETER COYLE, JOSEPH SULLIVAN, JOSEPH

M. LYONS, JAMES R. BROCKWELL, WILLIAM R. HILL, WILLIAM

NOLAN, JAMES BRENNAN, BRIAN MCDONALD, LARRY A.

THOMAS, ERNIE HARRIS, JOSEPH BROCK, SR., JOHN R. MULLER,

ROBERT OETTL, JOHN SHIELDS, LEWIS RICE, ROBERT J.

EWANCO, TERRY HUNTER, VERNON RHODES, RICH POTO-

CHNEY, JOSEPH P. SANTONE, JOHN CRISTINA, WILLIAM C.

JOHNSTON, RICHARD GLASS, DOUGLAS CAMPBELL, PAUL H.

KNOLLINGER, JR., WILLIAM SIMMONS, SR., HAROLD WOL-

CHOK, LANGSTON MCKAY, WALTER CAHILL, ROBERT OTTMAN

MARIO ABREGO, JOHN BURKE, VICTOR C. OLIVADOTI, TER-

ENCE MAJKA, JOHN AMADIO, FRANK CRAMER, ANTHONY

DEBELLA, RAY HILLIARD,

Intervenors.

TABLE OF CONTENTS

Page

Order of Honorable James L. Oakes,

Honorable George C. Pratt, and

Honorable Frank X. Altimari

I on cae n cnc secbievscacessscscs 1

Order of Honorable David N. Edelstein

eS) cin id as Sdd ¥db wd ado cies 5

Order of Honorable David N. Edelstein

SS ee 7

Order of Honorable David N. Edelstein

Dated March 14, 1989 [Consent Decree] ............. 55

Transcript of May 6, 1991 Hearing

Before Honorable David N. Edelstein ................ 108

Transcript of March 20, 1991 Hearing -

Before Honorable David N. Edelstein ................ 128

Transcript of March 14, 1989 Hearing

Before Honorable David N. Edelstein ................ 200

SDNY

N89-cv-499

88cv4486

EDELSTEIN

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

At a stated Term of the United States

Court of Appeals for the Second Circuit,

held at the United States Courthouse in the

City of New York, on the seventh day of

June, one thousand nine hundred and

ninety-one.

91-6112

United States of America,

Plaintiff-Appellee,

International Brotherhood of Teamster,

Chauffeurs, Warehousemen and Helpers of

America, AFL-CIO,

Defendant-Appellant.

91-6130

United States of America,

Plaintiff-—Appellee,

International Brotherhood of Teamsters,

Chauffeurs, Warehousemen and Helpers of

America, AFL-CIO,

Defendant-Appellant.

91-6136

United States of America,

Plaintiff-Appellee,

Vv.

International Brotherhood of Teamsters,

Chauffeurs, Warehousemen and Helpers of

America, AFL-CIO,

Defendant-Appellant,

Barry Feinstein, et al.,

Applicant-Intervenors-Appellants.

ORDER

Docket Nos. 91-6112; 91-6130; 91-6136

The appeal in 91-6112 is dismissed

since the order of April 29, 1991, is in

the nature of a calendaring order.

The order of May 6, 1991, as

amended by the order of May 7, 1991, on

appeal in 91-6130 is affirmed. See United

States v. IBT, slip op. 3601, 3616 (2d Cir.

April 12, 1991); United States v. IBT, 905

F.2d 610 (2d Cir. 1990) (Friedman &

Hughes). See also Berger v. Heckler, 771

F.2d 1556, 1567-68 (2d Cir. 1985) (consent

decree is court order, to be enforced as

such).

In respect to the appeal in

91-6136, from the denial of a motion to

intervene, we treat the appeal as a

petition to intervene on appeal and grant

Mandate to issue forthwith.

JAMES L. OAKES, Chief Judge

GEORGE C. PRATT, Circuit Judge

FRANK X. ALTIMARI, Circuit Judge

N.B. THIS SUMMARY ORDER WILL NOT BE

PUBLISHED IN THE FEDERAL REPORTER

AND SHOULD NOT BE CITED OR OTHERWISE

RELIED UPON IN UNRELATED CASES BEFORE

THIS OR ANY OTHER COURT

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

UNITED STATES OF AMERICA,

Plaintiff,

-V- 88 CIV. 4486 (DNE)

INTERNATIONAL BROTHERHOOD OF

TEAMSTERS, CHAUFFEURS,

WAREHOUSEMEN AND HELPERS OF

AMERICA, AFL-CIO, et al.,

Defendants.

ORDER

EDELSTEIN, District Judge:

IT IS HEREBY ORDERED that the following

sentences shall be added the May 6, 1991

Opinion & Order in the above-captioned case:

The sentence “Paragraph L.17, like the

entire Consent Decree, is a permanent

amendment to the IBT constitution.” shall

follow the last sentence of the first full

paragraph on page 22; and

———

The sentence "Nothing in this opinion

shall be construed to alter the provisions

of the Consent Decree that require the

Consent Decree's amendments to be put to

the convention delegates for a vote." shall

be added to follow the last sentence of the

second full paragraph on page 23.

So Ordered.

Dated: May 7, 1991

New York, New York

U.S.D.J.

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

PEED PERERA SD RT ID AE SEP DD DD x

UNITED STATES OF AMERICA,

Plaintiff,

-Vv- 88 CIV. 4486 (DNE)

INTERNATIONAL BROTHERHOOD OF

TEAMSTERS, CHAUFFEURS,

WAREHOUSEMEN AND HELPERS OF

AMERICA, AFL-CIO, et al.,

Defendants.

sxe em dn hs aw ea ty sm en aust geil lle ea eae histamine x

OPINION & ORDER

APPEARANCES: OTTO G. OBERMAIER, United

States Attorney for the

Southern District of New

York, (Edward T. Ferguson,

III, Peter C. Sprung,

Assistant United States

Attorneys, of counsel) for

the United States of America;

GOULSTON & STORRS, Boston

Massachusetts, (Rudolph G.

Pierce, James F. O'Brien,

Dennis King, of counsel) for

the International Brotherhood

of Teamsters.

EDELSTEIN, District Judge:

This opinion emanates from the

voluntary settlement in the action

commenced by plaintiff United States of

America (the “Government") against the

defendants International Brotherhood of

Teamsters (the "“IBT") and the IBT's General

Executive Board (the "GEB") embodied in the

voluntary consent order entered March 14,

1989 (the “Consent Decree"). The

provisions in the Consent Decree provided

for three Court-appointed officials, the

Independent Administrator to oversee the

remedial provisions, the Investigations

Officer to bring charges against corrupt

IBT members, and the Election Officer to

oversee the electoral process leading up to

and including the 1991 election for

International Officers (collectively, the

TN |

"Court Officers"). -The goal of the Consent

Decree is to rid one IBT of the hideous

influence of organized crime through the

election and prosecution provisions.

On March 19, 1991, the Government moved

this Court for (i) a declaration that the

function of the International Union

nominating convention as set out in

{F.12.(D) of the Consent Decree may not be

altered except by compliance with 4L.17 of

the Consent Decree; and (ii) an order

enjoining the IBT, as the representative of

the GEB, and its employees, members,

agents, attorneys and affiliates (including

local unions, joint counc.ls, and area

conferences [hereinafter the “subordinate

entities"]) from taking any action to alter

the function of the International Union

nominating convention as set out in

{F.12.(D) of the Consent Decree. This

-3-

Court held oral argument on this motion on

March 20, 1991, after which the parties

submitted proposed findings of fact and

conclusions of law.

This dispute arises because the

Government has reasons to believe that

constituencies of the IBT are planning for

the IBT convention delegates to "vote out”

the Consent Decree, more particularly, the

provisions for direct rank and file

elections of International Officers. The

Government contends that with the Consent

Decree's electoral provisions voted out,

the IBT would attempt to revert to its

prior election process. Thus, the

convention delegates themselves elect the

General President at the convention,

eliminating the rank and file vote, and

thereby disenfranchising the membership.

The Government seeks to prevent this

-4-

aaa eel

Situation. The Government asks this Court

to rule on the legal status of provisions

of the Consent Decree.

The validity of the Consent Decree's

electoral changes to the IBT constitution

are no longer at issue. Accordingly, the

relevant ruling for this Court to make is a

substantive determination of the legal

effect of the Consent Decree in the event

that the convention delegates vote against

its constitutional changes. In the

alternative, this Court will also rule on

the Government's motion de novo.

I. Background

The Consent Decree settled the

litigation between the Government and the

IBT (the “underlying litigation"). As has

been discussed more fully in opinions of

this Court and the Court of Appeals this

-5-

RICO litigation involved allegations of a

massive racketeering enterprise and

conspiracy to participate in that

enterprise. See, e.g. United States v.

International Brotherhood of Teamsters, et

al., Slip Opinion, (2d Cir. April 12, 1991)

(Election Rules); United States v.

International Brotherhood of Teamsters, et

al., 907 F.2d 277 (2d Cir. 1990) (All Writs

Act injunction); United States v.

International Brotherhood of Teamsters, et

al., 905 F.2d 610 (2d Cir. 1990) (Friedman

& Hughes); United States v. International

Brotherhood of Teamsters, et al., 708 F.

Supp. 1388 (S.D.N.Y. 1989) (Opinion denying

motion to dismiss complaint in underlying

litigation).

The Consent Decree amended the

electoral and disciplinary provisions of

the IBT constitution. By %9(a), the entire

-6-

ete arnteeseeneeel

Consent Decree immediately became prt of

the IBT constitution:

The IBT Constitution shall be deemed

and hereby is amended to incorporate

and conform with all of the terms set

forth in the order.

Paragraph 9(b) further stated that the

provisions of the Consent Decree would

formally be voted a part of the IBT

constitution by the delegates to the 1991

IBT Convention.

By no later than the conclusion of the

IBT convention to be held in 1991, the

IBT shall have formally amended the IBT

constitution to incorporate and conform

with all of the terms set forth in this

order by presenting said terms to the

delegates for a vote. If the IBT has

not formally so amended the IBT

constitution by that date, the

Government retains the right to seek

any appropriate action, including

enforcement of this order, contempt, or

reopening this litigation.

Among its substantive provisions, the

Consent Decree amended the IBT

constitution's then existing procedure for

~_ =

electing the General President and

International Officers. Under the prior

system, officers of IBT subordinate

entities had been ex officio delegates to

the IBT convention. At such a convention,

those delegates would directly elect the

General President and International

Officers. The Consent Decree created a

three-step election process culminating in

direct rank and file secret ballot

elections. First, the local unions have

been holding local secret ballot delegate

elections during the fall of 1990 and the

Spring of 1991. Second, these elected

delegates will attend the 1991 IBT national

convention to be held June 24-28 in Epcot

Center, Florida (the “convention"). There,

the delegates will vote (i) to approve the

Consent Decree's changes to the IBT

constitution as provided by 9 and

-8-

{F.12.(D) of the Consent Decree, and (ii)

to nominate candidates for IBT

International Officers. In the fall of

1991, the IBT will hold a union-wide,

direct, secret ballot election of the rank

and file for the International Officers.

Since the Consent Decree was executed

on March 14, 1989, its scope, terms, and

meaning have been repeatedly challenged.

With respect to the disciplinary provisions

of the Consent Decree, the Court of Appeals

and this Court have now determined that the

Investigations Officer and Independent

Administrator are stand-ins for the General

President and GEB, who properly delegated

their disciplinary power to those Court

Officers pursuant to Article XXVI, section

2 of the IBT Constitution. United States

v. International Brotherhood of Teamsters,

supra, Slip Opinion, (2d Cir., April 12,

1991) at 3617; United States v.

International Brotherhood of Teamsters,

supra, 905 F.2d at 622; December 27, 1990

Opinion & Order, 754 F. Supp. 333, 337

(S.D.N.Y. 1990); September 18, 1990 Opinion

& Order, 745 F. Supp. 189, 191-92 (S.D.N.Y.

1990); August 27, 1990 Opinion & Order, 745

F. Supp. 908, 911 (S.D.N.Y¥. 1990); March

13, 1990 Opinion & Order, 743 F. Supp. 155,

159-60, aff'd 905 F.2d 610, 622; January

17, 1990 Opinion & Order, 728 F. Supp.

1032, 1048-57, aff'd 907 F.2d 277 (2d Cir.

1990); November 2, 1989 Memorandum & Order,

725 F.2d 162, 169 (S.D.N.Y. 1989); Joint

Council 73 et al. v. Carberry et al., 741

F. Supp. 491, 493 (S.D.N.Y. 1990); Local 27

v. Carberry et al., July 20, 1990 at 3-4

(S.D.N.Y. 1990).

The validity of the Consent Decree's

electoral changes are also settled. This

=i O—

Court and the Court of Appeals in turn have

held that the electoral changes were

properly within the parties of the General

President and GEB and binding upon the

entire IBT. United States v. International

Brotherhood of Teamsters, supra. (April 12,

1991). The scope of the Election Officer's

duties, October 18, 1989 Memorandum &

Order, 723 F. Supp. 203, stay and

certification denied 728 F. Supp. 920

(S.D.N.Y. 1989); appeal dismissed, No.

89-6252 (2d Cir. Dec 13, 1989), cert.

denied, 110 S. Ct. 2618 (1990), aff'd Slip

Opinion (2d Cir. April 12, 1991), and

approved a comprehensive set of rules

applicable to all facets of the IBT that

govern this historic election. July 10,

1990 Opinion & Order, 742 F. Supp. 94

(S.D.N.Y. 1990), aff'd Slip Opinion (2d

Cir. April 12, 1991).

elie

The Consent Decree's constitutional

changes are fully effective and binding on

the entire 1.7 million member IBT.

Challenges by subordinate entities and

individual IBT members to the validity of

the disciplinary provisions and electoral

provisions have been repeatedly rejected by

the Court of Appeals and this Court. See,

e.q., United States v. International

Brotherhood of Teamsters, supra, 905 F.2d

610, aff'g March 13, 1990 Opinion & Order,

supra, (challenges to disciplinary powers

of Court Officers rejected); United States

v. International Brotherhood of Teamsters,

supra, Slip Opinion, April 12, 1991, aff'g

July 10, 1990 Opinion & Order (challenges

of electoral process to subordinate

entities rejected).

Paragraph L.17 of the Consent Decree,

the future practices provision, sets out

-12-

eel

the obligation of the parties not to alter

the understanding of both parties as to the

terms of the settlement Paragraph L.17

states:

The parties intend the provisions set

forth herein to govern future IBT

practices in those areas. To the

extent the IBT wishes to make any

changes, constitutional or otherwise,

in those provisions, the IBT shall give

prior written notice to the plaintiff,

through the undersigned. If the

plaintiff then objects to the proposed

changes as inconsistent with the terms

and objectives of this order, the

change shall not occur; provided,

however, that the IBT shall then have

the right to seek a determination from

the Court, of after the entry of

judgment dismissing this action, from

this Court or any other federal court

of competent jurisdiction as to whether

the proposed change is consistent with

the terms and objectives set forth

herein.

Paragraph L.17 has been interpreted as

requiring approval of any changes to the

IBT constitution that would alter the

background understanding of the parties as

to disciplinary or electoral matters:

=} 3<

(T]he IBT [must] refrain from any

unilateral changes, ‘constitutional or

otherwise,’ in the broad areas covered

by the Consent Decree. Paragraph

(L.J17 was obviously intended to

protect the background understanding of

both parties as to what existing rules,

regulations, and constitutional

provisions would govern the IBT.

United States v. International Brotherhood

of Teamsters, supra, 905 F.2d at 620

(quoting March 13 Opinion & Order, supra,

743 F. Supp. at 163).

II. Discussion

In the instant matter, this Court must

consider (i) %K.16, the application

provision of the Consent Decree, (ii) two

motions to intervene, (iii) the substantive

legal status of the delegates vote at the

IBT convention, and (iv) the Government's

motion.

—-14-

A. The Application Provision of the

Consent Decree

As a threshold matter, the IBT argues

that this Court should not entertain the

Government's motion or make any ruling

regarding the upcoming convention. The

Government argues that the IBT consented to

this Court ruling on the instant motion by

way of K.16. I agree.

Paragraph K.16 authorized this Court to

“entertain any future applications" by the

parties, which includes interpretations and

rulings relating to the Consent Decree.

Such rulings have been sought and issued

numerous times over the past two years.

