Joint Appendix — Mohawk Industries, Inc. v. Williams

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| FEB 2 ~ 2006

No. 05-465 LSPP IH OF THE CLL im

IN THE

Supreme Court of the United States

MOHAWK INDUSTRIES, INC.,

Petitioner,

Vv.

SHIRLEY WILLIAMS, GALE PELFREY,

BONNIE JONES, AND LORA SISSON,

individually and on behalf of a class,

Respondents.

On Writ of Certiorari to the United States

Court of Appeals for the Eleventh Circuit

JOINT APPENDIX

__ CARTER G. PHILLIPS* HOWARD W. FOSTER*

JUAN P. MORILLO JOHNSON & BELL, LTD.

STEVEN T. COTTREAU 33 West Monroe Street

JULIE A. GURLEY Suite 2700

MATTHEW J. WARREN Chicago, Illinois 60603

JIMMY R. ROCK (312)-372-0770

SIDLEY AUSTIN LLP

1501 K Street, NW

Washington, DC 20005

(202) 736-8000

-—€eunsel for Petitioner Counsel for Respondents

February 2, 2006 * Counsel of Record

{Additional Counsel Listed on Inside Cover]

I

PETITION FOR CERTIORARI FILED OCTOBER 7, 2005

CERTIORARI GRANTED DECEMBER 12, 2005

BosBy LEE COOK MATTHEW THAMES

CooK & CONNELLY GODDARD, THAMES,

9899 Commerce Street HAMMONTREE & BOLDING

P.O. Box 370 2716 Cleveland Highway

Summerville, GA 30747 P.O. Box 399

(706) 857-3421 Dalton, GA 30722-0399

(706) 278-0464

JOHN E. FLOYD

JOSHUA F. THORPE

RONAN P. DOHERTY

NICOLE G. IANNARONE

BONDURANT, MIXSON &

ELMORE, LLP

3900 One Atlantic Center

1201 Peachtree Street

Atlanta, GA 30309

(404) 881-4100

Counsel for Respondents

TABLE OF CONTENTS

Page

United States District Court, Northern District of

Georgia, Relevant Docket Entries ...............:c0see008 |

United States Court of Appeals, Eleventh Circuit,

ROMS Va DOCKSt EMTICS .....cccscesccsescsscssscossssoseccoseesee 5

Complaint, Williams v. Mohawk Inds., Inc., No.

4:04-CV-0003-HLM (N.D. Ga. filed Jan. 6,

ees cnencnsniaiieniebedsaiitiviinnaipapeiniusiaiasinibiniinatitnniienmstieaieiiitin 7

NOTICE

The following documents have been omitted in the printing of

this Joint Appendix. They may be found in the Petitioner’s

Appendix to the 05-465 Petition For A Writ Of Certiorari at

the following pages.

Williams v. Mohawk Inds., Inc., 411 F.3d 1252

se SEE FERDIUPPSRSRES RP rap ane meres SO eee la-23a

Williams v. Mohawk Inds., Inc., 314 F. Supp. 2d

SUP Ge CRU, GIP ID crncosenenssanientennavsimenmmnsvenees 24a-61a

—

Williams v. Mohawk Inds., Inc., No. 4:04-CV-

Q003-HLM (N.D. Ga. Aug. 18, 2005) (order

EE GRIND secccrsccnetrssenisnvitnnrissesneinninin 62a-66a

Williams v. Mohawk Inds., Inc., No. 04-90017-B

(11th Cir. July 28, 2004) (order granting petition

for interlocutory appeal) ............ccceeeeeeeeseeeeseeeeeeees 67a

Williams v. Mohawk Inds., Inc., No. 4:04-CV-

0003-HLM (N.D. Ga. May 27, 2004) (order

certifying case for interlocutory appeal)............. 68a-72a

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF GEORGIA

4:04-cv-00003

SHIRLEY WILLIAMS, GALE PELFREY, BONNIE JONES and

LORA SISSON, individually and on behalf of a class,

Plaintiffs,

versus

MOHAWK INDUSTRIES, INC.,

Defendant.

RELEVANT DOCKET ENTRIES

DATE NO.

PROCEEDINGS

01/06/2004 |

04/12/2004 44

COMPLAINT filed and summons(es)

issued. Consent form to proceed before U.S.

magistrate and pretrial instructions given to

attorney; jury demand; FILING FEE $

150.00; RECEIPT # 364113 (jta) (Entered:

01/06/2004)

* * * *

ORDER by Judge Harold L. Murphy:

GRANTING IN PART AND DENYING IN

PART [25-1] motion to dismiss action by

Mohawk; specifically, the Court DENIES

deft’s motion to dismiss as to all Federal

and Georgia RICO allegations in plas’

complaint, DENIES deft’s motion to

dismiss as to plas’ unjust enrichment claim

as it relates to deft’s wage savings in

employing plas at a diminished wage rate,

and GRANTS deft's motion to dismiss as to

plas’ unjust respect to worker's compensa-

tion claims. (cc) (bjj) (Entered: 04/12/2004)

2

DATE NO.

