November 19, 1996
VIA UPS OVERNIGHT
Tom Feeley
November 19, 1996
Page 1
Tom Feeley
34-21 Review Avenue
Long Island City, NY 11101
James P. Hoffa
2593 Hounds Chase
Troy, MI 48098
Gene Giacumbo
15 Village Road
Sea Bright, NJ 07760
Marie Schembri
Schembri & Associates
158 Dean Street
Brooklyn, NY 11217
Susan Davis
Cohen, Weiss & Simon
330 W. 42nd Street
New York, NY 10036
Bradley T. Raymond
Finkel, Whitefield, Selik, Raymond,
Ferrara & Feldman, P.C.
32300 Northwestern Highway, Suite 200
Farmington Hills, MI 48334
Tom Feeley
November 19, 1996
Page 1
Re: Election Office Case No. P-1110-LU804-NYC
Gentlepersons:
A pre-election protest was filed pursuant to Article XIV, Section 2(b) of the Rules for the 1995-1996 IBT International Union Delegate and Officer Election (“Rules”) by
Tom Feeley, a member of Local Union 804. Based on information contained in an
October 16, 1996 New York Daily News article, the protester alleges Gene Giacumbo made a campaign contribution to the Hoffa campaign when he hired investigator Marie Schembri to “discredit and undermine Ron Carey’s candidacy to the benefit of Hoffa’s candidacy.” The protester contends that the Hoffa campaign has violated the Rules because it did not report
Tom Feeley
November 19, 1996
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Mr. Giacumbo’s contribution on its Campaign Contribution and Expenditure Reports (“CCERs”).[1]
The Hoffa campaign responds that the protester has distorted the content of the
October 16, 1996 New York Daily News article by claiming that it reveals a “campaign contribution” by Mr. Giacumbo. The Hoffa campaign maintains that the July 14, 1996 New York Daily News article, which first reported the allegations of undue influence exerted by
Mr. Carey to persuade Anne Morgen to change her will, represented material in the public domain, and the campaign’s use of such material does not constitute a “campaign contribution.”
The protest was investigated by Election Office Representative Kathryn Naylor.
The protester states that a “campaign contribution includes any contribution of money where the purpose is to influence, positively or negatively, the election of a candidate.” The protester argues that the evidence submitted in Election Office Case No. P-928 and the
October 16, 1996 New York Daily News article unequivocally establishes that Ms. Schembri was hired to discredit and undermine Ron Carey’s candidacy, to the benefit of Hoffa’s candidacy, i.e., to negatively influence Mr. Carey’s candidacy while advancing Mr. Hoffa’s. Specifically, the protester asserts that the information uncovered by Ms. Schembri was presented in a Hoffa campaign press release on July 14, 1996, on the eve of the IBT Convention, thus timed to embarrass the Carey campaign and to advance the Hoffa campaign. The protester asserts that the October 16, 1996 New York Daily News article reports that
Ms. Schembri was hired by “Carey foe” Gene Giacumbo to “turn the tables on Carey.” According to the protester, Mr. Giacumbo is a “known Hoffa supporter and Carey detractor who, prior to his suspension by the Independent Review Board, was overtly and actively involved in advancing Hoffa’s candidacy.” The October 16, 1996 New York Daily News article, presented by the protester, reports, in pertinent part:
Leebove admitted the Hoffa campaign has used information about Carey’s private life gathered by a Brooklyn detective.
The detective, Marie Schembri, was hired earlier this year and paid at least $4,000 by another Carey foe to dig into Carey’s financial affairs.
Schembri located two widows who claim that Carey wrongly persuaded an elderly Queens woman to cut them out of her will,
Tom Feeley
November 19, 1996
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leaving him the bulk of her $395,000 estate. The women have since challenged the will in court.
Records show Schembri was paid for her work by Gene Giacumbo, a former New Jersey Teamster official once allied with Carey. In what he says was a political maneuver by Carey, Giacumbo was suspended last year after an Independent Teamster panel found he had misused union funds.
Giacumbo who recently declared personal bankruptcy, said hiring Schembri was an attempt to turn the tables on Carey.[2]
The Hoffa campaign asserts that the protester has misrepresented the timing and content of its press release on July 14, 1996, and that there is no substance to the claim that the campaign created the allegations contained in the press release. Specifically, the Hoffa campaign states that it first learned about the Anne Morgen story when it appeared in the New York Daily News on the morning of July 14, 1996 and its press release issued on the same day using only the information reported by the New York Daily News.
Regarding the statement in the October 16, 1996 New York Daily News article to the effect that “Leebove admitted that the campaign has used information gathered by
[Ms. Schembri],” the Hoffa campaign responds that this is an inaccurate characterization of what Mr. Leebove told the Daily News. The campaign states that “Mr. Leebove conceded only that to the extent information obtained by Mr. Giacumbo’s investigator had resulted in litigation which had received publicity from the Daily News, the campaign had subsequently publicized that information to Teamster members.”