See October 18, 1989 Memorandum & Order,

supra, (interpretating F.12 to determine

scope of duties of Election Officer);

November 2, 1989 Memorandum & Order, supra,

(interpreting D.5 to determine statute of

-15-

- :

limitations for bringing disciplinary

charges); November 16, 1989 Order,

(interpreting F.12.(E) to determine the

scope of the Independent Administrator's

_right to publish a monthly communication in

The International Teamster); December 12,

1989 Memorandum & Order, 726 F. Supp. 943

(S.D.N.Y. 1989), (interpreting {fE.10 to

determine when collateral lawsuits

interfere with work of Court Officers);

January 17, 1990 Opinion & Order, supra,

(interpreting scope of appiications to

Court under %K.16; status of {F.12

changes); February 27, 1990 Memorandum &

Order, 735 F. Supp. 502 (S.D.N.Y. 1990),

(Interpreting YF.12.(E) to permit

publication of names of those charged in

disciplinary proceedings in The

International Teamster); March 13, 1990

Opinion & Order, supra, determining

—-16-

siataaieaaeaaseiemaemeanaaeanaamaiiiel

Independent Administrator's power to

interpret disciplinary portions of IBT

constitution by {/F.12.(A); inability of IBT

to interpret disciplinary provisions of IBT

constitution without complying with %{L.17);

April 9, 1990 Memorandum & Order, 735 F.

Supp. 319 (S.D.N.Y. 1990), (interpreting

“reasonable cause” requirement for sworn

statements set out at {/F.12.(C)(c) and

(d)); July 10, 1990 Opinion & Order, supra,

(interpreting #F.12.(D) scope of Election

Officer duties; E.10 injunction); November

28, 1990 Memorandum & Order, 133 F.R.D. 99

(S.D.N.Y. 1990), (interpreting cause

requirement to take statements of IBT

agents at YF.12.(C)(i)(d)).

The scope of K.16 is broad enough to

warrant the court to consider prospective

matters that may threaten the letter,

Spirit and intent of this Decree. The

=} Pa

IBT's assertion that this motion is

speculative is merely a play on words.

Further, the IBT has specifically refused

to deny the Government's allegations. On

March 20, 1991, I directly asked IBT

General Counsel Grady whether the IBT

disputed the Government's allegations. On

behalf of the IBT, General Counsel Grady

did not deny those allegations.

(Transcript, March 20, 1991 at 24-25).

This matter would never even have to be

addressed had the IBT been candid and

forthright and assured me that no such plan

was in place. The fact that they did not

leads to the reasonable inference that they

are up to no good.

Accordingly, the IBT's challenges are

meritless.

~38-

‘es

B. Motions to Intervene

Two groups of IBT members, (i) the

Durham-Mathis Unity Team, (a slate of

candidates running for international

office), and (ii) a group of elected

delegates to the IBT convention, moved this

Court to intervene in the instant motion

pursuant to Fed. R. Civ. Pro. 24(a). These

applications have no merit. Neither group

has demonstrated that its interest in the

instant matter is not “adequately

represented by existing parties," in this

instance the IBT. See Fed. R. Civ. Pro.

24(a). It has been established that the

election of international officers pursuant

to the Consent Decree is a matter solely in

the purview of the IBT. United States v.

International Brotherhood of Teamsters,

supra, April 12, 1991 Slip Opinion at

3620. Accordingly, since the instant

-19-

motion relates exclusively to the Consent

Decree, specifically the validity of its

provisions, the movants have not met the

requirements of Rule 24.

As a result, intervention in this

matter is hereby denied in all respects.

C. The Status of the Consent Decree

The Government seeks to determine the

obligation of the IBT should the convention

delegates vote against the Consent Decree's

provisions. This issue needs clarification

because 9(a), which stated that the IBT

constitution was immediately amended to

include all the terms of the Consent

Decree, seems in conflict with 412(D) and

9(b), which provide that the changes would

be brought to a vote at the convention.

The language, purpose, and history of the

Consent reveal that there is no

-—-20-

inconsistency. The parties originally

included the convention vote because of

their uncertainty whether the IBT could

agree to constitutional changes that would

bind the subordinate entities by the

Consent Decree. The vote was designed to

ensure that the subordinate entities would

be bound by their ratification. In the

course of litigation over the past two

years it has been conclusively determined

that the IBT had the power to bind the

subordinate entities, and has bound the

subordinate entities, thus eliminating any

possible uncertainty.

It is clear that the Consent Decree is

fully part of the IBT constitution and the

law of that union no matter what the

convention delegates’ vote. The (i)

specific language of the Consent Decree and

the intent of the parties expressed to me

-21-

— ' |

when the Consent Decree was signed, and

(ii) legal decisions over the past two

years make this self-evident.

First, the specific language of {{/9(b)

and F.12.(D) (the “approval provisions") of

the Consent Decree, coupled with the

parties explicit statements clearly reveals

the reasons for the inclusion of those

provisions. At a conference held on March

14, 1989, after briefly considering the

draft Consent Decree submitted to the Court

by the parties, this Court pointed out a

number of ambiguities in that document.

(Transcript, March 14, 1989, at 1-18).

Most relevant was this Court's observation

that the Consent Decree contained an

inconsistency: {9 stated that the IBT

constitution was immediately amended in

accordance with all the terms of the

Consent Decree, but #12.(d) provided that

«@3-

the electoral changes would be submitted to

the IBT convention delegates for a vote at

the 1991 convention. (Tr. at 3).

In response to the Court's request for

clarification, counsel for the Government

on behalf of the parties stated why they

had included those inconsistent terms:

The document makes clear that the

constitution of the IBT is deemed

amended immediately. In the

Government's view, that is a permanent

amendment and not subject to change,

absent [Governmental approval pursuant

to WL.17), without first coming to the

Government for change...

Certain locals officials or local

unions may in the future raise legai

challenges about the amendment of an

international constitution in a manner

that was by court order rather than

pursuant to the constitution which

calls for ratification at a

convention. We believe, the Government

believes, your Honor, that there is no

question that the amendments can be

ordered by this Court pursuant to a

consent decree, and that they are

automatically in effect. But if down

the road, there is a challenge by a

local official or local union,

-23-

eee

sian aaa aaa aia

ratification at the convention would

eliminate any legal issue at all.

(Transcript, March 14, 1989 at 15-16). The

Court then instructed the parties to insert

“clarifying language" on this subject. Id.

at 16. The parties returned later that

day, having rewritten 9 to the current

"9(a) and (b).

As was clearly stated to the Court, the

Government insisted that the convention

delegates vote in the Consent Decree's

electoral changes, first at F.12.(D), then

at 9(b), in order to eliminate any

potential doubt as to the Consent Decree's

binding effect on the subordinate

entities. The Government in no way

intended to give the convention delegates

“veto" power over the entire Consent Decree

Or any portion of it. Nor does the

language of the Consent Decree, its purpose

—-24-

or history provide for such power. When

the Consent Decree was signed on March 14,

1989, there was no direct legal ruling that

established the IBT's ability to amend its

constitution by the Consent Decree. It is

undoubtedly true that had such precedent

been in place on March 14, 1989, the

approval provisions never would have been

part of the Consent Decree.

Further, there is no doubt that the IBT

agreed to the inclusion of the approval

provisions for the sole purpose of

ameliorating a potential legal challenge to

its power to enter into the Consent

Decree's constitutional changes. The

General Counsel for the IBT, Mr. Grady,

publicly stated just after the signing of

the Consent Decree in testimony before the

United States Senate, that the IBT agreed

for the Consent Decree's changes to be

-25-

submitted to the convention delegates

solely at the insistence of the Government:

SENATOR NUNN: How can, the Convention in

1991, or whenever it is going

to occur, how can they--the

Convention amend this if it

is precluded by this

provision [({L.17]?

MR. GRADY: I recognize where the Senator

is coming from and there does

appear to be some

inconsistency here.

“ 7 x

However, it was the

Government's position that ve

concur to that, that this was

a necessary element of a

settlement. That is, for the

delegates to, in effect,

bring these provisions into

their own constitution, and

that is why they are there.

Federal Government's Use of Trusteeships

under the RICO Statute: Hearings Before

the Permanent Subcomm. on Investigations of

the Senate Comm. on Governmental Affairs,

100th Cong., list Sess. at 31. (1989).

Second, interpretations by this Court

and subsequently the Court of Appeals have

=~2¢—

resolved challenges to the validity of the

Consent Decree's constitutional changes.

The amount of litigation that has ensued

boggles the imagination. Repeated

litigation has resulted in a line of

decisions that conclusively determined the

IBT's power to amend the IBT constitution

by entering into the Consent Decree, and

bind the entire union to those changes.

United States v. International Brotherhood

of Teamsters, supra, 905 F.2d 610, aff'g

March 13, 19906 Opinion & Order, supra;

United States v. International Brotherhood

of Teamsters, supra, Slip Opinion, April

12, 1991, aff'g July 10, 1990 Opinion &

Order; United States v. International

Brotherhood of Teamsters, supra, 907 F.2d

277, aff'g January 17, 1990 Opinion &

Order, 728 F. Supp. 1032. See also Joint

Council 73 v. Carberry et al., supra; Local

~97F<

eae ed

27 v. Carberry, supra. In consequence, the

precise uncertainty that led to the

inclusion of the approval provisions has

been resolved by this Court and the Court

of Appeals over the past two years. An

examination of those decisions reveals how

this uncertainty has been resolved.

With respect to the disciplinary

provisions of the Consent Decree, Anthony

“Hughes, an IBT officer from local 507 in

Cleveland, Ohio, argued before this Court

and the Court of Appeals that the Consent

Decree's disciplinary changes to the IBT

constitution were not binding on him

because the IBT did not have the power to

unilaterally amend its constitution at

judicial direction. The Court of Appeals

specifically rejected that argument:

Hughes contends that the IBT cannot

unilaterally change its

constitution...and then make the new

~28-

terms binding on [its affiliated local

unions and members]. This is so,

Hughes maintains, because various

provisions of the IBT constitution

explicitly reserve the power of

amendment to the International

Convention of the IBT, by vote of its

duly elected delegates.

...Hughes...clearly could be bound by

terms of the disciplinary mechanism set

in place by the Consent Decree. This

is so because the investigatory and

disciplinary mechanism of the Court

Officers are proper delegations of the

powers of the IBT General President and

the GEB within the scope of the IBT

constitution that binds all members,

and because the IBT constitution

contemplates amendment by the GEB,

under the circumstances of this case,

as a result of judicial direction.

United States v. International Brotherhood

of Teamsters. supra, 905 F.2d at 622.

With respect to the election provisions

of the Consent Decree, the parameters of

the election process set out in the Consent

Decree has been continually contested over

the past eighteen months by the IBT and the

subordinate entities. The Court of Appeals

-29-

has recently rejected all challenges to the

Consent Decree's electoral changes to the

IBT constitution. United States v.

International Brotherhood of Teamsters,

supra, Slip Opinion, April 12, 1991.

The electoral-related litigation began

in October, 1989, where in the October 18,

1989 Order, this Court ruled that the power

of the Election Officer at #F.12.(D) to

“supervise” the 1991 IBT election must "be

interpreted in its most expansive and

proactive meaning." October 18, 1989

Memorandum & Order, supra, 723 F. Supp. at

206. In that order, this Court further

authorized the Election Officer to

promulgate rules to govern the delegate and

International Officer election. Id. at 207.

On July 10, 1990, this Court approved,

as modified, the set of rules promulgated

by the Election Officer to govern the 1991

~30-

election. July 10, 1990 Opinion & Order,

supra, 742 F. Supp. 94. In objecting to

those rules, local unions argued that they

were not bound by the Consent Decree's

electoral changes to the IBT constitution

because the IBT could not unilaterally

agree to such changes absent their approval

at an IBT convention. Those challenges -

were rejected. Id. at 98.

On April 12, 1991, the Court of Appeals

affirmed this Court's July 10, 1990

Opinion. In that decision, the Court of

Appeals specifically rejected arguments by

IBT subordinate entities that the Consent

Decree's electoral provisions were

impermissible changes to the IBT

constitution. The Court of Appeals adopted

its reasoning in the Friedman & Hughes

opinion, and held that pursuant to Article

XXVI, Section 2 of the IBT constitution,

=3i—

the IBT could amend its constitution to

incorporate the Consent Decree's electoral

changes at judicial direction:

(The Affiliates] argue that those

provisions [of the Consent Decree] that

displace the IBT Constitution are not

binding on them unless and until the

amendments have been ratified at an IBT

Convention properly constituted under

the original IBT Constitution. We

disagree.

x * x

Where the subject matter of an IBT

constitutional provision relates to the

power of the international rather than

of local unions, the IBT may agree to a

consent decree entered by a court that

renders the provision inoperative and

that IBT local unions and members are

bound by the terms of that decree.

x x *

In the instant matter, the IBT

constitutional provisions rendered

inoperative concern not the powers of

the international union but the method

by which international

officials--Convention delegates and

international officers--are

selected....The challenged provisions

do not relate to, or intrude upon, the

governance of local unions or the

conduct of collective bargaining by

local unions. ...We believe,

therefore, that our decision in the

instant matter falls within the

-32-

rs ial

rationale of Friedman & Hughes and that

. the Affiliates are bound by the Consent

Decree.

x * *

(Wle...believe that an Affiliate or

member cannot veto the IBT's settlement

of this unique civil RICO action, at

least insofar as the Consent Decree

provides for membership elections of

Convention delegates and IBT officers.

Id. at 3617-3621. This line of decisions

has unequivocally determined that the

Consent Decree's changes to the IBT

constitution are valid and binding without

the approval of a convention of the IBT.

Id. This Court and the Court of appeals

have conclusively held that the IBT had the

power to agree to the constitutional

changes ordered by the Consent Decree, and

that the subordinate entities are so bound

by those new provisions. Id.

Accordingly, the Court finds that the

specific reason why the parties in

including the approval provisions is no

‘

longer at issue. Whatever the outcome of

the delegates votes as to the electoral and

disciplinary changes to the IBT

constitution, those provisions will be in

full effect in accordance with the Consent

Decree. The Consent Decree's provisions

may only be changed through full compliance

with #L.17, subject to approval by the

_Government or this Court.

As a result of these determinations,

the vote of the delegates on the Consent

Decree will now have no legal effect. No

action taken by the IBT at the convention

can undercut the provisions of this Consent

Decree.

I remind the IBT that it voluntarily

agreed to the Consent Decree, and with it

free rank and file elections. The past two

years have demonstrated that the IBT had no

intention of living up to its end of the

=the

agreement. The IBT has made every attempt

to limit the scope and restrict the terms

of the Consent Decree, and each time it has

lost. But the time for challenges to the

Consent Decree has now passed, and the IBT

must live with the Consent Decree as

written by the parties, approved by the

Court, and repeatedly interpreted by this

Court and the Court of Appeals.

I tend to be amused when I remember

that the IBT by its representatives have

made heroic statements from time to time to

reaffirm their commitment to a union free

of corruption and their dedication to free

elections. How I wish that some of these

statements could have been true. Time has

proved, however, that these statements are

empty of any meaning or purpose for the

good of this important union.

-35-

} A

ww Fd

D. The Motion for Declaratory and

Injunctive Relief the Consent Decree

While this Court's ruling that the

electoral provisions of the Consent Decree

are binding upon the entire IBT regardless

of the outcome of the convention's vote on

those amendments also determines the

Government's specific requests for relief

in its motion, this Court will in the

alternative also consider the Government's

motion on its merits. In order to decide

that motion, this Court must consider (i)

whether the parties to the Consent Decree

and this Court directly foresaw this

Situation, and inserted a specific remedy

at 99(b), (ii) the standards under which

these orders should issue, and (iii) the

merits of the Government's application.

This Court has already held that "K.16

permits prospective applications for relief.

=36-

of SPO

1. The Parties' Prior

Consideration of this Issue

The IBT argues that the parties' March

14, 1989 colloquy with the Court regarding

the inconsistency in the Consent Decree

demonstrates that the parties foresaw the

possibility that the delegates would vote

against the Consent Decree's changes. At

the Court's direction, a specific remedy,

9(b) of the Consent Decree, was inserted.

As a result, the IBT contends that this

Court should refrain from issuing this

interpretation of the Consent Decree. This

argument is without merit.

The specific language of the Consent

Decree permits the Government's motion.