PROCEEDINGS

* * * *

04/23/2004 46 MOTION by deft Mohawk Industries to

05/07/2004 51

05/07/2004 —

05/24/2004 56

05/27/2004 58

amend [44-1] order of the Court re deft’s

motion to dismiss to permit interlocutory

appeal and for stay of discovery with Memo

of Law in support. (bjj) (Entered:

04/23/2004)

* * * *

Response by: plaintiffs to deft’s [46-1]

motion to amend [44-1] order of the Court

re deft’s motion to dismiss to permit inter-

locutory appeal and for stay of discovery.

(bjj) (Entered: 05/07/2004)

SUBMITTED to Judge Harold L. Murphy

on deft’s [46-1] motion to amend [44-1]

order of the Court re deft’s motion to

dismiss to permit interlocutory appeal and

for stay of discovery, with plas’ [51-1]

response. (bjj) (Entered: 05/07/2004)

x* * * *

Reply by deft Mohawk Industries in support

of its [46-1] motion to amend [44-1] order

of the Court re deft’s motion to dismiss to

permit interlocutory appeal and for stay of

discovery. (bjj) (Entered: 05/24/2004)

* * * *

ORDER by Judge Harold L. Murphy:

GRANTING deft’s [46-1] motion to amend

[44-1] Order of the Court re deft’s motion to

dismiss to permit interlocutory appeal and

for stay of discovery w/out prejudice as to

issues re Class certification until the Elev-

DATE NO.

3

PROCEEDINGS

08/04/2004 59

08/04/2004

07/29/2005 61

08/11/2005 62

08/15/2005 63

enth Circuit disposes of the interlocutory

appeal; the Court AMENDS the April 12th,

2004 Order to provide that deft may seek

interlocutory review of said Order pursuant

to 28 U.S.C.A. Section 1292(b). (cc) (bij)

(Entered: 05/27/2004)

COPY OF ORDER from USCA GRANT-

ING permission to Appeal pursuant to 28

U.S.C. 1292(b). USCA #04-90017-B (bj)

(Entered: 08/06/2004)

NOTICE OF INTERLOCUTORY APPEAL

by dft as to 59 order by USCA granting

permission to appeal pursuant to 28 U.S.C.

1292(b). Filing fee $255, receipt number

364523. Transcript Order Form due on

8/18/2004 (bj) (Entered: 08/06/2004)

* * * *

MOTION to Lift the Stay of Discovery 58

Order, with Brief In Support by Shirley

Williams, Gale Pelfrey, Bonnie Jones,

Lora Sisson. (Attachments: #1 Exhibit A# 2

Exhibit B)(Thorpe, Joshua) (Entered:

07/29/2005)

MOTION for Order—Detendant’s Motion

to Continue the Stay of Discovery Pending

lis Petition for Certiorari with Brief In

Support by Mohawk Industries, Inc.,

(Attachments: #1)(Cannon, R.) (Entered:

08/11/2005)

RESPONSE in Opposition re 62 MOTION

for Order—Defendant’s Motion to Continue

the Stay of Discovery Pending Its Petition

4

DATE NO.

PROCEEDINGS

08/18/2005 67

08/18/2005 68

for Certiorari filed by Shirley Williams,

Gale Pelfrey, Bonnie Jones, Lora Sisson.

(Thorpe, Joshua) (Entered: 08/15/2005)

* * * *

REPLY to Response to Motion re 62

MOTION for Order—Defendant’s Motion

to Continue the Stay of Discovery Pending

Its Petition for Certiorari—Defendant’s

Reply in Support of Its Motion to Continue

the Stay of Discovery Pending Its Petition

for Certiorari filed by Mohawk Industries,

Inc., (Cannon, R.) (Entered: 08/18/2005)

ORDER denying as moot Plaintiffs’ 61

Motion to Lift the Stay of Discovery and

granting Deft Mohawk Industries, Inc.'s 62

Motion to Continue the Stay of Discovery

pending its Petition for Certiorari. The

Court STAYS discovery in this case until

the Supreme Court either (a) denies Deft’s

petition for a writ of certiorari or (b) decides

the case on the merits after granting Deft's

pettion. Signed by Judge Harold L. Murphy

on 8/18/05. (bjj) (Entered: 08/19/2005)

* * * *

5

UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

04-9000 17-B

04-13740-AA

SHIRLEY WILLIAMS, GALE PELFREY, BONNIE JONES and

LORA SISSON, individually and on behalf of a class,

Plaintiffs-Appellees,

versus

MOHAWK INDUSTRIES, INC.,

Defendant-Appellant.

RELEVANT DOCKET ENTRIES

DATE PROCEEDINGS PARTY PENDING

07/28/2004 Probable Jurisdiction Mohawk No

Noted: Industries

Inc.

* * * *

06/09/2005 Judgment Entered No

* * * *

06/09/2005 Opinion Issued No

AFFIRMED IN

PT/REVERSED IN

PT/& REMANDED.

x* * * *

DATE

6

PROCEEDINGS

PARTY PENDING

08/08/2005

08/16/2005

10/17/2005

12/27/2005

The Petition(s) for Re-

hearing are DENIED

and no Judge in regular

active service on the

Court having requested

that the Court be polled

on rehearing en banc,

the Petition(s) for Re-

hearing En Banc are

DENIED.