Prior to the publication of the July 14, 1996 New York Daily News article, the campaign states that several persons associated with the campaign, including Mr. Leebove, were only generally aware of an inquiry undertaken on behalf of Mr. Giacumbo concerning Mr. Carey’s involvement with the Morgen estate. In this regard, the campaign notes that for several years Mr. Giacumbo and Mr. Leebove have periodically discussed issues about
Mr. Carey’s conduct and ethics. As part of these discussions, in May or June of 1996,
Mr. Giacumbo advised Mr. Leebove that his investigator had just discovered possible irregularities concerning Mr. Carey’s inheritance from the Morgen estate. Mr. Giacumbo also indicated to Mr. Leebove that these irregularities might have some relevance to some of the findings in a 1994 report by the Independent Review Board. Mr. Giacumbo never provided Mr. Leebove or the Hoffa campaign with the work product or results of the investigation conducted on his behalf.
Tom Feeley
November 19, 1996
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Under the Rules, the term “campaign contribution” is defined as “any direct or indirect contribution of money or other thing of value where the purpose, object or foreseeable effect of that contribution is to influence, positively or negatively, the election of a candidate for . . . International Officer position.” However, candidates and slates are not required to report on their CCERs all activities undertaken by third parties that have the “foreseeable effect” of positively or negatively affecting their election to International union office. The Advisory on Campaign Contributions and Disclosure, issued December 14, 1995, recognizes that in-kind contributions made in concert or cooperation with a candidate should be reported on a candidate/slate’s CCERs:
[An] in-kind contribution results when an expenditure is made for goods/services or events by another in cooperation, consultation or concert with, or at the request or suggestion of the candidate, slate or independent committee. Even though the goods or services for which the expenditure was made were not actually received by the candidate, slate or independent committee (or the candidate was not present or participating in the activity for which the expenditure was made), the candidate, slate still received an in-kind contribution. The Election Officer will consider whether the expenditure was made for goods or services purchased or the event undertaken with the knowledge of and without the expressed disapproval of the candidate or his/her campaign, slate . . . The value of the in-kind contribution for this category is the amount of the expenditure made by the third party.
(Emphasis added.)
On the other hand, the candidate or slate is not required to report expenditures for truly independent activities undertaken by third parties that have a positive or negative effect on a candidate or slate’s campaign for International union office.
Based on the investigation, the Election Officer finds there is insufficient evidence to establish that Mr. Hoffa’s campaign and Mr. Giacumbo collaborated on the decision to hire
Ms. Schembri to investigate the affairs of Mr. Carey. Moreover, the issuance of the Hoffa campaign press release on July 14, 1996 does not establish that Mr. Giacumbo provided the results of Ms. Schembri’s investigation to the Hoffa campaign prior to the publication of the New York Daily News article, especially in light of the fact that the New York Daily News article was also published on July 14, 1996. A review of the campaign’s press release
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November 19, 1996
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indicates that the New York Daily News article of July 14, 1996 is stated as the reference for Mr. Hoffa’s knowledge regarding the allegations in the Morgen matter.[3]
The Hoffa campaign’s reliance on and use of information printed in a newspaper that is disseminated to the general public does not constitute a campaign contribution from the newspaper or the reporter’s possible sources, including Mr. Giacumbo and/or Ms. Schembri. Accordingly, neither Mr. Hoffa nor his campaign was not obligated to report the receipt of an
in-kind contribution from Mr. Giacumbo on the CCERs.
Based on the foregoing, the protest is DENIED.
Any interested party not satisfied with this determination may request a hearing before the Election Appeals Master within one day of receipt of this letter. The parties are reminded that, absent extraordinary circumstances, no party may rely upon evidence that was not presented to the Office of the Election Officer in any such appeal. Requests for a hearing shall be made in writing and shall be served on:
Kenneth Conboy, Esq.
Latham & Watkins
885 Third Avenue, Suite 1000
New York, NY 10022
Fax (212) 751-4864
Copies of the request for hearing must be served on the parties listed above as well as upon the Election Officer, 400 N. Capitol Street, Suite 855, Washington, DC 20001, Facsimile
(202) 624-3525. A copy of the protest must accompany the request for a hearing.
Sincerely,
Barbara Zack Quindel
Election Officer
cc: Kenneth Conboy, Election Appeals Master
[1]In a previous election protest, the protester alleged that the Hoffa campaign had hired Ms. Schembri to discredit Mr. Carey and advance Mr. Hoffa’s candidacy. In Feeley, P-928-LU804-NYC (September 18, 1996), the Election Officer held that the protester had not presented any evidence which showed that Ms. Schembri was retained by the Hoffa campaign and therefore should have been reported on its CCER.
[2]Joe Calderone and Tom Robbins, “Snoops on Both Sides of Teamsters Race,” New York Daily News, October 16, 1996, at page 16.
[3]In pertinent part, the report stated:
Shocked by a newspaper story reporting that Teamsters President Ron Carey is being sued for using a United Parcel Service (UPS) attorney to wrongly persuade “an ailing 88-year old woman to leave him the bulk of her $395,000 estate, Jim Hoffa today called on Carey to ‘step aside’ . . . An exclusive story in Sunday’s New York Daily News detailed how Carey used a UPS lawyer . . . Upon learning of the charges, Hoffa called on Carey to abandon his campaign . . .”