Paragraph 9(b) provides that in the event

that the IBT has not formally voted to

amend its constitution by the end of the

«37J—

IBT convention, the Government may seek

“enforcement of this order, contempt, or

re-open[ing of] this litigation." {9(b)

(emphasis added). In this application, the

Government is asking this Court to rule

that the future practices provision, {{L17,

is still in effect even if the convention

delegates vote against the Consent Decree.

The Consent Decree is a binding,

coercive order of this Court which

obligates the parties to adhere to its

terms. Assuming arguendo that the

delegates could vote out the Consent

Decree’s changes, the terms of the Consent

Decree would still be in effect as an order

of this Court binding on the General

President and GEB as the representatives of

the IBT. That order includes the

Government's right to seek the remedies

listed at %9(b), and the obligation of the

-38-

IBT to adhere to FL.17. Such was the

specific intent of the parties in

constructing the Consent Decree.

In addition, the Government's motion is

wholly consistent with the terms of {9(b).

That provision gave the Government the

right to “seek enforcement of this order"

in enumerated ways. This motion

essentially asks for a determination as to

the status of YL.17 should the changes not

be approved. Rationally, such a ruling

must be seen as the Government seeking

enforcement of another provision of the

Consent Decree.

2. The Standards for the Instant

Relief

With respect to the issue of the

standards that must be met for this ruling,

the IBT's argument that the Government must

-39-

meet this circuit's standards for a

preliminary injunction and declaratory

judgment are not relevant. The Government

has properly sought rulings setting out the

rights and responsibilities of the parties

with respect to the Consent Decree as is

their right under %K.16. While the IBT

correctly identifies the standards for

seeking a preliminary injunction or

instituting a declaratory judgment action,

those standards are not relevant in the

context of this ongoing case.

It is appropriate for this Court to

issue injunctive and declaratory relief in

the ongoing implementation of the Consent

Decree. The power of the Court to issue

such relief is to be found in the Consent

Decree itself. See New York State

Association for Retarded Children, Inc. v.

Carey, 596 F.2d 27, 38 (2d Cir.), cert.

-40-

denied 444 U.S. 836 (1979). As has been

stated, this Court finds that %K.16

a ae ee

specifically foresaw such rulings.

: Further, this Court has the authority

/ under the civil RICO statute to issue “such

restraining orders or prohibitions, or take

such other actions...as it shall deem

proper." 18 U.S.C. §1964(b). The

equitable relief moved for by the

Government may be issued by this Court in

the context of this ongoing civil RICO

action.

The Government has demonstrated that it

is an appropriate exercise of this Court's

equitable power to issue declaratory and

injunctive relief in this unique

Situation. The IBT convention that is to

take place June 24-28 1991 will mark a

watershed in the American Labor movement.

The IBT, this nation's largest labor union,

=4l—

will vote to nominate candidates for the

fall general rank and file secret ballot

election for international office for the

first time in its history. The convention

will mark the culmination of over two years

of work to achieve these noble electoral

goals. Millions of dollars in union

members' funds have already been spent in

the course of this election. The

convention itself is a large event, with

over 2000 IBT delegates, and 10,000 family

members travelling to Florida for five days.

I agree with the Government that a

matter so important must be settled in

advance of the convention. To do otherwise

would permit the convention to plunge into

total disarray. That {[K.16 provided for

the Court to issue declaratory and

injunctive relief in such a situation is

—42-

logical and rational. That RICO and the

All Writs Act permits such rulings is also

clear.

3. The Government's Application

With respect to the declaratory relief,

as a result of the subsequent judicial

determinations as to the legal status of

the Consent Decree, and as an order of this

Court, #L.17 of the Consent Decree will be

in effect for the three-year duration of

the Consent Decree. In accordance with

that provision, the Government or the Court

must approve any changes to the Consent

Decree, or the IBT constitutional

provisions that implicate the Consent

Decree, taken by the IBT.

Paragraph L.17 has been interpreted by

the Court of Appeals and this Court such

that:

—-43-

(T]he IBT [must] refrain from any

unilateral changes, ‘constitutional or

otherwise,’ in the broad areas covered

by the Consent Decree. Paragraph

(L.J17 was obviously intended to

protect the background understanding of

both parties as to what existing rules,

regulations, and constitutional

provisions would govern the IBT.

United States v. International Brotherhood

of Teamsters, supra, 905 F.2d at 620

(quoting March 13 Opinion & Order, supra,

743 F. Supp. at 163). The convention

delegates rejection of the Consent Decree's

changes would constitute an alteration of

the explicit understanding of the parties

as to the procedure for electing

international officers. As with any such

alteration of the background understanding

of the parties, such a change must be in

compliance with qL.17. Thus, the Court

declares that L.17 requires that any

substitute electoral procedure must be

first approved by the Government or by this

—-44-

Court. Failing this procedure, the

existing procedure set out in the Consent

Decree would remain in effect.

With respect to the equitable relief

sought by the Government, there can be no

doubt that every action must be taken to

assure the implementation of this most

important portion of the Consent Decree,

the honest, fair, secret ballot election.

It is undoubtedly an appropriate exercise

of this Court's equitable power to enjoin

any activity taken by the IBT that would

deny the membership their right to decide

the legitmate leadership of their union.

Further, the IBT explicitly agreed in

E.10 of the Consent Decree that it would

not “obstruct or otherwise interfere" with

the implementation of the Consent Decree,

Or the work of the Court Officers. Since

the Election Officer must supervise the

-45-

aimee aia

election according to the election rules,

any action taken to engineer a vote against

the current electoral provision would

constitute interference with the work of

the Election Officer. Accordingly, any

action taken to further the rejection of

the Consent Decree's changes would violate

the existing injunction in the Consent

Decree. Thus, the IBT is put on notice

that it shall not take action to vote

against the very Consent Decree which it

signed.

The Government's application is granted.

III. Conclusion

The Government's application for

interpretations and rulings of the consent

Decree is hereby granted.

IT IS HEREBY ORDERED that the motions

to intervene are denied.

—-46-

IT IS HEREBY ORDERED that the electoral

and disciplinary provisions of the Consent

Decree are part of IBT constitution and

binding on the subordinate entities

regardless of the vote of the delegates at

the IBT convention unless its provisions

are changed in accordance with #L.17 of the

Consent Decree.

IT IS FURTHER ORDERED that the function

of the 1991 IBT International Union

nominating convention as delineated in

paragraph F.12.(D) of the Consent Decree

may not be expanded, limited, altered, or

otherwise changed in any way without full

compliance with the provisions of {{L.17 of

the Consent Decree.

IT IS FURTHER ORDERED that the IBT, as

the representative of the GEB and its

employees, members, agents, attorneys and

affiliates (including local unions, joint

-47-

wes

councils, and area conferences), is hereby

enjoined from taking any action in an

attempt to cause any expansion,

enhancement, limitation, or other change in

the function of the 1991 IBT International

Union nominating convention as delineated

in paragraph F.12.(D) of the Consent

Decree, except action expressly authorized

by paragraph L.17 of the Consent Decree.

So Ordered.

Dated: May 6, 1991

New York, New York

U.S.D.J.

—4 8—

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

UNITED STATES OF

AMERICA,

Plaintiff,

V »

INTERNATIONAL

BROTHERHOOD OF

TEAMSTERS, CHAUFFEURS,

WAREHOUSEMEN AND

HELPERS

(DNE)

OF AMERICA, AFL-CIO

et al,

Defendants.

ed ee ee ee ee ee ee ee ee, ee, ee, ee

ORDER

88 CIV.

4486

WHEREAS, plaintiff United States of

America commenced this action on June 28,

1988, by filing a Complaint seeking

equitable relief involving the

International Brotherhood of Teamsters,

AFL-CIO (hereinafter,

“the

IBT"),

pursuant

to the civil remedies provisions of the

Racketeer Influenced and Corrupt

Organizations ("RICO") Act, 18 U.S.C. §

1964; and

WHEREAS, the Summons and Complaint have

been served, answers filed, and pretrial

discovery commenced by and between the

parties; and

WHEREAS, plaintiff United States of

America and defendants IBT and its General

Executive Board, William J. McCarthy,

Weldon Mathis, Joseph Trarotola, Joseph W.

Morgan, Edward M. Lawson, Arnold

Weinmeister, Donald Peters, Walter J. Shea,

Harold Friedman, Jack D. Cox, Don L. West.

Michael J. Riley, Theodore Cozza and Daniel

Ligurotis (hereinafter the “union

defendants") have consented to entry of

this order; and

WHEREAS, the union defendants

acknowledge that there have been

allegations, sworn testimony and judicial

findings of past problems with La Cosa

Nostra corruption of various elements of

the IBT; and

WHEREAS, the union defendants agree

that there should be no criminal element or

La Cosa Nostra corruption of any part of

the IBT; and

WHEREAS, the union defendants agree

that it is imperative that the IBT, as the

largest trade union in the free world, be

maintained democratically, with integrity

and for the sole benefit of its members and

without unlawful outside influence;

IT IS HEREBY ORDERED AND DECREED That:

A. COURT JURISDICTION

l. This Court has jurisdiction over

the subject matter of the action, has

personal jurisdiction over the parties, and

shall retain jurisdiction over this case

-3-

ae)

until further order of the Court.

a. Upon satisfactory completion and

implementation of the terms and conditions :

of this order, this Court shall entertain a |

joint motion of the parties hereto for

entry of judgment dismissing this action

with prejudice and without costs to either

party.

B. DURATION

3. The authority of the court

officers established in paragraph no. 12

herein shall terminate after the

certification of the 1991 election results

by the Election Officer for all IBT

International Officers as provided in this

Order, except as follows:

(1) The Election Officer and the

Administrator shall have the authority to

resolve all disputes concerning the conduct

—-4-

and/or results of the elections conducted

in 1991 under the authority granted to them

under paragraph 12(D) herein, and the

Investigations officer and the

Administrator shall have the authority to

investigate and discipline any corruption

associated with the conduct and/or results

of the elections to be conducted in 1991

under the authority granted them under

paragraph 12(A) and (C) herein, so long as

said investigation is begun within six

months of the final balloting.

(2) The Investigations Officer

and the Administrator shall have the

authority to resolve to completion and

decide all charges filed by the

Investigations Officer on or before the

date on which the authority granted to them

under paragraphs 12(A) and (C) herein

terminates the authority pursuant to

subparagraph (3) below.

-5-

(3) The role and authority

provided for in paragraphs 12 and 13 of

this Order regarding the Investigations

Officer and the Administrator and their

relationship with the Independent Review

Board shall terminate not later than nine

(9) months after the certification of the

1991 election results.

(4) As used herein, the date

referred to as “the certification of the

1991 election results" shall be construed

to mean either the date upon which the

Election Officer certifies the 1991

election results for all IBT International

Officers or one month after the final

balloting, whichever is shorter.

eee et. at eee Sree Were ty)

C. STATUS OF THE INDIVIDUAL UNION DEFENDANT

4. The union defendants herein remain

as officers of the IBT, subject to all of

the terms herein, including the

disciplinary authority of the

Court-appointed officers, described in

paragraph 12(A) herein.

D. CHANGES IN THE IBT CONSTITUTION

3. The portion of Section 6(a) of

Article XIX of the IBT Constitution that

provides, “Any charge based upon alleged

onduct which occurred more than one (1)

year prior to the filing of such charge is

barred and shall we rejected by the

Secretary-Treasurer, except charges based

upon the non-payment of dues, assessment

and other financial obligations," shall be

and hereby is amended to provide for a five

(S) year period, running from the discovery

of the conduct giving rise to the charge.

This limitation period shall not apply to

any actions taken by the Investigations

Officer or the Administrator.

6. Section 6(a) of Article XIX of the

IBT Constitution shall be deemed and is

hereby amended to include the following:

“Nothing herein shall preclude the General

President and/or General Executive Board

from suspending a member or officer facing

Criminal or civil trial while the charges

are pending."

7. Immediately after the conclusion

of the IBT elections to be conducted in

1991, Section 8 of Article VI of the IBT

Constitution shall be deemed and hereby is

amended to provide that a special election

be held whenever a vacancy occurs in the

office of IBT General President, pursuant

-8-

to the procedures described later herein

for election of IBT General President.

8. Article IV, Section 2 of the IBT

Constitution shall be deemed and is hereby

amended to include a new paragraph as

follows:

"No candidate for election shall accept

Or use any contributions or other

things of value received from any

employers, representative of an

employer, foundation, trust or any

Similar entity. Nothing herein shall

be interpreted to prohibit receipt of

contributions from fellow employees and

members of this International Union.

Violation of this provision shall be

grounds for removal from office.

9, (a) The IBT Constitution shall be

deemed and hereby is amended to incorporate

and conform with all of the terms set forth

in this order.

(b) By no later than the

conclusion of the IBT convention to be held

in 1991, the IBT shall have formally

amended the IBT Constitution to incorporate

and conform with all of the terms set forth

in this order by presenting said terms to

the delegates for a vote. If the IBT has

not formally so amended the IBT

Constitution by that date, the Government

retains the right to seek any appropriate

action, including enforcement of this

order, contempt or reopening this

litigation.

E. PERMANENT INJUNCTION

10. Defendants William J. McCarthy,

Weldon Mathis, Joseph Trarotola, Joseph WwW.

Morgan, Edward M. Lawson, Arnold

Weinmeister, Donald Peters, Walter J. Shea,

Harold Friedman, Jack D. Cox, Don L. West,

Michael J. Riley, Theodore Cozza and Daniel

Ligurotis, as well as any other or future

IBT General Executive Board members,

officers, representatives, members and

-10-

employees of the IBT, are hereby

permanently enjoined from committing any

acts of racketeering activity, as defined

in 18 U.S.C. § 1961 et seq., and from

Knowingly associating with any member or

associate of the Colombo Organized Crime

Family of La Cosa Nostra, the Genovese

Organized Crime Family of La Cosa Nostra,

the Gambino Organized Family of La Cosa

Nostra, the Lucchese Organized Crime Family

of La Cosa Nostra, the Bonnano Organized

Crime Family of La Cosa Nostra, any other

Organized Crime Families of La Cosa Nostra

Or any other criminal group, or any person

otherwise enjoined from participating in

union affairs, and from obstructing or

otherwise interfering with the work of the

court-appointed officers or the Independent

Review Board described herein.

-ll-

ll. As used herein, the term,

“knowingly associating," shall have the

same meaning as that ascribed to that term

in the context of comparable federal

proceedings or federal rules and

regulations.

F. COURT-APPOINTED OFFICERS

12. The Court shall appoint three (3)

officers -- an Independent Administrator,

an Investigations Officer and an Election

Officer -- to be identified and proposed by

the Government and the union defendants, to

oversee certain operations of the IBT as

described herein. The parties shall

jointly propose to the Court at least two

persons for each of these three positions.

Such proposal shall be presented to the

Court within four weeks of the date of the

entry of this Order, except that for good

-12-

cause shown such period may be extended by

the Court. Except as otherwise provided

herein, the duties of those three officers

shall be the following:

(A) DISCIPLINARY AUTHORITY --

From the date of the Administrator's

appointment until the termination of the

Administrator's authority as set forth in

paragraph 3(3) herein, the Administrator

shall have the rights and powers as the

IBT's General President and/or General

Executive Board under the IBT's

Constitution (including Articles VI and XIX

thereof) and Title 29 of the United States

Code to discharge those duties which relate

to disciplining corrupt or dishonest

officers, agents, employees or members of

the IBT or any of its affiliated entities

(such as IBT Locals, Joint Councils and

Area Conferences), and appointing temporary

-13-

trustees to run the affairs of any such

affiliated entities. The Investigations

Officer shall have the authority to

investigate the operation of the IBT or any

of its affiliates and, with cause,

(i) To initiate disciplinary

charges against any officer,

member or employee of the IBT or

any of its affiliates in the

manner specified for members under

the IBT Constitution and,

(ii) To institute

trusteeship proceedings for the

purposes and in the manner

specified in the IBT Constitution.

Prior to instituting any trusteeship

proceeding the Investigations Officer shall

notify the General President of the

Investigations Officer's pian to institute

Said trusteeship proceeding and the basis

=}g@u

therefor and give the General President ten

(10) days to exercise his authority

pursuant to the IBT Constitution to

institute such trusteeship proceedings. If

the General President timely institutes

such proceedings and/or a trusteeship is

imposed, the Investigations Officer and the

Administrator shall have authority to

review any action thus taken by the General

President and/or any trusteeship imposed

thereafter and to modify any aspect of

either of the above at any time and in any

manner consistent with applicable federal

law. If the General President fails to

institute trusteeship proceedings within

the ten-day period prescribed herein, the

Investigations Officer may immediately

proceed in accordance with the authority

specified above.