* * * *

CASE CLOSED-Man-

date Issued

x* * * *

Notice of Filing Certio-

rari: 05-465 (Atty: Ste-

ven T. Cottreau)

x* * * *

Certiorari Granted lim-

ited to Question | (SC#

05-165):

x * * *

No

No

Mohawk No

Industries

Inc.

Mohawk No

Industries

Inc.

7

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF GEORGIA

ROME DIVISION

{Filed Jan. 5, 2004]

Civil Action File No. 4 04-CV-03

Complaint—Class Action

SHIRLEY WILLIAMS, GALE PELFREY, BONNIE JONES and

LORA SISSON, individually and on behalf of a class,

Plaintiffs,

VS.

MOHAWK INDUSTRIES, INC.,

Defendant.

COMPLAINT

Plaintiffs Shirley Williams (“Williams”), Gale Pelfrey

(“Pelfrey”), Bonnie Jones (“Jones”) and Lora Sisson (“Sis-

son”), individually and on behalf of a class, bring this action

against Defendant Mohawk Industries, Inc. (“Mohawk”):

I. SUMMARY OF CLAIMS

l.

This is a class action under the federal and Georgia

Racketeer Influenced and Corrupt Organizations (“RICO”)

acts. The members of the class are current and former hourly

employees of Mohawk whose wages have been depressed by

Mohawk’'s employment and harboring of large numbers of

illegal workers. Plaintiffs seek injunctive and monetary relief

on behalf of Mohawk’s legally-employed hourly workers

in Georgia.

8

2.

Mohawk is the second largest carpet and rug manufacturer

in the United States. In 2002, its carpet and rug net sales were

approximately $3.2 billion. Mohawk employs approximately

31,780 persons, most of whom are employed in Northwest

Georgia. Mohawk owns or leases at least twenty-six facilities

in Georgia.

3.

Mohawk has, in its Georgia facilities, engaged in the wide-

spread employment of illegal workers, j.e., workers who are

not authorized to be employed in the United States. By

employing and harboring illegal workers, Mohawk is able to

reduce labor costs by depressing wages for its hourly workers

and discouraging claims for workers compensation.

4.

Mohawk’s conduct violates the federal Racketeer Influ-

enced and Corrupt Organizations Act, 18 U.S.C. § 1961 ef

seq. (“federal RICO”), and Georgia’s Racketeer Influenced

and Corrupt Organizations Act, O.C.G.A. § 16-14-1 ef seg.

(“Georgia RICO”), as more fully set forth below.

Il. PARTIES, JURISDICTION AND VENUE

5.

Plaintiff Gale Pelfrey is a citizen of Georgia and resides in

the Northern District of Georgia. She is eligible to be em-

ployed in the United States and is a former hourly employee

of Mohawk.

6.

Plaintiff Shirley Williams is a citizen of Georgia and

resides in the Northern District of Georgia. She is eligible to

be employed in the United States and is a former hourly

employee of Mohawk.

9

7.

Plaintiff Bonnie Jones is a citizen of Georgia and resides in

the Northern District of Georgia. She is eligible to be em-

ployed in the United States and is a current hourly employee

of Mohawk.

8.

Plaintiff Lora Sisson is a citizen of Georgia and resides in

the Northern District of Georgia. She is eligible to be em-

ployed in the United States and is a former hourly employee

of Mohawk.

9.

Defendant Mohawk is a Delaware corporation with its

principal place of business in Calhoun, Georgia. Mohawk

may be served by service on its registered agent for service of

process, Salvatore J. Perillo, Post Office Box 12069, South

Industrial Boulevard, Calhoun, Georgia 30703.

10.

Mohawk is subject to the personal jurisdiction of this

Court.

This Court has subject matter jurisdiction over this case

pursuant to 18 U.S.C. § 1964(c), 28 U.S.C. § 1332 (federal

question) and 28 U.S.C. § 1367 (ancillary jurisdiction).

12.

Venue is proper in this district, pursuant to 28 U.S.C.

§ 1391(b), as Mohawk resides in this district and events

giving rise io Plaintiffs’ claims occurred in this district.

Venue is also proper in this district pursuant to 18 U.S.C.

§ 1965, as Mohawk resides, is found in and transacts its

affairs in the Northern District of Georgia.

10

Ill. FACTS

Mohawk’ s Hiring and Harboring of Illegal Workers

13.

Mohawk employs many thousands of hourly paid workers

in its operations in North Georgia.

14.

In an effort to keep labor costs as low as possible, Mohawk

has engaged in the illegal hiring of persons who are not

eligible for employment in the United States.

15,

Mohawk has accepted for employment and continued to

employ workers that it knew or had reason to know were not

authorized to work in the United States.

16.

Mohawk has knowingly and recklessly accepted as proof

of eligibility for employment false documents or documents

that do not match the identity of the person presenting them.

For example, Mohawk has accepted drivers’ licenses and

other documents that obviously depict a person different than

the person presenting the document as proof of eligibility for

employment.

17.

Mohawk also has knowingly and recklessly accepted as

proof of eligibility for employment documents that reflect

successive different names for a single person. Indeed,

Mohawk frequently employs illegal workers who (a) first

present eligibility documents that reflect one name, (b) work

at Mohawk for some period of time, (c) leave their jobs at

Mohawk, and then (d) return to work at Mohawk and present

Mohawk with identification and work cligibility documents

showing a different name.

II

18.

In some instances, when illegal workers have informed

Mohawk that they would return to their countries of origin,

Mohawk supervisors have encouraged these employees to

return to the United States and reapply for work at Mohawk

in violation of United States law.

19.

Although Mohawk was and is aware that numerous em-

ployees have used or are using identities different from those

they had previously used while employed at Mohawk,

Mohawk has accepted and continues to accept new iden-

tification and work authorization documents that it knew or

had reason to know were false or obtained by false statements

from these persons.

es

Mohawk employees and/or supervisors have destroyed eli-

gibility documents showing that workers have used differ-

ent names and identification papers in an effort to conceal

Mohawk’s employment and harboring of illegal workers.

21.

Mohawk employees and supervisors have stated that they

are aware that illegal workers can easily obtain false iden-

tification and work authorization documents.

22.

Mohawk employees have traveled to the United States

border, including areas near Brownsville, Texas, to recruit

undocumented aliens that recently have entered the United

States in violation of federal law. These employees and other

persons have transported undocumented aliens from these

border towns to North Georgia so that those aliens may

procure employment at Mohawk. Mohawk has made various

12

incentive payments to employees and other recruiters for lo-

cating workers that Mohawk eventually employs and harbors.

23.

Various recruiters, including Mohawk employees, have

provided housing to these illegal workers upon their arrival in

North Georgia and have helped them find illegal employment

with Mohawk.

24.

Mohawk has conducted occasional audits of its workforce

and discovered numerous illegal workers within that work-

force. Although these infrequent audits often confirm the

presence of large numbers of illegal workers and therefore

put Mohawk on further notice that it is employing and harbor-

ing illegal workers, Mohawk has not increased the frequency

of these audits.

25.

Even when Mohawk terminates illegal workers after dis-

covering that they are not authorized to work in the United

States, many of those discharged illegal workers soon return

to work at Mohawk under different names. For example,

earlier this year, Mohawk discharged three employees that

Mohawk had discovered to be illegally working in one of its

facilities. Within two months after their discharge, Mohawk

re-hired these same employees under different names to work

on different shifts in the same facility.

26.

This practice of “recycling” illegal workers is widespread

at Mohawk.

27.

Law enforcement personnel have raided Mohawk facilities

in pursuit of undocumented aliens. On some of these occa-

sions, tlegal workers have hidden in barrels or other con-

13

tainers or run from the facilities being raided. This conduct

has put Mohawk on further notice of the presence of large

numbers of illegal workers in its workforce.

28.

Mohawk employees and supervisors have assisted illegal

workers in attempting to evade detection by law enforcement

personnel.

29.

Law enforcement authorities have arrested illegal workers

at Mohawk facilities.

30.

Law enforcement authorities have found undocumented

aliens in possession of Mohawk paychecks or identification

badges and fraudulent identification documents.

31.

Mohawk supervisors have stated that they prefer hiring

illegal workers because they do not complain about working

conditions or submit claims for workers’ compensation.

32.

Because illegal workers typically have no intention of

filing federal tax returns, many illegal workers inflate their

claimed exemptions to attempt to avoid withholding taxes.

Many of Mohawk’s illegal workers have intiated their

claimed exemptions to avoid federal income tax withholding.

This conduct has further put Mohawk on notice that large

numbers of its workforce are not authorized for employment

in the United States.

33.

Mohawk’s employment and harboring of large numbers of

illegal workers has enabled Mohawk to depress wages and

thereby to pay all of its hourly employees, including legally

14

employed workers who are members of the class, wages that

are lower than they would be if Mohawk did not engage in

this illegal conduct.

34.

Mohawk is the second largest carpet manufacturer in the

United States and one of the largest employers in North

Georgia. Mohawk employs tens of thousands of hourly work-

ers in North Georgia.

35.

Mohawk’s widespread employment and harboring of ille-

gal workers has substantially and unlawfully increased the

supply of workers from which Mohawk makes up its hourly

workforce. This unlawful expansion of the labor pool has

permitted Mohawk to depress the wages that it pays all its

hourly employees, including the Plaintiffs and all Class

members. If Mohawk had complied with the law by limiting

its hourly workforce to those workers authorized to work in

the United States, Mohawk would have had to pay higher

wages to the Plaintiffs and the members of the Class.

36.

One purpose and intended effect of Mohawk’s widespread

employment and harboring of illegal workers is to deprive

Mohawk’s hourly workforce of any individual or collective

bargaining power. Because Mohawk knows that many of its

workers are not authorized to reside or work in the United

States, Mohawk knows that those illegal workers are be-

holden to Mohawk. Mohawk is further aware that its un-

documented workers have virtually no effective means to

complain about the terms of their employment.

37.

Mohawk also is aware that its illegal employees are un-

likely to file worker’s compensation claims against Mohawk.

As a direct and proximate result of Mohawk’s employment

15

and harboring of illegal workers, Mohawk has been able to

save substantial sums of money in worker’s compensation

liability that it would have incurred if it had not violated

the law.

38.

As a direct and proximate result of Mohawk’s employment

and harboring of illegal workers, Plaintiffs and all members

of the Class have earned wages below the wages they would

have earned if Mohawk had complied with the law.

IV. CLASS ACTION ALLEGATIONS

39.