-15-

When the Investigations Officer files

charges, the following procedures shall be

observed:

(a) the Investigations Officer shall

serve written specific charges upon the

person charged;

(b) the person charged shall have at

least thirty (30) days prior to hearing to

prepare his or her defense;

be conducted before the Administrator;

(d) the person charged may be

represented by an IBT member at the

hearing; and

(e) the hearing shall be conducted

under the rules and procedures generally

applicable to labor arbitration hearings.

The Administrator shall preside at

hearings in such cases and decide such

cases using a "just cause" standard. The

=t¢@—

fai

Investigations Officer shall present

evidence at such hearings. As to decisions

of the IBT General Executive Board on

disciplinary charges and trusteeship

proceedings during the Administrator's

tenure, the Administrator shall review all

such decisions, with the right to affirm,

modify or reverse such decisions and, with

respect to trusteeship proceedings, to

exercise the authority granted above in

this paragraph. Any decision of the

Administrator shall be final and binding,

subject to the Court's review as provided

herein. For a period of up to fourteen

(14) days after the Administrator's

decision, any person charged or entity

placed in trusteeship adversely affected by

the decision shall have the right to seek

review by this Court of the Administrator's

decision. The Administrator shall also

oj F<

have the right to establish and disseminate

new guidelines for investigation and

discipline of corruption within the IBT.

All of the above actions of the

Administrator and Investigations Officer

shall be in compliance with applicable

Federal laws and regulations. |

(B) REVIEW AUTHORITY -- From the ‘

date of the Administrator's appointment

until the certification of the IBT

elections to be conducted in 1991, the

Administrator shall have the authority to

veto whenever the Administrator reasonably

believes that any of the actions or

proposed actions listed below constitutes

or furthers an act of racketeering activity

within the definition of Title 18 U.S.C. §

1961, or furthers or contributes to the

association directly, or indirectly, of the

-18-

IBT or any of its members with the LCN or

elements thereof:

(i) any expenditures or proposed

expenditure of International Union funds or

transfer of International Union property

approved by any officers, agents,

representatives or employees of the IBT,

(ii) any contract or proposed

contract on behalf of the International

Union, other than collective bargaining

agreements, and

(iii) any appointment or proposed

appointments to International Union officer

of any officer, agent, representative or

employee of the IBT.

In any case where the

Administrator exercises veto authority, the

action or proposed action shall not go

forward. The Administrator, upon request

of the IBT's General President or General

-19-

Executive Board, shall, within three (3)

days, advise the IBT's General President

and/or General Executive Board whichever is

applicable, of the reasons for any such

veto. For a period of up to fourteen (14)

days after the Administrator's decision,

the IBT's President and/or General

Executive Board shall have the right to

seek review by this Court of the

Administrator's decision. The

Administrator may prescribe any reasonable

mechanism or procedure to provide for the

Administrator's review of actions or

proposed actions by the IBT, and every

officer, agent, representative or employee

of the IBT shall comply with such mechanism

Or procedure.

(i) The Investigations Officer shall have

the authority to take such reasonable steps

—-20—

KGa Lt Sept Pes Pe Rit aby eae Ph

‘

that are lawful and necessary in order to

be fully informed about the activities of

the IBT in accordance with the procedures

as herein established. The Investigations

Officer shall have the right:

(a) To examine books and records

of the IBT and its affiliates, provided the

entity to be examined receives three (3)

business days advance notice in writing,

and said entity has the right to have its

representatives present during said

examination.

(b) To attend meetings or

portions of meetings of the General

Executive Board relating in any way to any

of the officer's rights or duties as set

forth in this Order, provided that prior to

any such meeting, the officer shall receive

an agenda for the meeting and then give

—-2l1-

notice to the General President of the

officer's anticipated attendance.

statements or sworn in-person examinations

of any officer, member, or employee of the

IBT provided the Investigations Officer has

reasonable cause to take such a statement

and provided further that the person to be

examined receives at least ten (10) days

advance notice in writing and also has the

right to be represented by an IBT member or

legal counsel of his or her own choosing,

during the course of said examination.

(d) To take, upon notice and

application for cause made to this Court.

which shall include affidavits in support

thereto, and the opportunity for rebuttal

affidavits, the sworn statements or sworn

in person examination of persons who are

agents of the IBT (and not covered in

subparagraph (c) above).

-22-

(e) To retain an independent

auditor to perform audits upon the books

and records of the IBT or any of its

affiliated entities (not including benefit

funds subject to ERISA), provided said

entity receives three (3) business days

advance notice in writing and said entity

has the right to have its representatives

present during the conduct of said audit.

(ii) The Independent

Administrator and the Election

Officer shall have the same rights

as the Investigations Officer as

provided in sections (a), (b), (c)

and (d) of A, herein.

(iii) The Independent

Administrator, Investigations

Officer and Election Officer shall

each be provided with suitable

office space at the IBT

headquarters in Washington, D.C.

—-23-

D. IBT ELECTION -- The IBT

Constitution shall be deemed amended, and

is hereby amended, to provide for the

following new election procedures:

(i) The procedures described

herein shall apply to elections of the

IBT's General President, General

Secretary-Treasurer, International Union

Vice Presidents, and International Union

Trustees;

(ii) Delegates to the IBT

International convention at which any

International Union officers are nominated

or elected shall be chosen by direct

rank-and-file secret balloting shortly

before the convention (but not more than

six months before the convention, except

for those delegates elected at local union

elections scheduled to be held in the fall

—-24-

of 1990), and with all convention Candidate

election voting by secret ballot each

delegate individually;

(iii) Delegates shall nominate

candidates for eleven (11) Regional Vice

Presidents, as*follows: Three (3) from the

Eastern Conference, three (3) from the

Central Conference, two (2) from the

Southern Conference, two (2) from the

Western Conference, and one (1) from the

Canadian Conference. In addition, there

shall be nominated candidates for five (5)

Vice Presidents to be elected at large.

All duly nominated Vice Presidents shall

stand for election conducted at local

unions on the same ballot and time as the

election of General President and General

Secretary-Treasurer, as provided herein;

(iv) At such an International

convention, after the nomination of

—-25-

SO |

International Union Vice Presidents and

election of Trustees, all delegates shall

then vote for nominees for the offices of

IBT General President and

Secretary-Treasurer;

(v) To qualify for the ballot for

the direct rank-and-file voting for IBT

General President, Secretary-Treasurer, and

Vice President, candidates must receive at

least five (5) percent of the delegate

votes at the International convention, for

the at large position, or by conference for

regional positions, as the case may be;

(vi) No person on the ballot for

the position of IBT General President may

appear on the ballot in the same election

year for the position of

Secretary-Treasurer; and further no member

shall be a candidate for more than one (1)

Vice President position;

-—-26-

(vii) No less than four (4)

months and no more than six (6) months

after the International convention at which

candidates were nominated, the IBT General

President, General Secretary-Treasurer and

Vice Presidents shall be elected by direct

rank-and-file voting by secret ballot in

unionwide, one-member, one-vote elections

for each at large position, and conference

wide, one-member one-vote elections for

each regional position;

(viii) All direct rank-and-file

voting by secret ballot described above

shall be by in-person ballot box voting at

local unions or absentee ballot procedures

where necessary, in accordance with

Department of Labor regulations; and

(ix) The current procedures under

the IBT Constitution for filling a vacancy

between elections in the office of General

Secretary-Treasurer, International Trustee,

and International Vice President shall

remain in effect.

The Election Officer shall

supervise the IBT election described above

to be conducted in 1991 and any special IBT

elections that occur prior to the IBT

elections to be conducted in 1991. In

advance of each election, the Election

Officer shall have the right to distribute

materials about the election to the IBT

membership. The Election Officer shall

supervise the balloting process and certify

the election results for each of these

elections as promptly as possible after the

balloting. Any disputes about the conduct

and/or results of elections shall be

resolved after hearing by the Administrator.

The union defendants consent to

the Election Officer, at Government

-28-

able Sol hale J

TS ae ee ee Se Ie ey eR

expense, to supervise the 1996 IBT

elections. The union defendants further

consent to the U.S. Department of Labor

supervising any IBT elections or special

elections to be conducted after 1991 for

the office of the IBT General President,

IBT General Secretary-Treasurer, IBT Vice

President, and IBT Trustee.

At the IBT 1991 International

Convention, the delegates shall be

presented with these aforesaid amendments

for vote; provided further that nothing

herein shall be deemed or interpreted or

applied to abridge the Landrum-Griffin free

speech right of any IBT officer, delegate

Or wember, including the parties hereto.

(E) REPORTS TO MEMBERSHIP --

The Administrator shall have the authority

to distribute materials at reasonable times

to the membership of the IBT about the

~99—

S4 |

Administrator's activities. The reasonable

cost of distribution of these materials

shall be borne by the IBT. Moreover, the

Administrator shall have the authority to

publish a report in each issue of the

International Teamster concerning the

activities of the Administrator,

Investigations Officer and Election Officer.

(F) REPORTS TO THE COURT --

The Administrator shall report to the Court

whenever the Administrator sees fit but, in

any event, shall file with the Court a

written report every three (3) months about

the activities of the Administrator,

Investigations Officer ont Election

Officer. A copy of all reports to the

Court by the Administrator shall be served

on plaintiff United States of America, the

IBT's General President and duly designated

IBT counsel.

=$9-

(G) HIRING AUTHORITY -- The

Administrator, the Investigations Officer

and the Election Officer shall have the

authority to employ accountants,

consultants, experts, investigators or any

other personnel necessary to assist in the

proper discharge of their duties.

Moreover, they shall have the authority to

designate persons of their choosing to act

on their behalf in performing any of their

duties, as outlined in subparagraphs

above. Whenever any of them wish to

designate a person to act on their behalf,

they shall give prior written notice of the

designation to plaintiff United States of

America, and the IBT's General President;

and those parties shall then have the

right, within fourteen (14) days of receipt

of notice, to seek review by this Court of

=3i<

the designation, which shall otherwise take

effect fourteen (14) days after receipt of

notice.

(H) COMPENSATION AND EXPENSE |

-- The compensation and expense of the |

Administrator, the Investigations Officer

and the Election Officer (and any designee

Or persons hired by them) shall be paid by

the IBT. Moreover, all costs associated

with the activities of these three

officials (and any designee or persons

hired by them) shall be paid by the IBT.

The Administrator, Investigations Officer

and Election Officer shall file with the

Court (and serve on plaintiff United States

of America and the IBT's General President

and designated IBT counsel) an application,

including an itemized bill, with supporting

material, for their services and expenses

once every three months. The IBT's General

=$2-

President shall then have fourteen (14)

business days following receipt of the

above in which to contest the bill before

this Court. If the IBT's President fails

to contest such a bill within that 14-day

period, the IBT shall be obligated to pay

the bill. In all disputes concerning the

reasonableness of the level or amount of

compensation or expense to be paid, the

Court and parties shall be guided by the

level of payment as authorized and approved

by the IBT for the payment of similar

services and expenses.

(I) APPLICATION TO THE COURT

-- The Administrator may make any

application to the Court that the

Administrator deems warranted. Upon making

any application to the Court, the

Administrator shall give prior notice to

plaintiff United States of America, the

-33-

IBT's General President and designated IBT

counsel and shall serve any submissions

filed with the Court on plaintiff United

States of America, the IBT's General

President and designated IBT counsel.

Nothing herein shall be construed

authorizing the parties or the

Court-appointed officers to modify, change

Or amend the terms of this Order.

G. INDEPENDENT REVIEW BOARD

Following the certification of the 1991

election results, there shall be

established: an Independent Review Board,

(hereinafter, referred to as the “Review

Board"). Said Board shall consist of three

members, one chosen by the Attorney General

of the United States, cone chosen by the IBT

and a third person chosen by the Attorney

General's designee and the IBT's designee. |

=36—-

A Se 000 ty atk >

In the event of a vacancy, the replacement

shall be selected in the same manner as the

person who is being replaced was selected.

(a) The Independent: Review Board

shall be authorized to hire a sufficient

staff of investigators and attorneys to

investigate adequately (1) any allegations

of corruption, including bribery,

embezzlement, extortion, loan sharking,

violation of 29 U.S.C. §530 of the Landrum

Griffin Act, Taft-Hartley Criminal

violations or Hobbs Act violations, or (2)

any allegations of domination or control or

influence of any IBT affiliate, member or

representative by La Cosa Nostra or any

other organized crime entity or group, or

(3) any failure to cooperate fully with the

Independent Review Roard in any

investigation of the foregoing.

(b) The Independent Review Board

=9S-

shall exercise such investigative authority

as the General President and General

Secretary-Treasurer are presently

authorized and empowered to exercise

pursuant to the IBT Constitution, as well

as any and all applicable provisions of law.

employees and representatives of the IBT

and its affiliated bodies shall cooperate

fully with the Independent Review Board in

the course of any investigation or

proceeding undertaken by it. Unreasonable

failure to cooperate with the Independent

Review Board shall be deemed to be conduct

which brings reproach upon the IBT and

which is thereby within the Independent

Review Board's investigatory and decisional

authority.

(d) Upon completion of an

investigation, the Independent Review Board

-—-36-

SE eee ey

Bibi.

shall issue a written report detailing its

findings, charges, and recommendations

concerning the discipline of union

officers, members, employees, and

representatives and concerning the placing

in trusteeship of any IBT subordinate

body. Such written reports shall be

available during business hours for public

inspection at the IBT office in Washington,

BC.

(e) Any findings, charges, or

recommendations of the Independent Review

Board regarding discipline or trusteeship

matters shall be submitted in writing to

any appropriate IBT entity (including

designating a matter as an original

jurisdiction case for General Executive

Board review), with a copy sent to the

General President and General Executive

Board. The IBT entity to which a matter is

o3F=

referred shall thereupon promptly take

whatever action is appropriate under the

circumstances, as provided by the IBT

Constitution and applicable law. Within 90

days of the referral, that IBT entity must

make written findings setting forth the

specific action taken and the reasons for

that action.

(f) The Independent Review Board

shall monitor all matters which it has

referred for action if, in its sole

judgment, a matter has not been pursued and

decided by the IBT entity to which the

matter has been referred in a lawful,

responsible, or timely manner, or that the

resolution proposed by the relevant IBT

entity is inadequate under the

circumstances, the Independent Review Board

shall notify the IBT affiliate involved of

its view, and the reasons therefor. A copy

~ZO—

i oak EG ed ora,

of said notice shall be sent by the

Independent Review Board shall notify the

IBT affiliate involved of its view, and the

reasons therefor. A copy of said notice

shall be sent by the Independent Review

Board, to the General President and the

General Executive Board.

(g) Within 10 days of the notice

described in paragraph (f) above, the IBT

entity involved shall set forth in writing

any and all additional actions it has taken

and/or will take to correct the defects set

forth in said notice and a deadline by

which said action may be completed.

Immediately thereafter, the Independent

Review Board shall issue a written

determination concerning the adequacy of

the additional action taken and/or proposed

by the IBT entity involved. If the

Independent Review Board concludes that the

-—-39-

IBT entity involved has failed to take or

propose satisfactory action to remedy the

defects specified by the Independent Review

Board's notice, the Independent Review

Board shall promptly convene a hearing,

after notice to all affected parties. All

parties shall be permitted to present any

facts, evidence, or testimony which is

relevant to the issue before the

Independent Review Board. Any such hearing

shall be conducted under the rules and

procedures generally applicable to labor

arbitration hearings.

(h) After a fair hearing has been

conducted, the Independent Review Board

shall issue a written decision which shall

be sent to the General President, each

member of the General Executive Board, and

all affected parties.

-40-

(i) The decision of the

Independent Review Board shall be final and

binding, and the General Executive Board

shall take all action which is necessary to

implement said decision, consistent with

the IBT Constitution and applicable Federal

laws.

(j) The Independent Review Board

shall have the right to examine and review

the General Executive Board's

implementation of the Independent Review's

decisions; in the event the Independent

Review Board is dissatisfied with the

General Executive Board's implementation of

any of its decision, the Independent Review

Board shall have the authority to take

whatever steps are appropriate to insure

proper implementation of any such decision.