Plaintiffs bring this action on behalf of all persons legally

authorized to be employed in the United States who are or

have been employed by Mohawk in hourly wage positions in

Georgia at any time from January 5, 1999 to the present

(the “Class”). The “Class Period” is from January 5, 1999 to

the present.

40.

The Class is so numerous that joinder of all Class members

is impracticable. Plaintiffs believe the Class contains many

thousands of members, and the actual number of Class mem-

bers can be ascertained through discovery.

4}.

There are numerous questions of law and fact common to

the Class. Those questions include, but are not limited to:

a. How many persons who are not authorized to be

employed in the United States has Mohawk employed

in hourly wage positions during the Class Period?

b. Has Mohawk knowingly or with reckless disregard

employed workers who are not authorized for employ-

ment in the United States during the Class Period?

16

c. Has Mohawk knowingly or recklessly harbored undoc-

umented aliens in the United States in violation of

federal law during the Class Period?

d. To what extent has Mohawk’s employment and har-

boring of persons who are not authorized to be em-

ployed in the United States in hourly wage positions

depressed the wages Mohawk provides to legal hourly

employees?

e. Is Mohawk part of an “enterprise” under the federal

RICO statute? and

f. Has Mohawk engaged in a pattern of racketeering

activity under the federal RICO statute or acquired and

maintained and [sic] interest in a pattern of racketeering

activity under the Georgia RICO statute?

42.

The claims of the Plaintiffs are typical of the claims of the

Class. Plaintiffs are or were hourly workers whose wages

have been depressed by Mohawk’s employment and _ har-

boring of illegal workers. Plaintiffs have no interests that are

antagonistic or adverse to the other Class members.

43.

Plaintiffs were injured by direct and proximate reason of

Mohawk’s illegal conduct.

44,

Plaintiffs will fairly and adequately protect the interests of

the class.

45.

Plaintiffs are adequate representatives of the Class. Plain-

tiffs are each authorized for employment in the United States

and are or were hourly Mohawk workers, whose wages have

been depressed by Mohawk’s employment and harboring of

17

illegal workers. Plaintiffs have retained counsel that are

experienced in class action litigation, RICO litigation and

complex litigation. Accordingly, Plaintiffs wil fairly and

adequately protect and represent the interests of the Class.

46.

Plaintiffs seek certification of a class, alternatively, under

Fed. R. Civ. P. 23(b) (2) or 23(b) (3), or a combination

thereof.

47.

Mohawk’s employment and harboring of illegal workers

has the effect of depressing wages and benefits to the

detriment of all members of the Class. Accordingly, declar-

atory and injunctive relief that prevents Mohawk from con-

tinuing to employ or harbor illegal workers is appropriate on

a class wide basis.

48.

The questions of law and fact common to all members of

the Class predominate over any questions that may affect

only individual members of the Class.

49.

A class acon is a superior method of adjudicating the

Class members* claims because individual actions would un-

necessarily burden the Court and create the risk of inconsis-

tent results,

50.

Given the significant expense required to prosecute the

foregoing claims against Mohawk, the costs of individual

actions would exceed or consume the amount recovered in

any individual action. The expense of pursuing individual

actions will require individual members of the Class to forego

their individual claims against Mohawk if they are not

permitted to pursue those claims as a Class.

18

Sl.

Plaintiffs are not aware of any litigation concerning this

controversy that has already been initiated by or against any

members of the Class.

$2.

Because both Mohawk and the large majority of the Class

members reside in this district and many of the events giving

rise to this action took place in this district, it is both desirable

and efficient to concentrate the litigation of these claims in

this particular forum.

53.

This action is manageable because the evidence proving

that Mohawk is engaging in the alleged conduct is common to

the Class. Furthermore, the identities of the Class members

are known to Mohawk.

V. MOHAWK HAS ENGAGED IN A PATTERN

OF RACKETEERING ACTIVITY

54.

Mohawk Is engaged in an ongoing pattern of racketeering

activity as defined by 18 U.S.C. § 1961(5).

55.

The federal RICO pattern of racketeering activity engaged

in by Mohawk consists of more than two acts of racketeering

activity, the most recent of which occurred within ten years

after the commission of a prior act of racketeering activity.

56.

Mohawk ts engaged in an ongoing pattern of racketeering

activity as defined by O.C.G.A. § 16-14-3(8).

19

57.

The Georgia RICO pattern of racketeering activity engaged

in by Mohawk consists of more than two acts of racketeering

activity, the most recent of which occurred within four years

after the commission of a prior act of racketeering activity.

58.

For purposes of federal RICO, the racketeering activity

includes an open and ongoing pattern of violations of Sec-

tion 274 of the Immigration and Nationality Act, 8 U.S.C.

§ 1324(a).

59.

Specifically Mohawk has violated and continues to violate

8 U.S.C. § 1324(a)(3)(A), which makes it a federal crime to:

“knowingly hire{| for employment at least 10 individuals with

actual knowledge that the individuals are aliens . . .” during a

12 month period. Mohawk has violated this provision of the

Act, including by employing more than 10 aliens per year

each year for the last four years, knowing that each such

person was (a) smuggled or otherwise brought into the United

States in violation of U.S. law; (b) illegally harbored once in

the United States; (c) not lawfully admitted to the United

States for permanent residence; and/or (d) not authorized for

employment in the United States.