(k) The Independent Review Bc:rd

shall be apprised of and have the authority

~~ to

to review any disciplinary or trusteeship

decision of the General Executive Board,

and shall have the right to affirm, modify,

or reverse any such decision. The

Independent Review Board's affirmance,

modifications, or reversal of any such

General Executive Board decision shall be

in writing and final and binding.

(1) The IBT shall pay all costs

and expense of the Independent Review Board

and its staff (including all salaries of

Review Board members and staff). Invoices

for all such costs and expense shall be

directed to the General President for

payment.

(m) The Investigations Officer

and the Administrator shall continue to

exercise the investigatory and disciplinary

authority set forth in paragraph 12 above

for the limited period set forth in

-42-

paragraph 3(3) above, provided, however,

that the Investigations Officer and the

Administrator may, instead, refer any such

investigation or disciplinary matter to the

Independent Review Board.

(n) The IBT Constitution shall be

deemed and hereby is amended to incorporate

all of the terms relating to the

Independent Review Board set forth above in

this paragraph. This amendment shall be

presented to the delegates to the 1991

Convention for vote.

H. INDEMNIFICATION

13. The IBT shall purchase a policy of

insurance in an appropriate amount to

protect the Administrator, the

Investigations Officer, the Election

Officer and persons acting on their behalf

from personal liability for any of their

-43-

actions on behalf of the IBT, the

Administrator, the Investigations Officer

or the Election Officer. If such insurance

is not available, or if the IBT so elects,

the IBT shall indemnify the Administrator,

Investigations Officer, Election Officer

and persons acting on their behalf from any

liability (or costs incurred to defend

against the imposition of liability) for

conduct taken pursuant to this order. That

indemnification shall not apply to conduct

not taken pursuant to this order. In

addition, the Administrator, the

Investigations Officer, the Election

Officer and any persons designated or hired

by them to act on their behalf shall enjoy

whatever exemptions from personal liability

may exist under the law for court officers.

-—-44-

I. IBT LEGAL COUNSEL

14. During the term of office of the

court-appointed officers, the IBT General

President shall have the right to employ or

retain legal counsel to prcevide

consultation and representation to the IBT

with respect to this litigation, to

negotiate with the appropriate official and

to challenge the decisions of the

court-appointed officers, and may use union

funds to pay for such legal consultation

and representation. The Administrator's

removal powers and authority over union

expenditures shall not apply to such legal

consultation and representation.

J. NON-WAIVER

15. To the extent that such evidence

would be otherwise admissible under the

Federal Rules of Evidence, nothing herein

=48—

shall be construed as a waiver by the

United States of America or the United

States Department of Labor of its right to

offer proof of any allegation contained in

the Complaint, Proposed Amended Complaint,

declarations or memoranda filed in this

action, in any subsequent proceeding which

may lawfully be brought.

K. APPLICATION TO COURT

16. This Court shall retain

jurisdiction to supervise the activities of

the Administrator and to entertain any

future applications by the Administrator or

the parties. This Court shall have

exclusive jurisdiction to decide any and

all issues relating to the Administrator's

actions or authority pursuant to this

order. In reviewing actions of the

Administrator, the Court shall apply the

-46—

same standard of review applicable to

review of final federal agency action under

the Administrative Procedure Act.

L. FUTURE PRACTICES

17. The parties intend the provisions

set forth herein to govern future IBT

practices in those areas. To the extent

the IBT wishes to make any changes,

constitutional or otherwise, in those

provisions, the IBT shall give prior

written notice to the plaintiff, through

the undersigned. If the plaintiff then

objects to the proposed changes as

inconsistent with the terms and objectives

of this order, the change shall not occur;

provided, however, that the IBT shall then

have the right to seek a determination from

this Court, or, after the entry of judgment

dismissing this action, from this Court or

o47—=

any other federal court of competent

jurisdiction as to whether the proposed

change is consistent with the terms and

objectives set forth herein.

M. SCOPE OF ORDER

18. Except as provided by the terms of

this order, nothing else herein shall be

construed or interpreted as affecting or

modifying: (a) the IBT Constitution; (b)

the Bylaws and Constitution of any IBT

affiliates; (c) the conduct and operation

of the affairs of the IBT or any

IBT-affiliated entity or any employee

benefit fund as defined in ERISA or trust

-fund as defined by Section 302(c) of the

Labor Management Relations Act, as amended;

(d) the receipt of any compensation or

benefits lawfully due or vested to any

officer, member or employee of the IBT or

=46-

any of its affiliates and affiliated

benefit fund; or (e) the term of office of

any elected or appointed IBT officer or any

of the officers of any IBT-affiliated

entities.

N. NON-ADMISSION CLAUSE

19. Nothing herein shall be construed

as an admission by any of the individual

union defendants of any wrongdoing or

breach of any legal or fiduciary duty or

obligation in the discharge of their duties

as IBT officers and members of the IBT

General Executive Board.

QO. FUTURE ACTIONS

20. Nothing herein shall preclude the

United States of America or the United

States Department of Labor from taking any

appropriate action in regard to any of the

~49—

PO ee ee

104

union defendants in reliance on federal

laws, including an action or motion to

require disgorgement of pension, severance

Or any other retirement benefits of any

individual union officer defendant on whom

discipline is imposed pursuant to paragraph

12 above.

P. LIMITS OF ORDER

21. Nothing herein shall create or

confer or is intended to create or confer,

any enforceable right, claim or benefit on

the part of any person or entity other than

to the parties hereto and the

court-appointed officers established

herein. As to the undersigned defendants

hereto, this order supercedes the order of

the Court entered on June 28, 1988, as

thereafter extended.

-50-

Q. EXECUTION

22. Each of the undersigned individual

defendants has read this order and has had

an opportunity to consult with counsel

before signing the order.

March 1]

, 1989.

DAVID N. EDELSTEIN

United States District Judge

CONSENTED TO:

BENITO ROMANO

United States Attorney

Southern District of New York

One St. Andrew's Plaza

New York, New York 10007

Attorney for Plaintiff

United States of America

By:

RANDY M. MASTRO

Assistant United States Attorney

-51-

By:

105

MUDGE ROSE GUTHRIE ALEXANDER

& FERDON

180 Maiden Lane

New York, New York 10038

Attorneys for Defendants IBT

and its General Executive Board

JED S. RAKOFF

JAMES T. GRADY, ESQ.

General Counsel

International Brotherhood of

Teamsters, Chauffeurs,

Warehousemen and Helpers

of America, AFL-CIO

25 Louisiana Avenue, N.W.

Washington, D.C. 20001

JAMES T. GRADY, ESQUIRE

Defendant WILLIAM J. McCARTHY

Defendant WELDON MATHIS

Defendant JOSEPH TREROTOLA

Defendant JOSEPH W. MORGAN

-52-

Defendant

EDWARD M. LAWSON

Defendant

ARNOLD WEINMEISTER

Defendant

DONALD PETERS

Defendant

WALTER J. SHEA

Defendant

HAROLD FRIEDMAN

Defendant

JACK D. COX

Defendant

DON L. WEST

Defendant

MICHAEL J. RILEY

Defendant

THEODORE COZZA

Defendant

DANIEL LIGUROTIS

-53-

108

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

aE Ae SIE LE ET 25 x

UNITED STATES OF AMERICA,

Plaintiff,

Vv. 88 Civil 4486

INTERNATIONAL BROTHERHOOD OF

TEAMSTERS, et al.,

Defendants.

ee eR ee AS. OP ED x

May 6, 1991

Li :0e @.H.,

Before:

HON. DAVID N. EDELSTEIN,

District Judge

APPEARANCES

OTTO G. OBERMAIER,

United States Attorney for the

Southern District of New York

EDWARD FEGUSON,

Assistant United States Attorney

Attorney for the Plaintiff

SOUTHERN DISTRICT

APPEARANCES: (Continued)

FREDRERICK B. LACEY, ESQ.,

STUART ALDEROTY, ESQ.,

Attorneys for Administration Officer

JONES, DAY, REAVIS & POGUE

Attorneys for Investigation Officer

CHARLES M. CARBERRY, ESQ.

ROBERT GAFFEY, ESQ.,

MICHAEL HOLLAND, ESQ.,

Attorney for Election Office

GOULSTON & STORRS

Attorneys for IBT

DENIS M. KING, ESQ.,

and

GRADY and DWYER

JAMES T. GRADY, ESQ.,

THE COURT: Here we go again.

I lifted that comment based upon my

recent reodilevttels of Mr. Reagan's first

debate with President Carter. Apropos of

some comments made by the president, Mr.

Reagan, with a broad smile and a shrug of

his shoulders, said, “Here we go again.”

We stand here on the eve of the first

direct, secret ballot election in the

unfortunate and very sordid history of the

IBT.

It is my firm conviction that this

election will give the membership of this

union the opportunity to themselves elect

legitimate leadership to govern this

country's largest labor union, despite all

efforts that may be made to frustrate that

purpose. I don't think it an excess of

-3-

iil

rhetoric to say that we stand at a historic

moment.

The government has recently moved this

court for orders relating to the vote to be

taken by the delegates to the 1991 IBT

convention on the consent decree's changes

in the IBT Constitution. I have carefully

considered that motion and have this

morning entered an opinion deciding that

matter in extenso. That will be delivered

to you shortly.

I have determined that as a result of

decisions rendered in the past two years,

it has been settled that the IBT had the

power to bind the entire union to the

consent decree's changes in the IBT

Constitution without a vote of the

delegates to a convention. Therefore, the

vote of the delegates on the consent decree

to be taken at the 1991 convention will now

-4-

112

have no legal effect. No action taken by

the IBT at the convention can or will be

permitted to undercut the provisions of

this consent decree.

I remind the IBT that it voluntarily

agreed to the consent decree with its free

rank and file elections. The past two

years have demonstrated clearly that the

IBT had no intention of living up to its

end of the agreement. The IBT has made

every attempt to limit and restrict the

terms of the consent decree and each time

it has lost, but has not learned any

lessons. But the time for challenges to

the consent decree has now past and the IBT

must live with the consent decree as

written by the parties, approved by the

court and repeatedly interpreted by this

court and the Court of Appeals.

-5-

113

I tend to be amused in a rather

paradoxical way when I remember that the

IBT, by its representatives, have made

heroic statements from time to time, both

here and before a constitutionally convened

Senate committee, to reaffirm their

commitment to a union free of corruption

and their dedication to free elections.

You can't imagine how I wish that some

of those statements could have been true.

Time, however, has proved otherwise. The

statements have been empty of any meaning

Or purpose for the good of this important

union.

trong language. I'm sorry I have to

indulge in that. Hippocracy is not a

substitute for free elections. There will

now be free elections and nothing short

will be countenenced.

-6§-

114

I still have under consideration

whether my presence is needed to provide

assurance that the convention will proceed

smoothly and in conformity with the many

decrees issued by this court and

subsequently affirmed by the Court of

Appeals.

Now, very recently I intended to save

my time, avoid the need of going to this

convention and thought that I would enter a

stop-gap order, nothing more, nothing

less. What happened? An appeal.

I'm very curious to see what the court

is going to do with that order and how

revealing it is about the IBT's intention

not even willing to agree to a small step

that would save time and money.

However, if there is any need for the

assurance that my presence may provide at

this convention as a barrier too high to

on Fan

jump over so that this convention may

proceed smoothly, I will take the time. It

means adjusting a very heavy criminal

calendar, but I'm sure there are enough

collegial colleagues on this bench to help

me over that hurdle. And here we are. The

Opinion is now available. You may have it

and that's it.

If there is any thought on your part

that you would like to apply for a stay, I

would consider that now, and I will tell

you it is rejected out of hand because it

doesn't meet any of the criteria that the

rules call for for a stay. I see no basis

SCE it Gt aii.

That's se.

Now you have an opportunity to read

this opinion, and I would 1ike some input.

Do you think -- well, why don't I do

this. Why don't you read the opinion, let

-8-

115

me hear from you if you think it is

necessary for me to be present at this

convention in order to get some guarantee

or assurance that I am there with a

courtroom available, with a staff in place

to deal with whatever problems may arise.

I will be in the robing room.

(Recess)

THE COURT: Letter dated May 2, 1991

handed to me by Mr. Holland which sets

forth in rather lengthy fashion the kind of

subject which may be necessary here.

MR. LACEY: What I have to say in

response to your question, your Honor, I

think may moot that.

THE COURT: What?

MR. LACEY: What I have to say in

response to your question that you raised

just as you raised earlier may moot that

communication, because you invited a

il?

comment from us on whether we think that

it's advisable for you to be present in the

court house in Atlanta during the week of

the convention -- I'm sorry -- in Orlando,

and I think it's a must that you be there.

History has shown us that on some very

important matters, we have been unable to

reach a negotiated conclusion and we have

had to come to your Honor for a

resolution. I think --

THE COURT: That's what I tried to stop

with that last order stop-gap for the

government and the IBT to say about any

perceived conduct stop, let's talk to the

judge. That went up on appeal.

However, I think you are right.

MR. LACEY: I think it's a must.

THE COURT: I think you are right.

MR. LACEY: I tell you this, let me

give you the reasons I have in mind.

-~10-

118

First of all, I am satisfied that what

we were trying to work out here was a

second or third or fourth best. Telephone

communication just is not going to be

workable.

I am concerned that something very

Significant might arise, there will be only

one way to deal with it, that would be to

bring everybody back up and stop the

convention and that makes absolutely no

sense.

So I think this:

I am not suggesting that your Honor be

at the hotel, the convention site, because

that makes no sense, either.

THE COURT: All right.

MR. LACEY: But if your Honor is in the

court house in Orlando, I don't know the

bureaucratic steps you have to go through,

empowered to rule there as if you were

-ll-

119

sitting here, I'm satisfied that that is

going to make, make a big difference in

what happens at that convention, and I

would urge it on your Honor just as

strongly as I can.

THE COURT: Well, you will recall that

initially, at the very beginning, I though

that that was the only way to go.

Then I foresaw the expense of my own

scheduling and I thought perhaps I could do

something a little more convenient, but I

have not been able to succeed in that.

So your letter, Mr. Holland, is marked

for identification, and under the

Circumstances it is moot.

You Know, I have had a nagging feeling

that I have forgotten something. It has

bothered me again and again. Then I would

forget about it.

-—~12-

i<0

Now, I am instructing the government to

do the following:

I would like the government to deliver

to my chambers a duplicate of the Roy

Williams deposition and the accompanying

transcript.

Do you have that thus far, Mr. Ferguson?

MR. FERGUSON: Yes, your Honor.

THE COURT: I also request that the

government have the original of the

deposition and a transcript at Orlando.

Why? I may find it appropriate to play

this testimony before the convention, and I

will not hesitate to do so if I think that

is necessary.

Keep that in mind.

Will you do that, Mr. Ferguson?

MR. FERGUSON: Yes, well, your Honor.

-13-

121

THE COURT: And will you also proceed

to make all arrangements for me and my

staff as follows:

My two law clerks and a reporter. I

have no problem, I'm sure, obtaining

secretarial help in Orlando and a deputy

clerk as well, so I will not burden the

expense account with more help than I

need. And go ahead and do it forthwith.

MR. FERGUSON: If your Honor please,

those arrangements to include hotel and

travel?

THE COURT: Yes. I don't think the

Orlando federal court would like to have it

said that I slept there.

MR. FERGUSON: Understood, your Honor.

I am just trying to find exactly --

THE COURT: All convenience,

transportation, et cetera.

MR. FERGUSON: Yes, your Honor.

=) =

THE COURT: Do it forthwith and make

sure that I have those tapes and the

testimony in my chambers.

MR. LACEY: Mr. Ferguson indicated he

might want to address one or two other

matters, your Honor, while we are here.

MR. FERGUSON: Your Honor, in reading

over the court's opinion, a couple of

matters occurred to me that if we could

clear them up right now it might safe us

some future litigation.

THE COURT: Ail right. Don't ambush me.

MR. FERGUSON: I won't, your Honor.

On page 22 of the opinion, the first

full paragraph, beginning with, "With

respect to the declaratory relief, as a

result of the subsequent judicial

determinations as to the legal status of

the consent decree, and as an order of this

court, paragraph L.17 of the consent decree

123

will be in effect for the three-year

duration of the consent decree. In

accordance with that provision, the

government or the court must approve any

changes to the consent decree, or the IBT

constitutional provisions that implicate

the consent decree, taken by the IBT."

My question for clarification purposes

is just to make sure so we can obviate an

argument later on that paragraph 17 of the

decree is no longer in effect after the

court appointed officers have completed

their tenures.

I would just like your Honor to clarify

for the record that paragraph 17 of the

decree, like the entire consent decree, is

a permanent amendment to the IBT

Constitution.

THE COURT: I will do that in an

amended brief order.

-16-

—

124

MR. FERGUSON: Thank you, your Honor.

My second and last request for

Clarification pertains to page 23 of the

order, the second to the last paragraph,

beginning with the word, "Further," and I

note in full as follows:

THE COURT: The IBT explicitly?

MR. FERGUSON: Yes.

“Further, the IBT explicitly agreed in

paragraph E.10 of the consent decree that

it would not ‘obstruct or otherwise

interfere’ with the implementation of the

consent decree, or the work of the court

officers. Since the election officer must

supervise the election according to the

election rules, any action taken to

engineer a vote against the current he

electoral provision would constitute

interference with the work of the election

officer. Accordingly, any action taken to

=~} J=

120

further the rejection of the consent

decree's changes would violate the existing

injunction in the consent decree. Thus,

the IBT is put on notice that it shall not

take action to vote against the very

consent decree which it signed.”

| My question for clarification purposes,

your Honor, is to make sure that the

paragraph I just read does not conflict

with the provision in the consent decree

itself that requires that the consent

decree amendments to the IBT constitution

be put before the delegates for a vote.

What I understand your Honor to be

saying in this opinion is that the consent

decree may be put to the delegates for a

vote. However, the outcome of that vote is

of no legal effect.

THE COURT: That's what I have said.

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125

MR. FERGUSON: As your Honor stated on

page 17 of the opinion. But I just want to

make sure that nothing in this --

THE COURT: What language would you

suggest for clarification?

MR. FERGUSON: A simple clarification

that would say nothing in this opinion

shall be construed to alter the provisions

of the consent decree that requires the

consent decree amendments to the IBT

constitution to be put to the delegates for

a vote.

THE COURT: I think that is a helpful

suggestion and I accept it and that will

also be included in the brief order that I

intend to file in accordance with this.

MR. KING: Your Honor, if the court

please, my name is Denis King --

THE COURT: Oh, I Know.

127

MR. KING: I am here in Mr. Pierce's

absence.

THE COURT: You need no introduction.

MR. KING: I had two questions

Originally, but Mr. Ferguson has --

THE COURT: If you have any questions,

write it out. I will not be ambushed. If

you have any questions, write it out.

MR. KING: Very well, your Honor.

THE COURT: So I can think about it.

All right?

MR. FERGUSON: Thank you, your Honor.

=20—

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

UNITED STATES OF AMERICA,

Plaintiff,

Vv. 88 Civ. 4486 DNE

INTERNATIONAL BROTHERHOOD OF TEAMSTERS,

Defendant.

March 20, 1991

10:30 a.m.,

Before:

HON. DAVID N. EDELSTEIN,

District Judge

APPEARANCES

OTTO G. OBERMAIER,

United States Attorney for the

Southern District of New York

Attorney for plaintiff

EDWARD FERGUSON,

PETER SPRUNG

Assistant United States Attorneys

SOUTHERN DISTRICT REPORTERS 212-791-1020

JAMES T. GRADY

BRIAN MAAS

RUDOLPH F. PIERCE

Attorneys for defendant

130

(Case called)

THE COURT: This is an anniversary.

Last week marked the second anniversary of

the signing of this historic consent decree

between the government and the

International Brotherhood of Teamsters.

Despite the enormous and persistent

opposition during the past two years, there

has been progression towards achieving the

underlying purpose and intent of this

decree, which is to return this great

union, which has been clouded by evilness,

to its members.

As I have said repeatedly and often,

the linchpin of this unprecedented effort

is the provision that the next leadership

of the IBT shall be chosen by the rank and

file itself in an open, free and democratic

election, without any fear of coercion or

any effort to undercut the purpose of this

-3-

idl

decree, to return this union to its

rightful rank and file people.

It is my determination that a free and

open democratic election is an unassailable

and inviolate goal. It is the compass by

which this case is directed.

By bringing the instant motion, the

government seeks to insure the reality of

this election. The papers submitted with

this motion, however, leave some issues

unclear, which must be brought into focus

and as I continue I will outline.

* I need some more light on the

specific harm that the government

foresees. I need some very clear

definition of the specific nature of the

remedies they seek from this court.

And so that will be a matter for oral

argument to bring to this court's attention.

-4-

132

I'm sure all you veterans at the bar

are-aware of a basic law in physics, sound

does not travel faster than light. I

expect you to be brief, to the extent that

you bring to my attention the clarity that

I require by succinct statements.

So, let me continue for just one moment

before we get on.

I have received a letter dated March

15, 1991 from Judge Lacey, the Independent

Adrinistrator of the International

Brotherhood of Teamsters, dealing with how

best to assure the presence of the court

during the IBT International Convention to

be held June 24 to 28, 1991, so that I may

be present to attend to any problems which

may arise. I anticipate, based upon my

experience, that there will be many

problems, many maneuvers and many

strategies and, accordingly, I find that

-5-

none of the options laid out for my

consideration are adequate enough to give

me the assurance that I will be able to

address quickly, effectively and

immediately any problems which may arise

during that period of time.

I believe it would be important for me

to sit in the Orlando federal Courthouse

and be present at the convention itself.

Thus, I am arranging to have facilities

available for me and my staff and I expect

to put that in place long before the June

date.

I was somewhat, -I must confess, amused

at the options offered to me. Those

options, when one compares them with the

experience that I have not always enjoyed

in this case; certainly doesn't assure the

kind of presence that may be needed.

-6-

id4

Now, you're going to argue, Mr.

Ferguson?

MR. FERGUSON: I am, your Honor.

THE COURT: Let me see if I can give

you some guidance.

As I see it, the government's motion

for a declaratory judgment is, in essence,

an application for interpretation of

paragraph 16, applications to the court; is

that correct?

MR. FERGUSON: Your Honor, it's

certainly correct that the government makes

this application pursuant to paragraph 16

of the Consent Decree. We believe that the

language on its face, of paragraph 16,

really needs no interpretation, gives this

court exclusive jurisdiction to decide

precisely these kinds of applications that

the parties may bring before it.

ido

But we are, as your Honor has noted,

moving under paragraph 16 of the Consent

Decree, in addition to other sources of

this court's power to decide the issue that

we have brought before it.

THE COURT: More succinctly, what are

you saying?

MR. FERGUSON: In terms of this court's

jurisdiction, your Honor?

We believe that the court clearly has

jurisdiction under paragraph 16 of the

Consent Decree to rule on this

application. That is what the government

and the IBT agreed to in entering into the

Consent Decree and that is what the court,

on more than one occasion, has made clear,

that this is the forum to which the parties

should come in the event they have an

application touching on the Consent Decree

~B8-

18d

that they would like to have the court

decide.

In addition to paragraph 16 of the

decree, this court has the authority under

the All Writs Act, 28 USC, Section 1651(a),

to issue such orders as are necessary to

prevent the frustration of the

implementation of the Consent Decree. This

court has previously held that it has

jurisdiction in this case under the All

Writs Act to prevent the frustration of the

implementation of the Consent Decree and

the Second Circuit, as the court is aware,

has affirmed that determination. So the

All Writs Act provides another independent

source of this court's jurisdiction to

issue the relief that the government

requests.

In addition, a third independent source

is the RICO statute itself, under which

aan

this action was filed. 18 USC, Section

1964(b) provides that in the case of a

civil RICO action brought by the

government, such as this one, the court,

pending a final determination of the

action, may make any orders that it

considers appropriate and necessary in the

exercise of its jurisdiction under the RICO

statute.

THE COURT: And that is crucial to your

argument?

MR. FERGUSON: That, your Honor, is one

of the independent bases of this court's

jurisdiction. Even if there were no such

statute, however, the Consent Decree alone

would give this court adequate jurisdiction.

And even if there were no Consent

Decree, the All Writs Statute alone would

give this court jurisdiction. Each of

these sources of jurisdiction, the Consent

138

Decree, and All Writs Act, and RICO

statute, provides an independent, separate

basis of jurisdiction for this court.

THE COURT: Then why does the

government not have to meet the criteria

under declaratory judgment in the Second

Circuit in the Kidder case?

MR. FERGUSON: Because this is not an

independent act that the government is

bringing. If the government did not have a

pending RICO suit against the Teamsters

Union, and were seeking this relief without

the background of a prior litigation which

has gone on since June of 1988, then it may

well be that the government would be

required to meet the declaratory judgment

Standards as set forth in 28 USC Section

2201.

ati«

189

THE COURT: You were asked to state how

you would satisfy the criteria set forth in

Kidder.

MR. FERGUSON: Assuming the criteria

for declaratory judgment would apply here,

and the government would have to satisfy

them, the government believes there is a

concrete controversy here and that is

really the essence of what is required for

a declaratory judgment. On the one hand,

the Consent Decree clearly provides that

the future practices provision contained in

paragraph 17 of the decree regulates the

method by which amendment to the IBT

constitution may be considered in areas

that touch upon the Consent Decree. That's

one half of the controversy.

The other half of the controversy,

which provides us the concreteness and

actuality of a controversy, is the facts

140

set forth in the government's moving

papers, which the government believes

indicate there is a serious risk that at

the IBT convention in June of this year an

attempt will be made to, in essence, ignore

the future practices provision of the

Consent Decree and attempt to revert to the

method of election international union

office that was in existence before the

Consent Decree amended the IBT

constitution.

So, on the one hand we have the clear

command of the Consent Decree. On the

other hand, we have evidence of a clear

intention, at least on the part of some

high-ranking members of the Teamsters Union

to frustrate that Consent Decree.

We believe the controversy has been

joined now and we believe that it is

appropriate for the court to consider this

AZo

141

now because if the court does not consider

it now and this issue is permitted to, in

essence, fester until the convention

itself, then we believe a serious risk is

presented of throwing the convention into

disarray and confusion and the risk is

presented of the convention not being able

to attend to all of the business it must

attend to in the five-day period that has

been set aside for it to do so.

So, we believe the controversy is here

now and that this court should decide it

now really for the benefit of not just the

government but of the union itself.

Because nothing could be worse in the

government's view than to have this

convention get underway and not be able to

complete its business.

—-14-

142

THE COURT: All right.

Now, I come to the next issue.

The government argues - and if you

think I have misstated in any way, call it

to my attention -- that the court need not

make the standard findings before entering

this injunction, that the need to make

these findings have never been questioned

in the numerous preliminary injunctions

entered in the course of this case. Does

that state your argument correctly?

MR. FERGUSON: Your Honor, it is our

position that the government is not seeking.

a preliminary injunction here. We are

Simply seeking relief under the Consent

Decree.

THE COURT: More in the nature of a

stay?

MR. FERGUSON: We are seeking two

things. I think your Honor stated it

-15-

443

correctly the first time. We are seeking

an interpretation, a confirmation of what

the Consent Decree provides on the one hand

and on the other hand we are also seeking

an injunction flowing out of an

interpretation that would prevent the IBT

from taking any action that is really

contrary to the agreement it signed.

But in terms of the findings that the

court must make in order to support the

relief the government seeks, all the court

must find is that the government's

interpretation of the Consent Decree is the

correct one.

Once the court has found that, then the

court is free in the course of and for the

purpose of implementing the Consent Decree

to give the government the injunctive

relief that it seeks.

-16-

144

The preliminary injunction standards

simply do not obtain here. We are not

looking forward to some sort of trial on

the merits, so that preliminary injunction

law and this circuit's test are really

completely irrelevant to this particular

application.

This particular application is no

different in kind as far as the court's

jurisdiction is concerned than the initial

applications made at the very beginning of

this case which dealt with matters as

mundane as office space for the court

officers.

It is the precise function and purpose

of paragraph 16 to allow the parties to

come to the court with any application that

they believe is necessary in order for the

Consent Decree to be implemented according

to its terms and that's really all the

government is doing here.

=i F=

ror

QQ}

THE COURT: Now, succinctly, the

question I asked: Is the government's

argument that the issuance of this

injunction would not implicate any statutes

or doctrines other than interpretations of

relevant provisions of the Consent Decree

9, 12, 16 and 17, because the injunction

would only bind the IBT to seek government

approval of any substitute election

procedure should the convention not approve

the Consent Decree's constitutional

change: Is the question too verbal.

MR. FERGUSON: I believe I understand

it, your Honor.

The court, should it grant an

injunction against the IBT, will have to

find that such - injunction is necessary

for the adequate implementation of the

Consent Decree.

Because it is an injunction that the

court would be issuing, the issuance of

that injunction would be subject to review,

as with any injunction, on an abuse of

discretion standard. Considerations that

the court would take into account in

deciding whether to grant the injunction

would be considerations that it would take

into account in deciding to grant any other

kind of injunction, mainly, whether equity,

which clearly applies here; allows such an

injunction.

THE COURT: Have you dealt with the

language I've used, namely, implication, at

all? Have you answered that? Will the

injunction implicate any statutes or

doctrines other than interpretation et

cetera, et cetera, et cetera?

MR. FERGUSON: The only doctrine I

believe that would be implicated, other

=}]9—

than what is in the Consent Decree itself,

would be the doctrine that an equitable

remedy, such as an injunction, must be

supported by adequate, equitable

considerations and we believe that we have

me that test here, because what is

precisely required, and that really there

is no other remedy for, is an injunction.

There's no other remedy that will really do

the job here.

THE COURT: Will implicate any statutes?

MR. FERGUSON: If your Honor were to

Ground an injunction on, for instance, the

All Writs Act, obviously, it would

implicate the All Writs Act.

But if your Honor were simply to ground

the issuance of an injunction on the

Consent Decree it would implicate no

statute.

=SO—

148

THE COURT: Now, this court has issued

a number of injunctions, is that correct?

MR. FERGUSON: That is correct.

THE COURT: Does this prayer for an

injunction, as you have described it,

differ from any of the other injunctions or

is 1t similar, all or in part?

MR. FERGUSON: I believe, your Honor,

this is the first time that the government

has sought the issuance of an injunction on

the strength of the consent order provision

alone. However, that is clearly permitted

by paragraph 16 of the consent order.

But i= is not the first time that the

government has come before the court under

the All Writs Act seeking an injunction and

there, as the court held in its All Writs

Act opinion preliminary injunction law was

Simply inapplicable because the government

—-21-

449

-/—_ -z

was not seeking a preliminary injunction,

it was seeking a simple injunction.

And the standards that apply to the

court's issuance of such an injunction is

whether it's an appropriate exercise of the

court's jurisdiction in a continuing case,

such as this one.

And that would be a similar analysis

that would take place here, if the court

were to ground its decision in whole or in

part on the All Writs Act.

THE COURT: There was a time when Mr.

Grady appeared before Senator Nunn's

committee and there was some dialogue and

ensued between them. You Know what I'm

talking about?

MR. FERGUSON: I do, your Honor.

THE COUR’: And I think you have

included transcript of that in your papers.

-22-

MR. FERGUSON: That's correct, we

included excerpts from it.

THE COURT: What did you think the

outcome of that dialogue means in terms of

what is here before us today?

MR. FERGUSON: Well, the government

believes that the dialogue between Mr.

Grady and Senator Nunn --

THE COURT: Under oath.

MR. FERGUSON: Under oath.

-- 15 emblematic of the approach that

the IBT has taken to this case from the

very moment the Consent Decree was entered.

We believe the IBT has always sought to

leave open the notion that in the event the

delegates to the convention vote their

disapproval of the Consent Decree, at that

time the IBT would be free to revert to its

prior method of electing officers, which

was at the convention itself.

=23-

This is a consistent position taken by

the IBT in its papers in this court and in

the Second Circuit, with statements such as

the Consent Decree is nothing more than an

act of faith between the parties, with

statements that the Consent Decree

amendments are subject to the approval of

the convention delegates. That simply is

not what the Consent Decree says or means.

But it has always been the IBT's position

in this litigation, the government

believes, to keep that issue alive and to

create enough doubt and confusion among the

membership that when the time comes at the

convention it will be possible for the IBT

to claim that the delegates' disapproval of

the Consent Decree allows it to go back to

its old ways.

—-24-

And it was precisely the function of

the future practices provision to prevent

that from happening.

The essence I guess of the government's

argument here is that the IBT's litigation

position has, from day one of the

post-decree period, ignored the existence

of the future practices provision and not

just the IBT's litigation position, as the

government's papers showed, this is not

Simply a hypothetical concern of the

government.