60.

Mohawk has also violated and continues to violate 8

U.S.C. § 1324(a)(1 (AG), which makes it a federal crime to

“conceal,|], harbor{|] or shield from detection, or attempt| | to

conceal, harbor or shield trom detection . . .~ aliens who have

entered the U.S. illegally. Mohawk has violated this provision

by (a) knowingly employing illegal alicns within its factories,

warehouses and other facilities in Georgia and/or (b) taking

steps to shield those illegal aliens trom detection, by, among

other things, helping them evade detection during law en-

forcement searches and inspections.

20

61.

Furthermore, Mohawk has also violated and continues to

violate 8 U.S.C. § 1324(a)(1)(A)iv), which prohibits any per-

son or entity from “encourag|ing] or induc[ing] an alien te

come to, enter, or reside in the United States, knowing or in

reckless disregard of the fact that such coming to, entry, or

residence is or will be in violation of law[{.]” By knowingly or

recklessly employing and harboring undocumented aliens in

its Georgia facilities, Mohawk has helped hundreds of aliens

to avoid detection and enabled them to remain in the United

States in violation of U.S. law. And by successively hiring

and employing the same undocumented aliens under different

names and accepting false identification and work author-

ization documents that reflect different identities for these

aliens, Mohawk has knowingly or recklessly encouraged any

undocumented aliens that are discovered to return to the

United States and to their employment at Mohawk in vio-

lation of United States law.

62.

Each violation of 8 U.S.C. § 1324 constitutes an act of

“racketeering activity” under the federal Racketeer Influenced

and Corrupt Organizations Act, 18 U.S.C. § 1961(F).

63.

For purposes of both federal and Georgia RICO, the rac-

keteering activity also includes open and ongoing violations

of 18 U.S.C. § 1546(a). including Mohawk’s acceptance of

identification documents and other documents that authorize

employment in the United States that Mohawk knew or had

reason to know were not lawfully issued for the bearer’s use,

were false and/or were obtained-y-false statements.

64.

Mohawk has also violated and continues to violate 18

U.S.C. § 1546(b) by using identification documents that Mo-

21

hawk knew or had reason to know were false and/or not

lawfully issued to the bearer to falsely verify the cligibility of

the persons presenting them to work at Mohawk, and re-

cording information from those documents on 1-9 forms.

65.

Each violation of 18 U.S.C. § 1546 constitutes “racket-

eering activity” under the federal Racketeer Influenced and

Corrupt Organizations Act, 18 U.S.C. § 1961(B).

66.

Each violation of 18 U.S.C. § 1546 also constitutes “rack-

eteering activity” under the Georgia Racketeer Influenced and

Corrupt Organizations Act. O.C.G.A. § 16-14-3(9 A)(xxix).

The Acts. of Racketeering Activity Committed

hy Mohawk Are Related

67.

The acts of racketeering activity committed by Mohawk

have the same or similar methods of commission in that they

involve the knowing employment of illegal workers, the con-

cealment, harboring and shielding from detection of illegal

workers, and the acceptance or use of fraudulent documents

in connection with the hiring of illegal workers.

68.

The acts of racketeering activity committed by Mohawk

have the same or similar objective: the reduction of wages

paid to Mohawk’s hourly workforce.

69.

The acts of racketeering activity committed by Mohawk

have the same or similar victims, including the plaintiffs and

the other members of the Class.

22

70.

The acts of racketeering activity committed by Mohawk

are otherwise related by distinguishing characteristics includ-

ing, but not limited to, the involvement of Mohawk, illegal

workers, and other members of the association-in-fact enter-

prise identified in paragraphs 76-84.

The Acts of Racketeering Activity Committed by Mohawk

Involve a Distinct Threat of Long-Term Racketeering Activity

71.

Mohawk’s acts of racketeering activity involve a distinct

threat of long-term racketeering activity.

72.

Mohawk’s practice of knowingly employing, harboring,

concealing and shielding illegal workers and Mohawk’s ac-

ceptance and use of documents that are not lawfully issued

for the use of the possessor or are false has continued for

years, is ongoing at the present time and will continue into the

future unless halted by judicial intervention.

73.

Mohawk’s knowing employment, harboring, concealing

and shielding of illegal workers and its acceptance and use of

documents that are not lawfully issued for the use of the

possessor or are false is part of its regular way of conducting

business,

74.

Mohawk has committed hundreds, and probably thousands,

of violations of 8 U.S.C. § 1324 and 18 U.S.C. § 1546 as part

of its pattern of racketeering activity.

75.

Mohawk’'s knowing employment, harboring, concealing

und shielding of illegal workers and its acceptance and use of

23

documents that are not lawfully issued for the use of the

possessor or are false is so pervasive that illegal workers now

constitute a majority of the work force in many of Mohawk’s

facilities in North Georgia.

VI. THE ENTERPRISE

76.