As IBT official Jack Yager, who at one

time was sitting provisionally on the

general executive board, testified in a

sworn deposition before the independent

administrator that there have been plans at

the highest echelon of this union to do

precisely that, that is, to go to the

convention and in the event that the

=-25-

103

delegates disapprove the Consent Decree to

dispense with the rank and file election in

December.

And it is that clear concern of the

government that brings it here today. This

is not just a matter of Yager's testimony.

It is Mr. Mathis, the number two official

in the union, who told the assembled

delegates of the Eastern Conference of

Teamsters last year in his view it's

completely up to the convention delegates

to determine what goes into the IBT

constitution. That simply once again

ignores the future practices provision of

the decree and it is because the government

fears, and with reason supported by

evidence, that an attempt will be made at

the convention to bypass the rank and file

elections set for December that we come

here today.

=%§-

THE COURT: Will you succinctly state

what precise remedy you seek and then I'm

going to follow up with the question: What

harm or prejudice do you perceive in the

event I do not grant your application for

relief?

MR. FERGUSON: The precise relief we

seek is an order that would do two things:

First, to declare that the function of the

nominating convention that is scheduled for

this June cannot be changed by anyone in

the absence of compliance with the future

practices provisions, which as your Honor

knows requires prior approval of the

government or this court for any changes

that might be made in the areas covered by

the decree. That's the first thing, an

order simply declaring that that is what

the Consent Decree means.

=97=

The second thing we seek is an

injunction that would enjoin the IBT,

acting as the representative of its

members, its officers and its affiliates

from taking any action that would change

the function of that nominating convention

THE COURT: How would changing the

function of that nominating committee bring

irreparable damage and harm to the

government?

MR. FERGUSON: It would bring

irreparable harm to the government by

dispensing with a rank and file election

that the parties agreed to and that this

court ordered in the Consent Decree.

Because if the June nominating convention

is turned into an electing convention, then

there will be nothing left for anyone to do

in December.

-—-28-

THE COURT: You mean it will become cut

and dried and, in effect, end up in a

manner speaking as a plebiscite.

MR. FERGUSON: It will be cut and dried

and the decision as to who will run this

union will be made by the delegates rather

than by the rank and file, which is what

the parties agreed to.

THE COURT: All right.

It's your turn, Mr. Grady.

MR. MAAS: Your Honor, my name is brian

Maas.

THE COURT: Wait aminute. I got

confused when I have a Jack-In-The-Box,

people jumping up. Who is going to argue?

MR. MAAS: I am going to be introducing

Mr. Pierce who is not a member of this

court.

THE COURT: Don't ambush me and don't

Surprise me. If you want to do something,

a%Qu

let me Know what you want to do instead of

popping up. I see Mr. Grady here. I know

him. He is counsel and I expect, unless

I'm led to believe otherwise, that you have

a different thought about it.

MR. GRADY: Thank you, your Honor. I

apologize to your Honor. Attorney Rudolph

Pierce, I believe he has filed the

necessary papers as substitution of counsel

for Brendan Sullivan.

THE COURT: There have been a few

efforts about filing irrelevant,

inappropriate applications for substitution

of counsel. I have had the waste of time

of having to send these papers back

repeatedly and I would suggest in the

future that local counsel pay close

attention not only to the rules of this

court but to the Federal Rules of Civil

Procedure.

=30-

I gather that you are admitted to

practice in this court and I gather you

looked at the petition which you filed with

this court when you asked for admission.

You pledged under oath that you were

familiar with the rules of the court, that

you were familiar with the canons of

ethics, that you were familiar with the

Federal Rules of Civil Procedure, et

cetera. In the future I don't want any

messy papers and I won't tolerate it. That

puts the facts on the record.

MR. GRADY: Your Honor, with the

court's permission, attorney Rudolph Pierce

will represent the International

Brotherhood of Teainsters at the hearing

today and at all hearings, your Honor.

THE COURT: When you say all future,

you mean for all practical purposes you're

sitting on the sidelines?

aZ}—-

MR. GRADY: Yes, your Honor. But very

close to the sidelines, your Honor.

THE COURT: That's a position I find it

very difficult to envision you in.

MR. GRADY: Mr. Pierce I believe can

bring to this court the competence and

clarity necessary.

THE COURT: Have you had an opportunity

to familiarize yourself sufficiently with

the history of this case and the many

gyrations it has taken, counsel?

MR. PIERCE: I think I've read 15 or 16

Or 17 opinions published by this court.

I've read a number of the transcripts,

including the transcript that relates

specifically the issuance or acceptance by

this court of the Consent Decree.

THE COURT: You've heard the questions

that I have specifically directed to the

government.

-32-

160

It is now your turn to deal with those

arguments and to persuade me that the

relief which they seek is unwarranted.

Your chance now is to tell me, one, do you

oppose this application for interpretation

of specific provision of the Consent

Decree, which has been stated by counsel

that this is not the injunction which is

usually sought when there is a case

involved.

Do you understand that? -

MR. PIERCE: I do.

THE COURT: All right. I'm ready.

MR. PIERCE: Fundamentally, the reason

we oppose it, your Honor, because the

Consent Decree, it seems to me, is clear

and it does not stand for or say what Mr.

Ferguson says it says.

To make this point, in a case which Mr.

Ferguson cited in his papers called New

-—-33-

tol

York Association of Regarded Children vs.

Carey, the court says on page 37: Consent

judgment is no mere contract, even though

reference to contract principles may be

useful, we may look at the circumstances

surrounding the order and the context in

which the parties were operating.

Now, what we said in our memorandum is

THE COURT: Will you identify this

citation with particularity?

MR. PIERCE: Yes, sir.

It is 596 F2d., page 27. It's the

Second Circuit. I'm reading from page 37.

The reason I started there, your Honor,

is because in the papers and in the

transcript of the proceedings which

occurred when the court accepted the

Consent Decree --

—-34-

THE COURT: Do you have a copy of that?

MR. PIERCE: Of the transcript?

THE COURT: Yes.

MR. PIERCE: I do. I cited it as an

attachment to my papers.

THE COURT: Mr. Ferguson, do you happen

to have a copy?

MR. FERGUSON: Your Honor, I don't have

the precise transcript with me. I think

the salient portions of it ar2 cited in the

7BT's opposing papers at page 3.

THE COURT: All right.

MR. PIERCE: In the transcript, your

Honor, you stated to the parties that there

seems to be some confusion with respect to

paragraph 12 in that it seems to say that

certain things are amended and it seems to

Say that the rank and file must vote on the

amendments.

-35-

And then the discussion occurred.

Finally, you concluded that the parties

recess and should go outside and seek to

clarify that provision.

And when the parties returned I think

it was the Assistant United States Attorney

reported to the court that the parties

Clarified that provision by paragraphs 9 A

and B of the Consent Decree.

Paragraphs 9 A and 9 B clearly indicate

I think or at least certainly it's clearly

implicit that if the rank and file voted or

the delegates voted not to accept the

election provisions which are set out in

paragraph 9, that the U.S. Attorney has the

remedies which are specified. That was the

agreement and that was the representation

that was made to the court by the Assistant

United states Attorney.

-—36-

eee

164

Now, all I've said here is we have not

asked for anything with respect to Consent

Decree. I agree with Mr. Ferguson and I

certainly agree with the court that the

basic text which is at issue here is the

interpretation of the Consent Decree. All

I've said, consistent with the opinion of

this court expressed in the IBT case and

elsewhere, the document has to be read by

its four corners and how one could read

this document without saying, as the

Consent Decree specifically says, that the

IBT retains the right to vote and the

document specifically references the

Landrum-Griffin free speech rights of the

membership.

I would add one other point. It seems

to be that Mr. Ferguson, in what he calls

facts in his affidavit, failed to mention

two I think very important facts. The

=-37=

first is that the delegates who are going

to vote at the IBT convention are delegates

who were elected pursuant to the procedures

instituted by the elections officers

insofar as I understand. And I heard the

representatives of the elections officer,

when we appeared before Judge McKenna in

another matter, stated that some 60 percent

of the delegate elections were contested

and some in excess of 50 percent of those

elections had occurred, if I understood it,

and were being counted. There isn't any

allegation here that I have seen. Mr.

Ferguson's papers that indicates in any way

that the IBT has done anything to interfere

with the implementation of the first stage

of the election process.

So that if one looks at the facts --

the facts to which Mr. Ferguson refers is

that there are some people in the IBT who

—38-

were of the opinion that the rank and file

reserved the right in the Consent Decree to

vote on the procedures. It seems to me

that opinion is fully consistent with the

express language which appears in the

Consent Decree and, with respect to the

statutes the Consent Decree refers, it says

specifically that at the IBT 1991

International Convention the delegates

shall be presented with these aforesaid

amendments for vote, providing further that

nothing herein shall be deemed or

interpreted or applied to abridge the

Landrum-Griffin's free speech right of any

IBT officer, delegate or member, including

the parties here to.

So that I think that language is clear

that the parties have a right to express

their opinion with respect to the election

=39-

and it's certainly clear that the

delegates have a right to vote.

And paragraph 9 B is clear that, if the

government does not like the outcome of the

vote, the remedies are specific as to what

they can do. And since your Honor has said

you were going to sit in Orlando, it seems

to me it even made the governmental

position even weaker. They have immediate

access, if they don't like the outcome, to

the court.

THE COURT: Is this a good time for me

to ask you the following question: I don't

find that the IBT has specifically disputed

the factual record presented by the

government that there are plans to

circumvent the direct election provisions

by arranging to vote out the Consent

Decree's constitutional change. And then I

would follow it up succinctly to ask you

~40—

and to give me a very clear answer: Does

the IBT dispute that some members of the

GEB intend to do what the government

alleged? Is that true?

MR. PIERCE: Let me answer your first

question about what we disputed, if I

understood that to be your first question.

THE COURT: Is my question clear?

MR. PIERCE: I thought the first

question is did we dispute the allegation

made by the United States that we're going

-- that an effort was underway to vote out

the procedures.

THE COURT: Will you answer my second

question?

MR. PIERCE: If you're asking me, sir,

if whether there are certain members on the

general executive board who say hold the

Opinion that they are going to vote out the

election, I cannot say that I have spoken

ng l=

to every member of the executive board so

that I Know that position.

THE COURT: That doesn't give me much

help. So I'll make my own finding on that,

Since I don't have a clear-cut answer, yes

or no.

MR. PIERCE: I don't Know that every

individual or I'm not going to represent to

the court that I Know what every individual

is --

THE COURT: Would you care to come to

the point on this issue, Mr. Grady?

MR. GRADY: If I may, your Honor, I'm

not aware of any single or combination of

people who have, in effect, formed a

political position that is going to be

ante-adoption of the Consent Decree.

THE COURT: That's about as helpful as

taking a shower with one' clothes on.

~~.

Can I get assurance from you that this

will not happen?

MR. GRADY: Their secret intentions I

am not aware of. Their express, explicit

statements, I would be aware of if they

appeared in the press or if they were made

a general executive board meeting or if the

general precedent was told by them. I am

not aware of any of those public kind of

statements that have been made. Their

secret intentions I don't know of, of

course.

MR. PIERCE: Your Honor, I was trying

to point out in Exhibit B to our papers an

article written by Mr. McCarthy, the last

two paragraphs of which I think come

directly to the point at least with respect

to Mr. McCarthy's position. This was

published in February of 1991. It states:

On another matter, I reiterate to the

~43~

membership, as I testified before the

United States Senate, that I intend to do

everything in my power to support the

provision of the consent order at the 1991

convention.

That was the point I thought that was

responsive to your question.

THE COURT: Now, do you wish to address

the government's argument on injunctive

relief?

MR. PIERCE: Yes, I do, your Honor.

To being with, I think that the regular

standards of Rule 65 apply, although they

are emanating from a different document.

That 1s to say we're looking at the

interpretation. The court has to look at

the interpretation and conclude,

considering the language of the Consent

Decree, whether the standards are

applicable. My view here is if one looks

—-44-

at the specific order, as Mr. Ferguson

asked for, if I reason back from the order

past the standard, his order is: Issue an

order saying the function of the convention

cannot be changed without court approval.

Well, your Honor, so far as we read the

document, the document says at the

convention the delegates can vote. I don't

see what change that the government is

asking for. I think this request isn't

specific enough.

If what Mr. Ferguson seems to be saying

is that the court should decide now that if

the delegates to the convention vote down

the amendments, what actions could be taken

or what the procedure will be thereafter, I

have these problems. First, I think that

violates a specific statute.

THE COURT: Is it fair to say that your

are willing to have this court, in this

-45-

context, interpret the constitution on

this point?

MR. PIERCE: Your Honor, we've never

challenged the jurisdiction of the court.

We have not challenged the jurisdiction of

the court with respect to the interpretation

THE COURT: Perhaps my question is less

articulate than I would wish it to be.

The language used for the relief sought

here is declaratory judgment. The

government has argued that that's what it

seems and I have said isn't that in the

nature of an application for

interpretation. And then they have gone on

further, in response to my more pointed

question, to establish the fact that even

pursuant to the criteria laid out in Kidder

Peabody, in a recent Second Circuit case,

they have alleged that they even meet that

—~46-

criteria, if they had to meet it. I

thought you said earlier that you agreed

that this is in effect, an application or

clarification and for interpretation of the

constitution. Isn't that what I thought

you said at one point?

MR. PIERCE: I thought that was

responsive to your question and I do

believe --

THE COURT: Do you agree that perhaps

it's desirable and may be very helpful for

both parties here to have some

understanding in advance of the convention

in June of this court's interpretation?

MR. PIERCE: No. I do not agree with

the statement.

THE COURT: I thought you would say

that.

~@ 7

MR. PIERCE: And I don't agree with

that statement because I don't think it's

necessary.

THE COURT: Whether it's necessary or

not, it's always good to have a package of

Band-Aids, isn't it?

MR. PIERCE: Your Honor, I think the

agreement makes it clear that the Band-Aids

exist --

THE COURT: I don't think so. I don't

think it's as easy as you would like to

have me believe.

MR. PIERCE: As I understand it, your

Honor, all the government has to do is make

application to the court by the conclusion

-- by not later than the conclusion of the

IBT convention.

THE COURT: I think this is an

appropriate application for interpretation

at the very least. I think even if I were

-—48-

to say to the government: Have you met

the criteria laid forth in Kidder-Peabody?

My finding would be yes, they have. So, I

don't think that's a problem that bothers

me further.

I have heard all the arguments. Is

there anything further that you wish to

address? Anything that I may have omitted?

MR. PIERCE: Not if you have already

reached a conclusion, your Honcr, I have

nothing else to say.

MR. FERGUSON: May I respond, your

THE COURT: Yes.

MR. FERGUSON: Mr. Pierce's argument on

behalf of the IBT was really a microcosm of

exactly what I was speaking about earlier,

which is the IBT's studied indifference and

ignorance of the future practices provision

of the decree. There was not a single time

“-49-

ajrmy

a |

during that presentation in which Mr.

Pierce even mentioned the words future

practices provision or paragraph 17.

We agree with the IBT that the question

of what the consent order means has to be

looked at by reading the consent order.

Where we part company with the IBT is

in our belief that one has to read the

entire consent order.

When the parties came before the court

on I believe it was March 13, 1989, and the

court identified certain difficulties it

had with the Consent Decree as drafted at

that point, this court sent the parties --

THE COURT: Two years ago?

MR. FERGUSON: Over two years ago now,

your Honor.

This court sent the parties back to

clarify the meaning of the Consent Decree.

This court considered the further

-50-

AINMD

173

submissions and drafting of the parties on

this issue and entered the decree. The

only conclusion one can draw from that is

that this court believed that those

clarifications had been provided.

It is quite simple to read the entire

Consent Decree with perfect consistency.

No inconsistency between any of the

provisions, no confusion, as Mr. Pierce

seems to indicate there may be in the

government's interpretation. But even if

there were confusion in how the decree

should be interpreted, that is precisely

why we are here, to ask the court to dispel

that confusion.

As I said before, the sequence of

events is clear. The Consent Decree has

been in effect since March 14, 1989. The

Consent Decree has been part of the IBT

constitution since March 14, 1989. Part of

-5l-

the IBT constitution, therefore, is

paragraph 17 of the Consent Decree, which

provides specifically that in the event the

IBT wishes to make any changes in the areas

covered by the decree it must seek the

prior approval of either the government or

this court.