Mohawk has engaged in an open and ongoing pattern of

violations of 8 U.S.C. § 1324 and 18 U.S.C. § 1546 during

the last five years through its participation in an association-

in-fact enterprise with third party employment agencies and

other recruiters, including Temporary Placement Services

(“TPS”), that supply Mohawk with illegal workers. Each

recruiter is paid a fee for each worker it supplies to Mohawk,

and some of those recruiters work closely with Mohawk to

meet its employment needs by offering a pool of illegal

workers who can be dispatched to a particular Mohawk facil-

ity On short notice as the need arises. Some recruiters find

workers in the Brownsville, Texas area and transport them to

Georgia. Others, like TPS, have relatively formal relation-

ships with the company in which they employ illegal workers

and then loan or otherwise provide them to Mohawk for a fee.

These recruiters are sometimes assisted by Mohawk employ-

ees who carry a supply of social security cards for use when a

prospective or existing employee needs to assume a new

identity.

77.

The recruiters and Mohawk share the common purpose of

obtaining illegal workers for employment by Mohawk. The

enterprise has worked in this fashion continuously over at

least the last five years.

78.

Mohawk participates in the operation and management of

the affairs of the enterprise. which exists for Mohawk’s

benefit.

24

79.

This association of Mohawk and the recruiters consti-

tutes an association-in-fact enterprise pursuant to 18 U.S.C.

§ 1961(4).

80.

The enterprise affects interstate commerce in a variety of

ways.

81.

The enterprise affects interstate commerce in that the ille-

gal workers employed by Mohawk travel in international and

interstate commerce in order to reach Mohawk facilities in

North Georgia.

82.

The enterprise also affects interstate commerce in that it

reduces the income of the legal workers who are still part of

the Mohawk hourly workforce.

83.

The enterprise also affects interstate commerce in that

Mohawk, a member of the enterprise, is directly engaged in

the production, distribution and acquisition of goods and

services in interstate commerce.

84.

Mohawk accepted and retained the benefits of the acts of

racketeering activity, thereby ratifying the conduct of its

managers, employees, and the members of the enterprise who

assisted it in committing those acts of racketeering activity.

25

VIl. MOHAWK HAS CAUSED PLAINTIFFS’

WAGES TO BE DEPRESSED

85.

Mohawk’s violations of federal and Georgia RICO proxi-

mately have caused the wages of Pelfrey, Williams, Jones,

Sisson and all other members of the Class to be dcoressed

below what they would have been in a labor inarket com-

prised of legally employed workers.

86.

Pelfrey, Williams, Jones, Sisson and the Class have suf-

fered an injury to their “business or property.” /.e. lost wages,

as a direct result of Mohawk’s violations of federal RICO,

and injury as a result of Mohawk’s violations of Georgia

RICO. 7

87.

Mohawk’s unlawful conduct has allowed Mohawk to earn

or retain significant funds to which it is not entitled. For

example, Mohawk’s widespread employment of illegal work-

ers has permitted Mohawk to depress the wages for its hourly

workers and to reduce the expenses it incurs as a result of

worker's compensation claims. These savings contribute to

Mohawk’s profit margins and provide the financial motive for

Mohawk’s hiring of illegal workers.

COUNT |

(Violation of 18 U.S.C. § 1962(c))

88.

Plaintiffs reallege and incorporate by reference herein the

allegations set forth in paragraphs 1-87 as if fully restated

hereinafter.

89.

The foregoing conduct constitutes a violation of 18 U.S.C.

§ 1962(c).

26

90.

Plaintiffs have been injured in their property by reasen of

Mohawk’s violations of 18 U.S.C. § 1962(c).

91.

The injuries suffered by plaintiffs were caused by Mo-

hawk’s violations of i8 U.S.C. § 1962(c).

92.

Pursuant to 18 U.S.C. § 1964(c), plaintiffs are entitled to

recover threefold the damages they have sustained and their

costs of suit, including reasonable attorney's fees.

COUNT Il

(Violation of O.C.G.A. § 16-14-4(a))

93.

Plaintiffs reallege and incorporate by reference herein the

allegations set forth in paragraphs 1-92 as if fully restated

hereinafter.

94.

Mohawk has acquired and maintained an interest in and

control of personal property, including money, through a

pattern of racketeering activity.

95.

Plaintiffs have been injured by reason of Mohawk’s

violation of O.C.G.A. § 16-14-4(a) and are entitled to recover

three times the actual damages sustained.

96.

In addition, Mohawk’s actions showed wilfull misconduct,

malice, fraud. wantonness, oppression and an entire want of

cure that raises the presumption of conscious indifference to

consequences and specific intent to cause harm, entitling

plaintiffs to receive punitive damages sufficient to deter, pen-

27

alize, or punish Mohawk in light of the circumstances of

the case.

97.

Plaintiff are also aggrieved persons within the meaning of

O.C.G.A. § 16-14-6(b). As a result, Plaintiffs are entitled to

appropriate preliminary and permanent injunctive relief.

98.

Pursuant to O.C.G.A. § 16-14-6(a), plaintiffs ask the Court

to issue appropriate orders and judgment requiring Mohawk

to cease its illegal conduct and imposing reasonable restric-

tions upon Mohawk’s future activities sufficient to prohibit

future violations of the law.

COUNT III

(Violation of O.C.G.A. § 16-14-4(c))

99.

Plaintiffs reallege and incorporate by reference herein the

allegations set forth in paragraphs 1-98 as if fully restated

hereinafter.

100.

Mohawk has endeavored to violate O.C.G.A. § 16-14-4(a),

in violation of O.C.G.A. § 16-14-4(c).

lO}.

Mohawk has also conspired with TPS and other recruiters,

known and unknown, to violate O.C.G.A. § 16-14-4(a), in

violation of O.C.G.A. § 16-14-4(c).

102.

Mohawk has committed overt acts, which are also acts of

racketeering activity, in furtherance of the conspiracy. These

overt acts include violations of 18 U.S.C. § 1546.

28

103.

Mohawk has also committed overt acts in furtherance of

the conspiracy by having Mohawk employees travel in inter-

_ State commerce for the purpose of assisting Mohawk in hiring

illegal workers.

104,

Mohawk’s actions show wilfull misconduct, malice, fraud,

wantonness, oppression and an entire want of care that would

raise the presumption of conscious indifference to conse-

quences, and specific intent to cause harm, entitling plaintiffs

to receive punitive damages sufficient to deter, penalize or

punish Mohawk.

105.

Mohawk’s violations of federal and Georgia RICO are

intended to and do in fact depress wages, and the Class is the

direct victim of these violations.

COUNT IV

(Unjust Enrichment in Violation of Georgia Law)

106.

Plaintiffs reallege and incorporate by reference herein the

allegations set forth in paragraphs 1-105 as if fully restated

hereinafter.

107.

Mohawk’s employment and harboring of illegal workers

has had the purpose and effect of depressing the wages paid

to Mohawk’s hourly workers who are eligible for employ-

ment in the United States. Mohawk’s conduct therefore is

intended to and has the effect of permitting Mohawk to reap

substantial wage savings.

29

108.

Mohawk’s employment and harboring of illegal workers

also has had the purpose and effect of reducing the number of

worker’s compensation claims that Mohawk receives. Mo-

hawk supervisors have stated that they prefer hiring illegal

workers in part because they do not submit worker's com-

pensation claims. Mohawk’s conduct therefore is intended to

and has the effect of permitting Mohawk to limit the amount

it must spend to respond to worker’s compensation claims.

109,

The savings that Mohawk has been able to achieve and

continues to achieve through its employment and harboring of

illegal workers have been unjustly and inequitably conferred

on Mohawk at the expense of its hourly workers who are

authorized for employment in the United States, including

Plaintiffs and all other members of the Class. These cost

savings permit Mohawk to earn larger profits than it would be

able to earn if it did not employ and harbor illegal workers.

110.

Under the circumstances, Mohawk has been unjustly en-

riched at the expense of the Plaintiffs and all the members of

the Class. Mohawk therefore should be ordered to disgorge its

unlawful profits or otherwise return the full amount of any

wage savings and worker's compensation savings that are the

direct and proximate result of Mohawk’s unlawful conduct.

XIII. PRAYER FOR RELIEF

Plaintiffs Pelfrey, Williams, Jones and Sisson demand

judgment and other relief as follows:

A. Certification of a Class pursuant to Fed. R. Civ. P. 23;

B. Judgment in an amount equal to three times the actual

damages sustained by the Class, pursuant to 18 U.S.C.

§ 1964(¢c);

30

C. Reasonable attorney’s fees, pursuant to 18 U.S.C.

§ 1964(c);

D. Judgment in an amount equal to three times the actual -

damages sustained by the Class, pursuant to O.C.G.A. § 16-

14-6(c);

E. Attorneys’ fees in the trial and appellate courts and

costs of investigation and litigation reasonably incurred, ~

suant to O.C.G.A. § 16-14-6(c);

F. Appropriate orders and judgments prohibiting Mohawk

from engaging in the violations of law alleged herein,

pursuant to O.C.G.A. § 16-14-4(a) and (b);

G. Judgment in an amount to be proven at trial that re-

quires Mohawk to disgorge any unlawful profits or otherwise

return the full amount of its unjust enrichment;

H. Trial by jury; and

1. Such other relief as the Court deems just and proper.

This 6th day of January, 2004.

Respectfully submitted

/s/ Bobby Lee Cook

BOBBY LEE COOK

Georgia Bar No. 183100

COOK & CONNELLY

9899 Commerce Street

Summerville, GA 30747

(706) 857-3421

(706) 857-1520 (facsimile)

31

/s/ John E. Floyd

Georgia Bar No. 266413

Joshua F. Thorpe

Georgia Bar No. 710665

Ronan P. Doherty

Georgia Bar No. 224885

Nicole G. lannarone

Georgia Bar No. 382510

BONDURANT, MIXSON & ELMORE, LLP

1201 W. Peachtree Street, N.W.

3900 One Atlantic Center

Atlanta, Georgia 30309

(404) 881-4000

(404) 881-4111 (facsimile)

/s/ Matthew Thames w/ permission

MATTHEW THAMES

Georgia Bar No. 703130

GODDARD, THAMES, HAMMONTREE

& BOLDING

2716 Cleveland Hwy.

P.O. Box 399

Dalton, GA 30722-0399

(706) 278-0464

(706) 278-0465 (facsimile)

/s/ Howard Foster w/permission

HOWARD FOSTER*

JOHNSON & BELL, LTD

55 E. Monroe Street

Suite 4100

Chicago, IL. 60603

(312) 372-0770

(312) 372-9818 (facsimile)

*Application for admission pro hac vice has been submitted