When the convention occurs, the

delegates, pursuant to paragraph 9 B and

paragraph 12 D of the decree, will have the

right to vote their approval or disapproval

of those Consent Decree amendments.

In the event that they vote to

disapprove those amendments, matters do

not, as the IBT contends, revert to the way

they used to be. Rather, pursuant to the

future practices provision, if the IBT,

through its delegates has any alternatives

to the electoral procedures required by the

decree that it would like to suggest, the

-52-

150

government will be on hand to deal with

those suggestions.

But all the government seeks here is to

hold the IBT to the bargain it struck two

years ago, that is, to give the government

prior notice of any constitutional changes

that are contemplated either by the IBT

general executive board between conventions

or by the delegates at the convention.

I would like to touch briefly on the

notion that the government is squelching

anyone's free speech rights here.

THE COURT: Well, that's been raised.

MR. FERGUSON: That's been raised

certainly.

THE COURT: On more than one occasion.

MR. FERGUSON: There is certainly no

truth to that.

THE COURT: Also freedom of

association. That's been raised.

-53-

MR. FERGUSON: The delegates at this

convention will be able to associate,

assemble, vote, discuss, debate, however

robustly on any matters properly before the

convention under the IBT's own rules for

conventions. They will be free to vote on

any matters properly before the

convention. They will be free to vote on

the Consent Decree. They will be free to

exercise to the fullest their LMRDA rights

and any rights they have under law.

THE COURT: And come to this court. As

I said, and will reiterate, I will be

sitting in Orlando. I will also be

ph, ~ically present with my the staff at the

convention itself.

MR. FERGUSON: Any delegate feeling

aggrieved at the convention will be able to

have access to the court. The government

doesn't seek to squelch or suppress anyone

-—-54-

ee TT LT ee

i82

free speech rights. The government seeks

only the enforcement of the agreement to

which the IBT agreed two years ago. That

is the only reason we are here. We believe

that this issue should be addressed now in

order to allay any doubt about the matter

in the months running unto the convention.

THE COURT: I have even pressed for an

answer I think. Assuming that this is an

application for any injunction in the

customary conventional sense, I have even

digressed from that and ask you to state

for the record whether you can allege and

demonstrate what irreparable harm you would

suffer and I think you have done that.

Do you care to amplify the statement

you have made.

MR. FERGUSON: The irreparable harm the

government will suffer is the denial of the

agreement, of the effects and fruits of the

-55-

153

agreement which it obtained two years

ago. The irreparable harm will occur if

this convention does not go forward as

contemplated by the parties and if, rather,

it turns into something else and that

something else eliminates the rank and file

election in December of this year that is

the linchpin, the touchstone, the most

important single part of this decree. That

is irreparable harm.

Indeed, I thought it was quite telling

that the IBT cannot give this court any

assurance whatsoever that what the

government has laid out in its papers will

not occur at the convention. That speaks

volumes about the need for the court to

decide this matter right now before the

convention is thrown into disarray.

Even if your Honor is there on the

scene to deal with the situation, it is

-56-

iS4

much better for all concerned, and for the

implementation of the Consent Decree, and

ultimately for the membership in terms of

protecting their right to the rank and file

election December, that these matters be

dealt with up front so that no one is under

any illusions at the convention that they

can try to make an end-run around the

Consent Decree by the maneuver that the

government has described in its moving

papers.

THE COURT: Perhaps I ought to lend

some thought about that.

As I said, I will be physically present

at the convention and I don't think you

have any doubt, either side, that if there

was any need to apply right there and then

for a stay of any conduct that was

considered in contravention of this Consent

Decree, that I could immediately order a

-§7-

stay and call this convention, with

respect to any particular item, to a

complete halt and immediately repair to the

courthouse for argument.

MR. FERGUSON: And that is exactly

right, your Honor.

THE COURT: And I think it's important

for everybody to bear that in mind.

MR. FERGUSON: I'm sure the court has

that power and it would not hesitate to

exercise that power.

I am equally sure that if the IBT were

to be the subject of such an order by the

court the first place it would go would be

the United States Court of Appeals for the

Second Circuit.

THE COURT: Then I think under those

circumstances that I have no need or

occasion to exercise a stay by dealing with

the problem right here and now, which gives

-58-

tSo

everybody not only clarification, but

gives them an opportunity to take the

elevator up from here to the 17th floor.

MR. FERGUSON: Your Honor, the

government can't emphasize enough that this

convention takes place over a very

concentrated five-day period and it is very

difficult to obtain meaningful appellate

review in five days. That is why the

government is coming to this court now to

get this court's determination now on the

proper interpretation of the Consent

Decree, to get appropriate injunctive

relief to effectuate that interpretation

and if anyone is dissatisfied with the

court's ruling we have between now and the

beginning of convention in late June to

make our arguments to the Second Circuit.

THE COURT: Doesn't that make sense?

Certainly it's much easier if I view the

=89-

iS?

government's argument favorably and decide

that and give you your opportunity to go to

the 17th floor, rather than wait possibly

for a time when I may be constrained to

grant a stay. Whatever appeal would follow

from that would certainly not be -- is that

now the Fifth Circuit or the Eleventh

Circuit?

MR. FERGUSON: That would be the

Eleventh Circuit.

THE COURT: It's the Eleventh now, as a

result of the split-off. Certainty, you're

not going to be entertained by the Eleventh

Circuit, but you would have to come back to

New York in June.

So, don't you think, under all the

circumstances, that this is the time to

come to a decision? Think about it, and if

you really think hard about it, you might

even say, yes, judge, I think we want you

-60-

185

to rule on this matter now. Think about

it. Think of the alternative. I might

decide to say I'm going to wait,

particularly in view of a comment made in

the Grady-Nunn dialogue about

alternatives. You remember that language?

MR. FERGUSON: If your Honor is

referring to paragraph 9 B, where the

government reserves certain rights in the

event of a vote of disapproval, that's

correct. It gives the government the right

to I believe seek any action from the

court, including contempt, reopening the

litigation or enforcement of the order.

And really all we're seeking right now is

enforcement of the order as it's written.

We're seeking that relief now because

we believe the alternative should be

unacceptable to all parties and that is the

alternative of throwing this convention

-6l-

into chaos so that it might not be able to

complete its business within the time

allotted. There are going to be delegates

coming to this convention from all over the

country and Canada and the facility is only

available for a limited period of time. It

is simply imperative that by Friday, June

28, this convention have completed its

business and if a maneuver of the kind

described in the government's papers is

even -- even gets somewhat off the ground,

that possess a risk that the convention

will not be able to complete its business

and that is why it's appropriate for this

court to decide the matter now.

THE COURT: What do you think will

happen at the convention if the delegates

vote against the Consent Decree?

-—-62-

190 C-

MR. FERGUSON: Well, it's possible to

imagine a number of scenarios. Here is one

that troubles the government perhaps the

most.

THE COURT: Perhaps unpredictable.

MR. FERGUSON: It will be an

unpredictable event, no question about it.

One thing that can be predicted is that

although we now have a substantial amount

of competition, even on the general

executive board, we have two competing

slates. In essence, it is entirely

foreseeable that as the convention

approaches and the members of the general

executive board become more keenly aware of

the competition both between them and with

outsider slates that they are going to have

to face in the run up to the December

election, that the general executive board

members may, in keeping with timeless

-63-

Teamster tradition, cut some sort of deal

so that the Teamster members of the general

executive board will be able to have a

united front at the convention.

The delegates who will have gone to the

convention -- many of those delegates, at

least, will be supporters or pledged or

committed in some sense to the members of

the general executive board who have

declared for election here. If a united

general executive board can persuade the

delegates to vote against the Consent

Decree, the next thing that can occur is

Simply to revert to the old method of

electing the general executive board, that

is, by the votes of the assembled

delegates, thereby dispensing with the

December election. That is an entirely

foreseeable scenario.

-64-

It is precisely because of these kinds

of concerns, which are not hypothetical,

which have actually been voiced by none

other than, for instance, the number two

person in the union. It is precisely

because there is a movement of sorts out

there to scuttle the December election that

the government is coming here now.

Mr. Mathis, right now, just to pick one

example, is part of a slate that declares

itself, at least to the membership, to be

in favor of a rank and file election in

December. But when Mr. Mathis' audience is

different, i.e., the delegates to the

eastern conference convention, his message

is always somewhat different. He says he

doesn't see anything wrong with the old

method of proceeding. It's precisely that

kind of double talk that causes the

government a great deal of concern. It

-65-

193

causes the government to want to come to

the court now to get this matter clarified.

MR. PIERCE: Your Honor, may I be heard?

I suppose that Mr. Ferguson can

hypothesize anything he wants. But there

is, it seems to me, particularly since

we're talking about elections, the Consent

Decree sets up an apparatus and one of the

persons appointed under the Consent Decree

is the elections officer and before we go

off and listen to Mr. Ferguson hypothesize

about what the possibilities are, it seems

to me that the elections officer who has

had his ear to the ground, has been

instituting election procedures, who has a

staff, who has been dealing with 600 and

some odd locals, we ought to have something

here from the elections officer or somebody

who has been instituting part of the

electoral process, which in some respects

—-66-

194

Supports some of these hypotheses which

Ferguson is alleging.

I could allege different hypotheses of

what is going to occur. One thing is very

clear, that the very delegates that Mr.

Ferguson is using as the very basis of his

hypothesis were delegates which were

elected pursuant to a procedure established

under the Consent Decree and one assumes

that if democracy is to mean anything in

this union that the most significant

election has to be the election of the

Gelegates. After all, in the final

analysis, the slate or slates or persons

that the rank and file get to vote on under

the Consent Decree's conceived procedures

are the candidates or slates which were

chosen by the delegates who were elected

pursuant to the procedures instituted by

the elections officer.

Nothing has been said here about this

first stage of the procedure and nothing

has been offered here from the election

office in support of the various hypotheses

which have been offered here by Mr.

Ferguson.

At a minimum, if Mr. Ferguson claims we

ought to stay on the four squares of the

Consent Decree, and we ought to interpret

it and follow it, it seems to me at a

minimum we would have to have something

here from the very officer --

THE COURT: You may not see the

something here. I disagree with you. I

see something here. It may not be enough.

But I can't accept your high-flying

statement. Perhaps you don't see anything

at all. I do. I'm not saying that I see

enough yet. That requires further study.

I'm going to order each of you to submit

-6§8-

aD |

199

proposed findings of facts and conclusions

of law in one week and not one minute later

than that.

MR. PIERCE: May I say one thing, your

Honor.

THE COURT: You may say more than one

thing.

MR. PIERCE: I did not say there was

nothing here. I tried to be careful to say

that I make no statements respecting what

individuals will vote at the convention. I

did say here that I pointed out a specific

statement made by Mr. McCarthy and Mr.

Grady stated that he was not aware of any

concerted effort. But I'm not going to go

on record --

THE COURT: He did not more than say

that. That statement what is long, prolix

and very nedgy. |

-69-

197

If you are going to characterize his

statement, I suggest, in all fairness, that

you do it rulsomely. If find absolutely

nothing in that response that gives me any

comfort or assurance whatsoever.

MR. PIERCE: I do want to make it clear

that I am not [ ir

THE COURT: You were at least frank and

said you don't want to take a position

about that because you don't know and I

think that's probably correct. You don't

Know.

Do you want any further response?

MR. FERGUSON: Two points, your Honor.

a |

irst on the matter that the delegates who

were going to be at the convention are

elected pursuant to the Consent Decree,

that of course is true. That is a matter

of some importance and, you know, we

198

fervently hope that the delegates at the

convention will approve the Consent Decree.

However, as this court is aware, a

democracy in the Teamsters Union is not

something that happens with the snap of

one's fingers and it is going to be quite

awhile before I think this union is fully

restored to a democratic footing.

One further point on that: The

Function of the delegates -- and I would

disagree with counsel with respect to his

assertion that the delegate elections are

the most important here. The function of

the delegates is the limited one of

nominating candidates for international

union office at the convention. That

nomination requires only a very low

threshold of five percent of the

delegates. The main event here is the rank

and file election in December and it is the

Ji.

199

desire to preserve the vitality and the

existence of that main event that the

government is seeking this relief here.

Secondly, with respect to the election

officer, I can represent to the court that

an application by the government has the

full support of the election officer.

THE COURT: I have asked you to submit

findings of facts and conclusions of law.

Perhaps in the serene environment of your

office, if you look at all the options and

alternatives and if you look at all that

may happen at the convention itself, you

may decide that it is in the best interests

for all concerned to get this matter

resolved now, here, in the Souther

District, rather than in the Eleventh

Circuit.

So, I want you all to prepare

yourselves for my presence in Orlando.

000000

~F2-

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

----------- x

UNITED STATES OF AMERICA,

Plaintiff,

Vv. 88 Civ. 4486(DNE)

INTERNATIONAL BROTHERHOOD OF

TEAMSTERS, CHAUFFEURS,

WAREHOUSEMEN AND HELPERS OF

AMERICA, AFL-CIO, et al.,

Defendants.

March 14, 1989

10:30 a.m.

Before:

HON. DAVID N. EDELSTEIN,

District Judge

(In the robing room)

201

THE COURT: There are a number of

issues that are unclear on the face of the

proposed settlement, stipulation and

order. I touched on it briefiy, but now I

am going to deal with it in depth.

Do you have the proposed order and

settlement with you?

MR. MASTRO: Yes, your Honor.

THE COURT: Do you, too, Mr.

Rakoff£?

MR. RAKOFF: Yes, your Honor.

THE COURT: Section F of the

agreement, Paragraph 12, --

SOUTHERN D.STRICT REPORTERS 212-791-1020

Tell me when you have it.

MR. MASTRO: I have it, your Honor.

THE COURT: -- provides for the

appointment of three officers. The

agreement leaves the time frame for the

proposal of officers undefined. Perhaps

eN2

this is desirable in order to eliminate

time pressures in the selection process.

On the other hand, it might be useful to

provide an outside date for the proposal of

names, tempered with a provision for an

extension of that time for good cause

shown. It is clear, until those officers

are in place to that extent, this decree is

not in place.

It also leaves unclear the Court's

responsibility with respect to the

appointment of these officers. Does the

Court have an obligation to independently

scrutinize the proposed officers, or is my

role limited to ratifying the decision of

the parties; in other words, rubber

stamping them? This would not be

acceptable to me.

Section K, Paragraph 16 and

Section M, Paragraph 18, seem to contain

—-3-

293

some ambiguity with respect to the Court's

jurisdiction, which, if not clarified,

might create some problems in the future.

I mentioned that yesterday when I spoke to

you on the telephone.

Paragraph 16 appears to give

jurisdiction to this Court with respect to

“any future applications by the

administrator or the parties”.

Paragraph 18 provides that the IBT

may seek a determination from any court of

competent jurisdiction as to whether future

changes in the IBT constitution are in

harmony with this agreement.

Are you with me?

MR. MASTRO: Yes, your Honor.

THE COURT: On Page 15, the last

paragraph contains a confusing clause. It

provides that the provisions of this

agreement amending the IBT constitution as

—4-

204

to election procedures, "shall be

presented," to the 1991 international

convention for a vote. However, Section D,

the preface to the election reforms

provisions provides that "The IBT

constitution shall be deemed amended, and

is hereby amended, to provide for the

following new election procedures." These

two provisions seem inconsistent on their

face.

Finally, the next one is simple.

There is the question of a prior orders

entered in this case, and particularly the

status quo order, first incorporated in the

order to show cause of June 28, 1988, and

extended after the first hearing. Although

it would appear that the settlement order

would supersede all prior orders, perhaps

an explicit statement to that effect would

be appropriate, particularly in light of

~F-

the open question regarding reimbursement

for individual officers attorney's fees.

MR. MASTRO: Would you want us to

comment at this point?

THE COURT: I have no priority. I

want to hear from both of you. Until these

clarifications are explained, I will not

sign this order.

MR. RAKOFF: Your Honor, one of

these I think we can deal with very

quickly, because we had previously

discussed it, and I'm sure we can put in

some language, if necessary.

THE COURT: Keep your voice up.

MR. RAKOFF: That's the one

regarding the appointments of the three

officers, both in terms of time and your

Honor's scrutiny. Certainly, we will need

some time, and I agree with your Honor,

that obviously this whole operation doesn't

—-6--

20d

take effect until the officers are

presented to your Honor and approved by

your Honor.

It would be -- we had talked

yesterday of an initial period of three

weeks, during which we would get tog

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